Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty
Investment decision making is already difficult for any diverse group of actors with different priorities and views. But the presence of deep uncertainties linked to climate change and other future conditions further challenges decision making by q...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2014/06/19616379/agreeing-robust-decisions-new-processes-decision-making-under-deep-uncertainty http://hdl.handle.net/10986/18772 |
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okr-10986-18772 |
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oai_dc |
| repository_type |
Digital Repository |
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Foreign Institution |
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Digital Repositories |
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World Bank Open Knowledge Repository |
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World Bank |
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English en_US |
| topic |
ABATEMENT ABATEMENT COSTS AFFORESTATION AIRPORTS APPROACH TO CLIMATE CHANGE ATMOSPHERE ATMOSPHERE-OCEAN GENERAL CIRCULATION BENEFICIARIES CAR CAR CRASH CARBON BUDGET CARBON EMISSIONS CARBON PRICE CARS CLIMATE CLIMATE CHANGE CLIMATE CHANGE IMPACTS CLIMATE CHANGE INDICATORS CLIMATE CHANGE MITIGATION CLIMATE CHANGE SCENARIOS CLIMATE CHANGES CLIMATE CONDITIONS CLIMATE DATA CLIMATE EFFECTS CLIMATE EXPERTS CLIMATE FACTORS CLIMATE FORECASTS CLIMATE INFORMATION CLIMATE MODEL CLIMATE MODELERS CLIMATE MODELS CLIMATE POLICIES CLIMATE PROJECTIONS CLIMATE RESPONSE CLIMATE RISKS CLIMATE SCENARIOS CLIMATE SCIENTISTS CLIMATE SENSITIVITY CLIMATE SIGNAL CLIMATE STATISTICS CLIMATE SYSTEM CLIMATE THREATS CLIMATE UNCERTAINTY CLIMATE VARIABILITY CLIMATE VARIABLES CLIMATES CLIMATIC EFFECTS CLOUDS CO CO2 CONGESTION COSTS CONVECTION CORROSION COST BENEFIT ANALYSIS COST OF CARBON COST-BENEFIT COST-BENEFIT ANALYSIS CREDIBILITY CROP INSURANCE CROSSING CROSSINGS DAMAGES DEEP UNCERTAINTY DEGREE OF RISK DEVELOPING COUNTRIES DISCOUNT RATE DISCOUNT RATES DISTRIBUTIONAL IMPACTS DRAINAGE DRIVERS DROUGHT ECONOMIC ANALYSES ECONOMIC ANALYSIS ECONOMIC CONDITIONS ECONOMIC GROWTH ECOSYSTEM EMISSION EMISSION REDUCTION EMISSION REDUCTION TARGET EMISSION SCENARIO EMISSIONS EMISSIONS REDUCTION EMISSIONS REDUCTIONS EMISSIONS SCENARIOS EMISSIONS TRENDS ENERGY CONSUMPTION ENERGY EFFICIENCY ENERGY USE ENVIRONMENTAL COSTS ENVIRONMENTAL GROUPS EXCESSIVE RAIN FEASIBILITY FEDERAL RESERVE FINANCIAL MARKETS FLOODS FOREST FOREST MANAGEMENT FORESTRY FORESTRY SECTOR FUTURE CLIMATE CHANGE FUTURE CLIMATE SCENARIOS FUTURES GHG GLACIERS GLOBAL CLIMATE GLOBAL MEAN TEMPERATURE GLOBAL WARMING GOVERNMENT POLICIES GREEN BELT GREENHOUSE GREENHOUSE GAS GREENHOUSE GAS EMISSIONS GREENHOUSE GASES HOUSING AFFORDABILITY HURRICANE HURRICANE PROTECTION HURRICANES ICE SHEETS IMPACT OF CLIMATE IMPACT OF CLIMATE CHANGE IMPACTS OF CLIMATE CHANGE IMPORTS INCOME INFORMATION ON CLIMATE INSURANCE INSURANCE COMPANIES INTANGIBLES INTENSITY OF STORMS INTERNATIONAL BANK INVESTING INVESTMENT ALTERNATIVES INVESTMENT DECISION INVESTMENT DECISIONS IPCC JOBS LAKES LAND USE LAND USE PATTERNS LOCAL GOVERNMENT LONG-TERM INVESTMENTS LOWER COSTS LOWER DISCOUNT RATE MANGROVE FOREST