Improving Climate Projections to Better Inform Climate Risk Management
K. Keller and R. Nicholas
Chapter in The Oxford Handbook of the Macroeconomics of Global Warming (15 January 2015)
editors: L. B. Semmler
This chapter describes and applies criteria for assessing the usefulness of climate projections to inform risk management decisions. In particular, we discuss climate projections in terms of whether they represent decision-relevant climate properties, time scales, and uncertainties. We focus on two decision problems outlined in the introduction: the design of climate change adaptation and mitigation strategies. We argue that although climate projections have seen drastic improvements in the last few years, they still show considerable limitations in the projection of decision-relevant metrics, are often silent on decision-relevant time scales, and neglect potentially crucial uncertainties. We close with a brief outline of potential research opportunities.
keywords: climate change; climate change adaptation; climate change mitigation; climate projections; climate risk management; overconfidence