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The optimal choice of climate change policy in the presence of uncertainty

Publication ,  Journal Article
Pizer, WA
Published in: Resource and Energy Economics
January 1, 1999

Considerable uncertainty surrounds both the consequences of climate change and their valuation over horizons of decades or centuries. Yet, there have been few attempts to factor such uncertainty into current policy decisions concerning stringency and instrument choice. This paper presents a framework for determining optimal climate change policy under uncertainty and compares the resulting prescriptions to those derived from a more typical analysis with best-guess parameter values. Uncertainty raises the optimal level of emission reductions and leads to a preference for taxes over rate controls. This suggests that analyses which ignore uncertainty can lead to inefficient policy recommendations. © 1999 Elsevier Science B.V. All rights reserved.

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Published In

Resource and Energy Economics

DOI

ISSN

0928-7655

Publication Date

January 1, 1999

Volume

21

Issue

4

Start / End Page

255 / 287

Related Subject Headings

  • Strategic, Defence & Security Studies
  • 3801 Applied economics
  • 1505 Marketing
  • 1403 Econometrics
  • 1402 Applied Economics
 

Citation

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Pizer, W. A. (1999). The optimal choice of climate change policy in the presence of uncertainty. Resource and Energy Economics, 21(4), 255–287. https://doi.org/10.1016/s0928-7655(99)00005-6
Pizer, W. A. “The optimal choice of climate change policy in the presence of uncertainty.” Resource and Energy Economics 21, no. 4 (January 1, 1999): 255–87. https://doi.org/10.1016/s0928-7655(99)00005-6.
Pizer WA. The optimal choice of climate change policy in the presence of uncertainty. Resource and Energy Economics. 1999 Jan 1;21(4):255–87.
Pizer, W. A. “The optimal choice of climate change policy in the presence of uncertainty.” Resource and Energy Economics, vol. 21, no. 4, Jan. 1999, pp. 255–87. Scopus, doi:10.1016/s0928-7655(99)00005-6.
Pizer WA. The optimal choice of climate change policy in the presence of uncertainty. Resource and Energy Economics. 1999 Jan 1;21(4):255–287.
Journal cover image

Published In

Resource and Energy Economics

DOI

ISSN

0928-7655

Publication Date

January 1, 1999

Volume

21

Issue

4

Start / End Page

255 / 287

Related Subject Headings

  • Strategic, Defence & Security Studies
  • 3801 Applied economics
  • 1505 Marketing
  • 1403 Econometrics
  • 1402 Applied Economics