MARGINAL ABATEMENT MARGINAL ABATEMENT COST MARKET PRICE MARKET PRICES MARKET VALUE MARKET VALUES MONETARY VALUE MONSOONS NEGATIVE IMPACT OCEANS OPPORTUNITY COST PHYSICS POLICY MAKERS POLITICAL ECONOMY POPULATION GROWTH PORTFOLIOS POWER PLANTS POWER STATIONS PRECIPITATION PRESENT VALUE PROBABILITY DISTRIBUTION PROBABILITY DISTRIBUTIONS PROBABILITY OF OCCURRENCE PUBLIC TRANSPORT PUBLIC TRANSPORT SUBSIDY QUANTITATIVE ANALYSIS RAIN RAINFALL RAINY DAYS RAPID CLIMATE CHANGE REGIONAL CLIMATE REGULATORY POLICIES RELATIVE PRICES RENEWABLE ENERGY RESOURCE ECONOMICS RETURN RETURNS RISK AVERSION RISK MANAGEMENT RISK MANAGEMENT STRATEGIES RISK NEUTRAL ROAD ROAD TRAFFIC ROAD TUNNEL ROADS ROUTE ROUTES SAFETY SCENARIOS SCIENTIFIC CONSENSUS SEA LEVEL RISE SEISMIC EVENT SENSITIVITY ANALYSES SETTLEMENT SHADOW PRICE SILVER SOCIAL COST OF CARBON STORM SURGE STORMS TEMPERATURE TEMPERATURE CHANGE TEMPERATURES TERRORISM TOTAL COST TRADING TRADING SYSTEM TRAFFIC TRAFFIC CONGESTION TRAFFIC LANES TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRAVEL COSTS TREASURY TROPICS TRUE UNCERTAINTIES UNCERTAINTY IN CLIMATE CHANGE PROJECTIONS URBAN PLANNERS UTILITY FUNCTION VALUATION VALUATION TECHNIQUES VALUATIONS WORST-CASE |
| spellingShingle |
ABATEMENT ABATEMENT COSTS AFFORESTATION AIRPORTS APPROACH TO CLIMATE CHANGE ATMOSPHERE ATMOSPHERE-OCEAN GENERAL CIRCULATION BENEFICIARIES CAR CAR CRASH CARBON BUDGET CARBON EMISSIONS CARBON PRICE CARS CLIMATE CLIMATE CHANGE CLIMATE CHANGE IMPACTS CLIMATE CHANGE INDICATORS CLIMATE CHANGE MITIGATION CLIMATE CHANGE SCENARIOS CLIMATE CHANGES CLIMATE CONDITIONS CLIMATE DATA CLIMATE EFFECTS CLIMATE EXPERTS CLIMATE FACTORS CLIMATE FORECASTS CLIMATE INFORMATION CLIMATE MODEL CLIMATE MODELERS CLIMATE MODELS CLIMATE POLICIES CLIMATE PROJECTIONS CLIMATE RESPONSE CLIMATE RISKS CLIMATE SCENARIOS CLIMATE SCIENTISTS CLIMATE SENSITIVITY CLIMATE SIGNAL CLIMATE STATISTICS CLIMATE SYSTEM CLIMATE THREATS CLIMATE UNCERTAINTY CLIMATE VARIABILITY CLIMATE VARIABLES CLIMATES CLIMATIC EFFECTS CLOUDS CO CO2 CONGESTION COSTS CONVECTION CORROSION COST BENEFIT ANALYSIS COST OF CARBON COST-BENEFIT COST-BENEFIT ANALYSIS CREDIBILITY CROP INSURANCE CROSSING CROSSINGS DAMAGES DEEP UNCERTAINTY DEGREE OF RISK DEVELOPING COUNTRIES DISCOUNT RATE DISCOUNT RATES DISTRIBUTIONAL IMPACTS DRAINAGE DRIVERS DROUGHT ECONOMIC ANALYSES ECONOMIC ANALYSIS ECONOMIC CONDITIONS ECONOMIC GROWTH ECOSYSTEM EMISSION EMISSION REDUCTION EMISSION REDUCTION TARGET EMISSION SCENARIO EMISSIONS EMISSIONS REDUCTION EMISSIONS REDUCTIONS EMISSIONS SCENARIOS EMISSIONS TRENDS ENERGY CONSUMPTION ENERGY EFFICIENCY ENERGY USE ENVIRONMENTAL COSTS ENVIRONMENTAL GROUPS EXCESSIVE RAIN FEASIBILITY FEDERAL RESERVE FINANCIAL MARKETS FLOODS FOREST FOREST MANAGEMENT FORESTRY FORESTRY SECTOR FUTURE CLIMATE CHANGE FUTURE CLIMATE SCENARIOS FUTURES GHG GLACIERS GLOBAL CLIMATE GLOBAL MEAN TEMPERATURE GLOBAL WARMING GOVERNMENT POLICIES GREEN BELT GREENHOUSE GREENHOUSE GAS GREENHOUSE GAS EMISSIONS GREENHOUSE GASES HOUSING AFFORDABILITY HURRICANE HURRICANE PROTECTION HURRICANES ICE SHEETS IMPACT OF CLIMATE IMPACT OF CLIMATE CHANGE IMPACTS OF CLIMATE CHANGE IMPORTS INCOME INFORMATION ON CLIMATE INSURANCE INSURANCE COMPANIES INTANGIBLES INTENSITY OF STORMS INTERNATIONAL BANK INVESTING INVESTMENT