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Rentschler, Jun

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Economics of Development, Environment, and Climate
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Last updated: November 16, 2023
Biography
Jun Rentschler is a Senior Economist at the Office of the Chief Economist for Sustainable Development, working at the intersection of climate change and sustainable resilient development. Prior to joining The World Bank in 2012, he served as an Economic Adviser at the German Foreign Ministry. He also spent two years at the European Bank for Reconstruction and Development (EBRD) working on private sector investment projects in resource efficiency and climate change. Before that he worked on projects with Grameen Microfinance Bank in Bangladesh and the Partners for Financial Stability Program by USAID in Poland. He is a Visiting Fellow at the Payne Institute for Public Policy, following previous affiliations with the Oxford Institute for Energy Studies and the Graduate Institute for Policy Studies in Tokyo. Jun holds a PhD in Economics from University College London (UCL), specializing in development, climate, and energy.
Citations 78 Scopus

Publication Search Results

Now showing 1 - 10 of 11
  • Publication
    Strengthening New Infrastructure Assets: A Cost-Benefit Analysis
    (World Bank, Washington, DC, 2019-06) Nicolas, Claire; Hallegatte, Stephane; Fox, Charles; Rozenberg, Julie; Rentschler, Jun
    This paper explores the benefits and the costs of strengthening infrastructure assets to make them more resilient, reducing the repair costs and infrastructure disruptions caused by natural hazards. Strengthening infrastructure assets in low- and middle-income countries would increase investment needs in power, transport, and water and sanitation by between $11 billion and $65 billion a year, i.e. 3 percent of baseline infrastructure investment needs. The uncertainty pertaining to the costs and benefits of infrastructure resilience makes it difficult to provide a single estimate for the benefit-cost ratio of strengthening exposed infrastructure assets. To manage this uncertainty, this paper explores the benefit-cost ratio in 3,000 scenarios, combining uncertainties in all parameters of the analysis. The benefit-cost ratio is higher than 1 in 96 percent of the scenarios, larger than 2 in 77 percent of them, and higher than 4 in half of them. The net present value of these investments over the lifetime of new infrastructure assets -- or, equivalently, the cost of inaction -- exceeds $2 trillion in 75 percent of the scenarios and $4.2 trillion in half of them. Moreover, climate change makes the strengthening of infrastructure assets even more important, doubling the median benefit-cost ratio.
  • Publication
    Stronger Power: Improving Power Sector Resilience to Natural Hazards
    (World Bank, Washington, DC, 2019-06) Nicolas, Claire; Rentschler, Jun; Potter van Loon, Albertine; Oguah, Sam; Schweikert, Amy; Deinert, Mark; Koks, Elco; Arderne, Christopher; Cubas, Diana; Li, Jie; Ichikawa, Eriko
    The power sector is both highly vulnerable to natural hazards and a priority for any country'srecovery and reconstruction. After Hurricane Maria in Puerto Rico in 2017, most of the power gridwas down. One year and tens of billions of dollars later some customers were yet to be reconnected to the main grid. This type of long and widespread power outage has major consequences on people's health and well-being, for instance through lacking access to refrigeration for food and medicine, and on the ability of firms to produce and provide people with goods, services, jobs, and income. In most countries, the power system is designed to cope with high-frequency but relatively low impact events. Low-frequency, high-impact events – such as many natural disasters – are rarely considered fully, and the implementation of planned management measures is often patchy. Furthermore, the power system is a special kind of infrastructure due to the heterogeneity of the generation assets and its wide spatial distribution. The latter means that power systems are often exposed to natural hazards and sometimes to more than one hazard, leading to high repair costs when disasters strike. This paper, prepared as a sectoral note for the Lifelines report on infrastructure resilience, investigates the vulnerability of the power system to natural hazards and climate change, and provides recommendations to increase its resilience. It first describes how power outages are often the consequence of natural disasters and outlines the main vulnerabilities of the power sector. It then proposes a range of approaches and solutions for building a more resilient power sector – from increased robustness to greater flexibility – showing that the additional cost of resilience is not high if resources are well spent. Finally, it describes how emergency preparedness and disaster recovery encompass not only technical aspects, like asset strengthening or criticality analysis, but also "softer" skills, like governance, regulatory or capacity building, and education.
