To stay within the 2êC temperature increase target for climate change calls for ambitious emission reduction targets already for the 2012-2020 compliance period. Cost-efficiency is a crucial criterion for the enforcement of such ambitious targets, requiring analyses of all possible abatement...

In a series of papers, Martin Weitzman has proposed a Dismal Theorem. The general idea is that, under limited conditions concerning the structure of uncertainty and preferences, society has an indefinitely large expected loss from high-consequence, low-probability events. Under such conditions,...