Page - 3 - in options, Volume winter 2017/2018

contentsoptions www.iiasa.ac.at 3 winter 2017/18 ◼ options www.iiasa.ac.atwww.iiasa.ac.atoptions ◼ winter 2017/18 winter 2017/18 ◼ options 1110 T he first attempts at setting up an internet platform for auctions on the web failed miserably. A secure exchange system between anonymous agents on a global scale seemed to present unsurmountable problems. Then a young programmer named Pierre Omidyar had an idea: he introduced a feedback forum where the rating of each user was displayed. In his simple words: “Give praise when it is due; make complaints when appropriate.” Thumbs up, thumbs down. The rest is history: a multi-billion market emerged almost overnight. In Omidyar’s words: “eBay, like your favorite grade-school teacher, recognizes and rewards good behavior. As your feedback grows, eBay posts stars next to your rating, each color signifying a feedback milestone.” Economists had a new object for their studies: online reputation mechanisms. Human behavior is largely influenced by praise and blame. Our eagerness for a good reputation is economically sound: our good name is a capital asset for each of us. It is to “our credit” to have acted honestly. But in addition to making economic good sense, the craving for a good reputation is deeply, subconsciously ingrained in our minds. Witness a famous experiment which took place in a British science department. There, in a corner of the cafeteria, people could get their milk and cookies during tea-time. They were supposed to pay into an “honesty box”—the sums were way too small to have anyone check them. Now it so happened that close to the honesty box, a calendar hung on the wall. Nobody paid any attention to it. For a period of two weeks, the calendar showed a picture of female eyes—friendly, smiling eyes. Then, for two weeks, it showed colorful flowers—bright lush flowers. Then eyes again. Then flowers. And so on. And at the end of the year, guess what? It was found that people had paid three times as much, during the “eye” weeks, than during the “flower” weeks. Most hadn’t even noticed the calendar, let alone felt its influence. But the subliminal effect of the eyes had been enough to make them more honest! Which shows that, as H.L. Mencken said, “Conscience is the nagging feeling of being watched.” Experimental game theory—a field which has been booming in recent years— has brought many findings which show that humans are not merely guided by beliefs and preferences, but react on cues and obey what John Maynard Keynes termed “animal spirits”. Economy and social sciences are deeply influenced by human behavior, by what David Hume termed “human nature” and Adam Smith “moral sentiments.” They underlie our individual actions and lead to collective actions having a huge impact on our planet. This is the reason why Lord May, the former president of the Royal Society, declared that “the only science still capable of saving us is the science of human behavior.” In old Rome, families kept shrines of their ancestors at home. Day and night they felt watched by their ancestors. Today, we must find ways to act, consciously and unconsciously, under the watchful eyes of the generations to come. ◼ Further info Sigmund shared these ideas at the European Forum Alpbach 2017 in a plenary address and as part of the Alpbach- Laxenburg Group retreat www.iiasa.ac.at/events/ALG-17 Q At the Alpbach-Laxenburg Group retreat in August, you participated in a discussion on governance and institutional transformation towards sustainability. What do you see as the biggest barriers to sustainable development? A Sustainability challenges typically require a concerted effort to achieve impact. We still lack the appropriate governance and accountability mechanisms that ensure implementation of well-intended strategies and commonly devised goals. Q As an expert in social entrepreneurship and innovation, what new developments have you seen that you think could drive a transformation towards sustainability? Could you give examples of successful innovations that have taken hold? A We do see innovation on many fronts. Especially in governance, technology has enabled a number of useful and helpful innovations that allow for more transparent and accountable processes. At the same time we still face enormous challenges that cannot be fixed by technology and require us to face deeply rooted relational and cultural problems. The prevalence of open defecation and lack of sanitary infrastructure in India is just one example. Q Sometimes it seems like there are many great ideas, but adoption is slow. What do you think is necessary to make the leap from innovative idea to widespread practice? A “Most new ideas are bad ideas” as Jim March from Stanford University would say. We must stop praising innovation and start to think