A flood victim stands in his damaged house, following rains and floods during the monsoon season, in Nowshera, Pakistan August 31, 2022. Photo: Reuters/Fayaz Aziz
- A lot of widespread confusion about climate change – some of it unwitting, some of it cultivated – stems from the critical miscommunication of two little words: risk and uncertainty.
- The terminology stems from a 1921 treatise by economist Frank Knight. Knightian risk is akin to picking a card out of a deck. The probability of picking any one card is known.
- Knightian uncertainty, meanwhile, is akin to picking a card out of a pile cobbled together from more than one deck, or picking a card out of a deck with missing cards.
- Climate scientists should realise that while Knightian uncertainty might be worse than risk in technical terms, in expressing the need for action, risk almost always beats uncertainty.
A lot of today’s widespread confusion about climate change – some of it unwitting, some of it deliberately cultivated – stems from the critical miscommunication of two little words: risk and uncertainty. To most of the public, risk means a danger that must be addressed, whereas uncertainty means a lack of clarity about whether there is any meaningful danger at all. To scientists and economists like myself, uncertainty has a starkly different meaning. It is worse than risk; it indicates the possible range of just how bad a (very real) danger will be. You can think of uncertainty as a risk multiplier.
As a result of this confusion, our efforts to share our research findings with a broad audience have often backfired spectacularly. If we want to speak more clearly and effectively about the grave threats facing the world, we need to unlearn our academic communication habits and embrace the language of everyday speech. It is certain that unmitigated climate change will – and to a large extent already does – affect everyone on Earth; the impacts are uncertain only in the sense that they might be even more destructive than we expect. Failure to respond aggressively will make the danger worse. That is another certainty, one that becomes more likely every time climate change drops down on the list of public priorities.
The words we choose can have an enormous impact. Mention that climate change is inherently uncertain and an oft-heard response is “Oh, looks like we don’t quite know yet. Better to wait and see, do more research.” That one word has become a powerful tool for sowing doubt about climate action. In the early 2000s, pollster Frank Luntz famously counselled Republican leaders to make a supposed “lack of scientific certainty a primary issue in the debate,” following in the tradition of fossil-fuel interests that have pursued a similar strategy to stave off carbon-limiting policies or regulations. Luntz understood that “should the public come to believe that the scientific issues are settled, their views about global warming will change accordingly.”
Mention that climate change involves plenty of risks, in the familiar sense of the word, and the immediate response isn’t one of wait-and-see but rather one of action. Risk conveys the need to decrease looming dangers where possible and to adapt to cover the rest—even, or especially, in the face of other pressing concerns, from war to inflation. (The best long-term response to “fossilflation,” too, is to stop using fossil fuels.) By breaking free from jargon, we academics can help put to rest these wasteful uncertainty-certainty debates. Then we can focus more clearly on the most relevant uncertainties: the ones that could make the future of our planet even worse than expected.
The current linguistic mess has a convoluted history going back more than a century, to a 1921 treatise by economist Frank Knight, one of the founders of the Chicago school of economics. Spend any time focused on the economics of risk and you will inevitably encounter Knight’s book Risk, Uncertainty, and Profit, based on his Cornell University dissertation from five years prior. In it, he came up with a brilliantly precise set of definitions to distinguish between risk and uncertainty. These are the definitions many academics have in mind when they talk about possible outcomes from climate change.
Knightian risk is akin to picking a card out of a deck. The chance of picking a spade is 1 in 4; the chance of picking the queen of spades is 1 in 52. Knightian uncertainty, meanwhile, is akin to picking a card out of a pile cobbled together from more than one deck, or picking a card out of a deck with missing cards. You know you will end up with one of 52 cards, but you don’t know the probability of getting any specific one. There may be more than the usual share of spades in the pile of cards, or there may be none.
For the purposes of planning and preparation, uncertainty is clearly worse than risk. Applying Knight’s ideas to climate change, we know for certain that the planet is warming, just as we know that the deck of cards exists. If the issue were solely one of risk, scientists would be able to run simulations revealing how much warming to expect and what the consequences will be, with a high degree of statistical accuracy – like knowing the odds of picking a spade.
