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Climate change and psychological adaptation: A behavioral environmental economics approach

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  • Aronsson, Thomas
  • Schöb, Ronnie

Abstract

Economic models of climate policy (or policies to combat other environmental problems) typically neglect psychological adaptation to changing life circumstances. People may adapt, to different degrees, to a deteriorated environment. The present paper addresses these issues in a model of optimal tax policy to combat climate change and discusses the consequences for optimal climate policies. Furthermore, from a normative-methodological point of view, we argue that psychological adaptation needs to be taken into account even by a pure welfarist policy maker, who aims at internalizing an intertemporal externality.

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  • Aronsson, Thomas & Schöb, Ronnie, 2018. "Climate change and psychological adaptation: A behavioral environmental economics approach," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 74(C), pages 79-84.
    • Handle: RePEc:eee:soceco:v:74:y:2018:i:c:p:79-84
    DOI: 10.1016/j.socec.2018.03.005
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    Cited by:

    1. Thomas Aronsson & Ronnie Schöb, 2022. "Habit formation and the pareto-efficient provision of public goods," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 59(3), pages 669-681, October.
    2. Kanzola, Anna-Maria & Papaioannou, Konstantina & Petrakis, Panagiotis E., 2023. "Environmental behavioral perceptions under uncertainty of alternative economic futures," Technological Forecasting and Social Change, Elsevier, vol. 190(C).
    3. Stephan Hügel & Anna R. Davies, 2020. "Public participation, engagement, and climate change adaptation: A review of the research literature," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 11(4), July.
    4. Joe F. Bozeman & Rayne Bozeman & Thomas L. Theis, 2020. "Overcoming climate change adaptation barriers: A study on food–energy–water impacts of the average American diet by demographic group," Journal of Industrial Ecology, Yale University, vol. 24(2), pages 383-399, April.

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    More about this item

    Keywords

    Behavioral environmental economics; Climate change; Intertemporal externalities; Adaptation; Taxation;
    All these keywords.

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

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