Carbon markets, like other commodity markets, are volatile. They react to stochastic “disequilibrium” spot prices, which may be affected by inadequate policies, speculations and bubbles. The market-based emission trading, therefore, does not necessarily minimize abatement costs and achieve...

This paper describes a spatial-dynamic,stochastic optimization model that takes account ofthe complexities and dependencies of catastrophicrisks. Following a description of the general model,the paper briefly discusses a case study of earthquakerisk in the Irkutsk region of Russia. For this...

Traditional discounting dramatically affects the outcome of catastrophic risk management and spatio-temporal vulnerability modeling. The misperception of discount rates produces inadequate evaluations of risk management strategies, which may provoke catastrophes and significantly contribute to...

This paper discusses trade mechanisms in pollutionpermit markets. Proofs are given, that sequential,bilateral trade in tradeable emissions permitsconverges to a market equilibrium with minimal totalcosts of pollution control. If ambient or depositionpermits are traded, the convergence of...

The paper presents a new framework to assess firm level heterogeneity and to study the rate and direction of technical change. Building on the analysis of revealed short-run production functions by Hildenbrand (1981), we propose the (normalized) volume of the zonotope composed by vectors-firms...