and act on linking innovation and scaling as two distinct processes to create impact. Innovation is an investment and creates the potential for impact. Scaling enacts and grows this potential and transforms innovation into tangible outcomes—improving the lives of marginalized people and communities and making progress on stubborn societal and environmental problems.We have elaborated on this in our new book on “Innovation and Scaling for Impact – How Successful Social Enterprises Do It”, which I co-wrote with Christian Seelos. Q How do innovation and governance go together? What are the challenges and opportunities for bringing new ideas into institutions and governments? A Governance needs to exert an enabling role. We need to craft and design governance systems that foster innovation. At the same time governance systems need to also make sure that the potential and usefulness of innovation can be tested along the way. This requires reflecting on markers of success that are process- and not outcome-focused. Q The Alpbach-Laxenburg Group brings together leaders from business, and young entrepreneurs, along with government leaders and science experts. What do you think can be gained from a meeting of this type? A The most important outcome will be a shared understanding of priorities, pathways, and markers of success for this journey. ◼ Further info www.iiasa.ac.at/events/ALG-17 Karl Sigmund, senior research scholar in the IIASA Evolution and Ecology program and professor emeritus of mathematics at the University of Vienna, is a leading expert in game theory. Stop praising innovation Johanna Mair is a professor of Organization, Strategy and Leadership at the Hertie School of Governance and a member of the Alpbach- Laxenburg Group, which held its annual retreat in August. The watchful eyes of the future 13www.iiasa.ac.at winter 2017/18 ◼ options12 options ◼ winter 2017/18 www.iiasa.ac.at A ndrii Bilous lives in Kiev, Ukraine, a professor of forestry and ecology at the National University. Rabul Hazarika is a geography professor in Assam, India. Anna Cipriani is a geochemist in Modena, Italy. And Ibrar ul Hassan Akhtar works for a space applications research firm in Islamabad, Pakistan. At first glance, the four may seem to have little in common. But in their free time, Bilous, Hazarika, Cipriani, and Akhtar are all hobby scientists, among thousands of volunteers around the world who have contributed to Geo-Wiki projects—citizen science campaigns run by IIASA researchers. Citizen science is hot right now. CitizenScience.org, a website dedicated to the field, currently lists over 1,000 projects around the world. Many of these projects focus on biodiversity and weather monitoring, the fields where citizen science first took flight, but projects range widely. In Australia, you can send in fish skeletons leftover from dinner to help scientists monitor the health of fisheries. In New York, researchers are asking cyclists to help monitor air quality and health impacts by carrying pollution monitors and wearing special shirts that monitor their heart rate and blood pressure. At IIASA, citizen science has blossomed in the past eight years from a small project focused on validating satellite land-cover data, to a research group of over 20 people working on around 13 current projects in 12 countries, with a network of nearly 15,000 citizen scientists like Akhtar, Bilous, Cipriani, and Hazarika. Many of these projects are linked in some way to land-cover data, maps of the Earth’s surface that provide key information such as the size and location of forests, agriculture, and cities. These data are vital not only for the global models that IIASA is known for, but also provide a potential breakthrough for monitoring implementation of the UN Sustainable Development Goals. And the team has become a hub for knowledge on citizen science, providing expertise and advice to partners around the world. Want to be a citizen scientist? Visit www.geo-wiki.org for details, follow @Geo_Wiki on Twitter, or sign up for the Geo-Wiki newsletter for updates on all the upcoming opportunities. FotoQuest GO: If you live in Austria, download the FotoQuest Go app and help IIASA scientists track land-cover change across the country! http://fotoquest-go.org/ LandSense: The EU-funded LandSense project will run a number of campaigns in spring and summer 2018. Sign up for the project newsletter to get all the news. https://landsense.eu/ GET INVOLVED The power of the crowd A network of over 15,000 volunteers works with IIASA scientists on some of their toughest research challenges www.iiasa.ac.atwww.iiasa.ac.at winter 2017/18 ◼ optionsoptions ◼ winter 2017/18 1716 Program found that by taking appropriate adaptation measures at targeted locations across the country—namely expanding irrigation, providing subsidies