Efficacy of insurance for organisational disaster recovery: case study of the 2010 and 2011 Canterbury earthquakes

Insurance is widely acknowledged to be an important component of an organisation's disaster preparedness and resilience. Yet, little analysis exists of how well current commercial insurance policies and practices support organisational recovery in the wake of a major disaster. This exploratory qualitative research, supported by some quantitative survey data, evaluated the efficacy of commercial insurance following the sequence of earthquakes in Canterbury, New Zealand, in 2010 and 2011. The study found that, generally, the commercial insurance sector performed adequately, given the complexity of the events. However, there are a number of ways in which insurers could improve their operations to increase the efficacy of commercial insurance cover and to assist organisational recovery following a disaster. The most notable of these are: (i) better wording of policies; (ii) the availability of sector‐specific policies; (iii) the enhancement of claims assessment systems; and (iv) risk‐based policy pricing to incentivise risk reduction measures.     

An exploration of the potential for re-distributed manufacturing to contribute to a sustainable,resilient city*

Abstract

Re-distributed manufacturing (RDM), broadly described as manufacturing done at a smaller-scale and locally, could be beneficial to business and urban society through creating jobs, reducing the environmental impacts of production, and improving resilience to future disturbances. Consideration of RDM within a city-region requires the consideration of a wide range of issues – societal, technical, economic and environmental. This paper presents the results of a study into the potential for RDM to contribute to a sustainable, resilient city in the face of a range of expected future disturbances on the city and on manufacturing sectors. The study took an integrated assessment approach which incorporated the development of a conceptual framework; a ‘strawman’ causal loop diagram which was reviewed by participants in a workshop; and a stock and flow system dynamics model that represents our understanding about the structure and behaviour of urban manufacturing. Several key themes emerged: similarities between RDM and traditional manufacturing, availability of physical space for RDM to be done, achieving urban resilience through RDM by enabling responsiveness to disturbances, changes in environmental impacts from production, additions or losses in jobs, the competitiveness of local manufacturing, and skills and innovation for RDM technologies. Further work is recommended.     

The cultural politics of mining and natural disaster in Indonesia: by fire and sword

Natural disasters are inevitably the outcome of cultural agonisms. The cultural politics of natural disasters are shaped by competing claims and conceptions of ‘nature’. Recent disasters in Indonesia are directly linked to these contending conceptions and the ways in which different social groups imagine risk and reward. The Sidoarjo volcanic mudflow of 2006 represents a volatile and violent exemplar of contending cultural and economic claims. Like other disasters in Indonesia and elsewhere in the developing world, this ‘natural’ disaster is characterised by differing conceptions of ‘nature’ as cultural tradition, divine force, and natural resource. A new extractive project in East Java is exhibiting similar economic and cultural agonisms, particularly around the notion of development, environment, self‐determination, and tradition. This paper examines the ‘disputes over meaning’ associated with natural disasters in contemporary societies, and the ways in which they are related to human culture, social organisation, and hierarchical systems of violence.     

Are there reasons against open-ended research into solar radiation management? A model of intergenerational decision-making under uncertainty

Solar radiation management (SRM) has been proposed as a means of last resort against dangerous climate change. We propose a stylized model of intergenerational decision making on SRM research, greenhouse-gas abatement and SRM deployment, under uncertainties about (a) the extent of future climate damage and (b) effectiveness and potential harmful side-effects of SRM. Open-ended research may reveal either that SRM effectively reduces climate damage, or that it would cause more harm than benefits. We find that SRM research increases the likelihood of deployment (“slippery slope”), and derive conditions that it decreases abatement effort in expectation (“moral hazard”). Neither of these provides a rationale against SRM research, though. The rational decision is to perform SRM research, unless (i) discounting is hyperbolic and (ii) the absolute prudence of expected climate damage is smaller than absolute risk aversion. These results generalize to the case where SRM research also provides information on climate sensitivity.     

The social costs of second-best policies: Evidence from agricultural GHG mitigation

This paper investigates the social costs of second-best agricultural greenhouse gas (GHG) mitigation policies. Adjustments along the land use and input intensity margins are represented within a regionalized optimization model of California crop production calibrated to economic and agronomic information. Second-best policies relying on spatially aggregated GHG emission factors lead to small abatement efficiency losses, while policies targeting a single GHG lead to moderate losses. In contrast, policies targeting a single input entail large abatement efficiency losses, which nonetheless can be reduced by combining instruments.     

