HESS Opinions ``Ensembles, uncertainty and flood prediction''

Ensemble predictions are being used more frequently to model the propagation of uncertainty through complex, coupled meteorological, hydrological and coastal models, with the goal of better characterising flood risk. In this paper, we consider the issues that we judge to be important when designing and evaluating ensemble predictions, and make recommendations for the guidance of future research.

Uncertainty and feasibility studies: an Italian case study

Uncertainty affects all aspects of the property market but one area where the impact of uncertainty is particularly significant is within feasibility analyses. Any development is impacted by differences between market conditions at the conception of the project and the market realities at the time of completion. The feasibility study needs to address the possible outcomes based on an understanding of the current market. This requires the appraiser to forecast the most likely outcome relating to the sale price of the completed development, the construction costs and the timing of both. It also requires the appraiser to understand the impact of finance on the project. All these issues are time sensitive and analysis needs to be undertaken to show the impact of time to the viability of the project. The future is uncertain and a full feasibility analysis should be able to model the upside and downside risk pertaining to a range of possible outcomes. Feasibility studies are extensively used in Italy to determine land value but they tend to be single point analysis based upon a single set of “likely” inputs. In this paper we look at the practical impact of uncertainty in variables using a simulation model (Crystal Ball ©) with an actual case study of an urban redevelopment plan for an Italian Municipality. This allows the appraiser to address the issues of uncertainty involved and thus provide the decision maker with a better understanding of the risk of development. This technique is then refined using a “two-dimensional technique” to distinguish between “uncertainty” and “variability” and thus create a more robust model.

Variation in the global-scale impacts of climate change on crop productivity due to climate model uncertainty and adaptation

Crop production is inherently sensitive to fluctuations in weather and climate and is expected to be impacted by climate change. To understand how this impact may vary across the globe many studies have been conducted to determine the change in yield of several crops to expected changes in climate. Changes in climate are typically derived from a single to no more than a few General Circulation Models (GCMs). This study examines the uncertainty introduced to a crop impact assessment when 14 GCMs are used to determine future climate. The General Large Area Model for annual crops (GLAM) was applied over a global domain to simulate the productivity of soybean and spring wheat under baseline climate conditions and under climate conditions consistent with the 2050s under the A1B SRES emissions scenario as simulated by 14 GCMs. Baseline yield simulations were evaluated against global country-level yield statistics to determine the model's ability to capture observed variability in production. The impact of climate change varied between crops, regions, and by GCM. The spread in yield projections due to GCM varied between no change and a reduction of 50%. Without adaptation yield response was linearly related to the magnitude of local temperature change. Therefore, impacts were greatest for countries at northernmost latitudes where warming is predicted to be greatest. However, these countries also exhibited the greatest potential for adaptation to offset yield losses by shifting the crop growing season to a cooler part of the year and/or switching crop variety to take advantage of an extended growing season. The relative magnitude of impacts as simulated by each GCM was not consistent across countries and between crops. It is important, therefore, for crop impact assessments to fully account for GCM uncertainty in estimating future climates and to be explicit about assumptions regarding adaptation.

Moving the nanoscience and technology (NST) debate forwards: short-term impacts, long-term uncertainty and the social constitution

Nanoscience and technology (NST) are widely cited to be the defining technology for the 21st century. In recent years, the debate surrounding NST has become increasingly public, with much of this interest stemming from two radically opposing long-term visions of a NST-enabled future: ‘nano-optimism’ and ‘nano-pessimism’. This paper demonstrates that NST is a complex and wide-ranging discipline, the future of which is characterised by uncertainty. It argues that consideration of the present-day issues surrounding NST is essential if the public debate is to move forwards. In particular, the social constitution of an emerging technology is crucial if any meaningful discussion surrounding costs and benefits is to be realised. An exploration of the social constitution of NST raises a number of issues, of which unintended consequences and the interests of those who own and control new technologies are highlighted.

Understanding the WTA–WTP gap: Attitudes, feelings, uncertainty and personality

We present an experiment designed to study the psychological basis for the willingness to accept (WTA)–willingness to pay (WTP) gap. Specifically, we conduct a standard WTA–WTP economic experiment to replicate the gap and include in it five additional instruments to try to follow the psychological processes producing it. These instruments are designed to measure five psychological constructs we consider especially relevant: (1) attitudes, (2) feelings, (3) familiarity with the target good, (4) risk attitudes, and (5) personality. Our results provide important new insights into the psychological foundations of the WTA–WTP disparity, which can be used to organize some major previous results and cast serious doubts on the claim that the gap might be just a consequence of inappropriate experimental practice.

Harnessing the ancestors: mutuality, uncertainty and ritual practice in the Eastern Cape Province, South Africa

In the Eastern Cape Province of South Africa, chronic economic uncertainty has seen social relations stretched to breaking point. Informants speak of a 'war between men and women'. While grinding poverty, death in the shape of the 'axe' (HIV/AIDS) and suspicion stalk the land, and the project of building the umzi (homestead) falters, hope for the future and with it, trust between people, leaches away. One response to such uncertainty is a turn to ritual. Through a nearly relentless schedule of ritual activity which invokes the ancestors and the Christian deity in various forms, Xhosa people attempt to dam up trust, secure ongoing investment in the rural homestead and sustain ties of reciprocity both among rural people and between them and their urban kin. It is also through the staging of these rituals that women, acting together and in support of each other, are increasingly assertive – often in the face of a violent, rearguard opposition from men - in their efforts to exercise agency over the differentiated, fragmented and fragile social and economic relationships within their homesteads and across their villages.

