Uncertainty, Irreversibility and the Timing Problems of Environmental Policy

(整期优先)网络出版时间:2006-04-14
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Mostenvironmentalissuesandpolicydesigningareuncertainandirreversible;therefore,thetimingofenvironmentalpolicyimplementationbecomesespeciallyimportant.Thispaperestablishesarandomdynamicprogrammingmodelandanalyzestheoptimaltimingproblemsinenvironmentalpolicyunderuncertainvariables.Thismodelresultsindicatethattwovariableshaveasignificantimpactonthetimingofenvironmentalpolicyimplementationandtheyworkinoppositedirecfons:ononehand,themoreuncertaintheeconomyis,thehigherthecostofpoliciesimplementationwillbe,andconsequentlytheincentivetoimmediatelyadoptthepolicywillbestronger.Ontheotherhand,thehighertheuncertaintyoftheenvironmentis,thestrongertheirreversibilityofecologicalharmcausedbypollutantsperunitwillbe.Therefore,thegovernmentshouldimplementnewenvironmentalpoliciesasearlyaspossibleinordertogainmoreecologicalbenefits.