Subgame-perfect cooperative agreements in a dynamic game of climate change

We model climate change as a dynamic game and prove existence of a unique subgame-perfect Nash equilibrium (SPNE) that is also Markov perfect. We interpret this unique SPNE as the business-as-usual (BAU) equilibrium and show that if the countries are not sufficiently symmetric then the familiar trigger strategy equilibria may not be Pareto improvements over the BAU equilibrium and may even lack efficiency properties. We then motivate and introduce a subgame-perfect cooperative agreement as an improvement over the BAU equilibrium in the sense that every country or coalition of countries is better off in every subgame, irrespective of the extent of heterogeneity of the countries. We characterize subgame-perfect cooperative agreements and identify sufficient conditions for their existence. We show that (direct or indirect) transfers between countries to balance the costs and benefits of controlling climate change are a necessity and not a matter of approach.     

Benefits and ancillary costs of natural infrastructure: Evidence from the New Jersey coast

This paper empirically estimates the economic impacts of a large-scale public investment in natural infrastructure aimed at adapting to climate change and increasing coastal resilience. I utilize temporal and spatial variation in investment in dunes to provide a hedonic property value estimate of the economic benefits. I identify the net effect of treatment utilizing the doubly robust Oaxaca-Blinder estimator and show that coastal housing price increases attributable to constructed dunes are approximately 3.6%. A decomposition of the average impact suggests that the policy intervention generates ancillary costs related to impaired ocean views and privacy concerns that partially offset large protection benefits.     

Foreword

We provide an introduction to the volume The Arctic in the Earth System perspective: the role of tipping points. The terms tipping point and tipping element are described and their role in current science, general debates, and the Arctic are elucidated. From a wider perspective, the volume focuses upon the role of humans in the Arctic component of the Earth system and in particular the envelope for human existence, the Arctic ecosystems. The Arctic climate tipping elements, the tipping elements in Arctic ecosystems and societies, and the challenges of governance and anticipation are illuminated through short summaries of eight publications that derive from the Arctic Frontiers conference in 2011 and the EU FP7 project Arctic Tipping Points. Then some ideas based upon resilience thinking are developed to show how wise system management could ease pressures on Arctic systems in order to keep them away from tipping points.     

Detecting and Coping with Disruptive Shocks in Arctic Marine Systems: A Resilience Approach to Place and People

It seems inevitable that the ongoing and rapid changes in the physical environment of the marine Arctic will push components of the region’s existing social-ecological systems—small and large—beyond tipping points and into new regimes. Ongoing changes include warming, freshening, acidification, and alterations to food web structure. In anticipation we pose three distinct but interrelated challenges: (1) to explore existing connectivities within components of the marine system; (2) to seek indicators (if they exist) of approaching regime change through observation and modeling; and (3) to build functional resilience into existing systems through adaptation-oriented policy and to have in hand transformative options when tipping points are crossed and new development trajectories are required. Each of the above challenges is scale dependent, and each requires a much deeper understanding than we currently have of connectivity within existing systems and their response to external forcing. Here, we argue from a global perspective the need to understand the Arctic’s role in an increasingly nonlinear world; then describe emerging evidence from new observations on the connectivity of processes and system components from the Canada Basin and subarctic seas surrounding northern North America; and finally posit an approach founded in “resilience thinking” to allow northern residents living in small coastal communities to participate in the observation, adaption and—if necessary—transformation of the social-ecological system with which they live.     

Assessment of the Netherlands’ Flood Risk Management Policy Under Global Change

Climate change and sea level rise urge low-lying countries to draft adaption policies. In this context, we assessed whether, to what extent and when the Netherlands’ current flood risk management policy may require a revision. By applying scenarios on climate change and socio-economic development and performing flood simulations, we established the past and future changes in flood probabilities, exposure and consequences until about 2050. We also questioned whether the present policy may be extended much longer, applying the concept of ‘policy tipping points’. Climate change was found to cause a significant increase of flood risk, but less than economic development does. We also established that the current flood risk management policy in the Netherlands can be continued for centuries when the sea level rise rate does not exceed 1.5 m per century. However, we also conclude that the present policy may not be the most attractive strategy, as it has some obvious flaws.