Data/hora: 12/06/2024 16:59:44

Provedor de dados: | Research in Agricultural & Applied Economics (AgEcon Searh)
País: | United States
Título: | Climate Change Catastrophes
Autores: | Pizer,   William A.
Data: | 2005-10-26
Ano: | 2003
Palavras-chave: | Climate change; Global warming; Prices versus quantities; Stock externalities; Integrated assessment; Uncertainty; Environmental Economics and Policy; Q28; D81; C68.
Resumo: | Most studies that compare price and quantity controls for greenhouse gas emissions under uncertainty find that price mechanisms perform substantially better. In these studies, the benefits from reducing emissions are proportional to the level of reductions, and such linear benefits strongly favor price policies (Weitzman 1974). Catastrophic damages, however, challenge that intuition as consequences become highly nonlinear. Catastrophe avoidance offers huge benefits, and incremental adjustments on either side of the associated threshold are relatively unimportant, suggesting a strong preference for quantity controls. This paper shows that with catastrophic damages, both price and quantity mechanisms offer large gains over the business-as-usual alternative, and the difference between policies is never more than 10%. Catastrophe avoidance is much more important than efficient catastrophe avoidance. Although previous studies favoring price policies in the presence of uncertainty have worried that catastrophes would reverse their results, this analysis indicates that such concerns are not borne out.
Tipo: | Working or Discussion Paper
Idioma: | Inglês

Identificador:

18619

http://purl.umn.edu/10499

Editor: | AgEcon Search

Relação:

Resources for the Future&gt;Discussion Papers

Discussion Paper 03-31

Formato:

25

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