Knowing what we don't know (and won't learn): Environmental Regulation under ''Conscious Unawareness'' and ''Negative learning''
Economic Policy, Applied Economics
Final Report Abstract
The project has made contributions to two strands of literature. The first strand is the applied theory literature on decision-making under uncertainty and learning. The second strand the project has contributed to is the emerging literature on geoengineering, in particular the literature on governance of solar geoengineering, e.g. the release of sulfur particles in the upper atmosphere to establish a reflective and therefore cooling veil in order to tackle global climate change. I adjusted the initial project proposal, which did not include the geoengineering part and focused on a slightly different strand in the decision-theoretic literature, in order to make the project’s contributions more relevant and tailored towards my current career stage. The project was successful, both in terms of scientific output and in terms of promoting my career. In terms of scientific output, several novel contributions stand out. The first novel contribution is the development of a framework that allows to determine the relative value of short-term and long-term forecasts. This research can inform public decisions on how best to improve forecast systems, e.g. the widely used hurricane forecasts. The project’s second contribution is a novel angle to the applied theory literature of decision-making under model uncertainty. Here, I demonstrate how a decision rule with a flexible margin of safety can give a decision-maker more control over the trade-off between precaution and efficiency. This research promises to attract wide interest in environmental decision-making, especially the field of biodiversity. The third novel contribution has been to the nascent literature on the governance of solar geoengineering. The background is the concern that solar geoengineering could lead to unilateral over-cooling. Against this background research undertaken in the project demonstrates that counter-geoengineering capabilities (i.e. rapid warming) may indeed increase the likelihood of a cooperative solution on geoengineering. This paper has been covered in a newspaper article in the German daily Süddeutsche Zeitung. Finally, the idea of over-provision of a public good, implicit in the geoengineering debate, has been formalized in a general framework and promises to increase the understanding of public good in a range of topics including resource management and foreign aid.
Publications
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(2017). Valuing predictability, Grantham Research Institute on Climate Change and the Environment Working Paper No. 260
Millner, A. and Heyen, D.
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(2018). Strategic Implications of Counter-Geoengineering: Clash or Cooperation?, Grantham Research Institute on Climate Change and the Environment Working Paper No. 313 and CESifo Working Paper No. 7180
Heyen, D., Horton, J. and Moreno-Cruz, J.
