2.6.3.1. Identifying Extreme Values, Ranges, and Thresholds

It is worth noting that by failing to provide an estimate of the full range of outcomes (i.e., not specifying outliers that include rapid nonlinear events), authors of previous assessments were not conveying to potential users a representation of the full range of uncertainty associated with the estimate. This has important implications with regard to the extent to which the report accurately conveyed to policymakers potential benefits or risks that may exist, even if at a low or unknown probability (see Figure 2-1). If it were necessary to truncate the range, it should have been clearly explained what the provided range includes and/or excludes. Furthermore, the authors might have specified how likely it is that the answer could lie outside the truncated distribution.

Pittock and Jones (1999) recommend construction of thresholds that can be linked to projected ranges of climate change. Such thresholds can account for biophysical and/or socioeconomic criteria in the initial stages of an assessment but must be expressed in climatic terms (e.g., above a certain temperature, rainfall frequency, water balance, or combination of several factors). Further analysis compares these thresholds with projected regional climate change. Similar approaches are contained in concepts of tolerable climate change (see Hulme and Brown, 1998).

2.6.3.2. Valuation Issues

Any comprehensive attempt to evaluate the societal value of climate change should include, in addition to the usual monetary value of items or services traded in markets, measures of valued items or services that are not easily marketed. Schneider et al. (2000) refer to this costing problem in vulnerability analysis as "The Five Numeraires": monetary loss, loss of human life, reductions in quality of life (including forced migration, conflicts over environmentally dependent resources, loss of cultural diversity, loss of cultural heritage sites, etc.), loss of species/biodiversity, and increasing inequity in the distribution of material well-being. There is little agreement on how to place a monetary value on the nonmarket impacts of climate change, yet such valuation is essential to several analytic techniques to assess the efficiency or cost-effectiveness of alternative climate policy proposals (see Section 2.5.6).

One such technique for valuation is to survey expert opinion on subjective assessment of probability distributions of climate damage estimates (see Nordhaus, 1994a; Morgan and Keith, 1995; Titus and Narayanan, 1996, for examples of decision analytic elicitations of climate effects and impacts; see Morgan and Dowlatabadi, 1996, for examples of how such elicited subjective probability distributions can be incorporated into IAMs that examine "optimal" policies). An alternative valuation framework is to use "cultural theory" (Douglas and Wildavsky, 1982) to identify different value perspectives in designing policy strategies (see van Asselt and Rotmans, 1995, for an application to population growth). With this technique, subjective judgment about uncertainties may be described from the viewpoints of different cultural perspectives. Preferred policy options depend on the perspective adopted. Real policy choice, of course, depends on the logic and consistency of formulating a basis for policy choices (i.e., the role of decision analysis tools) and on the values of decisionmakers at all levels. More formal and explicit incorporation of uncertainties into decision analysis is the emphasis here.

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