  • Publication
    Underutilized Potential: The Business Costs of Unreliable Infrastructure in Developing Countries
    (World Bank, Washington, DC, 2019-06) Kornejew, Martin; Rentschler, Jun; Braese, Johannes; Hallegatte, Stephane; Obolensky, Marguerite
    This study constructs a microdata set of about 143,000 firms to estimate the monetary costs of infrastructure disruptions in 137 low- and middle-income countries, representing 78 percent of the world population and 80 percent of the GDP of low- and -middle-income countries. Specifically, this study assesses the impact of transport, electricity, and water disruptions on the capacity utilization rates of firms. The estimates suggest that utilization losses amount to $151 billion a year -- of which $107 billion are due to transport disruptions, $38 billion due to blackouts, and $6 billion due to dryouts. Moreover, this study shows that electricity outages are causing sales losses equivalent to $82 billion a year. Firms are also incurring the costs of self-generated electricity, estimated to amount to $64 billion a year (including annualized capital expenditure). At almost $300 billion a year, these figures highlight the substantial drag that unreliable infrastructure imposes on firms in developing countries. Yet, these figures are likely to be under-estimates as neither all countries nor all types of impacts are covered.
  • Publication
    Wading Out the Storm: The Role of Poverty in Exposure, Vulnerability and Resilience to Floods in Dar es Salaam
    (World Bank, Washington, DC, 2019-08) Erman, Alvina; Tariverdi, Mercedeh; Obolensky, Marguerite; Chen, Xiaomeng; Vincent, Rose Camille; Malgioglio, Silvia; Rentschler, Jun; Hallegatte, Stephane; Yoshida, Nobuo
    Dar es Salaam is frequently affected by severe flooding causing destruction and impeding daily life of its 4.5 million inhabitants. The focus of this paper is on the role of poverty in the impact of floods on households, focusing on both direct (damage to or loss of assets or property) and indirect (losses involving health, infrastructure, labor, and education) impacts using household survey data. Poorer households are more likely to be affected by floods; directly affected households are more likely female-headed and have more insecure tenure arrangements; and indirectly affected households tend to have access to poorer quality infrastructure. Focusing on the floods of April 2018, affected households suffered losses of 23 percent of annual income on average. Surprisingly, poorer households are not over-represented among the households that lost the most - even in relation to their income, possibly because 77 percent of total losses were due to asset losses, with richer households having more valuable assets. Although indirect losses were relatively small, they had significant well-being effects for the affected households. It is estimated that households’ losses due to the April 2018 flood reached more than US$100 million, representing between 2-4 percent of the gross domestic product of Dar es Salaam. Furthermore, poorer households were less likely to recover from flood exposure. The report finds that access to finance play an important role in recovery for households.
  • Publication
    From A Rocky Road to Smooth Sailing: Building Transport Resilience to Natural Disasters
    (World Bank, Washington, DC, 2019-06) Rozenberg, Julie; Avner, Paolo; Fox, Charles; Hallegatte, Stephane; Rentschler, Jun; Avner, Paolo
    Reliable transport infrastructure is one of the backbones of a prosperous economy, providingaccess to markets, jobs and social services. Sustainable Development Goal 9 (SDG9) calls forincreased access to sustainable transport infrastructure in low- and middle-income countries.Collectively, these countries will need to spend between 0.5 percent and 3.3 percent of their GDPannually (157 billion to 1 trillion US Dollars) in new transport infrastructure by 2030 – plus an additional 1 percent to 2 percent of GDP to maintain their network – depending on their ambition and their efficiency in service delivery (Rozenberg and Fay, 2019). Because of the wide spatial distribution of transport infrastructure, many transport assets are exposed and vulnerable to natural hazards, increasing costs for national transport agencies and operators. During the 2015 floods in Tbilisi, Georgia, the repair of transport assets contributed approximately 60 percent of the total damage cost (GFDRR, 2015). In the 1995 earthquake in Kobe, Japan, accessibility as measured by the length of open networks directly after the shock dropped by 86 percent for highways and by 71 percent for railways (Kazama and Noda, 2012b). Such transport disruptions necessarily have direct impacts on the local economy. Employees face difficulties commuting, access to firms is disrupted for clients, interruptions in the supply chain inhibit production, and finished products cannot be easily shipped (Kajitani and Tatano, 2014). The paper, prepared as background material for the Lifelines report on infrastructure resilience, summarizes the main findings on the risk faced by transport networks and users as a result of natural disasters and climate change, and the main recommendations for building more resilient transport networks. It starts by describing how transport disruptions affect firms and households either directly and through supply chains. It then proposes a range of approaches and solutions for building more resilient transport networks, showing that the additional cost of resilience is not high if resources are well spent. Finally, it provides a set of practical recommendations.
