| Registro completo |
| Provedor de dados: |
AgEcon
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| País: |
United States
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| Título: |
Tipping Points and Ambiguity in the Economics of Climate Change
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| Autores: |
Lemoine, Derek M.
Traeger, Christian P.
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| Data: |
2010-12-16
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| Ano: |
2010
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| Palavras-chave: |
Threshold
Climate
Integrated assessment
Regime shift
Ambiguity
Uncertainty
Dynamic programming
Social cost of carbon
Tipping point
Carbon tax
Environmental Economics and Policy
Risk and Uncertainty
Q54
D90
D81
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| Resumo: |
Replaced with revised version of paper Feb 13, 2012 available at http://purl.umn.edu/120349
We model optimal policy when the probability of a tipping point, the welfare change due to a tipping point, and knowledge about a tipping point's trigger all depend on the policy path. Analytic results demonstrate how optimal policy depends on the ability to affect both the probability of a tipping point and also welfare in a post-threshold world. Simulations with a numerical climate-economy model show that possible tipping points in the climate system increase the optimal near-term carbon tax by up to 45% in base case specifications. The resulting policy paths lower peak warming by up to 0.5 degrees C compared to a model without possible tipping points. Different types of tipping points have qualitatively different effects on policy, demonstrating the importance of explicitly modeling tipping points' effects on system dynamics. Aversion to ambiguity in the threshold's distribution can amplify or dampen the effect of tipping points on optimal policy, but in our numerical model, ambiguity aversion increases the optimal carbon tax.
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| Tipo: |
Report
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| Idioma: |
Inglês
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| Identificador: |
http://purl.umn.edu/98127
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| Relação: |
University of California, Berkeley>Department of Agricultural and Resource Economics>CUDARE Working Papers
CUDARE Working Papers
1111
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| Formato: |
35
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