Climate Change Adaptation under Heterogeneous Beliefs

• Tác giả: Marcel Nutz, Florian Stebegg
• Ngôn ngữ: eng
• Ký hiệu phân loại: 304.25 Climatic and weather factors
• Thông tin xuất bản: 2021
• Bộ sưu tập: Báo, Tạp chí
• ID: 166026

Tóm tắt

 Comment: Forthcoming in 'Mathematics and Financial Economics'We study strategic interactions between firms with heterogeneous beliefs about future climate impacts. To that end, we propose a Cournot-type equilibrium model where firms choose mitigation efforts and production quantities such as to maximize the expected profits under their subjective beliefs. It is shown that optimal mitigation efforts are increased by the presence of uncertainty and act as substitutes
  i.e., one firm's lack of mitigation incentivizes others to act more decidedly, and vice versa.