Review of Economic Instruments in Risk Reduction

Economic instruments (EI), such as subsidies, taxes and insurance-related options are at the heart of discussions regarding novel approaches for managing risk and adapting to climate change, including in the context of multi-stakeholder partnerships (MSP) between the private and public sectors. Although the attractiveness of reducing and managing disasters has long been demonstrated, there is underinvestment into disaster risk management (DRM). A number of factors, such as lack of comprehensive information and cognitive biases are important. In particular, financial constraints and moral hazard, i.e. adverse incentives provided by current arrangements for dealing with disasters rule high. In this line of thinking, instruments that provide a price signal for risk management and incentivize behavioural change hold high appeal to policymakers including the EU. Yet, little is known about such economic instruments, their mechanics, links to risk management and concrete application in the field of disaster risk management (and climate adaptation). Knowledge gaps exist particularly for conditions that create enabling environments for innovative market based EI. Among these are, e.g., the attractiveness for stakeholders in the context of MSP or institutional settings that are required to successfully and efficiently apply the EI. This report reviews key EI according to their potential for managing and incentivising risk management in the context of the ENHANCE project. The guiding questions for this review are: What economic instruments exist for managing disaster risk? How do they contribute to risk management? What innovative options re being discussed? How do case studies plan to discuss and assess economic instruments? The overall aim of this report is to develop an inventory of EI as they support risk management generally and their anticipated uptake in the ENHANCE cases studies. This report first discusses the methodology and the mechanics of EI. Next it presents the market-based and risk financing instruments; finally it concludes with a synthesis of our findings and next steps for the case studies, which are being carried out as part of the ENHANCE project

The Politics of (and Behind) the UNFCCC’s Loss and Damage Mechanism

Despite being one of the most controversial issues to be recently treated within climate negotiations, Loss and Damage (L&D) has attracted little attention among scholars of International Relations (IR). In this chapter we take the “structuralist paradox” in L&D negotiations as our starting point, considering how IR theories can help to explain the somewhat surprising capacity of weak parties to achieve results while negotiating with stronger parties. We adopt a multi-faceted notion of power, drawing from the neorealist, liberal and constructivist schools of thought, in order to explain how L&D milestones were reached. Our analysis shows that the IR discipline can greatly contribute to the debate, not only by enhancing understanding of the negotiation process and related outcomes but also by offering insights on how the issue could be fruitfully moved forward. In particular, we note the key importance that discursive power had in the attainment of L&D milestones: Framing L&D in ethical and legal terms appealed to standards relevant beyond the UNFCCC context, including basic moral norms linked to island states’ narratives of survival and the reference to international customary law. These broader standards are in principle recognised by both contending parties and this broader framing of L&D has helped to prove the need for action on L&D. However, we find that a change of narrative may be needed to avoid turning the issue into a win-lose negotiation game. Instead, a stronger emphasis on mutual gains through adaptation and action on L&D for both developed and developing countries is needed as well as clarity on the limits of these strategies. Examples of such mutual gains are more resilient global supply chains, reduction of climate-induced migration and enhanced security. As a result, acting on L&D would not feel as a unilateral concession developed countries make to vulnerable ones: it would rather be about elaborating patterns of collective action on an issue of common concern

Participatory Agent-Based Modelling for Flood Risk Insurance

In the context of climate change adaptation, there has been a recent research focus on the impact of flood insurance on flood risk reduction behaviour. ABM has been recently used in such researches to model the interaction of stakeholders. Building on this foundation, we propose the integration of participatory methods to capture the socio-cognitive and behavioral aspects of flood risk insurance, which have been missed in such models. The results of our suggested line of research on Participatory ABM for Flood Risk Insurance can support public and private sector considering their preferences and contextual requirements

Climate change adaptation to escape the poverty trap: role of the private sector

Climate change adaptation and poverty alleviation call for an integrated strategy, because poverty exacerbates the vulnerability to climate change and vice versa. The private sector, which has traditionally been excluded from adaptation planning, may contribute greatly to the development of an integrated strategy. Here, we identify the differences in adaptation trajectories between the private sector and communities by proposing a conceptual framework and report on a case study in a dryland area of China, where the private sector led a successful adaptation and poverty alleviation project. We found that their win–win strategy achieved both climate change adaptation and development, thereby helping a disadvantaged community to escape the poverty trap and achieve sustainable development. The private sector played a dominant role in the response, as this sector can adapt in ways that are not possible for governments or communities. We suggest that participatory governance that includes private-sector stakeholders is more likely to achieve sustainable development

Reconciling place attachment with catchment-based flood risk management:What can we learn from film?

A catchment-based approach to flood risk management (FRM) is gaining prominence in the United Kingdom. It is undertaken with wider awareness of multiple stakeholders, as part of a catchment scale understanding, and, as with other approaches, can visually re-shape place. Land cover and land management change at this scale also has the potential to reconfigure landscape values and place attachment. Researchers have used qualitative, quantitative, and mapping approaches to understand place attachment. Here we explore secondary data, specifically, we transcribe and code the stories of five Mytholmroyd, West Yorkshire residents from the short film, Calder about the December 26, 2015 floods. We find place attachment, identity, and social capital are interconnected and feature strongly in the mitigation and prevention phase, post-disaster. Our findings suggest better understanding of place attachment can support a more catchment scale approach to FRM policy and practice

The challenges of extending climate risk insurance to fisheries

This is the author accepted manuscript. The final version is available from Nature Research via the DOI in this recordNatural Environment Research Council (NERC)Centre for Environment, Fisheries and Aquaculture Science (Cefas)Willis Research NetworkCommonwealth Marine Economies Programme, UK Foreign and Commonwealth Offic

Attribution: how is it relevant for loss and damage policy and practice?