ALTERNATIVES INVESTMENT DECISION INVESTMENT DECISIONS IPCC JOBS LAKES LAND USE LAND USE PATTERNS LOCAL GOVERNMENT LONG-TERM INVESTMENTS LOWER COSTS LOWER DISCOUNT RATE MANGROVE FOREST MARGINAL ABATEMENT MARGINAL ABATEMENT COST MARKET PRICE MARKET PRICES MARKET VALUE MARKET VALUES MONETARY VALUE MONSOONS NEGATIVE IMPACT OCEANS OPPORTUNITY COST PHYSICS POLICY MAKERS POLITICAL ECONOMY POPULATION GROWTH PORTFOLIOS POWER PLANTS POWER STATIONS PRECIPITATION PRESENT VALUE PROBABILITY DISTRIBUTION PROBABILITY DISTRIBUTIONS PROBABILITY OF OCCURRENCE PUBLIC TRANSPORT PUBLIC TRANSPORT SUBSIDY QUANTITATIVE ANALYSIS RAIN RAINFALL RAINY DAYS RAPID CLIMATE CHANGE REGIONAL CLIMATE REGULATORY POLICIES RELATIVE PRICES RENEWABLE ENERGY RESOURCE ECONOMICS RETURN RETURNS RISK AVERSION RISK MANAGEMENT RISK MANAGEMENT STRATEGIES RISK NEUTRAL ROAD ROAD TRAFFIC ROAD TUNNEL ROADS ROUTE ROUTES SAFETY SCENARIOS SCIENTIFIC CONSENSUS SEA LEVEL RISE SEISMIC EVENT SENSITIVITY ANALYSES SETTLEMENT SHADOW PRICE SILVER SOCIAL COST OF CARBON STORM SURGE STORMS TEMPERATURE TEMPERATURE CHANGE TEMPERATURES TERRORISM TOTAL COST TRADING TRADING SYSTEM TRAFFIC TRAFFIC CONGESTION TRAFFIC LANES TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRAVEL COSTS TREASURY TROPICS TRUE UNCERTAINTIES UNCERTAINTY IN CLIMATE CHANGE PROJECTIONS URBAN PLANNERS UTILITY FUNCTION VALUATION VALUATION TECHNIQUES VALUATIONS WORST-CASE Kalra, Nidhi Hallegatte, Stephane Lempert, Robert Brown, Casey Fozzard, Adrian Gill, Stuart Shah, Ankur Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty |
| relation |
Policy Research Working Paper;No. 6906 |
| description |
Investment decision making is already
difficult for any diverse group of actors with different
priorities and views. But the presence of deep uncertainties
linked to climate change and other future conditions further
challenges decision making by questioning the robustness of
all purportedly optimal solutions. While decision makers can
continue to use the decision metrics they have used in the
past (such as net present value), alternative methodologies
can improve decision processes, especially those that lead
with analysis and end in agreement on decisions. Such
"Agree-on-Decision" methods start by
stress-testing options under a wide range of plausible
conditions, without requiring us to agree ex ante on which
conditions are more or less likely, and against a set of
objectives or success metrics, without requiring us to agree
ex ante on how to aggregate or weight them. As a result,
these methods are easier to apply to contexts of large
uncertainty or disagreement on values and objectives. This
inverted process promotes consensus around better decisions
and can help in managing uncertainty. Analyses performed in
this way let decision makers make the decision and inform
them on (1) the conditions under which an option or project
is vulnerable; (2) the tradeoffs between robustness and
cost, or between various objectives; and (3) the flexibility
of various options to respond to changes in the future. In
doing so, they put decision makers back in the driver's
seat. A growing set of case studies shows that these methods
can be applied in real-world contexts and do not need to be
more costly or complicated than traditional approaches.
