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On climate tail risks

Numéro164
DateAugust 2022
Auteur
Résumé

Abstract. I model two ways climate tail risk could threaten the resources available for consumption in an otherwise standard cake-eating problem. I show that precautionary behaviour is optimal, no matter how low the probability of catastrophic  climate outcomes.
JEL Codes: E20, Q50.
Keywords: Climate change, Tail Risk, Tipping Point.
Summer,

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