EconPapers    
Economics at your fingertips  
 

Classical Decision Rules and Adaption to Climate Change

Harry Clarke

Australian Journal of Agricultural and Resource Economics, 2008, vol. 54, issue 4, 18

Abstract: One approach to rationalising policies for addressing potentially catastrophic climate change when such policies may prove unnecessary is to suppose the policies provide a form of social insurance even in the presence of pure uncertainty. Then, provided the policies are effective, such insurance can be justified as a precautionary or minimax response. Even if the policies are potentially ineffective however, intervention can be justified as an attempt to minimise the regret experienced by future generations. This reasoning extends to justify ‘all weather’ policies provided such policies always reduce policy costs. If, however, policy decisions provide ‘all weather’ benefits in only certain states of the world, this rationale breaks down. Minimising regret can establish a case for ‘mixed’ policy responses provided adopting a policy mix precludes the chance that intervention will fail altogether. Precautionary policies and policies which minimise regret are computed for a simple, dynamic, adaptive climate change planning problem and sufficient conditions for policy maker pessimism provided.

Keywords: Environmental Economics and Policy; Risk and Uncertainty (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/161898/files/j.1467-8489.2008.00421.x.pdf (application/pdf)

Related works:
Journal Article: Classical decision rules and adaptation to climate change * (2008) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aareaj:161898

DOI: 10.22004/ag.econ.161898

Access Statistics for this article

More articles in Australian Journal of Agricultural and Resource Economics from Australian Agricultural and Resource Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().

 
Page updated 2025-03-19
Handle: RePEc:ags:aareaj:161898