Better than the real thing

Why read a stack of research papers when you can watch a 3 min cartoon?

Thanks to Eric Roston of Bloomberg for putting this together.

El Niño is coming, make this time different

Kyle Meng and I published an op-ed in the Guardian today trying to raise awareness of the potential socioeconomic impacts, and policy responses, to the emerging El Niño.  Forecasts this year are extraordinary.  In particular, for folks who aren't climate wonks and who live in temperate locations, it is challenging to visualize the scale and scope of what might come down the pipeline this year in the tropics and subtropics. Read the op-ed here.

Countries where the majority of the population experience hotter conditions under El Niño are shown in red. Countries that get cooler under El Niño are shown in blue (reproduced from Hsiang and Meng, AER 2015)

Violence is expensive

We've blogged before (ad nauseam?) about our ongoing research that suggests that changes in climate could substantially affect patterns of human violence.  Imagine, for a moment, that you buy these results.  A natural question is, how much should we care?

One way to answer this question it to try to calculate the added economic cost of a climate-induced change in conflict.  E.g., if temperatures were to rise 1 degree, what would be the economic cost of the ensuing increase in conflict?  Expressing the cost in dollars then allows us to compare it against other things we spend money on to give a sense of how "large" the costs of climate-induced violence might be.  And to the extent that we actually think future changes in climate could increase conflict risk, such a calculation could also inform estimates of the "social costs of carbon" -- essentially, the overall cost of emitting one more ton of CO2 today.  

Clearly it is not easy to calculate how much a climate-induced change in conflict would cost. It's going to be some combination of the economic damage wrought by different types of conflict, and the increase in each type of conflict due to a change in climate.   Our paper provides some estimates of the latter, but figuring out the former seems like a real bear.

This is why it was very interesting to see a new report entitled "The Economic Cost of Violence Containment", put out by a group called the Institute for Economics and Peace [ht: Tom Murphy].  As the title suggests, the goal of this report is to calculate the aggregate economic costs of violence and what we spend to contain it.   Violence, they calculate, is very very expensive.  Their headline number is that we spend about $10 trillion a year in "violence containment", which they define as "economic activity that is related to the consequences or prevention of violence… directed against people or property." For those scoring at home, $10 trillion is about 10% of the total value of stuff the world produces (the so-called Gross World Product).  For those of you who think only in Benjamins, it's 100 billion of them. 

Their estimate is the result of a big adding-up exercise where they use existing estimates from the literature on how much each type of violence costs directly -- from what we spend to house and feed conflict refugees, to the economic cost of a homicide -- and add to them estimates of how much we spend to "contain" violence more broadly, which for them includes all military expenditure (more on that below).  The figure below shows their assessment of breakdown of the different costs, with the shares given by the exploding pie chart (yeah!) on the left, and the absolute values on the right.  

There are clearly some questions about what the authors have decided to include and not include.  For instance, it doesn't seem like military expenditure can just be thought of as a cost. Sure, with a fixed budget, increased expenditure on the military necessarily reduces the investments we could otherwise make, many of which could be higher return.  But this doesn't mean that investment in the military has no economic benefit.  Irrespective of one's feelings about military spending, the military employs a lot of people, both directly and indirectly, so this sort of expenditure has benefits as well as costs.

Then as you can see in the table on the right, to get from $5 trillion in direct costs to $10 trillion in total costs, they literally multiply the direct costs by 2.  The claim is that the economic spillover from reduced violence -- e.g. from investments made elsewhere with the money you save, and from people no longer having to protect themselves from violence -- is as large as the direct cost of violence.  This number seems to come out of nowhere.

Nevertheless, if we that military expenditure is actually a wash in terms of total costs, and assume that there is no multiplier effect, we still have a cost of violence estimate of $2.3 trillion dollars.  If you drop out the "private security" and "internal security" categories for similar reasons (e.g. they are employing people), you are down closer to $1.3 trillion dollars.  So call it $1 trillion dollars in annual costs of violence.  I.e., to be conservative, let's assume that the report was off by an order of magnitude.

So what of the economic costs of climate-induced increase in conflict?  For a quick back-of-the-envelope, we can combine this $1 trillion estimate with our earlier estimates on how conflict risk responds to increases in temperature.  We had calculated these latter estimates as standardized effects -- i.e. a percentage change in conflict per 1 standard deviation change in temperature or precipitation -- and came up with numbers between about 4% and 14%, depending on the type of violence.  And since we're not used to thinking of temperature changes in terms of standard deviations, we made the map below (Fig 6 in our Science paper) to show the projected change in temperature between 2000 and 2050, expressed as multiples of the historical temperature standard deviation at each location.

