Working Paper

Investing in Disaster Risk Management in an Uncertain Climate

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collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
McDermott, Thomas K.J.
dc.date.accessioned
2016-05-04T15:52:13Z
dc.date.available
2016-05-04T15:52:13Z
dc.date.issued
2016-04
dc.date.lastModified
2017-12-14T04:02:55Z
dc.description.abstract
Climate change will exacerbate the challenges associated with environmental conditions, especially weather variability and extremes, in developing countries. These challenges play important, if as yet poorly understood roles in the development prospects of affected regions. As such, climate change reinforces the development case for investment in disaster risk management. Uncertainty about how climate change will affect particular locations makes optimal investment planning more difficult. In particular, the inability to derive meaningful probabilities from climate models limits the usefulness of standard project evaluation techniques, such as cost-benefit analysis. Although the deep uncertainty associated with climate change complicates disaster risk management investment decisions, the analysis presented here shows that these considerations are only relevant for a relatively limited set of investment circumstances. The paper offers a simple decision framework that enables policy makers to identify the particular circumstances under which uncertainty about future climate change becomes critical for disaster risk management investment decisions. Accounting for climate uncertainty is likely to shift the optimal balance of disaster risk management strategies toward more flexible, low-regret type interventions, especially those that seek to promote "development first" or "risk-coping" objectives. Such investments are likely to confer additional development dividends, regardless of the climate future that materializes in a given location. Importantly, the analysis here also demonstrates that climate uncertainty does not necessarily motivate a "wait and see" approach. Instead, where opportunities exist to avail of adaptation co-benefits, climate uncertainty provides additional motivation for early investment in disaster risk management initiatives.
en
dc.identifier
http://documents.worldbank.org/curated/en/2016/04/26212121/investing-disaster-risk-management-uncertain-climate
dc.identifier.uri
http://hdl.handle.net/10986/24204
dc.language
English
dc.language.iso
en_US
dc.publisher
World Bank, Washington, DC
dc.relation.ispartofseries
Policy Research Working Paper;No. 7631
dc.rights
CC BY 3.0 IGO
dc.rights.holder
World Bank
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo/
dc.subject
LOCAL TEMPERATURE
dc.subject
VULNERABILITY TO CLIMATE CHANGE
dc.subject
IMPACTS OF CLIMATE CHANGE
dc.subject
CLIMATE CHANGE DAMAGES
dc.subject
FINANCIAL SERVICES
dc.subject
UNCERTAINTIES
dc.subject
ECONOMIC GROWTH
dc.subject
TEMPERATURE
dc.subject
EXTREME TEMPERATURES
dc.subject
MONETARY ECONOMICS
dc.subject
WIND SPEED
dc.subject
INCOME
dc.subject
RAINFALL PATTERNS
dc.subject
DRAINAGE SYSTEMS
dc.subject
STORMS
dc.subject
METEOROLOGY
dc.subject
WIND
dc.subject
EMISSIONS
dc.subject
EXTREME SCENARIOS
dc.subject
RAINFALL EVENTS
dc.subject
INTENSE RAINFALL
dc.subject
CLIMATE UNCERTAINTY
dc.subject
CLIMATE EVENTS
dc.subject
INCENTIVES
dc.subject
CLIMATE ENVELOPE
dc.subject
MODELS
dc.subject
OCEAN BASINS
dc.subject
DAMAGES
dc.subject
TEMPORAL SCALE
dc.subject
UNCERTAIN CLIMATE FUTURE
dc.subject
ASSESSING CLIMATE CHANGE
dc.subject
EXTREME WEATHER
dc.subject
CLIMATE CHANGE PROJECTIONS
dc.subject
ECONOMIC ANALYSIS
dc.subject
ECONOMIC ACTIVITY
dc.subject
CLIMATIC CONDITIONS
dc.subject
SCENARIOS
dc.subject
TEMPORAL SCALES
dc.subject
DEVELOPMENT ECONOMICS
dc.subject
EFFICIENCY GAINS
dc.subject
UNCERTAINTY IN CLIMATE CHANGE PROJECTIONS
dc.subject
QUANTITATIVE ANALYSIS
dc.subject
COST-BENEFIT ANALYSES
dc.subject
IMPLICATIONS OF CLIMATE CHANGE
dc.subject
IMPACTS OF CLIMATE VARIABILITY
dc.subject
ICE AGES
dc.subject
