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Dynamic Optimisation in the Presence of Threshold Effects when the Location of the Threshold is Uncertain With an Application to a Possible Disintegration of the Western Antarctic Ice Sheet

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Author Info
Eric Nævdal (Princeton University and Agricultural University of Norway)

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Abstract

The purpose of this paper is to derive necessary conditions for the optimal control in the presence of threshold effects when the threshold is a curve in n-dimensional space of uncertain location. The usefulness of these conditions is shown by examining the optimal regulation of two greenhouse gases when there is a risk that the combined radiative forcing from these two gases may lead to the catastrophic event that the Western Antarctic Ice Sheet disintegrates.

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File URL: http://wws.princeton.edu/econdp/pdf/dp224.pdf
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Publisher Info
Paper provided by Princeton University, Woodrow Wilson School of Public and International Affairs, Discussion Papers in Economics. in its series Working Papers with number 143.

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Date of creation: Sep 2003
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Handle: RePEc:pri:wwseco:143

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Related research
Keywords: Optimal Control; Catastrophic Risk; Climate Change;

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Find related papers by JEL classification:
C61 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Optimization Techniques; Programming Models; Dynamic Analysis
Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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  1. Nævdal , Eric & Vislie, Jon, 2008. "Climate Change, Catastrophic Risk and the Relative Unimporartance of Discounting," Memorandum 28/2008, Oslo University, Department of Economics. [Downloadable!]
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