Climate change is considered among the most critical risks that global society faces in this
century. So far, climate policy strategies have been evaluated by means of a variety of …

We survey literature on ambiguity with an emphasis on recent applications in
macroeconomics and finance. Like risk, ambiguity leads to cautious behavior and …

This paper provides (for the nonspecialist) a highly streamlined discussion of the main
issues, and controversies, in the design of climate mitigation policy. The first part of the …

Economic evaluation of climate policy traditionally treats uncertainty by appealing to
expected utility theory. Yet our knowledge of the impacts of climate policy may not be of …

Established environmental policy theory is based on the assumption of homo economicus.
This means that people are seen as fully rational and acting in a self-regarding manner. In …

This article explores how farmer risk preferences are related to their perception of risk of
climate change. We measure risk preferences and risk perceptions using a survey and a lab …

We propose a robust risk management approach to deal with the problem of catastrophic
climate change that incorporates both risk and model uncertainty. Using an analytical model …

This article examines the socially optimal pricing of carbon emissions over time when
climate‐change impacts are unknown, potentially high‐consequence events. The carbon …

We review recent models of choices under uncertainty that have been proposed in the
economic literature. In particular, we show how different concepts and methods of economic …

We analyze the policy implications of aversion to Knightian uncertainty (ambiguity) about the
possibility of tipping points. We demonstrate two channels through which uncertainty …