  • Publication
    Three Feet Under: The Impact of Floods on Urban Jobs, Connectivity, and Infrastructure
    (World Bank, Washington, DC, 2019-06) Braese, Johannes; Rentschler, Jun; Jones, Nick; Avner, Paolo; Avner, Paolo
    This paper analyses the degree to which infrastructure reliability and urban economic activity in several African cities is impacted by flooding. It combines firm-level micro data, flood maps, and several spatial data layers across cities through a harmonized geospatial network analysis. The analysis shows that a significant share of jobs in cities is directly affected by floods. It further details how transport infrastructure is subjected to significant flood risk that disproportionally affects main roads in many cities. While direct flood effects are revealed to be significant, this work further shows how knock-on implications for the entire urban economy might be even larger. Regardless of the direct flood exposure of firms, flooded transport networks mean that disruptions propagate across the city and drastically reduce the connectivity between firms. Access to hospitals is also found to be reduced significantly -- even during relatively light flooding events: From a third of locations in Kampala, floods mean that people would no longer be able to reach hospitals within the "golden hour" -- a rule of thumb referring to the window of time that maximizes the likelihood of survival after a severe medical incident. Overall, this study showcases the use of high-detail city-level analyses to better understand the localized impacts of natural hazards on urban infrastructure networks.
  • Publication
    Infrastructure Disruptions: How Instability Breeds Household Vulnerability
    (World Bank, Washington, DC, 2019-06) Obolensky, Marguerite; Erman, Alvina; Rozenberg, Julie; Rentschler, Jun; Avner, Paolo; Hallegatte, Stephane; Avner, Paolo
    This review examines the literature on the welfare impacts of infrastructure disruptions. There is widespread evidence that households suffer from the consequences of a lack of infrastructure reliability, and that being connected to the grid is not sufficient to close the infrastructure gap. Disruptions and irregular service have adverse effects on household welfare, due to missed work and education opportunities, and negative impact on health. Calibrating costs of unreliable infrastructure on existing willingness to pay assessments, we estimate the welfare losses associated with blackouts and water outages. Overall, between 0.1 and 0.2 percent of GDP would be lost each year because of unreliable infrastructure -- electricity, water and transport.
  • Publication
    Resilient Infrastructure for Thriving Firms: A Review of The Evidence
    (World Bank, Washington, DC, 2019-06) Braese, Johannes; Rentschler, Jun; Hallegatte, Stephane
    This review examines the literature on the role of infrastructure in determining the productivity and competitiveness of firms. It shows that the existing evidence base is clear in concluding that reliable and high-quality infrastructure is a crucial foundation for enabling businesses to thrive. It demonstrates that the provision of electricity, transport, water, and telecommunications systems increases firm-level productivity. It also shows that providing infrastructure per se is not enough to boost productivity, unless it offers reliable service. Disruptions and irregular service have substantial adverse effects on firms, not least due to disrupted supply chains, underutilization of production capacity, and costly adaptation measures.
  • Publication
    Well Spent: How Governance Determines the Effectiveness of Infrastructure Investments
    (World Bank, Washington, DC, 2019-06) Kornejew, Martin; Rentschler, Jun; Hallegatte, Stephane
    This study explores the role of governance in improving infrastructure reliability. It estimates that increasing infrastructure spending and improving governance in parallel is six times more effective at enhancing transport system performance than increasing spending alone. It also estimates that under current fiscal budgeting, every $1 spent on infrastructure maintenance is as effective as $1.5 of new investments in many OECD economies. Overall, the evidence in this study demonstrates that it is the quality rather than the quantity of infrastructure spending that determines the quality of infrastructure services.
  • Publication
    Candle in the Wind? Energy System Resilience to Natural Shocks
    (World Bank, Washington, DC, 2019-06) Obolensky, Marguerite; Rentschler, Jun; Kornejew, Martin
    This study finds that natural shocks -- storms in particular -- are a significant and often leading cause for power supply disruptions. This finding is based on 20 years of high frequency (i.e. daily) data on power outages and climate variables in 28 countries -- Bangladesh, the United States and 26 European countries. More specifically: (1) Natural shocks are the most important cause of power outages in developed economies. On average, they account for more than 50 of annual outage duration in both the US and Europe. In contrast, natural shocks are responsible for a small share of outages in Bangladesh, where disruptions occur on a daily basis for a variety of reasons. (2) Outages due to natural shocks are found to last significantly longer than those due to non-natural shocks in -- e.g. more than 4.5 times in Europe. Reasons include the challenge of locating wide-spread damages, and the sustained duration of storms. (3) Several factors can reinforce the adverse effect of natural shocks on power supply. In the US, forest cover is shown to significantly increase the risk of power outages when storms occur. (4) There are significant differences in network fragility. For instance, wind speeds above 35 km/h are found to be 12 times more likely to cause an outage in Bangladesh than in the US. This difference may be explained by a range of factors, including investments in infrastructure resilience and maintenance.