Is too much personal dread stifling alternative pathways to improving urban water security?

Highlights

• Psychological bias occurs in the risk assessments of water projects.

• Dread was found to be an important psychological factor increasing risk scores for unfamiliar and new water projects.

• Higher risk scores result in water projects not being pursued.

• Personal affect of water practitioners changes investment outcomes in the options analysis of water projects.

Abstract

Despite an ongoing dire prognosis of the state of water resources, water practitioners maintain their traditional approaches to water planning. Alternative water projects to those that are considered ‘business-as-usual’ are not contemplated despite the threats posed by increasing urbanisation and climate change. Previous studies in psychological perceptions of risk in other fields have found that the personal feelings of risk practitioners, particularly feelings of dread, have had a significant impact on risk perceptions, an element known to be affecting decision-making of an individual. Could a similar trend exist in the water sector? We consider the decision-making process of 77 water practitioners in Melbourne Australia, to determine their personal biases and attitudes towards these alternative water pathways. In particular, this study assesses the impact of cognitive bias on reported risk scores in the water sector. Utilising pre-validated risk psychology survey methodology ( Slovic et al, 1985), psychometric testing was conducted to determine the influences that guide their personal risk perceptions, and in turn, their decision-making processes. It was concluded that ‘Dread’ plays a key role in the variation of risk scores between the participants that were evaluated. Furthermore, variables such as ‘Fear of the Unknown’ and ‘Dread related to perceived fatal risk’ where also found to be statistically significant factors in the link between risk scores and cognitive bias. These findings are critical in water planning, as a feeling of dread may be driving up risk scores, thus reducing the chances of establishing alternative water projects.

Introduction

Cities are increasingly dealing with the effects of anthropogenic climate change and rising urbanisation; the former reduces the supply of water resources, the latter results in an increase in water demand in urban areas. In Australia, despite a distinct divide between rural and urban water systems, environmental water use, farming and city demands all vie for a share of the declining water resource pool. Looking globally, with water resources constrained, and demand peaking, calls are being made to find and evaluate alternative options to solve the problem of water security (Romano and Akhmouch, 2019). As new or unfamiliar projects and innovations in the water sector are not being established some concerns have been raised regarding the way water resources are being managed.

In this paper, we consider the way in which decisions are being evaluated in a water-strained environment, focusing on the role that personal risk perceptions of decision-makers play in the allocation of public funds. Risk aversion has previously been mentioned in the context of water planning and yet has not been explored via psychometric testing detail (West et al., 2017; Gober et al., 2013; Dobbie and Brown, 2014). Within this research, we seek to address this gap, and in doing so, provide an insight into the psychological theory of risk and how the underlying personal biases of those who evaluate water sector projects seep into public-sector decision-making.

Those who assess the risks of water infrastructure from four different authorities in Melbourne, Australia, were selected as a case study for this research. Water security in Melbourne has remained of high public interest, due to the long periods of drought that have had an impact upon the water management of the region, a discussion that has been at the forefront again in mid-2019 (Davis and Doyle, 2019; Barbour, 2019). Stream flows in Victoria, Australia are projected to decrease between by 24 and 87%, with the worst-case scenario reporting stream flows to be 78% worse than the Millennium Drought, which occurred in South Eastern Australia between 1997 and 2009 (Fiddes and Timbal, 2017). A further pressing issue in Melbourne is the increase in urbanisation, a phenomenon that has ultimately resulted in the most striking impact upon water shortages increasing the strain on infrastructure (Short et al., 2010). And this is not an issue that will subside in the near future. Urbanisation is expected to intensify, with Melbourne projected to increase from 77% of Victoria's population to 79% by 2027 (Australian Bureau Of Statistics, 2018), and become the largest city in Australia. This trend of increasing population is not unusual for water strained cities globally (Domene and Saurí, 2006; Mustafa et al., 2016). In 1900, only ten percent of the world's people lived in cities, by 2000, this was over 50 percent (Luke, 2006). It is predicted that by 2050, 67 percent of the projected ten billion global population will be living in cities (Luke, 2006). This will place a large strain on public infrastructure and in particular, on water resources. As water issues become ever-more concerning, the need for new approaches to dealing with supply and demand issues will increase. Innovative projects exist, such as stormwater harvesting schemes, sponge cities, and decentralised water recycling plants, all promoted heavily by private industry. However, the take-up of these alternative approaches is relatively low within the water utilities themselves, which some authors posit could be due to risk aversion (West et al., 2016; Gober et al., 2013). This begs the question of why risk aversion is present.

In our previous paper (Kosovac et al., 2019), we argued that in providing quantified justification for options through formal ‘objective’ assessments of risk assessments, water practitioners could not be devoid of subjective bias. In this paper an attempt is made to understand this dynamic further. We ask whether the psychological affiliations of a risk assessor could affect these scores. Furthermore, could the underlying personal psychological biases behind environmental decision-making in water planning determine the scores assessors provided? To evaluate these questions psychometric paradigm testing was conducted on 77 risk assessors drawn from the four water authorities that govern the supply of water in Melbourne Australia. A Principal Component Analysis was undertaken on these results to reduce the factors when regressing against the risk scores provided through original risk assessments.