When to Bite the Bullet? - A Study of Optimal Strategies for Reducing Global Warming

@inproceedings{Luo2013WhenTB,
  title={When to Bite the Bullet? - A Study of Optimal Strategies for Reducing Global Warming},
  author={Xu-Ren Luo and Pavel V. Shevchenko},
  year={2013}
}
  • Xu-Ren Luo, Pavel V. Shevchenko
  • Published 2013
  • Mathematics, Computer Science
  • This work is based on the framework proposed by Conrad (1997) to determine the optimal timing of an investment or policy to slow global warming. While Conrad formulated the problem as a stopping rule option pricing model, we treat the policy decision by considering the total damage function that enables us to make some interesting extensions to the original formulation. We show that Conrad's framework is equivalent to minmization of the expected value of the damage function under the stochastic… CONTINUE READING

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