Optimal Learning on Climate Change: Why climate skeptics should reduce emissions
AbstractClimate skeptics typically argue that the possibility that global warming is exogenous, implies that we should not take additional action towards reducing emissions until we know what drives warming. This paper however shows that even climate skeptics have an incentive to reduce emissions: such a directional change generates information on the causes of global warming. Since the optimal policy depends upon these causes, they are valuable to know. Although increasing emissions would also generate information, that option is inferior due to its irreversibility. We show that optimality can even imply that climate skeptics should actually argue for lower emissions than believers.
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Bibliographic InfoPaper provided by Oxford Centre for the Analysis of Resource Rich Economies, University of Oxford in its series OxCarre Working Papers with number 111.
Date of creation: 2013
Date of revision:
climate policy; global warming; climate skepticism; active learning; irreversibilities;
Other versions of this item:
- Sweder van Wijnbergen & Tim Willems, 2012. "Optimal Learning on Climate Change: Why Climate Skeptics should reduce Emissions," Tinbergen Institute Discussion Papers 12-085/2, Tinbergen Institute.
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
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