Shackle on time, uncertainty and process

This paper is intended both as a contribution to the conceptual work on process in economic thought and as an attempt to connect a non-institutionalist, non-evolutionary thinker to it. The paper has two principal objectives: (i) to delineate a broad, philosophically grounded conception of what an economic process theory (EPT) is; and (ii) to locate the contributions of George Shackle within this broad conception of EPT. In pursuing these two objectives, I hope to draw out the originality and significance of Shackle’s economics with a particular emphasis on what he adds to process conceptions developed within other heterodox traditions such as institutional and evolutionary economics. I will also highlight some of the perceived limitations of Shackle’s approach and link them to the limitations of process philosophy.

Moral uncertainty and permissibility: evaluating option sets

In this essay, we explore an issue of moral uncertainty: what we are permitted to do when we are unsure about which moral principles are correct. We develop a novel approach to this issue that incorporates important insights from previous work on moral uncertainty, while avoiding some of the difficulties that beset existing alternative approaches. Our approach is based on evaluating and choosing between option sets rather than particular conduct options. We show how our approach is particularly well-suited to address this issue of moral uncertainty with respect to agents that have credence in moral theories that are not fully consequentialist.

Vegetation dynamics in abandoned crop fields on a Mediterranean island: Development of succession model and estimation of disturbance thresholds

This case study on the Sifnos island, Greece, assesses the main factors controlling vegetation succession following crop abandonment and describes the vegetation dynamics of maquis and phrygana formations in relation to alternative theories of secondary succession. Field survey data were collected and analysed at community as well as species level. The results show that vegetation succession on abandoned crop fields is determined by the combined effects of grazing intensity, soil and geological characteristics and time. The analysis determines the quantitative grazing thresholds that modify the successional pathway. Light grazing leads to dominance by maquis vegetation while overgrazing leads to phryganic vegetation. The proposed model shows that vegetation succession following crop abandonment is a complex multi-factor process where the final or the stable stage of the process is not predefined but depends on the factors affecting succession. An example of the use of succession models and disturbance thresholds as a policy assessment tool is presented by evaluating the likely vegetation impacts of the recent reform of the Common Agricultural Policy on Sifnos island over a 20-30-year time horizon. (c) 2006 Elsevier B.V. All rights reserved.

Decision theory and real estate development: a note on uncertainty

Real estate development appraisal is a quantification of future expectations. The appraisal model relies upon the valuer/developer having an understanding of the future in terms of the future marketability of the completed development and the future cost of development. In some cases the developer has some degree of control over the possible variation in the variables, as with the cost of construction through the choice of specification. However, other variables, such as the sale price of the final product, are totally dependent upon the vagaries of the market at the completion date. To try to address the risk of a different outcome to the one expected (modelled) the developer will often carry out a sensitivity analysis on the development. However, traditional sensitivity analysis has generally only looked at the best and worst scenarios and has focused on the anticipated or expected outcomes. This does not take into account uncertainty and the range of outcomes that can happen. A fuller analysis should include examination of the uncertainties in each of the components of the appraisal and account for the appropriate distributions of the variables. Similarly, as many of the variables in the model are not independent, the variables need to be correlated. This requires a standardised approach and we suggest that the use of a generic forecasting software package, in this case Crystal Ball, allows the analyst to work with an existing development appraisal model set up in Excel (or other spreadsheet) and to work with a predetermined set of probability distributions. Without a full knowledge of risk, developers are unable to determine the anticipated level of return that should be sought to compensate for the risk. This model allows the user a better understanding of the possible outcomes for the development. Ultimately the final decision will be made relative to current expectations and current business constraints, but by assessing the upside and downside risks more appropriately, the decision maker should be better placed to make a more informed and “better”.

Consensus and uncertainty: using forecast probabilities of output declines

A number of studies have addressed the relationship between intra-personal uncertainty and inter-personal disagreement about the future values of economic variables such as output growth and inflation using the SPF. By making use of the SPF respondents' probability forecasts of declines in output, we are able to construct a quarterly series of output growth uncertainty to supplement the annual series that are often used in such analyses. We also consider the relationship between disagreement and uncertainty for probability forecasts of declines in output.

The potential to narrow uncertainty in regional climate predictions

Faced by the realities of a changing climate, decision makers in a wide variety of organisations are increasingly seeking quantitative predictions of regional and local climate. An important issue for these decision makers, and for organisations that fund climate research, is what is the potential for climate science to deliver improvements - especially reductions in uncertainty - in such predictions? Uncertainty in climate predictions arises from three distinct sources: internal variability, model uncertainty and scenario uncertainty. Using data from a suite of climate models we separate and quantify these sources. For predictions of changes in surface air temperature on decadal timescales and regional spatial scales, we show that uncertainty for the next few decades is dominated by sources (model uncertainty and internal variability) that are potentially reducible through progress in climate science. Furthermore, we find that model uncertainty is of greater importance than internal variability. Our findings have implications for managing adaptation to a changing climate. Because the costs of adaptation are very large, and greater uncertainty about future climate is likely to be associated with more expensive adaptation, reducing uncertainty in climate predictions is potentially of enormous economic value. We highlight the need for much more work to compare: a) the cost of various degrees of adaptation, given current levels of uncertainty; and b) the cost of new investments in climate science to reduce current levels of uncertainty. Our study also highlights the importance of targeting climate science investments on the most promising opportunities to reduce prediction uncertainty.