Connectivity and Inequality Tipping points in the Human- Earth System John Finnigan CSIRO Marine and Atmospheric Research Canberra, Australia.

Connectivity and Inequality

Tipping points in the Human-Earth System

John FinniganCSIRO Marine and Atmospheric

ResearchCanberra, Australia

Tipping Points in the Human-Earth System

Climate Tipping Points • Positive feedbacks overcome negative feedbacks, moving the climate

system inexorably to a new, warmer equilibrium. Critical destabilizing feedbacks include:

– Loss of Arctic Sea Ice– Loss of continental Ice sheets– Mobilization of high latitude methane stores and runaway greenhouse effect– …….

Social-Economic-Biophysical Tipping Points• Can population and economic growth move the world system into unstable

states that it can only leave via population, economic or social collapse-the Malthusian trap?

• What are the elements of an earth system dynamics that would allow us to answer questions like these?

Populationfertility -mortality

GDP

food, water agriculture,

aquaculture

economy energy GHG

urbanisation

land

waterClimate and nat. system change

Earth

Ocean

Atmosphere

Biosphere

Climate change and global change: A Simplified picture of the world system

A simplified picture of the world system

Endogenous trends or Driving forces?

– Population – Aspiration– Connectivity– Biogeochemical change.

These four variables have substantial inertia over the next few decades-the space between prediction and projection.

Population

Most population projections assume that the demographic transition will take place in all countries

Population

Population numbers lag changes in the fertility-mortality balance because, as mortality falls, several generations can co-exist

Projections from IMAGE, Boermans et al, 2006

Population

The strongest correlate with fertility/mortality is per capita wealth. Per capita GDP is usually used as a surrogate

The causal relationships are both more complicated and contested but the underlying correlation is undeniable.

Total fertility rate vs GDP per capita; World Bank 2010

Aspiration

Pre 1800: Malthusian trap-little trend growth in GDP per capita

Industrial revolution: sustained growth in GDP per capita in the West -’The Great Divergence’

Late 20th, 21st century : spread of economic growth and increased per capita GDP to the developing world – ‘The Great Convergence’

Global GDP per capita 1000AD 1820 1998

U$435 U$710 U$5700

Australia 1900-2005 X5 1900-2025 X10 (at 4% pa)

ConnectivityThe world trade network today is fully connected, the

signature of a globalised world.

Data source: CIA World Fact Book www.cia.gov

A connected earth: connectivity of information flows: The World Wide Web

From: Steffen et al. 2004

Biogeochemical Change

A wide range of bio-geophysical indicators start to change rapidly within the decade centred on 1950

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Biogeochemical Change:What is locked in for next 20-30 years or longer?

• Warming: Committed• Hydrological adjustments: increasing• Biodiversity loss/ecosystem change• Increase in built infrastructure

What is NOT locked in• Institutional and technological change

Globe

Changes in three marine food webs Jackson et al. (2001)

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Consequences of a connected World System: Perturbing the Physical economy

fertility -mortality

GDP

food, water agriculture,

aquaculture

economy energy GHG

urbanization

land

water

Earth

Ocean

Atmosphere

Biosphere

Climate and nat. system change

Population

Carbon price imposed

Tipping Points in the Human-Earth System

Climate Tipping Points • positive feedbacks overcome negative feedbacks, moving the climate

system inexorably to a warmer equilibrium. Critical destabilizing feedbacks include:

– Loss of Arctic Sea Ice– Loss of continental Ice sheets– Mobilization of high latitude methane stores and runaway greenhouse effect

Social-Economic-Biophysical Tipping Points• unsustainable population and economic growth moves the world system into

an unstable state that it can only leave via population,economic and social collapse*-the Malthusian trap. Critical destabilizing feedbacks include:

– Urbanization X energy costs X migration of food production– Population growth X climate change X water availability– Global connectivity X local inequality

*If history is any guide!

Good Life and Bad Life Attractors

• Per capita wealth must grow significantly to limit fertility (and population) by benign means: GDP must grow faster than population

• GDP growth requires capital surpluses to be reinvested

• If population growth is too fast, economic surpluses are used to meet immediate demands rather than being reinvested.

• During the Industrial Revolution, the fertility-mortality gap was 2-3 times smaller than in the developing world today

• The side effects of intense economic activity using present technologies can significantly reduce GDP growth and directly increase mortality.

(Meadows et al (2006)

Good Life: GDP per capita rises; population peaks and then fallsBad Life: GDP per capita falls; population rises to unsustainable

levels and then crashes

Global connectivity X local inequalityGlobal Trade in food is essential to feed the current world population

The fully connected world trade network is essential to supply not only net shortfalls of food in many countries but also fuel, fertilizer and other

inputs to countries which are domestically self sufficient.

