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Tipping Points and Ambiguity in the Economics of Climate Change
Lemoine, Derek M.; Traeger, Christian P. - National Bureau of Economic Research (NBER) - 2012
We model welfare-maximizing policy in an infinite-horizon setting when the probability of a tipping point, the welfare change due to a tipping point, and knowledge about a tipping point's trigger all depend on the policy path. Analytic results demonstrate how optimal policy depends on the...
Persistent link: https://www.econbiz.de/10010969374
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Continuous-Time Methods for Integrated Assessment Models
Judd, Kenneth L.; Lontzek, Thomas S.; Cai, Yongyang - National Bureau of Economic Research (NBER) - 2012
Continuous time is a superior representation of both the economic and climate systems that Integrated Assessment Models (IAM) aim to study. Moreover, continuous-time representations are simple to express. Continuous-time models are usually solved by discretizing time, but the quality of a...
Persistent link: https://www.econbiz.de/10010950988
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Robust Optimal Policy in a Forward-Looking Model with Parameter and Shock Uncertainty
Giannoni, Marc P. - National Bureau of Economic Research (NBER) - 2006
uncertainty about model parameters and shock processes. We show that the robust optimal policy rule is likely to involve a … uncertainty. Thus parameter uncertainty alone does not necessarily justify a small response of monetary policy to perturbations …. However uncertainty may amplify the degree of "super-inertia" required by optimal monetary policy. We finally discuss the …
Persistent link: https://www.econbiz.de/10005084782
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Thinking Ahead: The Decision Problem
Bolton, Patrick; Faure-Grimaud, Antoine - National Bureau of Economic Research (NBER) - 2005
We propose a model of bounded rationality based on time-costs of deliberating current and future decisions. We model an individual decision maker%u2019s thinking process as a thought-experiment that takes time and let the decision maker %u201Cthink ahead%u201D about future decision problems in...
Persistent link: https://www.econbiz.de/10005718599
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Satisficing Contracts
Bolton, Patrick; Faure-Grimaud, Antoine - National Bureau of Economic Research (NBER) - 2009
We propose a model of equilibrium contracting between two agents who are "boundedly rational" in the sense that they face time-costs of deliberating current and future transactions. We show that equilibrium contracts may be incomplete and assign control rights: they may leave some enforceable...
Persistent link: https://www.econbiz.de/10005830681
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When Does Labor Scarcity Encourage Innovation?
Acemoglu, Daron - National Bureau of Economic Research (NBER) - 2009
This paper studies the conditions under which the scarcity of a factor (in particular, labor) encourages technological progress and technology adoption. In standard endogenous growth models, which feature a strong scale effect, an increase in the supply of labor encourages technological...
Persistent link: https://www.econbiz.de/10005778012
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Equilibrium Bias of Technology
Acemoglu, Daron - National Bureau of Economic Research (NBER) - 2005
The study of the bias of new technologies is important both as part of the analysis of the nature of technology adoption and the direction of technological change, and to understand the distributional implications of new technologies. In this paper, I analyze the equilibrium bias of technology....
Persistent link: https://www.econbiz.de/10005049961
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The Environment and Directed Technical Change
Acemoglu, Daron; Aghion, Philippe; Bursztyn, Leonardo; … - National Bureau of Economic Research (NBER) - 2009
This paper introduces endogenous and directed technical change in a growth model with environmental constraints and limited resources. A unique final good is produced by combining inputs from two sectors. One of these sectors uses "dirty" machines and thus creates environmental degradation....
Persistent link: https://www.econbiz.de/10008614634
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Diversity and Technological Progress
Acemoglu, Daron - National Bureau of Economic Research (NBER) - 2011
This paper proposes a tractable model to study the equilibrium diversity of technological progress and shows that equilibrium technological progress may exhibit too little diversity (too much conformity), in particular, foregoing socially beneficial investments in "alternative" technologies that...
Persistent link: https://www.econbiz.de/10009004109
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Transition to Clean Technology
Acemoglu, Daron; Akcigit, Ufuk; Hanley, Douglas; Kerr, … - National Bureau of Economic Research (NBER) - 2014
We develop a microeconomic model of endogenous growth where clean and dirty technologies compete in production and innovation—in the sense that research can be directed to either clean or dirty technologies. If dirty technologies are more advanced to start with, the potential transition to...
Persistent link: https://www.econbiz.de/10011098928