So putting this all together:  $1 trillion annual cost of violence, say a 5% increase in violence for every SD increase in temperature to be conservative, and say a 2SD increase in temperature by 2050 (most populated regions are higher than that, as shown in the figure).  Under the assumption that future societies will respond to temperature increases as societies have in the past, then this would give us a $100 billion increase in the annual cost of violence by 2050.  Assuming a linear temperature increase between now and 2050 (and assuming effects stop after 2050), and setting the discount rate at 2%, you can calculate the present value of a future increase in climate-induced conflict by adding up the effects in each year and discounting them back to the present.

The number I get is just over $1.5 trillion, or a little over 1% of current Gross World Product. That is a large number.  As a simple calibration, it is about 1/5th of the total cost of climate change calculated in the Stern Review a few years back (which did not consider costs from violence).

Clearly there are a ton of assumptions that go into these sorts of calculations, but these order-of-magnitude exercises can be useful for getting a basic answer to the "should we care" question.  And even if this new report is off by an order of magnitude about the costs of violence and conflict, I think the answer to whether we should care about the potential costs of climate-induced violence is a simple "Yes".  These are big numbers.

The power of avocado

I woke up last Saturday to several emails and voice mails asking for my view on guacamole. That isn’t usually how my weekend starts. But it turns out that Chipotle issued some statement in their annual report about risks of price increases, and among them was avocado. I presume this is mainly related to the current drought, but then Chipotle wrote something about this being a possible trend and cited a paper we wrote nearly 10 years ago with some projections for avocado.

None of that would have amounted to much, but I guess it was a slow news day and reporters rarely pass up the chance to use “Holy Guacamole” in a headline (nor should they). Today I checked and a search for “avocado Chipotle” on Google News gives over 6000 results, ranging from the predictable to the fairly impressive “Guacapocalypse”.

The study we did looked at state level data and tried to infer climate sensitivity for a range of high value crops. Avocados were one that seemed to suffer with very high late summer temperatures. This was based on only a couple of hot years and so the uncertainties were quite large, as we reported in the study. We also did some follow up work with more data and more fancy statistics in what I consider a better paper. There we decided to focus on crops where the relationships were most robust, and that didn’t include avocado. But it did include some popular crops, namely the four shown below (figure shows distribution of projected impacts in terms of % yield, not including CO2 effects). Which makes me wonder what the best headline for a story on cherries would be? I’m sure Max has already thought of a few good ones.

Maybe I’m over-analyzing (and by maybe, I mean almost definitely) but I think the episode demonstrates a few common things. First, it is very difficult to contrast current trends in crop yields or prices to what would have happened without anthropogenic climate change. Max’s last post discusses this issue, one he and I have been grappling with for years in our service for the IPCC. Should we expect more down years for avocado in the future? That’s not an easy question, certainly not one I’ve looked at enough for this particular crop to offer a firm answer, even if one was possible.

Second, the media has a bit of a tendency to exaggerate things. I assume I’m the first person to ever notice this. (That was sarcasm). Things are either a total non-issue or the end of the world, and nothing in between is newsworthy. That makes it tricky to communicate an issue like climate change where almost everything is somewhere between these two extremes. 

Third, and probably most important, is that people really take what businesses say related to climate change risks very seriously. The shame is that I know a lot of businesses are convinced of the science and have thought a lot about risks posed by climate change, but they rarely make these concerns public. I recall sitting on a panel at a large agricultural company and was asked what the company could do to help society prepare for climate change. My answer was that they should not be so silent about the issue. They were the third agricultural company that year to tell me they believe the science, that they are concerned about the risks, but that they don’t dare talk publicly about it for fear of alienating customers who see climate change as a political issue.

As a bit of consolation for US readers, please know it is hard to find an avocado here in Australia for less than $3 a piece. So that extra $2 for guacamole at Chipotle is a real bargain. I hope there’s still some left when I get back!

Is climate change really killing 400,000 people a year?

A new report out by an international consortium of scientists and policymakers makes the somewhat surprising claim that climate change is already killing about 400,000 people a year, through a combination of its effects on disease and hunger.  This certainly sounds like a big number, and would account for almost 1% of the roughly 50 million people that die around the world each year.

Reading up on the report's methodology a bit, it looks like they arrive at this number by thinking of all the things that can kill you, assembling estimates from the literature of how effective these things are in doing so, and then combining these with estimates of how much these things might be affected by climate.  They do this at the country or grid level and then add everything up to get a global estimate. 

