{"id":57823,"date":"2021-05-12T18:55:17","date_gmt":"2021-05-12T23:55:17","guid":{"rendered":"https:\/\/olduvai.ca\/?p=57823"},"modified":"2021-05-12T18:55:17","modified_gmt":"2021-05-12T23:55:17","slug":"what-roles-for-markets-and-for-the-state-when-climate-risk-is-existential","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=57823","title":{"rendered":"What roles for markets and for the state when climate risk is existential?"},"content":{"rendered":"

What roles for markets and for the state when climate risk is existential?<\/a><\/h3>\n\n\n\n\n
\"\"<\/a><\/td>\n<\/tr>\n
Climate system tipping points. From\u00a0Climate Reality Check 2020<\/a><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

This blog is based on a paper given to the University of Hamburg’s \u201cUnsustainable Past \u2013 Sustainable Futures?\u201d conference on 12 February 2021.\u00a0 A video of the presentation<\/em>\u00a0is available<\/em>.<\/a><\/p>\n

In his\u00a0foreword<\/a>\u00a0to our 2018 Breakthrough report on scientific reticence and the Intergovernmental Panel of Climate Change (IPCC), Prof. Hans Joachim Schellnhuber, the Director Emeritus of the Potsdam Institute, wrote that:<\/p>\n

“When the issue is the very survival of our civilisation… conventional means of analysis may become useless.”<\/p>\n

And yes, he was talking about the IPCC! This failure of analysis extends beyond the science of climate change, to the political economy of climate disruption.<\/p>\n

The climate policymaking orthodoxy is that markets can efficiently price and mitigate climate risks, but this blog argues that when risks are existential \u2014 that is, a permanent and drastic curtailing of human civilisation\u2019s future development \u2014 then the\u00a0damages are beyond calculation<\/a>. What follows is that conventional climate cost-benefit analyses and climate-economy models, which rely on the quantification of both the potential damages and the\u00a0 probabilities, are of little value, and that markets cannot efficiently assess or optimally price the risk.<\/p>\n

RISK<\/strong><\/p>\n

In cases of existential risk, markets fail because they can not adequately assess or respond to the risks. Nor can they mitigate the threat to society as a whole. This is true for weapons of mass destruction, for pandemics and ecological collapse, and for other existential risks, where the primary risk-management responsibility lies with the state apparatus.\u00a0 It is also true for climate disruption, where markets have failed to heed the high-end risks \u2014 especially non-linear impacts and system tipping points which are difficult to model \u2014 and where the range of potential second-order impacts is difficult to articulate.<\/p>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

What roles for markets and for the state when climate risk is existential? Climate system tipping points. From\u00a0Climate Reality Check 2020 This blog is based on a paper given to the University of Hamburg’s \u201cUnsustainable Past \u2013 Sustainable Futures?\u201d conference on 12 February 2021.\u00a0 A video of the presentation\u00a0is available. In his\u00a0foreword\u00a0to our 2018 Breakthrough […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,4],"tags":[7439,17945,1849],"class_list":["post-57823","post","type-post","status-publish","format-standard","hentry","category-economics","category-environment","tag-climate-code-red","tag-david-spratt","tag-financial-markets"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/57823","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=57823"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/57823\/revisions"}],"predecessor-version":[{"id":57825,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/57823\/revisions\/57825"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=57823"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=57823"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=57823"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}