Numerical analysis of non-constant pure rate of time preference: A model of climate policy

A-Tier
Journal: Journal of Environmental Economics and Management
Year: 2008
Volume: 56
Issue: 1
Pages: 83-101

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

When current decisions affect welfare in the far-distant future, as with climate change, the use of a declining pure rate of time preference (PRTP) provides potentially important modeling flexibility. The difficulty of analyzing models with non-constant PRTP limits their application. We describe and provide software (available online) to implement an algorithm to numerically obtain a Markov perfect equilibrium for an optimal control problem with non-constant PRTP. We apply this software to a simplified version of the numerical climate change model used in the Stern Review. For our calibration, the policy recommendations are less sensitive to the PRTP than widely believed.

Technical Details

RePEc Handle
repec:eee:jeeman:v:56:y:2008:i:1:p:83-101
Journal Field
Environment
Author Count
2
Added to Database
2026-01-25