Data source: CIA World Fact Book www.cia.gov

The world trade network today sits well above the connectivity threshold

Analysis of the world trade network in 2000 by Brede and Boschetti (2008) shows its power law distribution and the strongly skewed character of trading nations. If we remove trade links at random, we can take away ~80% before the network becomes disconnected. If we target trade hubs, removing ~10% sees the USA and Europe emerge as separate trading blocs.

Con

nect

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The structure of the world trade network is inherently unstable

The dominant trade hubs are strongly connected to each other.

This is the signature of networks that are ‘locally’ unstable

The structure of the world trade network is inherently unstable

World trade overwhelmingly flows through a few hubs.

Transient problems with these critical nodes has a disproportionate effect (Ukraine and the gas pipeline). This is a sign of ‘global’ instability.

Growing oscillations in the price or availability of food, fuel, essential goods can lead to social tipping points when they

intersect with inequality

Growth in world food price

Sociopolitical settings can turn fluctuations into thresholds with massive social consequences

Within-country economic inequality measured as Gini coefficient

Between country inequality has risen inexorably over the last 200 years. Income ratio of developed : rest of world was 3:1 in 1820. It is 19:1 today.

[NB. If PPP is used as measure, last 20 years may look slightly different.]

Worldwide, Gini coefficients range from approximately 0.232 in Denmark to 0.707 in Namibia

History warns us that inequality can have functional effects

Source: Paul Collier and David Dollar, editors, Globalization, Growth, and Poverty: Building an InclusiveWorld Economy (Washington: World Bank, 2002). Frieden (2006)

International Economic Integration, 1870-2000

Tipping Points in a Connected World: a summary

• We need to mitigate climate change and other side effects of economic activity to prevent far-reaching damage to the ecosystems upon which we depend.

• At the same time we need to make more people wealthier to halt and reverse population growth

• And we need to feed the larger population we will inevitably have at the same time as food production and other services are being impacted by climate and other system changes

BUT• We must do this in a highly connected system which is prone to growing

oscillations but whose connectivity supports the world population

• Where fluctuating availability of necessities intersects with inequality to threaten the globalisation upon which present and future population levels depend

Analysis and understanding of the coupled human-earth system requires dynamic models that include the functional effects of social processes, going well past what is embodied in current Integrated Assessment Models.

fertility -mortality

GDP

food, water agriculture,

aquaculture

economy energy GHG

urbanization

land

water

Earth

Ocean

Atmosphere

Biosphere

Climate and nat. system change

decarbonising energy

Ag EfficiencySoylent Green?

WORLD SYSTEM INTERVENTION POINTS

Population

Migration?

Steady state economies?

Resilient cities?

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Reduce impact of economic activity

Consequences of a connected World System: autonomous changes to the monetary economy$

fertility -mortality

GDP

food, water agriculture,

aquaculture

economy energy GHG

urbanization

land

water

Earth

Ocean

Atmosphere

Biosphere

Climate and nat. system change

Population

$

$

$

The Global Financial Crisis

• The proximate causes of the GFC involve factors like miscalculation of risk, poor regulation of financial institutions, debt:asset ratios, greedy bankers etc.

• From a complex system viewpoint, the ultimate cause is unstable networks of monetary flows and obligations, eg.– 2006, measured economic output of the world: $48.6 Tr.– 2006, total market capitalization of world’s stock markets: $50.6 Tr.– 2006, total value of domestic and international bonds was: $67.9 Tr.– 2006, notional value of derivatives (eg. options and swaps): $400 Tr.

• The connections between financial institutions this requires indicates a very unstable system-but no one can quantify these links

• From this viewpoint, even if bankers had behaved with perfect probity, or if regulations had been strictly applied, the system would eventually have become unstable.

Eg. analysis of financial contagion by Gai and Kapadia (2008) Bank of England

Population growth X climate change X water availability

If we can engineer the demographic transition across the world, we will still need to feed 8.5-10Bn people in 2050.

The food supplied will have a higher transport (energy) cost as the majority of these people will live in cities.

Currently (and increasingly in the future) food will be produced far from where it is consumed. To keep present and growing populations fed we need reliable networks of global tradeData from Meadows et al (2006)

Wigner (1967), May (1972), Farkas et al (2001), Brede and Finnigan (2004)

Connectivity and InstabilityThe benefits of strongly connected world systems come with a serious

price tag

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Stability

Instability

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Once enough feedback loops in a network are connected together, growing oscillations in any process operating on the network are almost inevitable