An extensive climate policy literature provides various recommendations, but they are not supported democratically since the models employed consider either infinitely-lived individuals or normative social objectives (or both). In contrast, the present paper provides policy recommendations that...

Experts often disagree. A decision-maker may be averse to such expert disagreement. Existing models of aversion to expert disagreement rest on ambiguity-averse preferences adopting a unanimity principle: If all experts consider one choice better than another, so should the decision-maker. Such...

This paper considers one altruistic developed country and several heterogeneous developing countries. We demonstrate that the lack of coordination between countries in tackling climate change finds an optimal solution if developing countries can expect to receive development aid transfers from...

This paper analyzes how insurance companies allow the issue of market incompleteness to be overcome. A general equilibrium economy is considered in which heterogeneous agents face endowment risks. Markets are incomplete: there are only markets for trading commodities ex-post and hedging price...

The classic Arrow-Debreu framework requires a very large number of specific securities to reach Pareto optimality. The present paper shows that financial intermediation can play an important role in maintaining a more parsimonious market framework while still obtaining Pareto optimality. In the...

Prevention and insurance are studied in an urban model with spatial heterogeneity due not only to commuting transport costs but also to natural disaster risks. Costly insurance and charity donation both lead to low insurance purchase. While the former leads to high prevention, the latter leads...

This paper provides a welfare analysis of solvency regulation for catastrophe insurance. We consider an economy with risk-averse agents exposed to a common source of risk and an insurer owned by risk-averse shareholders. We show that the optimal insurance contract features full coverage and is...

An extensive climate policy literature provides various recommendations, but they are not supported democratically since the models employed consider either infinitely-lived individuals or normative social objectives (or both). In contrast, the present paper provides policy recommendations that...