Saturday, January 19, 2013

"Up-side" Risk & Development

Brainstorm on "up-side risks" and development economics

"The only ignorant question is the one not asked"

As (I hope will not be too) apparent to anyone with a some level of economics or statistical education, this is not my primary area of work - yet to open the bridges between siloed disciplines (aka interdisciplinary work) we must start walking into personally murky waters. We must not fear retribution for basics not received or lost (can you tell this is a pep talk?)

Up-side Risk
Are there "up-side" risks? In other words, how does one assess (or does one assess) the risks associated with a "positive" upside event? Of course for those that hedge there is upside risk. Hmm. So perhaps we can see investment in things like Air Conditioning or perhaps water systems and electrical systems as a hedge against risks in natural capital? Of course in an urban environment - with population densities well beyond the carrying capacity - such systems are no longer a "hedge", no longer "insurance" but full blown... cost? I now reach too far beyond my ken. Perhaps some input from others on how to think this through.