for fertilizer, and investing in infrastructure—policymakers could improve smallholders’ income and food security. “In some regions we found that there are currently no irrigation systems in place, but the biophysical conditions would be suitable for it, leading to a large untapped production potential,” explains Boere. “In other areas we saw that there is a lack of infrastructure, making it difficult to get products to market.” The researchers used a new methodology to map each farm according to factors including its size, activities, and intensity, as well as climate and environment. They could then model which policy measures would be most effective in each area. Systems focusing on high-value products rely on a strong infrastructure for trade purposes. “Our research suggests that mixed crop-livestock systems would be beneficial,” explains Boere. “They can pool their risk and are less prone to food insecurity.” The results are being used to provide support to Ethiopian policymakers, as well as helping the International Fund for Agricultural Development implement effective irrigation projects in the country. Public and private When implementing local climate policies, one major question is how public authorities could share responsibility for adaptation with private companies or individuals. “Public authorities play a central role in climate change adaptation,” explains IIASA researcher Mia Landauer, who works in the IIASA Risk and Resilience Program and Arctic Futures Initiative. “However, engaging the private sector and shifting responsibility towards them would be beneficial for adaptation.” Landauer’s recent case study of Copenhagen and Helsinki with colleagues from Aalto University, indicates that more attention needs to be paid to how local authorities engage private actors. “So far, regulations and market-based mechanisms with strong public ownership have been used to foster adaptation and to involve and steer private actors,” says Landauer. “However, in practice this provided little motivation for the private sector to take responsibility for implementing adaptation actions.” Landauer’s research recommends focusing on questions such as who bears the consequences of climate change, and who should carry the residual risk? “Public authorities should assess the ‘problem ownership’ of adaptation policies and measures, and hence identify in which contexts adaptation is a public or private good,” she says. “This would clarify citizens’ and companies’ motivation and capacities to adapt.” The City of Helsinki, for example, offers a highly energy-efficient district cooling service, which private actors can buy: centrally-cooled water can be pumped directly into private ventilation systems, in order to regulate indoor temperature in the case of extreme heat events. Here, the public healthcare service carries the residual health risk of exposure to heat. Unfortunately, coordination between public authorities and the private sector is also often lacking in planning and implementing national climate policies. In a Nordic study comparing national climate and tourism strategies, Landauer found that important details, about how snow-based tourism can adapt to shifting seasons, for Dealing with drought Currently around a third of the world’s population is coping with water scarcity, which is defined as more than 40% of available water being used. The largest population living with water stress is concentrated in Asia and the Middle East, but water shortages are also occurring in the USA and many other countries around the world. Climate change is expected to worsen this situation, through an increased number of extreme weather events such as droughts, making it harder to implement and maintain secure water supply systems. In a recent paper, IIASA Water Program Deputy Director Yoshihide Wada and coauthors give six clear adaptation strategies that could be implemented to relieve water stress. The strategies include infrastructure projects to increase supply, such as building more reservoirs and increasing sea water desalination, as well as more plausible socioeconomic interventions such as improving irrigation efficiency, which would reduce water demand. The researchers created models for each country and water basin, based on projected climate, population, and water security issues. They then used the models to predict how different combinations of the six technologies or practices in each area would affect the fraction of the global population under water stress, and found that a reduction is possible by 2050. “I am an optimist,” says Wada. “Before this project, there wasn’t much research on how we could adapt to reduce water stress, and many thought the situation was untenable. Now at least we know that something can be done.” However, unsurprisingly, the research shows