ADAPTING MORE CLEVERLY TO CLIMATE CHANGE BY USING ‘REAL OPTIONS’ TO ADDRESS THE UNCERTAINTIES

Leo Dobes ()

No 47615, 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia from Australian Agricultural and Resource Economics Society

Abstract: Scientists consider that some climate change is already inevitable, even if anthropogenic greenhouse emissions are stabilised immediately. Adaptation measures are therefore needed, irrespective of any mitigation action. But policy discussion is focussed on deterministic responses, generally risk-based "worst case‟ scenarios. An example is the development of more stringent standards for buildings and for coastal development. Such "climate proofing‟ is misconceived in the face of the huge uncertainties involved. Economists need to promote more rational policy frameworks that draw on cost-benefit analysis, including the use of "real options‟ to minimise the cost to society of adapting to climate change.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 12
Date: 2009
New Economics Papers: this item is included in nep-ene and nep-env
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aare09:47615

DOI: 10.22004/ag.econ.47615

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