To a large extent, climate researchers can do just that. But then there is the added element of uncertainty, because the deck has some unknown cards added or taken away. It’s possible the uncertainty will lead to an outcome that is slightly less bad, though still risky. Or it could lead to a worst-case outcome – like pulling four spades in a row, a full-on climate catastrophe.
These points seem so obvious to researchers who are steeped in the economics of risk that they tend to forget what uncertainty means to the rest of the world. Some of them have responded by ignoring uncertainty entirely and focusing on the naked facts: Climate is changing, humans are the cause, and cutting net greenhouse gas emissions to zero is essential for limiting the impacts. But sidestepping the issues of risk and uncertainty ignores the visceral human response to evident danger, and it misses a crucial pragmatic implication. Climate uncertainties actually make unmitigated climate change even costlier and more harmful to society.
A crucial set of uncertainties involves tipping points in the climate system, such as thawing permafrost that releases trapped greenhouse gases, the abrupt disintegration of ice sheets, and large-scale changes in atmospheric circulation. Researchers have worried about such tipping points for years. The late Columbia geochemist Wally Broecker, in 1987, emphasised the importance of “unpleasant surprises in the greenhouse.” To him it was clear that what we knew about climate change at the time was bad enough; surprises made things potentially much worse.
The big question now is quite how bad things might get due to such climate tipping points, and when they could be triggered. In other words, the total risk emerging from such tipping points is all about probability × impact. Although the exact probabilities and impacts are up for debate, the existence of such tipping points is not in doubt. They are, you might say, certain uncertainties.
Perhaps the best indication of what could be in store is to look at the last time the planet had atmospheric concentrations of carbon dioxide as high as they are today, around 420 parts per million. That was more than 3.1 million years ago, when the geological clock read “Pliocene.” Global average temperatures were at least 2-3° C higher, and sea levels reached 10 to 30 meters above where they are now.
One tangible way to translate scientific uncertainties into immediate human consequences is to measure their likely impact on the global economy. Eight well-studied climatic tipping points have the potential to increase the cost of climate change by at least 25% above what is conventionally expected. And that 25% figure is simply the average value of additional damages from tipping points. It is not the full story. The same calculations indicate a 10% chance that tipping points will more than double the economic cost.
Put differently, the economic impact of tipping points is itself uncertain, and there is nothing theoretical about that double uncertainty. Even without any of the uncertainties, we can project that climate change will lead to increased poverty and hunger around the world. If we end up on the high end of the possible damages, these predictions get significantly worse. It is therefore appropriate – I would argue – for academics like me to frame these ideas in terms of risk.
The issues of risk and uncertainty also mean that extreme weather could become an even worse problem than is commonly projected, with harms that go far beyond economic loss. Small changes in average temperatures can lead to rapid increases in extreme temperatures. Once temperatures hit 32° C (90° F), all sorts of harsh impacts follow. Standardised test scores suffer. Worker productivity declines. People die, especially the poor. Much like with overall climatic tipping points, the 32° threshold is no secret, but the full implications are waiting to be unearthed and fully quantified. It is another dangerous uncertainty in the risk equation.
We all face a daunting task in quantifying the measurable aspects of climate change while reckoning with the full implications of the risks that cannot be fully quantified. For the lay public, it’s important to remember that when researchers talk about uncertainty, they are providing an added reason for concern. Let that insight guide the way you live and the way you vote. This is a helpful message to keep sharing with your friends and family, too: Uncertainty is not our friend.
A lot of the responsibility lands on us academics, however. We need to let go of Frank Knight’s terminology distinguishing uncertainties from risks and speak of the two more meaningfully as different parts of one big “risks” category. Knightian uncertainty might be worse than risk in technical terms, but in expressing the need for action, risk almost always beats uncertainty. Risk speaks to the emotional and pragmatic truths, the ones that really matter.