RAINFALL INTENSITY
dc.subject
MARKETS
dc.subject
RAINFALL
dc.subject
CLIMATIC DISASTERS
dc.subject
ECONOMIC IMPACTS OF CLIMATE
dc.subject
SURFACE TEMPERATURE
dc.subject
CLIMATE MODEL
dc.subject
CLIMATE SCENARIO
dc.subject
CYCLONES
dc.subject
BIOLOGICAL SCIENCES
dc.subject
CLIMATE HAZARDS
dc.subject
CLIMATE PREDICTION
dc.subject
ENVIRONMENTAL ECONOMICS
dc.subject
CLIMATE MODELS
dc.subject
EXPOSURE TO CLIMATE HAZARDS
dc.subject
EXTREME CLIMATE CHANGE
dc.subject
CLIMATE SENSITIVITY
dc.subject
CLIMATE PREDICTIONS
dc.subject
FINANCE
dc.subject
LAND USE
dc.subject
INVESTMENT DECISIONS
dc.subject
CLIMATE VARIABILITY
dc.subject
FLOOD INSURANCE
dc.subject
CONSUMPTION
dc.subject
CLIMATE CHANGE ECONOMICS
dc.subject
ECONOMIC IMPACT
dc.subject
ECONOMIC RESILIENCE
dc.subject
ECONOMIC COSTS
dc.subject
POLICIES
dc.subject
CLIMATE CHANGE
dc.subject
SCIENCE
dc.subject
SOCIAL VULNERABILITY TO CLIMATE CHANGE
dc.subject
GLOBAL CLIMATE
dc.subject
PRECAUTIONARY PRINCIPLE
dc.subject
CLIMATE-RELATED HAZARD
dc.subject
VALUE
dc.subject
POLICY MAKERS
dc.subject
CLIMATE CHANGE IMPACTS
dc.subject
EXTREME EVENTS
dc.subject
GLOBAL MEAN TEMPERATURES
dc.subject
CLIMATE
dc.subject
APPLIED METEOROLOGY
dc.subject
DEMAND
dc.subject
CLIMATE RISK
dc.subject
CLIMATE SYSTEM
dc.subject
SOCIAL DIMENSIONS OF CLIMATE CHANGE
dc.subject
CLIMATE VARIABLE
dc.subject
MAXIMUM WIND SPEED
dc.subject
COST BENEFIT ANALYSIS
dc.subject
COST-BENEFIT
dc.subject
CLIMATE RISKS
dc.subject
CLIMATE SENSITIVE
dc.subject
DEEP UNCERTAINTY
dc.subject
MARKET
dc.subject
FUTURE CLIMATE CHANGE
dc.subject
ECONOMIC THEORY
dc.subject
ENVIRONMENTAL CATASTROPHE
dc.subject
POLICY
dc.subject
ECONOMIC ANALYSES
dc.subject
UNCERTAIN FUTURE CLIMATE
dc.subject
CLIMATE OUTCOMES
dc.subject
INSURANCE
dc.subject
INVESTMENT STRATEGIES
dc.subject
CLIMATIC CHANGE
dc.subject
PROBABILITY DENSITY
dc.subject
OCEANS
dc.subject
SEA-LEVEL RISE
dc.subject
ECONOMIC IMPACTS
dc.subject
CLIMATE CHANGE SCENARIOS
dc.subject
CATASTROPHIC CLIMATE CHANGE
dc.subject
WIND SPEEDS
dc.subject
CLIMATE CHANGE ADAPTATION
dc.subject
FINANCIAL MARKETS
dc.subject
ICE
dc.subject
TROPICAL CYCLONES
dc.subject
ALLOCATION
dc.subject
CLIMATE EXTREMES
dc.subject
TEMPERATURES
dc.subject
EXTERNAL SHOCKS
dc.subject
CLIMATE PROJECTIONS
dc.subject
INVESTMENTS
dc.subject
RISK MANAGEMENT
dc.subject
CLIMATE POLICY
dc.subject
SEA-LEVEL
dc.subject
COST-BENEFIT ANALYSIS
dc.subject
EXTREME WEATHER EVENTS
dc.subject
HEALTH OF CLIMATE EXTREMES
dc.subject
ECOLOGICAL ECONOMICS
dc.subject
CLIMATE INFORMATION
dc.subject
CLIMATE HAZARD
dc.subject
GLOBAL TEMPERATURES
dc.subject
RAINFALL VARIABILITY
dc.subject
CLIMATIC VARIABILITY
dc.subject
SEASONS
dc.subject
ESTIMATES OF CLIMATE CHANGE
dc.subject
ECONOMICS OF CLIMATE CHANGE
dc.subject
EXTREME WEATHER EVENT
dc.subject
UNCERTAINTY IN CLIMATE PROJECTIONS
dc.subject
BENEFITS
dc.subject
GLOBAL CLIMATE MODEL
dc.title
Investing in Disaster Risk Management in an Uncertain Climate
en
dc.type
Working Paper
en
okr.date.disclosure
2016-04-12
okr.doctype
Publications & Research
okr.doctype
Publications & Research :: Policy Research Working Paper
okr.docurl
http://documents.worldbank.org/curated/en/2016/04/26212121/investing-disaster-risk-management-uncertain-climate
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-7631
okr.identifier.externaldocumentum
090224b08428aa0e_2_0
okr.identifier.internaldocumentum
26212121
okr.identifier.report
WPS7631
okr.imported
true
okr.language.supported
en
okr.pdfurl
http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2016/04/12/090224b08428aa0e/2_0/Rendered/PDF/Investing0in0d0an0uncertain0climate.pdf
en
okr.topic
Environment :: Environmental Disasters & Degradation
okr.topic
Macroeconomics and Economic Growth :: Climate Change Economics
okr.topic
Environment :: Climate Change Mitigation and Green House Gases
okr.topic
Environment :: Adaptation to Climate Change
okr.unit
Climate Change Cross-Cutting Solutions Area; Global Facility for Disaster Reduction and Recovery

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