Attribution has become a recurring issue in discussions about Loss and Damage (L&D). In this highly-politicised context, attribution is often associated with responsibility and blame; and linked to debates about liability and compensation. The aim of attribution science, however, is not to establish responsibility, but to further scientific understanding of causal links between elements of the Earth System and society. This research into causality could inform the management of climate-related risks through improved understanding of drivers of relevant hazards, or, more widely, vulnerability and exposure; with potential benefits regardless of political positions on L&D. Experience shows that it is nevertheless difficult to have open discussions about the science in the policy sphere. This is not only a missed opportunity, but also problematic in that it could inhibit understanding of scientific results and uncertainties, potentially leading to policy planning which does not have sufficient scientific evidence to support it. In this chapter, we first explore this dilemma for science-policy dialogue, summarising several years of research into stakeholder perspectives of attribution in the context of L&D. We then aim to provide clarity about the scientific research available, through an overview of research which might contribute evidence about the causal connections between anthropogenic climate change and losses and damages, including climate science, but also other fields which examine other drivers of hazard, exposure, and vulnerability. Finally, we explore potential applications of attribution research, suggesting that an integrated and nuanced approach has potential to inform planning to avert, minimise and address losses and damages. The key messages are In the political context of climate negotiations, questions about whether losses and damages can be attributed to anthropogenic climate change are often linked to issues of responsibility, blame, and liability. Attribution science does not aim to establish responsibility or blame, but rather to investigate drivers of change. Attribution science is advancing rapidly, and has potential to increase understanding of how climate variability and change is influencing slow onset and extreme weather events, and how this interacts with other drivers of risk, including socio-economic drivers, to influence losses and damages. Over time, some uncertainties in the science will be reduced, as the anthropogenic climate change signal becomes stronger, and understanding of climate variability and change develops. However, some uncertainties will not be eliminated. Uncertainty is common in science, and does not prevent useful applications in policy, but might determine which applications are appropriate. It is important to highlight that in attribution studies, the strength of evidence varies substantially between different kinds of slow onset and extreme weather events, and between regions. Policy-makers should not expect the later emergence of conclusive evidence about the influence of climate variability and change on specific incidences of losses and damages; and, in particular, should not expect the strength of evidence to be equal between events, and between countries. Rather than waiting for further confidence in attribution studies, there is potential to start working now to integrate science into policy and practice, to help understand and tackle drivers of losses and damages, informing prevention, recovery, rehabilitation, and transformation

Science for loss and damage. Findings and propositions

The debate on “Loss and Damage” (L&D) has gained traction over the last few years. Supported by growing scientific evidence of anthropogenic climate change amplifying frequency, intensity and duration of climate-related hazards as well as observed increases in climate-related impacts and risks in many regions, the “Warsaw International Mechanism for Loss and Damage” was established in 2013 and further supported through the Paris Agreement in 2015. Despite advances, the debate currently is broad, diffuse and somewhat confusing, while concepts, methods and tools, as well as directions for policy remain vague and often contested. This book, a joint effort of the Loss and Damage Network—a partnership effort by scientists and practitioners from around the globe—provides evidence-based insight into the L&D discourse by highlighting state-of-the-art research conducted across multiple disciplines, by showcasing applications in practice and by providing insight into policy contexts and salient policy options. This introductory chapter summarises key findings of the twenty-two book chapters in terms of five propositions. These propositions, each building on relevant findings linked to forward-looking suggestions for research, policy and practice, reflect the architecture of the book, whose sections proceed from setting the stage to critical issues, followed by a section on methods and tools, to chapters that provide geographic perspectives, and finally to a section that identifies potential policy options. The propositions comprise (1) Risk management can be an effective entry point for aligning perspectives and debates, if framed comprehensively, coupled with climate justice considerations and linked to established risk management and adaptation practice; (2) Attribution science is advancing rapidly and fundamental to informing actions to minimise, avert, and address losses and damages; (3) Climate change research, in addition to identifying physical/hard limits to adaptation, needs to more systematically examine soft limits to adaptation, for which we find some evidence across several geographies globally; (4) Climate risk insurance mechanisms can serve the prevention and cure aspects emphasised in the L&D debate but solidarity and accountability aspects need further attention, for which we find tentative indication in applications around the world; (5) Policy deliberations may need to overcome the perception that L&D constitutes a win-lose negotiation “game” by developing a more inclusive narrative that highlights collective ambition for tackling risks, mutual benefits and the role of transformation

Changing storminess and global capture fisheries

This is the author accepted manuscript. The final version is available from Nature Publishing Group via the DOI in this record.Climate change-driven alterations in storminess pose a signifcant threat to global capture fsheries. Understanding how storms interact with fshery social-ecological systems can inform adaptive action and help to reduce the vulnerability of those dependent on fisheries for life and livelihood.N.C.S. acknowledges the financial support of the UK Natural Environment Research Council (NERC; GW4+ studentship NE/L002434/1), Centre for Environment, Fisheries and Aquaculture Science and Willis Research Network