FEEM working papers "Note di lavoro" series
2016 .052

Climate Engineering under Deep Uncertainty and Heterogeneity


Authors: Johannes Emmerling, Vassiliki Manoussi, Anastasios Xepapadeas
Series: Mitigation, Innovation and Transformation Pathways
Editor: Massimo Tavoni
Keywords: Climate Change, Solar Radiation Management, Uncertainty, Robust Control, Differential Game
JEL n.: Q53, Q54

Abstract

Climate Engineering, and in particular Solar Radiation Management (SRM) has become a widely discussed climate policy option to study in recent years. However, its potentially strategic nature and unforeseen side effects provide major policy and scientific challenges. We study the role of the SRM implementation and its strategic dimension in a model with two heterogeneous countries with the notable feature of model misspecification on the impacts from SRM. We find that deep uncertainty leads to a reduction in SRM deployment both under cooperation and strategic behavior, which is a more relevant issue if countries act strategically. Furthermore, we demonstrate that the heterogeneity in impacts from SRM has an asymmetric effect on the optimal policy and could typically lead to unilateral SRM implementation. We also consider heterogeneous degrees of ambiguity aversion, in which case the more confident country only will use SRM.

***

Suggested citation: Emmerling, J., V. Manoussi, A. Xepapadeas, (2016), 'Climate Engineering under Deep Uncertainty and Heterogeneity', Nota di Lavoro 52.2016, Milan, Italy: Fondazione Eni Enrico Mattei

Download file
Download PDF file

FEEM Update

Subscribe to stay connected.

Your personal data will be processed by Fondazione Eni Enrico Mattei. – data Controller – with the aim of emailing the FEEM newsletter. The use of Your email address is necessary for the implementation of the newsletter service. You are invited to read the Privacy Policy in order to obtain additional information about the protection of Your rights.

This Website uses technical cookies and cookie analytics, as well as “third party” profiling cookies.
If you close this banner or you decide to continue navigating on this Website, you express consent to the use of cookies. If you need additional information or you wish to express selective choices on the use of cookies, please refer to the   Cookie PolicyI agree