Athens University of Economics and Business
and University of Bologna
Tel: 30 831 77405
Fax: 30 831 77406
Institutional Affiliation: University of Crete
Information about this author at RePEc
NBER Working Papers and Publications
|March 2018||Climate Policy under Cooperation and Competition between Regions with Spatial Heat Transport|
with Yongyang Cai, William Brock, Kenneth Judd: w24473
We build a novel stochastic dynamic regional integrated assessment model (IAM) of the climate and economic system including a number of important climate science elements that are missing in most IAMs. These elements are spatial heat transport from the Equator to the Poles, sea level rise, permafrost thaw and tipping points. We study optimal policies under cooperation and noncooperation between two regions (the North and the Tropic-South) in the face of risks and recursive utility. We introduce a new general computational algorithm to find feedback Nash equilibrium. Our results suggest that when the elements of climate science are ignored, important policy variables such as the optimal regional carbon tax and adaptation could be seriously biased. We also find the regional carbon tax is sig...
|January 2001||Environmental Policy and Firm Behavior: Abatement Investment and Location Decisions under Uncertainty and Irreversibility|
in Behavioral and Distributional Effects of Environmental Policy, Carlo Carraro and Gilbert E. Metcalf, editors
|August 1999||Environmental Policy and Firm Behavior: Abatement Investment and Location Decisions Under Uncertainty and Irreversibility|
This paper explores abatement investment and location responses to environmental policy, which takes the form of emission taxes or tradeable emission permits and subsidies against the costs of abatement investment, under uncertainty and irreversibility. Uncertainty is associated with output price, environmental policy parameters, or technological parameters. Irreversibility is related to abatement expenses and movements to a new location. Uncertainty is modeled by Itô stochastic differential equations, and the problem is analyzed by using optimal stopping methodologies. Continuation intervals during which firms do not engage in abatement investment or relocate and intervals during which firms take the irreversible decision of undertaking abatement expenses or relocating are defined. Free...