Climate Policy when the Distant Future Matters: Catastrophic Events with Hyperbolic Discounting
نویسندگان
چکیده
منابع مشابه
Climate Policy when the Distant Future Matters: Catastrophic events with hyperbolic discounting
We study climate change policy with hyperbolic discounting under the risk of catastrophic events. Using a binary action model, we compare the set of Markov Perfect Equilibria (MPE) to the optimal policy under (time consistent) commitment. For some initial conditions there are multiple MPE that may involve either excessive or insufficient stabilization efforts relative to the policy under commit...
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Empirical studies in economics and behavioral ecology suggest that, ceteris paribus, animals and humans appear to place less weight on the future than on the present, i.e., they act as though they discount future payoffs. Furthermore (and more interestingly), they do so with discount rates that increase as the time before those payoffs are realized grows shorter. In other words, subjects act as...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2007
ISSN: 1556-5068
DOI: 10.2139/ssrn.961045