that improving this situation would take an unprecedented effort: “If every country under water stress employed four of the six strategies at the same time,” explained Wada, “the proportion of people in the world who are facing water stress would stabilize rather than continue to grow.” “The problem is that although water scarcity is a regional issue, water stress is exacerbated by global processes, including climate change, population and economic growth, and food production and trade. Stabilization and even a significant reduction in the number of people suffering water stress are possible by 2050, but strong international commitment and strategic efforts are required.” Fighting hunger Food security is another pressing issue, especially in developing countries. IIASA researcher Esther Boere has been focusing on smallholder farmers in Ethiopia, who are especially vulnerable to the threats of climate change. Boere and her team in the IIASA Ecosystems Services and Management example, were absent from the national climate strategies. The same was true the other way round: tourism strategies did not state how the sector could implement climate adaptation actions. “There was hardly any mention of one in the other,” explained Landauer. “There must be more collaboration in order to build coherent and effective strategies across scales and sectors.” These concrete policy and action recommendations, made through evidence- based understanding of how sectors, countries, and individuals’ actions affect each other, are essential for humanity to adapt to our changing climate. NL Further info § Landauer M, Goodsite ME, & Juhola S (2017). Nordic National Climate Adaptation and Tourism Strategies – (How) Are They Interlinked? Scandinavian Journal of Hospitality and Tourism: 1-12. [pure.iiasa.ac.at/14658] § Klein J, Landauer M, & Juhola S (2016). Local authorities and the engagement of private actors in climate change adaptation. Environment and Planning C: Government and Policy: 1-20. [pure.iiasa.ac.at/13956] § ar16.iiasa.ac.at/farmers-in-ethiopia/ § ar16.iiasa.ac.at/reducing-water-stress-worldwide/ Yoshihide Wada wada@iiasa.ac.at Esther Boere boere@iiasa.ac.at Mia Landauer landau@iiasa.ac.at Working together to adapt to changing climate Sea level rise, fiercer storms, heat waves, fires, and droughts: the effects of climate change are increasingly being seen around the globe. Adapting now for present and future change is essential to survival, but it requires careful coordination and cooperation. IIASA research is providing clear guidance on the most effective measures to adopt—as well as where, how, and by whom. www.iiasa.ac.at winter 2017/18 ◼ optionsoptions ◼ winter 2017/18 1918 www.iiasa.ac.at “If you tax systemically risky transactions, you give banks an incentive to avoid them, making the system more resilient.” Stefan Thurner T he last Roman emperor of the west, Romulus Augustulus, was deposed in the autumn of 476 AD. As the grapes ripened on the vines that year, the Roman Empire in western Europe, a system that had lasted for 500 years, collapsed. The Dark Ages began. From the Roman Empire to international banking crises, human history shows that even vast networks, affecting billions of people, can be at risk of collapse. Their size does not protect them, and simple weaknesses, built into the system, can bring the whole structure down. Financial collapse The risk of system collapse—known as systemic risk—came under close scrutiny from scientists after the bankruptcy of the Lehmann Brothers in 2008 sent shockwaves through the financial world and connected banks began to fall like dominoes. Governments scrambled to reduce the impact, but the world slipped into a global recession. In the wake of the crisis, IIASA researchers developed a method of measuring how risky each financial transaction is—in other words, how much it contributes to the chances and costs of system collapse. Equipped with this knowledge, it is possible to tax transactions according to the risk they pose to the system. “If you tax systemically risky transactions, you give banks an incentive to avoid them, making the system more resilient,” says IIASA researcher Stefan Thurner, who spearheaded the approach. And testing with models indicates that it is extremely effective— when the tax is introduced, the system rewires itself into a form that is basically free of systemic risk. Not only that, but it does so without reducing the amount traded. Taxes like the “Tobin tax”—proposed as a response to the 2008 crisis—reduce the number of transactions overall because they are charged indiscriminately on every transaction, rather than targeting those that increase risk. “The fascinating thing about systemic risk tax is that it does not reduce the volume of transactions, but just re-shapes the network,” says Thurner. The