Optimal Learning on Climate Change: Why Climate Skeptics Should Reduce Emissions
Tinbergen Institute Discussion Paper 12-085/2
35 Pages Posted: 22 Aug 2012
Date Written: August 16, 2012
Climate skeptics argue that the possibility that global warming is exogenous implies that we should not take additional action towards reducing greenhouse gas emissions until we know more. However this paper shows that even climate skeptics have an incentive to reduce emissions: such a change of direction facilitates their learning process on the causes of global warming. Since the optimal policy action depends on these causes, they are valuable to know. Although an increase in emissions would also ease learning, that option is shown to be inferior because emitting greenhouse gases is irreversible. Consequently the policy implications of the different positions in the global warming debate turn out to coincide - thereby diminishing the relevance of this debate from a policy perspective. Uncertainty is no reason for inaction.
Keywords: climate policy, global warming, climate skepticism, active learning, irreversibilities
JEL Classification: D83, Q54, Q58
Suggested Citation: Suggested Citation