Not the next one. Maybe the one after the next one.
In this podcast the FT Alphaville folks talk with a couple economists about financial impacts of global warming and regulations. And if you listen in, pay close attention to the woman, Professor Lint Barrage.
She is exactly what you want in an environmental economist, precise in her thinking, going no further than her research has taken her and in fact reining in one of the FTAV interviewers, Colby Smith, on a couple points where Barrrage is reluctant to come to conclusions that she can't back up with her research.
The reason this is important? Her topic is flooding and the economic effects thereof and when you get into this area you are dealing with a complex-chaotic system, markets, overlaid upon another complex-chaotic system, weather and then you take that bundle and further mix it up with human preferences and behaviors you literally need a supercomputer just to map the permutations.
And speaking of maps, two quick asides.
1) As Professor Barrage was talking about FEMA's flood maps I was thinking of Goad's fire insurance maps of London in the 1880's. See after the jump for an example.* But that got me thinking about the Sun and Phoenix Fire Insurance offices and unfortunately that got me wondering about the Exchange Alley fire of 1748 which sent the stockjobbers running, and if there was a map of the damage and there is and I spent ten minutes rooting around before remembering I had to get back to this post.
2) Professor Barrage's dissertation director at Yale pretty much created the approach used to model economic impacts which always reminds me of Korzybski's admonition:
"The map is not the territory"
-Alfred Korzybski
"A Non-Aristotelian System and its Necessity for Rigour in Mathematics and Physics"
presented before the American Mathematical Society December 28, 1931
We've noted her dissertation director a half-dozen times, usually with some variation of this factoid:
A look at his c.v. turns up at least three Nobel Laureates among his co-authors and he hangs his hat at Yale's Cowles Foundation which also has some Nobelist connections:...MOREAnd longtime readers are now ahead of me and yes it's William Nordhaus who was awarded his own Nobel in 2018.
Sorry about the long and winding road but here we are, finally arrived at the 'ville:
By Colby Smith, February 8
Could climate change spark the next financial crisis?
35 inches of rain. 130mph winds. 51 people dead. That was Hurricane Florence, which made landfall in North Carolina as a tropical storm in mid-September last year. Nearly six months later, and some coastal communities have yet to recover. In fact, Moody's reckons Florence could cost between $38 and $50bn, with up to $22bn of property damage.*Intersection of Borough High Street and Southwark Street. I think this one is
Florence's intensity and the scope of its destruction were immense, but by no means unique. Hurricanes Harvey, Irma and Maria in the year before it indiscriminately demolished the homes, people and infrastructure when they hit Texas, Florida and Puerto Rico, respectively. Storms like these are set to become the norm. (Or worse, even more intense.)
Alphaville recently attended a conference at the Rhodes Center for International Economics and Finance at Brown University on America's climate change future. (Rhodes is Alphaville's partner institution for Alphachat.) The event, which featured a keynote address by Senator Sheldon Whitehouse of Rhode Island, focused not only on the housing markets and assets at risk of both climate change and policy, but the political forces at work preventing credible measures in the first place.
Alphaville pulled aside two of the presenters for a deeper conversation on the economic and financial ramifications of climate action and inaction. We discussed with Lint Barrage, who teaches economics and environmental studies at Brown University, what happens to a beach-front city like Miami, and asked about the billions of dollars worth of coastal properties that could be underwater not too far off in the future.....MORE, including links to the 35 minute podcast "Climate change is not a business cycle".
For a really spooky look here are the zoomable interactive versions at the British Library.
