PhD Position Systemic Physical Risk for Governments and Collateral Fiscal Damage

Join our ERC SPHINX Team to model how climate risks ripple through housing markets. Help uncover when homes become stranded assets and fuel systemic impacts. Help shaping climate resilient policies!

PhD Position: Systemic Physical Risk for Governments and Collateral Fiscal Damage

This 4-year fully funded PhD position is part of the ERC Consolidator project “Systemic physical climate risk in complex adaptive economies” (SPHINX), made possible thanks to a 2-million-euro grant from the European Research Council.

Background:

Globally, climate change already manifests via physical risks – damages from floods, storms, wildfires, heatwaves, droughts, and sea-level rise. Concerns are rising that these risks may become systemic, when local damages to one element cannot be contained and adversely affect the entire socio-economic system. Traditionally, physical climate risk assessments overlay hazard probability, exposure, and vulnerability, linearly extrapolating historic data and assuming markets efficiently capitalize full information about climate risks and adjust gradually. This approach is criticized for underestimating the true costs of climate change (e.g., at just 1-3% of GDP loss even under severe scenarios), impeding climate action.

In contrast, analysis of systemic risks embraces complex interactions among elements/agents, adjusting expectations, mechanisms of contagion dynamics, feedbacks, and non-linear tipping. The SPHINX research program aims to fundamentally advance simulation methods and consolidate novel data to understand how systemic physical climate risks emerge in the socio-economic system, and to explore strategies to curtail their spiraling costs. The project focuses on Europe, with a detailed analysis of three selected case-study regions.

Methodologically, SPHINX embraces five pillars, ranging from data collection to agent-based and computable general equilibrium modeling, led by five team members. The first three pillars concern the development of computational agent-based models to explore three different channels of risk propagation with a focus on the triggers of systemic risks. The current PhD position aims to advance assessments of physical climate risks for governments, including the emergence of moral hazard and inequality in the allocation of climate adaptation funding, as well as collateral damage to their budgets.

Job Description / Role and Responsibilities:

The successful candidate will work within the SPHINX research team to explore how governments balance economic development objectives with adaptation to accelerating physical climate risks, as households-voters decide where to live given their preferences for public adaptation. To explore the emergence of moral hazard and fiscal strain for governments under shifting climate risks, the candidate will develop an agent-based model grounded in the Tiebout theory and supported by data, including data on public preferences for allocating adaptation funds. During this 4-year-long project, the PhD student will build on the latest progress in economic research on changes in governmental debt and collateral fiscal damages, and instances of moral hazard and loss of creditworthiness for governments facing escalating climate risks. Connecting the mutually dependent decisions of governments to provide and fund public adaptation, and the location choices of diverse private actors in an agent-based model will be essential here. This modeling effort will benefit from the behavioral data on expectations elicited via tailored household and firm surveys (carried out by another team member) and other spatial and physical climate risk data. The goal of this agent-based modeling is to identify conditions under which risk contagion causes regional decline, and the roots of changing inequality based on how local governments decide on the level of public adaptation provision contingent on both households’ preferences for it and the availability of sufficient tax-based governmental budgets to afford it.

• Work within the SPHINX research team to explore how governments balance economic development objectives with adaptation to accelerating physical climate risks, as households-voters decide where to live given their preferences for public adaptation.
• Develop an agent-based model grounded in the Tiebout theory and supported by data, including data on public preferences for allocating adaptation funds, to explore the emergence of moral hazard and fiscal strain for governments under shifting climate risks.
• Build on the latest progress in economic research on changes in governmental debt and collateral fiscal damages, and instances of moral hazard and loss of creditworthiness for governments facing escalating climate risks.
• Connect the mutually dependent decisions of governments to provide and fund public adaptation, and the location choices of diverse private actors in an agent-based model.
• Utilize behavioral data on expectations elicited via tailored household and firm surveys (carried out by another team member) and other spatial and physical climate risk data.
• Identify conditions under which risk contagion causes regional decline, and the roots of changing inequality based on how local governments decide on the level of public adaptation provision contingent on both households’ preferences for it and the availability of sufficient tax-based governmental budgets to afford it.

Job Requirements

A candidate should ideally have:

• MSc in Environmental Economics, Spatial Economics, Computational Science, Geography, Environmental Studies, or Engineering & Policy Analysis
• Knowledge of a programming language (Python, Julia, etc) and training in any of the simulation methods
• Experience with (statistical) data analysis
• Previous experience with agent-based modeling or any type of spatial modeling is beneficial
• Ability to work with spatial data/GIS is an asset
• Domain knowledge in the field of coupled social-environmental systems, climate change or global environmental change in general is an advantage
• Solid problem-solving skills and capacity to take the initiative
• Fluent written and spoken English. For more details, please check the Graduate Schools Admission Requirements. Dutch is not obligatory; TU Delft offers opportunities to learn the language if desired.

About TU Delft (Delft University of Technology)

Delft University of Technology is built on strong foundations. As creators of the world-famous Dutch waterworks and pioneers in biotech, TU Delft is a top international university combining science, engineering and design. It delivers world class results in education, research and innovation to address challenges in the areas of energy, climate, mobility, health and digital society. For generations, our engineers have proven to be entrepreneurial problem-solvers, both in business and in a social context.

Faculty Technology, Policy & Management

The Faculty of TPM provides an important contribution to solving complex technical-social issues, such as energy transition, mobility, digitalisation, water management and (cyber) security. TPM does this with its excellent education and research at the intersection of technology, society and policy. We combine insights from both engineering and social sciences as well as the humanities. TPM develops robust models and designs, is internationally oriented and has an extensive network of knowledge institutions, companies, social organisations and governments.

Conditions of Employment

• Doctoral candidates will be offered a 4-year period of employment in principle, but in the form of 2 employment contracts. An initial 1.5 year contract with an official go/no go progress assessment within 15 months, followed by an additional contract for the remaining 2.5 years assuming everything goes well and performance requirements are met.
• Salary and benefits are in accordance with the Collective Labour Agreement for Dutch Universities, increasing from €3059 - €3881 gross per month, from the first year to the fourth year based on a fulltime contract (38 hours), plus 8% holiday allowance and an end-of-year bonus of 8.3%.
• As a PhD candidate you will be enrolled in the TU Delft Graduate School. The TU Delft Graduate School provides an inspiring research environment with an excellent team of supervisors, academic staff and a mentor. The Doctoral Education Programme is aimed at developing your transferable, discipline-related and research skills.
• The TU Delft offers a customisable compensation package, discounts on health insurance, and a monthly work costs contribution. Flexible work schedules can be arranged.

Additional information

For more information about this position, please contact: Prof Dr. T.Filatova, e-mail: t.filatova@tudelft.nl.