Do you want to wager on the future of the planet?
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| CREDIT: Pexels |
As the country’s foremost science communicator knows, sometimes there is no point in waving around the same peer-reviewed studies. Sometimes you have to put your money where your mouth is. You have to turn empirical truths into cold, hard cash.
To that end, UK hedge fund Winton Capital is setting up the first market to make predictions about climate change. Climate scientists will bet on the future state of the climate, and the market will pay out yearly to those who make the most accurate predictions. The aim is to find a consensus among experts about the future of the climate.
The climate prediction market will rely on something known as the wisdom of the crowd. This phenomenon was discovered more than a century ago when English statistician Francis Galton studied a contest to guess the weight of 1,198-pound ox. Nearly 800 villagers entered the contest, and their estimations varied widely, but the average of their guesses was 1,197 pounds, almost the exact weight of the ox. The numbers showed that a large number of reasonably informed people with a diverse set of opinions can, in the aggregate, make accurate guesses.
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| An ox of undetermined weight. CREDIT: Pixabay |
This where the wisdom of the crowd comes into play. In the lead-up to the weekend’s game, Vegas had the Huskies as a 33-point favorite— bets were placed on whether Washington would win the game by more or less than 33 points. If the crowd got bullish on Washington, casinos might change their prediction to 34 or 35 points.
This is the crucial part. Because bettors tend to be sports aficionados steeped in the latest news and analysis, their predictions, on the whole, tend to be pretty accurate. Ultimately, Washington beat Fresno State by 32 points. That’s the wisdom of the crowd in action.
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| University of Washington defensive lineman Vita Vea. CREDIT: University of Washington Athletics |
U.S. gambling laws are murky when it comes to prediction markets, so Winton is setting up its climate prediction market in the United Kingdom. But the climate prediction market isn’t intended as a money-making scheme. This is a philanthropic endeavor, the goal of which is to produce useful information. It’s likely that Winton will lose money on the project, as it pays dividends to scientists who correctly predict the future.
“With a prediction market, getting the information is the primary objective,” said Mark Roulston, the scientist overseeing the climate prediction market.“There’s not necessarily a consensus on all the implications of climate change. The idea is have a benchmark which could track any emerging consensus.”
Other methods exist for determining what scientists think about climate change. The United Nations Intergovernmental Panel on Climate Change (IPCC) aggregates the finding of researchers from around the world to estimate future temperatures under different emissions scenarios. But the IPCC doesn’t generate forecasts. Rather, it provides a road map of the future, showing how the choices we make today are likely to shape the climate in the decades to come.
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| Hurricane Irene, 2011. CREDIT: Pixabay |
University of New Mexico physicist Mark Boslough has repeatedly challenged climate deniers to bets on near-term warming of the climate, but no one has taken him up on the offer. Other scientists have had more success turning climate predictions into cold, hard cash, and they have encouraged others to do the same.
The Long Now Foundation has created a forum for anyone to make bets on the future, though there are no climate bets posted at the moment. Some wagers are rather interesting — like the bet that the population of Earth would decline over the next half-century. Others are more frivolous. One man wagered the Large Hadron Collider would destroy the Earth by 2018. If he wins the $1,000 bet, he will most assuredly be dead.
Money, however, is a measure of seriousness. It is hard to doubt the convictions of scientists willing to wager on the future of the planet. This fact may make Winton’s climate prediction market a useful tool for persuading business leaders who are on the fence about climate change. Scientists willing to bet on the climate are unlikely to misrepresent what they think.
Winton believes the climate prediction market could make meaningful forecasts that account for predicted policy shifts or technological breakthroughs. The market may predict the rise in temperature will continue unchecked, or it may predict that nations take the steps necessary to avert catastrophic climate change.
Someday, the climate prediction market may offer a way to evaluate the credibility of scientists. Scientists who take part in the prediction market may be more credible by being willing bettors. The market will also allow the public to determine how the views of a particular scientist compare to those of her peers.
Winton’s founder, David Harding, studied theoretical physics at Cambridge and firmly believes in using the scientific method to guide his business decisions. The climate prediction market is an extension of that philosophy. Winton plans to open the market to climate scientists at universities later this year. Next year, it will expand the project to allow anyone in the United Kingdom to participate.
Links
- We’ve Been Risking Everything By Ignoring Climate Change, So Maybe It’s Time For A Different Kind Of Gamble
- Climate projections
- New climate change projections for Australia
- Get ready for 60-day heatwaves as Australia warms up — the dire climate predictions
- Longer, hotter summers predicted in extreme weather report by Climate Council
- Coastal Risk Australia
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