1. Oluwakemi Izomo

2. Hans-Peter Plag November 24, 2014 (Foresight: Summary) Decision Making: Introduction Final Assignment Decision Making Concepts Decision Making and Climate Change Decision Making and Adaptation

3. Given the speed and magnitude of the complex climate system; deterministic projections have little practice-relevant value Abrupt changes are happening (e.g., Arctic sea ice, biodiversity); more likely to come We need early warning systems; including early warning for LSL Cumulative LSL equation (CLE) can be used to describe LSL changes The CLE provides a basis to assess the risk not addressed by making a choice for a range of LSL trajectories Abrupt LSL rise could (slowly) develop into a global disaster/X-event Paradigm shift to overcome normalcy bias: Instead of “Sea level is stable” (last 6,000 years) assume “Sea level is variable!”

4. Research on decision-making: - Psychological: individual decisions within personnel values, preferences and needs - Cognitive: continuous process in interaction with the environment - Normative: within logic of decision-making and rationality Decision-making: - problem-solving activity, terminated by a satisfactory solution - reasoning or emotional process which can be rational or irrational.

5. Daniel Kahneman: Thinking, Fast and Slow (2011): Two systems: - System 1: Fast, automatic, frequent, emotional, stereotype, subconscious - System 2: Slow, effortful, infrequent, logical, calculating, conscious Developed: - cognitive biases: - anchoring effect: decisions influenced by irrelevant number - availability heuristics: events seem more probable if we know examples - substitution of complex questions by simpler ones - optimist bias and illusion of control - planning fallacy: overestimate benefits and underestimate costs - overconfidence: what you see is all that is there.

6. - Prospect Theory: behavioral economic theory, describes how we choose between probabilistic alternatives involving risk; - decision made on loss and gain considerations rather than final outcome; - describes real-life decisions rather than optimal decisions; Daniel Kahneman: Thinking, Fast and Slow (2011): Two systems: - System 1: Fast, automatic, frequent, emotional, stereotype, subconscious - System 2: Slow, effortful, infrequent, logical, calculating, conscious

8. - Prospect Theory: behavioral economic theory, describes how we choose between probabilistic alternatives involving risk; - decision made on loss and gain considerations rather than final outcome; - describes real-life decisions rather than optimal decisions; - reveals loss aversion (we fear losses more than we value gains) - underlines importance of framing: 90% survival chance versus 10% mortality Daniel Kahneman: Thinking, Fast and Slow (2011): Two systems: - System 1: Fast, automatic, frequent, emotional, stereotype, subconscious - System 2: Slow, effortful, infrequent, logical, calculating, conscious

9. Ekstrom et al., 2011 Time and effort as function of scope and scale of adjustments and adaptation

10. Ekstrom et al., 2011 Three main elements: - system of concern - actors - governance and environment

11. Ekstrom et al., 2011 Phases of traditional approach

12. Lovelock (and many others): - Planet is on a run-away path; could reach a warm state (5 o C warmer) already in 2050 - Carrying capacity of the planet would be reduced to 1 Billion - Recommendation: look for the lifeboats - Science is focused on Type I errors (false positives) - Society is impacted by this focus - Type II errors (false negatives) are critical in times of unsustainability and rapid changes

13. Plan A: Planning for a (somewhat) predictable future Social construct of risk and vulnerability: North Sea countries: general perception (based on 2,000 years of cultural heritage): vulnerability to, and risk associated with storm surges is very high and a national/regional problem; approach to extreme events: there is a 1% chance that the 1 in 10,000 years flood happens in this century. Approach to SLR: What is the maximum SLR in the 21st century that cannot be excluded? United States: general perception: vulnerability to, and risk associated with storm surges is more a local problem and can be addressed ad hoc by (horizontal) evacuation; approach to extreme events: there is a 1% chance that the 1 in 100 years flood happens in this year. Approach to SLR: What curve should we choose? Definitely not the maximum SLR in the 21st century that cannot be excluded!

14. Preparing for surprises Knowing the “worst case” and facilitate adaptation to unpredictable future Paradigm shifts: understanding the vulnerabilities and comprehensively assessing the risks knowing the worst cases (food, water, heat waves, droughts, storms, sicknesses, social unrest, wars,...) having early warning (for extreme events and rapid impacts) Hampton Roads: - making room for the water - a built environment for extreme floods (buildings and services) Living where it is safe, working where it is needed

15. Social construct of risk and vulnerability: Question: Do we know the risks we have not addressed? Fire insurance: we pay for a risk that has a 99.8% chance not to happen. Hurricanes and storm surges: - The Netherlands: pays (a lot: 2.5% of GDP) to reduce a risk that has a 99% chance not to happen in this century. - The USA: we here do not pay (a lot) to reduce a risk that has a 66% chance to happen in this century. - Norfolk and Virginia Beach: Cost-benefit analysis shows we should be willing to pay on the order of $100,000,000 each year to reduce this risk (with many immediate benefits) Preparing for surprises