Modeling the Cost of Climate Policy: Distinguishing Between Alternative Cost Definitions and Long-Run Cost Dynamics

2003 ◽  
Vol 24 (1) ◽  
Author(s):  
Mark K. Jaccard ◽  
John Nyboer ◽  
Crhis Bataille ◽  
Bryn Sadownik
Keyword(s):  
Climate Policy ◽  
Long Run ◽  
The Cost

scholarly journals Application of the theory of decision making under risk and uncertainty at modelling of costs

2010 ◽  
Vol 56 (No. 5) ◽  
pp. 201-208 ◽  
Author(s):  
M. Beranová ◽  
D. Martinovičová
Keyword(s):  
Decision Making ◽  
Financial Accounting ◽  
Cost Functions ◽  
Risk And Uncertainty ◽  
Managerial Decision ◽  
Managerial Decision Making ◽  
Bayesian Theorem ◽  
Long Run ◽  
Short Run ◽  
The Cost

The costs functions are mentioned mostly in the relation to the Break-even Analysis where they are presented in the linear form. But there exist several different types and forms of cost functions. Fist of all, it is necessary to distinguish between the short-run and long-run cost function that are both very important tools of the managerial decision making even if each one is used on a different level of management. Also several methods of estimation of the cost function's parameters are elaborated in the literature. But all these methods are based on the past data taken from the financial accounting while the financial accounting is not able to separate the fixed and variable costs and it is also strongly adjusted to taxation in the many companies. As a tool of the managerial decision making support, the cost functions should provide a vision to the future where many factors of risk and uncertainty influence economic results. Consequently, these random factors should be considered in the construction of cost functions, especially in the long-run. In order to quantify the influences of these risks and uncertainties, the authors submit the application of the Bayesian Theorem.

scholarly journals Competing Conventions with Costly Information Acquisition

Games ◽  
2021 ◽  
Vol 12 (3) ◽  
pp. 53
Author(s):  
Roberto Rozzi
Keyword(s):  
Information Acquisition ◽  
Evolutionary Model ◽  
Equilibrium Selection ◽  
The Other ◽  
Group Interactions ◽  
Social Coordination ◽  
Long Run ◽  
Stochastic Stability Analysis ◽  
The Stability ◽  
The Cost

We consider an evolutionary model of social coordination in a 2 × 2 game where two groups of players prefer to coordinate on different actions. Players can pay a cost to learn their opponent’s group: if they pay it, they can condition their actions concerning the groups. We assess the stability of outcomes in the long run using stochastic stability analysis. We find that three elements matter for the equilibrium selection: the group size, the strength of preferences, and the information’s cost. If the cost is too high, players never learn the group of their opponents in the long run. If one group is stronger in preferences for its favorite action than the other, or its size is sufficiently large compared to the other group, every player plays that group’s favorite action. If both groups are strong enough in preferences, or if none of the groups’ sizes is large enough, players play their favorite actions and miscoordinate in inter-group interactions. Lower levels of the cost favor coordination. Indeed, when the cost is low, in inside-group interactions, players always coordinate on their favorite action, while in inter-group interactions, they coordinate on the favorite action of the group that is stronger in preferences or large enough.

The Finnish Climate Change Act: Architecture, Functions, and Challenges

Climate Law ◽  
2014 ◽  
Vol 4 (3-4) ◽  
pp. 301-326 ◽  
Author(s):  
Ismo Pölönen
Keyword(s):  
Climate Change ◽  
Climate Policy ◽  
Policy Making ◽  
Dynamic Features ◽  
Policy Choices ◽  
Legal Implications ◽  
Proposed Model ◽  
Term Energy ◽  
Public Scrutiny ◽  
The Cost

The article examines the key features and functions of the proposed Finnish Climate Change Act (fcca). It also analyses the legal implications of the Act and the qualities and factors which may limit its effectiveness. The paper argues that, despite its weak legal implications, the fcca would provide the regulatory preconditions for higher-quality climate policy-making in Finland, and it has the capacity to play an important role in national climate policy. The fcca would deliver regulatory foundations for systematic and integrated climate policy-making, also enabling wide public scrutiny. The proposed model leaves room for manifold climate-policy choices in varying societal and economical contexts. The cost of dynamic features is the relalow predictability in terms of sectorial paths on emission reductions. Another relevant challenge relates to the intended preparation of overlapping mid-term energy and climate plans with instruments of the fcca.

scholarly journals Altruism in behavioural, motivational and evolutionary sense

2019 ◽  
Vol 30 (1) ◽  
pp. 122-134 ◽  
Author(s):  
Bojana Radovanovic
Keyword(s):  
Reproductive Success ◽  
Social Norm ◽  
Moral Principle ◽  
Non Profit ◽  
Altruistic Motivation ◽  
Evolutionary Theories ◽  
Long Run ◽  
Material Benefits ◽  
The Cost ◽  
The Sacrifice