This approach at getting at climate impacts is not unlike that taken by Integrated Assessment Models in the broader climate impact debate:  you try to directly account for all the stuff that might be going on that affects your outcome of interest.  The appeal is that you can get really down and dirty in the details and try to model everything that is going on.  But this complexity is also a source of difficulty, since we don't always have good estimates of how climate affects each intermediate variable, and it's hard to know how to add things up without under- or over-counting (e.g. is a person who dies from malaria the same person who's going to die from hunger?).

You could imagine more "reduced form" ways at getting at the same thing:  e.g. a study that looked at the direct effect of past climate variation on mortality.  The disadvantage with this approach is that it is hard to illuminate the intermediate variables that link climate and mortality, but the advantage is that you avoid the adding-up problem of the more "integrated" approach.  Put simply, your headline impact estimate might be more trustworthy, but you're probably going to understand it less.  

I don't know of a good paper that has directly looked at the relationship between climate and overall mortality (although a working paper by Kudamatsu et al is a step in that direction), but there is a nice paper from Baird, Friedman, and Schady (undated version here) that tells us how much infant mortality goes up when aggregate economic productivity declines in poor countries.  We can combine this with another nice recent estimate from Dell, Jones, and Olken (ungated here) of how aggregate economic productivity responds to temperature change to derive an estimate of the effect of climate on infant mortality via economic productivity.  Economists are perhaps overly-comfortable assuming that aggregate economic measures such as GDP capture most of what we care about in terms of a country's well-being, but it's not a bad place to start.  

So, some simple math:

- Dell Jones Olken estimate that a 1C increase in temperature reduced GDP growth rates in poor countries by 1.3 percentage points.

- Baird, Friedman, and Schady estimate that a 1% reduction in GDP increases infant mortality rate in poor countries between 0.24 and 0.4 deaths per 1000 births (call this 0.32 per 1000)

- IPCC AR4 estimates average surface warming of 0.13C per decade since 1950 - so 0.013C per year.  

- The UN estimates that there have been 6.4 billion births in less developed countries between 1950-2010.  Infant mortality rates over the period average 91 per 1000 births in these regions.

Combine these and (if I did the math right) you get an estimate that warming since 1950 has resulted in an extra 2 million infant deaths in the developing world.  This gives you a per-year mortality estimate of a little less than 40,000, or about an order of magnitude smaller than the estimate in the new report.  

What's going on here?  Some possible explanations:

1. The lion's share of climate's effects on mortality are not captured in climate's effects on GDP or its correlates

2. The reduced form estimate only considers effects on infant mortality, and perhaps a lot of adults are dying and driving up the "integrated" estimate. 

3. There is an adding-up problem in the 400,000 number.  

Some part of (1) is undoubtedly true, but personally I find it hard to believe that GDP would not pick up a lot of climate's effect on a country's mortality outcomes - at least more than 10%.  (2) seems unlikely, and the report notes that most of the 400,000 deaths are children.   So I'm worried at the culprit might be in part (3):  it's just hard to know how climate impacts every possible way people die, and it's maybe even harder to add up these impacts. 

It would be nice if someone wanted to repeat the Baird et al paper but just run climate as the independent variable instead of growth, which would give us a direct estimate of climate on infant mortality.  Until that time, while it seems almost certain that climate change is already killing people and will kill a lot more in the future, we might be a little skeptical that the effects are already anything like 400,000 climate deaths per year. 

Are we coping with extreme heat better than in the past?

I'm live at CNN...

Extreme heat and droughts -- a recipe for world food woes

With extreme heat and the worst drought in half a century continuing to plague the farm states, there are important lessons to be learned for all of us -- farmers, consumers and the world's poorest populations alike -- about the effect of climate change.

The Agriculture Department announced this season's first major crop yield forecasts, and they weren't pretty: a nationwide average of 123.4 bushels of corn per acre, the lowest level since 1995. Soybean yield is expected to be low too, though not as bad as corn.

The United States, which is the world's largest producer and exporter of staple grains, is grappling with the biggest surprise in production shortfalls since the Dust Bowl of the 1930s. Certainly, this July surpassed July 1936 as the hottest month on record. 

So, how will the devastation affect U.S. crop farmers? .....

The World

A nice story on The World about drought and corn. i like the farmer's line of "crops don't like heat, and the plants know it."

Also, an interesting story on how drought tolerant seeds are doing.