Resource Management Under Catastrophic Threats

Yacov Tsur and Amos Zemel ()
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Amos Zemel: Department of Solar Energy and Environmental Physics, The Jacob Blaustein Institutes for Desert Research, Ben Gurion University of the Negev, Beer Sheva 8410501, Israel

Annual Review of Resource Economics, 2021, vol. 13, issue 1, 403-425

Abstract: We survey the rapidly growing economic literature on environmental catastrophes and the various approaches developed to address the hovering threats. Various theoretical descriptions of catastrophic occurrences are classified with respect to the uncertain conditions that trigger the events, the postoccurrence dynamic regime, and the form of the inflicted damage. We show that variations in each of these characteristics strongly affect the ensuing optimal response to the threats. The basic setup is then extended in several dimensions, allowing the modeler to consider more realistic formulations of catastrophic scenarios. Recent efforts to incorporate catastrophic events within large-scale numerical schemes to study the global climate change problem are reviewed. The number of publications in this vein increases in tandem with the growing number of disasters reported globally and their scale of damage, reflecting the growing concern that this phenomenon portends environmental collapse.

Keywords: environmental disasters; uncertainty; intertemporal trade-offs; natural resources (search for similar items in EconPapers)
JEL-codes: C61 C70 D81 H41 Q54 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (4)

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DOI: 10.1146/annurev-resource-100920-020522

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