Uncertainty surrounding if the U.S. will implement a federal climate policy introduces risk into the decision to invest …, general equilibrium model to quantify the macroeconomic impacts of this climate policy transition risk. The model incorporates … lower carbon economy. We find that climate policy transition risk decreases carbon emissions today by causing investment to …

uncertainty over climate change and its impact, why there is so much uncertainty, and why we will continue to face uncertainty in … the near future. I also explain the policy implications of climate change uncertainty. First, the uncertainty … stronger actions to reduce CO2 emissions. Second, uncertainty interacts with two kinds of irreversibilities. First, CO2 remains …

price, the equilibrium risk-free rate, and risk premia. Climate disasters, which are more likely to occur sooner as … temperature rises, significantly increase risk premia. …