06 March 2017
IIASA

IIASA postdoctoral seminar: New modeling approaches for understanding the economy-environment linkages

IIASA Postdoctoral Research Scholar Asjad Naqvi will discuss two relatively new modeling approaches that can help analyze the linkages between economic activity and the environment. 

© Alain Lacroix | Dreamstime.com

© Alain Lacroix | Dreamstime.com

The next IIASA postdoctoral seminar will feature IIASA RISK and ASA Postdoctoral Research Scholar Asjad Naqvi.  In his presentation he will discuss agent-based modeling (ABM) for simulating natural disaster scenarios and stock-flow consistent (SFC) macro models for understanding the impact of long-term growth on resource use and environmental externalities.  Existing work done in both areas will be discussed with directions for future research, new ideas, and collaboration opportunities.

Overview

Geo-Simulations as a Policy Toolkit for Natural Disasters

Adverse post-natural disaster outcomes in low-income regions, like elevated internal migration levels, and low consumption levels are the result of market failures, poor mechanisms for stabilizing income, and missing insurance markets, which force the affected population to respond, and adapt to the shock they face.  In a spatial environment, with multiple locations with independent but inter-connected markets, these transitions quickly become complex and highly non-linear due to the feedback loops between the micro individual-level decisions and the meso location-wise market decisions.  To capture these continuously evolving micro-meso interactions, a spatially-explicit bottom-up agent-based model to analyze natural disaster-like shocks to low-income regions is discussed here.  The aim of the model is to temporally and spatially track how population distributions, income, and consumption levels evolve, in order to identify low-income workers that are "food insecure''.  Model results show, how various factors like existing income and saving levels, distance from the fault line, and proximity to other locations, can give insights on the spatial and temporal emergence of vulnerabilities.  The simulation framework presented here, leaps beyond existing modeling efforts, which usually deals with macro long-term loss estimates, and allows policy makers to come up with informed short-term policies in an environment where data is non-existent, policy response is time dependent, and resources are limited.


An Integrated Approach to Modeling Growth, Finance, and the Environment

A key challenge in high income countries is how to achieve growth without increasing the climate impact.  While several solutions have been proposed in literature from market-based carbon pricing mechanisms to more centralized “command-and-control” government regulations, higher investment in green technologies to innovation policies, several questions still remain unanswered: what drives innovation when resources are limited, who finances it, and which climate policies work under such scenarios?  To address these concerns, a new approach is used: stock-flow consistent (SFC) macro modeling which allows for fully tracking financial flows within an economic system across multiple sectors – firms, households, government, and commercial banks.  The framework incorporates behavioral rules with cross-sector linkages that allows for tracking the feedback of one sector on other sectors.  This framework can be easily integrated with the national system of accounts (NSA) for policy analysis.  Two models are presented here.  The first model discusses induced technological change across multiple inputs with budget constraints and tests for different types of climate policies including higher environmental tax, and higher R&D investment.  The second model discusses North-South linkages with focus on the impact of innovation and climate policies in the global north on countries in the global south.



Asjad Naqvi joined IIASA in January 2017, and is a Postdoctoral Research Scholar with IIASA RISK and ASA programs. From 2013 to 2017, he was a postdoctoral researcher at the Institute for Ecological Economics, Vienna University of Economics and Business (WU) and from 2011 to 2013, the Research Director at the Center for Economic Research Pakistan (CERP). He received his doctorate in Economics from the New School for Social Research (New York) in 2012. His research work at IIASA will focus on developing agent-based models to understand aspects of natural disasters and climate risk in low-income countries, and looking at relationships between financialization and flood risk in high income countries. In additiona to this, Naqvi works on stock-flow consistent macro models to investigate the relationship between growth, climate change, and inequality in a global context, understanding drivers of technological progress and linkages between trade, emissions, and climate policies between the global north and the global south. In the past, Naqvi has collaborated on projects in the fields of development, migration, institutions, economic geography and economic history with the World Bank, Harvard Kennedy School, MIT, University of Chicago, University of Sussex, University of London, London School of Hygiene and Tropical Medicine, and IIASA.


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Last edited: 16 February 2017

CONTACT DETAILS

Asjad Naqvi

IIASA Postdoctoral Research Scholar

Capacity Building and Academic Training

Risk and Resilience

Advanced Systems Analysis

T +43(0) 2236 807 575

International Institute for Applied Systems Analysis (IIASA)
Schlossplatz 1, A-2361 Laxenburg, Austria
Phone: (+43 2236) 807 0 Fax:(+43 2236) 71 313