Introduction: Climate Variability, Predictability, and Climate Risks: A European Perspective (H. Wanner, M. Grosjean, R. Rothlisberger, E. Xoplaki) -- Climate Variability - Observations, Reconstructions, and Model Simulations for the Atlantic-European and Alpine region from 1500-2100 AD (C. C. Raible, C. Casty, J. Luterbacher, A. Pauling, J. Esper, D. C. Frank, U. Buntgen, A. C. Roeschz, P. Tschuck, M. Wild, P.-L. Vidale, C. Schar, H. Wanner) -- Challenges posed by and Approaches to the study of Seasonal-to-Decadal Climate Variability (C. Schwierz, C. Appenzeller, H. C. Davies, M. A. Liniger, W. Muller, T. F. Stocker, M. Yoshimori) -- Global Warming and the Summertime Evapotranspiration Regime of the Alpine Region (P. Calanca, A. Rosch, K. Jasper, M. Wild) -- Climate Risks and their Impact on Agriculture and Forests in Switzerland (J. Fuhrer, M. Beniston, A. Fischlin, Ch. Frei, S. Goyette, K. Jasper, Ch. Pfister) -- The Coupling of Optimal Economic Growth and Climate Dynamics (O. Bahn, L. Drouet, N. R. Edwards, A. Haurie, R. Knutti, S. Kypreos, T. F. Stoker, J.-P. Vial) -- Modeling Endogenous Learning and Imperfect Competition Effects in Climate Change Economics (L. Viguier, L. Barreto, A. Haurie, S. Kypreos, P. Rafaj) -- Economics of Climate Policy and Collective Decision Making (B. Burgenmeier, A. Baranzini, C. Ferrier, C. Germond-Duret, K. Ingold, S. Perret, P. Rafaj, S. Kypreos, A. Wokaun). Observations and reconstructions for the late Holocene show that the warming since the 1960s is likely unprecedented over the last millennium (Jones and Mann 2004). Modelling studies give some evidence that the temperature change of at least the second half of the 20th century can only be explained by including anthropogenic forcing (Rind et al. 1999; Crowley 2000; IPCC 2001; Meehl et al. 2003; Bauer et al. 2003). Nevertheless, to assess future climate change for key regions, like the Atlantic-European area, with con?dence, a thorough understanding of the underlying mechanisms of natural climate variability on different spatio-temporal scales for the late Holocene is necessary (Jones and Mann 2004). One possibility to address the understanding of natural climate variability of the Atlantic- Europeanregionistoinvestigategeneralcirculationmodels(GCMs).Modellingresultsshow that for the mid-latitudes the coupling between atmosphere and ocean plays a major role on decadal variability (Grotzner et al. 1998; Raible et al. 2001; Marshall et al. 2001, and ref- ences therein). This coupling has implications for the low-frequency (decadal) behaviour of the North Atlantic Oscillation (NAO), with its well-known linkage to temperature and p- cipitation on the interannual time scale (Hurrell 1995; Hurrell and Loon 1997; Wanner et al.