The present paper argues that the costs of climate change are primarily adjustment costs. The central result is that climate change will reduce welfare whenever it occurs more rapidly than the rate at which capital stocks (interpreted broadly to include natural resource stocks) would naturally...

Intertemporal choice has obvious similarities with choice under uncertainty. However, because of technical difficulties in mapping results between the two domains, theoretical analysis of these topics has proceeded independently. In this article, we show that, using Rank Dependent Expected...