The 15th edition of the World Economic Forum’s Global Risks Report is published as critical risks are manifesting. The global economy is facing an increased risk of stagnation, climate change is striking harder and more rapidly than expected, and fragmented cyberspace threatens the full potential of next-generation technologies — all while citizens worldwide protest political and economic conditions and voice concerns about systems that exacerbate inequality. The challenges before us demand immediate collective action, but fractures within the global community appear to only be widening. Stakeholders need to act quickly and with purpose within an unsettled global landscape.
Over the Summer of 2019, the Wharton Risk Management and Decision Processes Center, the Kleinman Center for Energy Policy, the Penn Program on Regulation, and the Faculty Senate at the University of Pennsylvania hosted a virtual ideation session to generate new policy-relevant and solution-oriented ideas for tackling one or more of three interrelated types of climate risk.
This report compiles the solutions from researchers across multiple schools, departments, and research centers at the university, highlighting the interdisciplinary nature of this project.
After the Mandatory Purchase (MPR) went into effect in 1973, the number of communities enrolled in the National Flood Insurance Program (NFIP) grew rapidly, as did the number of properties with flood insurance coverage. That said, despite the MPR, an insurance coverage gap remains for many properties at risk from flooding.
This report examines the motivation behind creation of the MPR and the extent to which it is still meeting original policy goals.
Focusing on the city of Tulsa, Oklahoma, this study examines the feasibility of using social return on investment (SROI) methods to evaluate “whole community” and resilience-building activities at the local level.
Escalating wildfire risk and a unique legal regime threaten the financial health of California’s electric utilities, with consequences for customers, taxpayers, and shareholders. This report examines potential financing options for third-party wildfire damages, including a discussion of possible funding sources and mechanisms, and their distributional implications.
Today, many homeowners are uninsured against flood damage. The lack of widespread take-up of flood insurance will not only impose financial strain on families but could have spillover effects in adjoining communities and may trigger foreclosures that hurt lenders. This paper describes the U.S. housing market’s exposure to flood risk and suggests directions for future research and action.
Based on interviews with 63 market participants, external document review, and data analyses, the report characterizes the current state of the private market for residential flood insurance across the country, and identifies the main factors influencing the number and form of policies offered in this new market.
The world faced a growing number of complex and interconnected challenges in 2018. From climate change and slowing global growth to economic inequality, we will struggle if we do not work together in the face of these simultaneous challenges. The Global Risks Report 2019 provides an opportunity to place the global risk landscape into context at the beginning of the new year and identify priority areas for action in 2019.
Structural and interconnected nature of risks in 2018 threaten the very system on which societies, economies and international relations are based, according to the Global Risks Report 2018. A deteriorating geopolitical landscape is partly to blame for the pessimistic outlook, with 93% of respondents saying they expect political or economic confrontations between major powers to worsen and nearly 80% expecting an increase in risks associated with war involving major powers.
See also Knowledge@Wharton podcast and article: Global Risks in 2018: What Lies Ahead?
Economic inequality, societal polarization and intensifying environmental dangers are the top three trends that will shape global developments over the next ten years, the World Economic Forum’s Global Risks Report 2017 found. Collaborative action by world leaders is urgently needed to avert further hardship and volatility in the coming decade.
See also Knowledge@Wharton podcast and article: The Biggest Risks Facing the World in 2017.
An increased likelihood of all risks – environmental, geopolitical, societal, economic, and technological, looks set to shape the global agenda in the coming year.
- Evidence is mounting that inter-connections between risks are becoming stronger – for example, climate change and involuntary migration or international security – often with major and unpredictable impacts.
- Failure of climate-change mitigation and adaptation is the number one global risk in terms of impact.
- Large-scale involuntary migration tops the list of risks in terms of likelihood and is the fastest rising in terms of both impact and likelihood.
- Cyberattacks are now considered the greatest risk to doing business in North America.
The biggest threat to the stability of the world in the next 10 years comes from the risk of international conflict, according to the 10th edition of the Global Risks Report 2015. The Global Risks report is an initiative of the World Economic Forum. The Wharton Risk Center has been the Forum’s academic partner since 2005.
The report, which every year features an assessment by experts on the top global risks in terms of likelihood and potential impact over the coming 10 years, finds interstate conflict with regional consequences as the number one global risk in terms of likelihood, and the fourth most serious risk in terms of impact. In terms of likelihood, as a risk it exceeds extreme weather events (2), failure of national governance systems (3), state collapse or crisis (4) and high structural unemployment or underemployment (5).