Finally, while this paper focuses on climate change, a
better treatment of uncertainties and disagreement would in
general improve decision making and development outcomes. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Kalra, Nidhi Hallegatte, Stephane Lempert, Robert Brown, Casey Fozzard, Adrian Gill, Stuart Shah, Ankur |
| author_facet |
Kalra, Nidhi Hallegatte, Stephane Lempert, Robert Brown, Casey Fozzard, Adrian Gill, Stuart Shah, Ankur |
| author_sort |
Kalra, Nidhi |
| title |
Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty |
| title_short |
Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty |
| title_full |
Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty |
| title_fullStr |
Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty |
| title_full_unstemmed |
Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty |
| title_sort |
agreeing on robust decisions : new processes for decision making under deep uncertainty |
| publisher |
World Bank, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2014/06/19616379/agreeing-robust-decisions-new-processes-decision-making-under-deep-uncertainty http://hdl.handle.net/10986/18772 |
| _version_ |
1764442657800585216 |
| spelling |
okr-10986-187722021-04-23T14:03:49Z Agreeing on Robust Decisions : New Processes for Decision Making under Deep Uncertainty Kalra, Nidhi Hallegatte, Stephane Lempert, Robert Brown, Casey Fozzard, Adrian Gill, Stuart Shah, Ankur ABATEMENT ABATEMENT COSTS AFFORESTATION AIRPORTS APPROACH TO CLIMATE CHANGE ATMOSPHERE ATMOSPHERE-OCEAN GENERAL CIRCULATION BENEFICIARIES CAR CAR CRASH CARBON BUDGET CARBON EMISSIONS CARBON PRICE CARS CLIMATE CLIMATE CHANGE CLIMATE CHANGE IMPACTS CLIMATE CHANGE INDICATORS CLIMATE CHANGE MITIGATION CLIMATE CHANGE SCENARIOS CLIMATE CHANGES CLIMATE CONDITIONS CLIMATE DATA CLIMATE EFFECTS CLIMATE EXPERTS CLIMATE FACTORS CLIMATE FORECASTS CLIMATE INFORMATION CLIMATE MODEL CLIMATE MODELERS CLIMATE MODELS CLIMATE POLICIES CLIMATE PROJECTIONS CLIMATE RESPONSE CLIMATE RISKS CLIMATE SCENARIOS CLIMATE SCIENTISTS CLIMATE SENSITIVITY CLIMATE SIGNAL CLIMATE STATISTICS CLIMATE SYSTEM CLIMATE THREATS CLIMATE UNCERTAINTY CLIMATE VARIABILITY CLIMATE VARIABLES CLIMATES CLIMATIC EFFECTS CLOUDS CO CO2 CONGESTION COSTS CONVECTION CORROSION COST BENEFIT ANALYSIS COST OF CARBON COST-BENEFIT COST-BENEFIT ANALYSIS CREDIBILITY CROP INSURANCE CROSSING CROSSINGS DAMAGES DEEP UNCERTAINTY DEGREE OF RISK DEVELOPING COUNTRIES DISCOUNT RATE DISCOUNT RATES DISTRIBUTIONAL IMPACTS DRAINAGE DRIVERS DROUGHT ECONOMIC ANALYSES ECONOMIC ANALYSIS ECONOMIC CONDITIONS ECONOMIC GROWTH ECOSYSTEM EMISSION EMISSION REDUCTION EMISSION REDUCTION TARGET EMISSION SCENARIO EMISSIONS EMISSIONS REDUCTION EMISSIONS REDUCTIONS EMISSIONS SCENARIOS EMISSIONS TRENDS ENERGY CONSUMPTION ENERGY EFFICIENCY ENERGY USE ENVIRONMENTAL COSTS ENVIRONMENTAL GROUPS EXCESSIVE RAIN FEASIBILITY FEDERAL RESERVE FINANCIAL MARKETS FLOODS FOREST FOREST MANAGEMENT FORESTRY FORESTRY SECTOR FUTURE CLIMATE CHANGE FUTURE CLIMATE SCENARIOS FUTURES GHG GLACIERS GLOBAL CLIMATE GLOBAL MEAN TEMPERATURE GLOBAL WARMING GOVERNMENT POLICIES GREEN BELT GREENHOUSE GREENHOUSE GAS GREENHOUSE GAS EMISSIONS GREENHOUSE GASES HOUSING AFFORDABILITY HURRICANE HURRICANE PROTECTION HURRICANES ICE SHEETS IMPACT OF CLIMATE IMPACT OF CLIMATE CHANGE IMPACTS OF CLIMATE CHANGE IMPORTS INCOME INFORMATION ON CLIMATE INSURANCE INSURANCE COMPANIES INTANGIBLES INTENSITY OF STORMS INTERNATIONAL BANK INVESTING INVESTMENT ALTERNATIVES INVESTMENT DECISION