Digby Hall

Nov 5, 2021

6 min read

Climate Contagion — Will the Wisdom of Crowds Accelerate a City’s Demise?

For many Cities the exodus of its people due to climate change is still Optional

On January 28, 1986, the space shuttle Challenger exploded.

I remember it happening — it was televised, so news travelled quickly.

Within mere minutes the stock market had begun to punish the four contractors involved in making the Challenger. Three of those contractors suffered minor hits, between 3–6% falls in their share prices.

The fourth one — Morton Thiokol (which built the solid-fuel booster rocket) was suspended from trading only 21 minutes after the explosion and closed the day 12% down.

Within mere minutes, even before any public announcements or speculation, the market had reached the same conclusion that the six-month investigation of the disaster found — that Morton Thiokol were indeed at fault. The other three contractors were exonerated.

Photo by NASA on Unsplash

The market just knew — it was the ‘blink’ that Malcolm Gladwell talks about.

Whilst this example isn’t held up as a reliable model for predicting the rise and fall of the stock market, there was something eerie in the way the crowd picked the contractor at fault.

Now, as an academic exercise, swap out the Challenger with catastrophic climate change. Choose your calamity — sea level rise taking out whole towns, heat so hot that humans perish, agricultural sectors collapsing, cities running dry, airports flooding.

Now, slow it down — not a fiery disaster unfolding on TV but one that takes a few decades to become un-ignorable.

At what point will the populace know that disaster is inevitable? What will be the hints that all is not well?

Could it be another drought? More wildfires, coral reefs dying, more frequent coastal floods, a beach or two disappearing? Rivers drying up? A hailstorm that kills? Farmers going broke because their crops keep dying of thirst or heat or pest or lack of pollinators?

Or will the triggers be more insidious…

Our garden pretty much died again this summer after we’d already replaced it from last year. We’re just sick of the heat. We’re moving to somewhere cooler.

The Joneses up the road have a kid with Malaria — Malaria! Here?! I just don’t feel safe here anymore.

The Smiths lost their roof again during that storm, and the insurers are saying it’s not covered anymore. They’re heartbroken — it’s going to send them broke… maybe we should think about leaving before it happens to us.

Long before the city administration admits that climate change is insurmountable and adaptation is no longer viable, the residents will have already reached their conclusions.

And this is where the concept of ‘climate contagion’ comes in. It’s the tipping point (again from Malcolm Gladwell), but not in a good way.

The term Contagion is typically used in financial markets to describe the rapid spreading of change — typically meaning bad news is spreading, and a great paper by Paul Gilding from the University of Cambridge talks about Climate Contagion in the context of financial markets.

When a few residents of a town or coastal community sell up and move because of their concerns about climate change it’s generally disguised as typical real estate market churn.

It’s lost in the noise.

But at some point, when the community senses that the home sales are higher than usual, or people aren’t getting the prices they’d hoped… when homes start to lose some value, when residents hear that their neighbours are leaving because of climate change, that community may be approaching climate contagion.

The market will have recognised that the location is at long term climate risk.

From this point onwards it’s like a snowball gathering momentum. Word gets out. More people put up the ‘for sale’ sign or find alternative rentals. Much like panic selling in the stock market, we’ll see similar scenes in communities, towns and even cities where climate catastrophe is no longer something that walls and ditches can hold back. Few people want to be the ones left behind.

Photo by Maxim Hopman on Unsplash

And the process hastens the outcome.

As residents leave, they take with them the rates and taxes they were paying. They take away the time they gave to community services, education, jobs, maintenance, culture.

And sadly those who are left behind may be the communities who can least afford to react, to adapt and make safe. It’s a disaster unfolding at a pace too slow to see it for what it is.

The City starts to lose income and skills at the very time they need it most — to fund climate adaptation works for the population that remains. Either the government coffers open up to subsidise the City, or the City declines and perishes.

I’m exploring this using the S-curve, traditionally applied to innovation, growth, retail sales, personal development… to gain and growth. Now the curve describes climate contagion — this process where a town or city might drain of people once climate risk becomes un-manageable.

Climate Contagion Curve, by author

Can We Prevent Climate Contagion?

If we accept for the moment that climate contagion is a phenomenon that can indeed take place in communities, towns and cities at high climate risk, is it possible to change this curve?

Can we postpone it into the distant future by pushing out the tipping point?

Even more enticingly, is there a way to flatten the curve so much that the tipping point is avoided altogether?

It depends.

The answer will be different for each location.

Some cities simply have no way out — for example a coastal community only a few metres above sea level is effectively living on borrowed time, and retreat will one day be the only option.

Other locations will find themselves in searing temperatures and humidity where humans simply can’t survive — adaptation won’t be feasible.

If you want to dive into the rabbit hole, spend some time in the IPCC’s Interactive Atlas to explore the possible climate impacts in your region.

But there will be many towns and cities where — in a choose-your-own-adventure sense, adaptation is possible, feasible and even a path to long term prosperity if they start planning and investing now. Think of them as ‘shoulder cities’ — they’ll be adaptable and may even prosper if climate adaptation is cleverly managed, and if the investment is spread out over decades of city-building. If the planning doesn’t take place then the city will fail.

Short term adaptation delays the outcome. By author

And here’s the thing; Adaptations can take many forms and many timelines. Short term fixes might delay the climate contagion and perhaps there’s even a justification for some cities planning eventual surrender.

But those Cities that take a long enough view and plan for a deeper future might just be able to flatten the curve enough to avoid the tipping point completely.

Early and targeted adaptation may avoid climate contagion. By author

It might require an all-hands-to-the-pumps effort by the population, supported by a seismic bending of the financial markets towards climate mitigation and adaptation, but it’s physically possible.

The detailed socio-economic mechanics of climate contagion are too vast for this page, and in reality the contagion is never going to only implicate a departure of wealthy home owners who can afford to sell up and relocate.

My curiosity here has been to overlay the financial markets’ concept of contagion onto the spectre of catastrophic climate change in city making and city planning, to prompt an awareness that the City can in many cases influence the outcome, even avoiding the contagion altogether.

An excellent recent paper by Anna Marandi and Kelly Leilani Main unpacks the concepts of ‘vulnerable cities’, ‘recipient cities’ and ‘climate destinations’ in relation to climate migration, including the financial impacts on the City. I’ve only just entered that rabbit hole — I’ll no doubt be re-visiting this topic from time to time.