idea has yet to be put into action in a real-world banking system, but it has already gained attention from the world’s central banks, who are interested in calculating the risks associated with their own transactions. While the financial crisis focused attention on systemic risk, researchers can study numerous systems—from epidemics to food security to governance—using the same principles. “When we study these systems we are looking at networks of nodes and links,” says Ulf Dieckmann, Evolution and Ecology Program director at IIASA. “In a financial Highly interconnected networks are everywhere in our world, from finance to ecosystems: How can we strengthen them against collapse? www.iiasa.ac.atwww.iiasa.ac.atoptions ◼ winter 2017/18 winter 2017/18 ◼ options 1110 T he first attempts at setting up an internet platform for auctions on the web failed miserably. A secure exchange system between anonymous agents on a global scale seemed to present unsurmountable problems. Then a young programmer named Pierre Omidyar had an idea: he introduced a feedback forum where the rating of each user was displayed. In his simple words: “Give praise when it is due; make complaints when appropriate.” Thumbs up, thumbs down. The rest is history: a multi-billion market emerged almost overnight. In Omidyar’s words: “eBay, like your favorite grade-school teacher, recognizes and rewards good behavior. As your feedback grows, eBay posts stars next to your rating, each color signifying a feedback milestone.” Economists had a new object for their studies: online reputation mechanisms. Human behavior is largely influenced by praise and blame. Our eagerness for a good reputation is economically sound: our good name is a capital asset for each of us. It is to “our credit” to have acted honestly. But in addition to making economic good sense, the craving for a good reputation is deeply, subconsciously ingrained in our minds. Witness a famous experiment which took place in a British science department. There, in a corner of the cafeteria, people could get their milk and cookies during tea-time. They were supposed to pay into an “honesty box”—the sums were way too small to have anyone check them. Now it so happened that close to the honesty box, a calendar hung on the wall. Nobody paid any attention to it. For a period of two weeks, the calendar showed a picture of female eyes—friendly, smiling eyes. Then, for two weeks, it showed colorful flowers—bright lush flowers. Then eyes again. Then flowers. And so on. And at the end of the year, guess what? It was found that people had paid three times as much, during the “eye” weeks, than during the “flower” weeks. Most hadn’t even noticed the calendar, let alone felt its influence. But the subliminal effect of the eyes had been enough to make them more honest! Which shows that, as H.L. Mencken said, “Conscience is the nagging feeling of being watched.” Experimental game theory—a field which has been booming in recent years— has brought many findings which show that humans are not merely guided by beliefs and preferences, but react on cues and obey what John Maynard Keynes termed “animal spirits”. Economy and social sciences are deeply influenced by human behavior, by what David Hume termed “human nature” and Adam Smith “moral sentiments.” They underlie our individual actions and lead to collective actions having a huge impact on our planet. This is the reason why Lord May, the former president of the Royal Society, declared that “the only science still capable of saving us is the science of human behavior.” In old Rome, families kept shrines of their ancestors at home. Day and night they felt watched by their ancestors. Today, we must find ways to act, consciously and unconsciously, under the watchful eyes of the generations to come. ◼ Further info Sigmund shared these ideas at the European Forum Alpbach 2017 in a plenary address and as part of the Alpbach- Laxenburg Group retreat www.iiasa.ac.at/events/ALG-17 Q At the Alpbach-Laxenburg Group retreat in August, you participated in a discussion on governance and institutional transformation towards sustainability. What do you see as the biggest barriers to sustainable development? A Sustainability challenges typically require a concerted effort to achieve impact. We still lack the appropriate governance and accountability mechanisms that ensure implementation of well-intended strategies and commonly devised goals. Q As an expert in social entrepreneurship and innovation, what new developments have you seen that you think could drive a transformation towards sustainability? Could you give examples of successful innovations that have taken hold? A We do see innovation on many fronts. Especially in governance, technology has enabled a number of useful and helpful innovations that allow for more transparent