This paper discusses the relations between three forms of altruism: behavioural, evolutionary and motivational. Altruism in a behavioural sense is an act that benefits another person. It can range from volunteering to a charity and helping a neighbour, to giving money to a non-profit organisation or donating blood. People often dedicate their material and nonmaterial resources for the benefit of others to gain psychological, social and material benefits for themselves. Thus, their altruistic acts are driven by egoistic motivation. Also, the final goal of an altruistic act may be the increase in the welfare of a group or adherence to a certain moral principle or a social norm. However, at least sometimes, the welfare of others is the ultimate goal of our actions, when our altruistic acts are performed from altruistic motivation. In evolutionary sense, altruism means the sacrifice of reproductive success for the benefit of other organisms. According to evolutionary theories, behaviour which promotes the reproductive success of the receiver at the cost of the actor is favoured by natural selection, because it is either beneficial for the altruist in the long run, or for his genes, or for the group he belongs to. However, altruism among people emerges as a distinctly human combination of innate and learned behaviours. Not only do we benefit the members of our own group, but we are capable of transcending our tribalistic instincts and putting the benefit of strangers at our own personal expense as our ultimate goal.

scholarly journals ESTIMATING PROFIT , COST FUNCTION AND TECHNICAL EFFICIENCIES OF RICE PRODUCTION IN NEJAF FOR SEASON 2016*

2019 ◽  
Vol 50 (5) ◽  
Author(s):  
Al-Mashhdani & Mahmood
Keyword(s):  
Cost Function ◽  
Output Level ◽  
Average Output ◽  
Optimal Output ◽  
Long Run ◽  
Actual Output ◽  
Short Run ◽  
Profit Maximizing ◽  
Economic Price ◽  
The Cost

The aim of this study was to estimate the profit and cost functions as well as economic, price, cost, and technical efficiencies beside the other economic indices at actual, optimal and profit-maximizing output of rice. A random sample of 240 rice  farms in Nejaf province was used during the agricultural season 2016. From efficiency scales of profit function, it was shown that the output quantity had the greatest impact on the profit compared to other variables (average output costs and price). According to the cost function, the optimum output level and the profit- maximizing output  level for the short run were 64.84 tons and 117.4 tons respectively. The lowest price that the farmer can accept was 194.83 thousand dinars / ton. At this price, the producer loss all fixed costs in the short run, hoping that the price of rice will improve in the long run. Net profit was estimated on the basis of actual output, cost minimizing output (optimal) and profit-maximizing output, which amounted to 8084.32, 30852.65 and 45547.5 thousand dinars, respectively. The of technical efficiency were 34%. and the cost efficiency was 0.52. We conclude from the study that economic resources have not been exploited optimally, indicating that actual output is far from optimal output. The study recommends a output policy aimed at increasing economic efficiency and optimizing the use of available resources.

scholarly journals Cheater-altruist synergy in immunopathogenic ecological public goods games

2017 ◽  
Author(s):  
Bryce Morsky ◽  
Dervis Can Vural
Keyword(s):  
Immune System ◽  
Public Goods ◽  
Free Riding ◽  
Average Growth ◽  
Public Goods Games ◽  
Cheating Behavior ◽  
Long Run ◽  
Population Dynamics Models ◽  
The Cost ◽  
Dynamics Models

AbstractMuch research has focused on the deleterious effects of free-riding in public goods games, and a variety of mechanisms that suppresses cheating behavior. Here we argue that under certain conditions cheating behavior can be beneficial to the population. In a public goods game, cheaters do not pay for the cost of the public goods, yet they receive the benefit. Although this free-riding harms the entire population in the long run, the success of cheaters may aid the population when there is a common enemy that antagonizes both cooperators and cheaters. Here we study models in which an immune system antagonizes a cooperating pathogen. We investigate three population dynamics models, and determine under what conditions the presence of cheaters help defeat the immune system. The mechanism of action is that a polymorphism of cheaters and altruists optimizes the average growth rate. Our results give support for a possible synergy between cooperators and cheaters in ecological public goods games.

scholarly journals The Macro Effects of Climate Policy Uncertainty

2021 ◽  
Vol 2021 (015) ◽  
pp. 1-50
Author(s):  
Stephie Fried ◽  
◽  
Kevin Novan ◽  
William B. Peterman ◽  
◽  
...  
Keyword(s):  
Climate Policy ◽  
Equilibrium Model ◽  
Fossil Fuels ◽  
Carbon Tax ◽  
Policy Uncertainty ◽  
Dynamic General Equilibrium Model ◽  
Macroeconomic Impacts ◽  
Policy Risk ◽  
The Cost ◽  
The U.S

Uncertainty surrounding if and when the U.S. government will implement a federal climate policy introduces risk into the decision to invest in capital used in conjunction with fossil fuels. To quantify the macroeconomic impacts of this climate policy risk, we develop a dynamic, general equilibrium model that incorporates beliefs about future climate policy. We find that climate policy risk reduces carbon emissions by causing the capital stock to shrink and become relatively cleaner. Our results reveal, however, that a carbon tax could achieve the same reduction in emissions at less than half the cost.

