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This note considers the treatment of risk and uncertainty in the recently established social cost of carbon (SCC) for analysis of federal regulations in the United States. It argues that the analysis of the US Interagency Working Group on Social Cost of Carbon did not go far enough into the tail...
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This note considers the treatment of risk and uncertainty in the recently established social cost of carbon (SCC) for analysis of federal regulations in the United States. It argues that the analysis of the US Interagency Working Group on Social Cost of Carbon did not go far enough into the tail...
Persistent link: https://www.econbiz.de/10010309048
contribution, the paper extends the smooth ambiguity model by providing a threefold disentanglement between, risk aversion …, ambiguity aversion, and the propensity to smooth consumption over time. …
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pervasive uncertainty is best modeled as ambiguity rather than risk, as a set of situations where multiple prior probability …
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