and accountable processes. At the same time we still face enormous challenges that cannot be fixed by technology and require us to face deeply rooted relational and cultural problems. The prevalence of open defecation and lack of sanitary infrastructure in India is just one example. Q Sometimes it seems like there are many great ideas, but adoption is slow. What do you think is necessary to make the leap from innovative idea to widespread practice? A “Most new ideas are bad ideas” as Jim March from Stanford University would say. We must stop praising innovation and start to think and act on linking innovation and scaling as two distinct processes to create impact. Innovation is an investment and creates the potential for impact. Scaling enacts and grows this potential and transforms innovation into tangible outcomes—improving the lives of marginalized people and communities and making progress on stubborn societal and environmental problems.We have elaborated on this in our new book on “Innovation and Scaling for Impact – How Successful Social Enterprises Do It”, which I co-wrote with Christian Seelos. Q How do innovation and governance go together? What are the challenges and opportunities for bringing new ideas into institutions and governments? A Governance needs to exert an enabling role. We need to craft and design governance systems that foster innovation. At the same time governance systems need to also make sure that the potential and usefulness of innovation can be tested along the way. This requires reflecting on markers of success that are process- and not outcome-focused. Q The Alpbach-Laxenburg Group brings together leaders from business, and young entrepreneurs, along with government leaders and science experts. What do you think can be gained from a meeting of this type? A The most important outcome will be a shared understanding of priorities, pathways, and markers of success for this journey. ◼ Further info www.iiasa.ac.at/events/ALG-17 Karl Sigmund, senior research scholar in the IIASA Evolution and Ecology program and professor emeritus of mathematics at the University of Vienna, is a leading expert in game theory. Stop praising innovation Johanna Mair is a professor of Organization, Strategy and Leadership at the Hertie School of Governance and a member of the Alpbach- Laxenburg Group, which held its annual retreat in August. The watchful eyes of the future 2 editorial 2 Part of something bigger 4 research news 4 The deadly impacts of “Dieselgate“  An end to population aging? 5 First map of certified forests  New books by IIASA scientists 6 China’s Lake Taihu at risk from climate change  The costs of phasing down hydrofluorocarbons  Water management interventions push scarcity downstream  Optimal harvests without top-down planning  Uncertainty in the Paris climate pledges 7 research tools & methods 7 Innovative study links forests and economy 8 science into policy 8 Modelling Indonesia’s energy revolution 9 Solving Delhi’s pollution troubles  IIASA informs UN aging projections  Given the green light  IIASA at the UN 22 regional focus 22 africa Lighting the world through open source electricity  Reversing deforestation in the Congo Basin 23 americas Measuring residential isolation among Montréal’s immigrants  Analyzing the impact of human activities on the California drought 24 asia Visualizing internal migration in China  Working to improve energy security in India 25 Injecting biomethane into Malaysia’s natural gas grid  Evaluating outcomes of China’s synthetic natural gas development 26 europe Using demand-side management to solve UK energy problems  Room for improvement in European flood preparedness 27 institute news 27 40th anniversary celebrations of the YSSP 28 Institutional review  Council Chair 29 Thought leaders gather for ALG retreat  IIASA activities surrounding the UN General Assembly  Chocolate as a force for good  Cooperation over competition  Arctic advances 30 people at iiasa 30 yssp What would an oil spill mean for the Arctic 2017 YSSP participant Maisa Nevalainen explores how an oil spill would affect vulnerable Arctic wildlife 30 yssp Is a sustainable lifestyle achievable? Gibran Vita, a 2017 YSSP participant, looks at how use of durable goods contributes to energy demand 31 interview From oil rich to low carbon Q&A with IIASA postdoc Katya Perez Guzman 10 opinion The watchful eyes f th fu re ByKarl Si u d 11 Q & A Stop praising innovation Interview with Johanna Mair 12 cover feature The power of the crowd IIASA scientists work with a global network of 15,000 volunteers 16 Working together to adapt to climate change New research provides clear guidance on the most effective measures 18 System failure How can we strengthen the highly interconnected networks of our world against collapse? Cover photo © Arthimedes | Shutterstock