Regulation Under Uncertainty: An Intuitive Survey and Application to Fisheries

This paper surveys the issues involved in setting or improving regulatory activity in the presence of uncertainty. It is conducted in a way that will bring forth the underlying intuitions of the existing literature so that the various policy options can easily be distinguished on grounds of efficiency, as well as distributional and international considerations. This approach not only fits well into a section outlining the need for regulatory review, but also provides a basis for suggesting the issues involved in regulating fisheries. Intuition more than modeling aids in initially applying general analysis to specific areas, and the fisheries example illustrates how that application can be scientifically accomplished.Environmental Economics and Policy, International Development, Resource /Energy Economics and Policy, Risk and Uncertainty,

INFINITE UNCERTAINTY, FORGOTTEN FEEDBACKS, AND COST-BENEFIT ANALYSIS OF CLIMATE POLICY

Tol (2003) found evidence that the uncertainty that surrounds estimates of the marginal damage of climate change may be infinite even if total damages are finite and questioned the applicability of expected cost-benefit analysis to global mitigation policy. Yohe (2003) suggested that this problem could be alleviated if international development aid were directed at eliminating the source of the problem – climate induced negative growth rates in a few regions along a handful of troublesome scenarios. The hypothesis about adding a second policy lever to the climate policy calculus is shown to hold, but not as robustly as perhaps expected. Infinite uncertainty and its implications for global mitigation policy can be avoided for a reasonable price in the relatively unlikely event that climate change can cause negative economic growth in a region or two when the portfolio of international policies includes at least two tools.climate policy, development aid, equity weighting, expected cost-benefit analysis

INFINITE UNCERTAINTY, FORGOTTEN FEEDBACKS, AND COST-BENEFIT ANALYSIS OF CLIMATE POLICY

Tol (2003) found evidence that the uncertainty that surrounds estimates of the marginal damage of climate change may be infinite even if total damages are finite and questioned the applicability of expected cost-benefit analysis to global mitigation policy. Yohe (2003) suggested that this problem could be alleviated if international development aid were directed at eliminating the source of the problem – climate induced negative growth rates in a few regions along a handful of troublesome scenarios. The hypothesis about adding a second policy lever to the climate policy calculus is shown to hold, but not as robustly as perhaps expected. Infinite uncertainty and its implications for global mitigation policy can be avoided for a reasonable price in the relatively unlikely event that climate change can cause negative economic growth in a region or two when the portfolio of international policies includes at least two tools.climate policy, development aid, equity weighting, expected cost-benefit analysis

THE WEAKEST LINK HYPOTHESIS FOR ADAPTIVE CAPACITY: AN EMPIRICAL TEST

Yohe and Tol (2001) built an indexing method for vulnerability based on the hypothesis that the adaptive capacity for any system facing a vector of external stresses could be explained by the weakest of eight underlying determinants – the so-called “weakest link” hypothesis. Subsequent work supported the hypothesis by analogy from other contexts, but we now offer perhaps the first attempt to explore its validity through empirical means. We estimate a structural form designed to accommodate the full range of possible interactions across determinants. The perfect complement case of the pure “weakest-link” formulation lies on one extreme, and the perfect substitute case where each determinant can compensate for all others at constant rates is the other limiting case. For vulnerability to natural disasters, infant mortality and drinking water treatment, we find qualified support for a modified weakest link hypothesis: the weakest indicator plays an important role, but is not essential because other factors can compensate (with increasing difficulty). For life expectancy, sanitation and nutrition, we find a relationship that is close to linear – the perfect substitute case where the various determinants of adaptive capacity can compensate for each other. Moreover, we find another source of diversity in the assessment of vulnerability, since the factors from which systems draw to create adaptive capacity are different for different risks.Adaptive capacity, vulnerability, weakest-link hypothesis, substitution

The "crowding out" of private expenditures by fiscal policy actions

Fiscal policy ; Crowding out (Economics)

PRECAUTION AND A DISMAL THEOREM: IMPLICATIONS FOR CLIMATE POLICY AND CLIMATE RESEARCH

We discuss the implication of Weitzman's Dismal Theorem for climate policy and climate research.climate change, uncertainty

Invasive Crayfish Faxonius Rusticus Do Not Prefer Pheromones of Conspecifics

The invasive crayfish Faxonius rusticus has invaded multiple watersheds throughout Pennsylvania and the country. Current trapping methods are time consuming, labor intensive, and ineffective. Because crustaceans produce and utilize pheromones to communicate social status and mating condition, baited pheromone traps might serve as an effective alternative to the current trapping methods. The aim of this study was to examine if F. rusticus can distinguish between pheromones produced by conspecifics during breeding and non-breeding seasons. Previous research in our lab showed that during the breeding season females prefer male pheromones, but that preference disappears during the non-breeding season. We collected pheromones from male and female F. rusticus during breeding and non-breeding seasons. Collected pheromones were combined to create stocks; female breeding, female non-breeding, male breeding, and male non-breeding. Sexually mature F. rusticus were exposed to breeding and non-breeding pheromone stocks of opposite sex by pumping the pheromones through the arms of a Y-maze. The preference of the individual was determined based on which arm of the maze it selected and spent more time in. Findings suggest that during the non-breeding season mature crayfish do not exhibit a preference for pheromone type, breeding or non-breeding. There was no difference in pheromone preference between males and females; neither sex exhibited preference for opposite sex pheromones from the either breeding or non-breeding season. Understanding how pheromones are used by crayfish is essential to developing effective methods for eradication of invasive species

THE WEAKEST LINK HYPOTHESIS FOR ADAPTIVE CAPACITY: AN EMPIRICAL TEST

Yohe and Tol (2001) built an indexing method for vulnerability based on the hypothesis that the adaptive capacity for any system facing a vector of external stresses could be explained by the weakest of eight underlying determinants – the so-called “weakest link” hypothesis. Subsequent work supported the hypothesis by analogy from other contexts, but we now offer perhaps the first attempt to explore its validity through empirical means. We estimate a structural form designed to accommodate the full range of possible interactions across determinants. The perfect complement case of the pure “weakest-link” formulation lies on one extreme, and the perfect substitute case where each determinant can compensate for all others at constant rates is the other limiting case. For vulnerability to natural disasters, infant mortality and drinking water treatment, we find qualified support for a modified weakest link hypothesis: the weakest indicator plays an important role, but is not essential because other factors can compensate (with increasing difficulty). For life expectancy, sanitation and nutrition, we find a relationship that is close to linear – the perfect substitute case where the various determinants of adaptive capacity can compensate for each other. Moreover, we find another source of diversity in the assessment of vulnerability, since the factors from which systems draw to create adaptive capacity are different for different risks.Adaptive capacity, vulnerability, weakest-link hypothesis, substitution