Watch Your Step: Optimal Policy in a Tipping Climate

• 成果类型: Article
• 署名作者: Lemoine, Derek; Traeger, Christian
• 署名单位: University of Arizona; University of California System; University of California Berkeley
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.6.1.137
• 发表日期: 2014
• 页码: 137-166
• 关键词: economics; thresholds; management; uncertain; systems; points; GROWTH; models

摘要

We investigate the optimal policy response to the possibility of abrupt, irreversible shifts in system dynamics. The welfare cost of a tipping point emerges from the policymaker's response to altered system dynamics. Our policymaker also learns about a threshold's location by observing the system's response in each period. Simulations with a recursive, numerical climate-economy model show that tipping possibilities raise the optimal carbon tax more strongly over time. The resulting policy paths ultimately lower optimal peak warming by up to 0.5 degrees C. Different types of posttipping shifts in dynamics generate qualitatively different optimal pretipping policy paths.