Randomized Observational Studies on the Economics of Therapies – Biometrical Experience of Two Trials

1998 ◽  
Vol 37 (01) ◽  
pp. 53-58 ◽  
Author(s):  
J. Högel ◽  
A. C. Rodloff ◽  
G. Büchele ◽  
W. Gaus
Keyword(s):  
Randomized Controlled Trial ◽  
Observational Studies ◽  
Controlled Trial ◽  
Innovative Therapy ◽  
Treatment Regimens ◽  
Randomized Controlled ◽  
Long Run ◽  
Low Costs ◽  
The Cost ◽  
Economic Studies

Abstract:Economic studies in medicine are intended to investigate costs, associated with a particular problem dealing with the indication, diagnosis or therapy, for instance, whether the high costs involved in a highly intensive or innovative therapy could be balanced by the eventual savings made, due to the shorter periods of treatment. In such situations a randomized controlled trial is necessary to find out which therapy or which therapeutical strategy is least expensive in the long run. Economic studies do, however, present some specific problems. Making a list of all the cost-relevant treatment items can be very laborious, but the use of flat rates and lump sums alone cannot lead to a complete cost analysis. Often, costs between hospitals vary more than between treatment regimens.Early and sudden deaths incur low costs and may bias the results. Furthermore, costs are distributed with a long and heavy upper tail incltJding extreme outliers. This does, in fact, complicate the estimation of the sample size. In this article, these problems are outlined and, with the help ofthe data obtained from two randomized economic trials in health care, solutions are proposed and discussed.

A politico-economic perspective on financial sustainability

2014 ◽  
Vol 26 (1) ◽  
pp. 140-164 ◽  
Author(s):  
Tilman Slembeck ◽  
Armin Jans ◽  
Thomas Leu
Keyword(s):  
Financial Stability ◽  
Time Inconsistency ◽  
Financial Sustainability ◽  
Problem Of Time ◽  
Public Finances ◽  
Long Run ◽  
Maastricht Criteria ◽  
The Cost ◽  
Large Primary

Financial sustainability requires governments to run sufficiently large primary surpluses going forward to cover the cost of servicing its debt budgets to balance in the long run. In democracies, politicians who strive for reelection often tend to systematically violate this tenet. This paper discusses two types of “anchors” that may be used to cope with this problem by limiting the room for new and excessive public debt. First, we analyze national constitutional safeguards on the basis of the “debt brake” in Switzerland and Germany. Second, we discuss international institutions to maintain financial discipline, referring to the Maastricht-criteria. These anchors are designed to allow policymakers to commit to policies that provide long term financial stability and sustainability of public finances. However, as the recent crises have shown, the problem of time inconsistency in policy making remains, especially when anchors are weak. Therefore, the paper discusses the circumstances under which institutional anchors may help to restrict politician behavior to promote sustainability of public finances. We conclude by indentifying three conditions required for the proper functioning of collective anchors in the context of public finances.

The Optimal Level of Debt in an OLG Model with Endogenous Fertility

2011 ◽  
Vol 12 (3) ◽  
pp. 351-369 ◽  
Author(s):  
Luca Spataro ◽  
Luciano Fanti
Keyword(s):  
Public Debt ◽  
Optimal Level ◽  
Child Rearing ◽  
Olg Model ◽  
Endogenous Fertility ◽  
Ceteris Paribus ◽  
Long Run ◽  
The Interest Rate ◽  
The One ◽  
The Cost

Abstract In the present work we extend Diamond’s OLG model by allowing for endogenous fertility and look at the consequences of such an extension on the rules for optimal public debt issuing. In particular, we show that the condition according to which the rate of growth of population should be higher than the interest rate is no longer sufficient for obtaining welfare improvements via debt increases and that the level of optimal debt is, ceteris paribus, lower than the one arising with exogenous fertility. Finally, a sensitivity analysis shows that the optimal level of debt is higher the lower the capital share, the higher individuals’ degree of patience, the bigger the child-rearing cost and the lower the preference for children. On policy grounds we argue that debt-tightening policies may be optimal in the long run provided that the cost of rearing children does not increase (or, if anything, does decrease).

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