Climate engineering under deep uncertainty
Anastasios Xepapadeas () and
Journal of Economic Dynamics and Control, 2018, vol. 94, issue C, 207-224
Climate engineering, and in particular solar radiation management (SRM), is attracting increasing attention as a climate policy option. However, its potentially strategic nature and unforeseen side effects provide major policy and scientific challenges. We study the role of SRM in a two-country model with the notable feature of deep uncertainty modeled as model misspecification of SRM side effects. We find that deep uncertainty leads to a reduction in SRM deployment under both global cooperation and strategic Nash behavior, and that the effect is larger if countries act strategically. Furthermore, we demonstrate that if countries have different model confidence about SRM impacts, then the more confident country will engage more strongly in using SRM, leading this country to “free drive”.
Keywords: Climate change; Solar radiation management; Uncertainty; Robust control; Differential game (search for similar items in EconPapers)
JEL-codes: Q53 Q54 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:dyncon:v:94:y:2018:i:c:p:207-224
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