INVESTMENT DECISIONS IPCC JOBS LAKES LAND USE LAND USE PATTERNS LOCAL GOVERNMENT LONG-TERM INVESTMENTS LOWER COSTS LOWER DISCOUNT RATE MANGROVE FOREST MARGINAL ABATEMENT MARGINAL ABATEMENT COST MARKET PRICE MARKET PRICES MARKET VALUE MARKET VALUES MONETARY VALUE MONSOONS NEGATIVE IMPACT OCEANS OPPORTUNITY COST PHYSICS POLICY MAKERS POLITICAL ECONOMY POPULATION GROWTH PORTFOLIOS POWER PLANTS POWER STATIONS PRECIPITATION PRESENT VALUE PROBABILITY DISTRIBUTION PROBABILITY DISTRIBUTIONS PROBABILITY OF OCCURRENCE PUBLIC TRANSPORT PUBLIC TRANSPORT SUBSIDY QUANTITATIVE ANALYSIS RAIN RAINFALL RAINY DAYS RAPID CLIMATE CHANGE REGIONAL CLIMATE REGULATORY POLICIES RELATIVE PRICES RENEWABLE ENERGY RESOURCE ECONOMICS RETURN RETURNS RISK AVERSION RISK MANAGEMENT RISK MANAGEMENT STRATEGIES RISK NEUTRAL ROAD ROAD TRAFFIC ROAD TUNNEL ROADS ROUTE ROUTES SAFETY SCENARIOS SCIENTIFIC CONSENSUS SEA LEVEL RISE SEISMIC EVENT SENSITIVITY ANALYSES SETTLEMENT SHADOW PRICE SILVER SOCIAL COST OF CARBON STORM SURGE STORMS TEMPERATURE TEMPERATURE CHANGE TEMPERATURES TERRORISM TOTAL COST TRADING TRADING SYSTEM TRAFFIC TRAFFIC CONGESTION TRAFFIC LANES TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRAVEL COSTS TREASURY TROPICS TRUE UNCERTAINTIES UNCERTAINTY IN CLIMATE CHANGE PROJECTIONS URBAN PLANNERS UTILITY FUNCTION VALUATION VALUATION TECHNIQUES VALUATIONS WORST-CASE Investment decision making is already difficult for any diverse group of actors with different priorities and views. But the presence of deep uncertainties linked to climate change and other future conditions further challenges decision making by questioning the robustness of all purportedly optimal solutions. While decision makers can continue to use the decision metrics they have used in the past (such as net present value), alternative methodologies can improve decision processes, especially those that lead with analysis and end in agreement on decisions. Such "Agree-on-Decision" methods start by stress-testing options under a wide range of plausible conditions, without requiring us to agree ex ante on which conditions are more or less likely, and against a set of objectives or success metrics, without requiring us to agree ex ante on how to aggregate or weight them. As a result, these methods are easier to apply to contexts of large uncertainty or disagreement on values and objectives. This inverted process promotes consensus around better decisions and can help in managing uncertainty. Analyses performed in this way let decision makers make the decision and inform them on (1) the conditions under which an option or project is vulnerable; (2) the tradeoffs between robustness and cost, or between various objectives; and (3) the flexibility of various options to respond to changes in the future. In doing so, they put decision makers back in the driver's seat. A growing set of case studies shows that these methods can be applied in real-world contexts and do not need to be more costly or complicated than traditional approaches. Finally, while this paper focuses on climate change, a better treatment of uncertainties and disagreement would in general improve decision making and development outcomes. 2014-06-25T21:59:54Z 2014-06-25T21:59:54Z 2014-06 http://documents.worldbank.org/curated/en/2014/06/19616379/agreeing-robust-decisions-new-processes-decision-making-under-deep-uncertainty http://hdl.handle.net/10986/18772 English en_US Policy Research Working Paper;No. 6906 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |