We investigate the economic impact of stochastic endogenous extreme events and insurance in a growth model. Our analytical results and computational experiments show that i) transparency of the insurance sector is the decisive requisite for abatement activities, implying substantial policy...

Climate change represents one of the epic issues of our time and it is likely to cause catastrophic damages. How to efficiently manage climate change catastrophe risk is a universal challenge. Private insurance generally produces optimal outcomes in which consumers maximise utility and insurers...