Polluting resource extraction and climate risk
Using a fossil fuel extraction model that treats the atmosphere as a depletable resource, we study the optimal price of carbon in the presence of endogenous uncertainty around a climatic regime shift. We find that the optimal carbon tax should account an uncertainty-adjusted cost term associated wit...
محفوظ في:
| المؤلف الرئيسي: | |
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| مؤلفون آخرون: | |
| التنسيق: | article |
| منشور في: |
2022
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| الوصول للمادة أونلاين: | http://hdl.handle.net/10725/17324 https://doi.org/10.1111/nrm.12354 http://libraries.lau.edu.lb/research/laur/terms-of-use/articles.php https://onlinelibrary.wiley.com/doi/full/10.1111/nrm.12354 |
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| _version_ | 1864513474365751296 |
|---|---|
| author | Hashem, Israa |
| author2 | Marrouch, Walid |
| author2_role | author |
| author_facet | Hashem, Israa Marrouch, Walid |
| author_role | author |
| dc.creator.none.fl_str_mv | Hashem, Israa Marrouch, Walid |
| dc.date.none.fl_str_mv | 2022 2023-02 2025-10-03T10:20:25Z 2025-10-03T10:20:25Z |
| dc.identifier.none.fl_str_mv | 0890-8575 http://hdl.handle.net/10725/17324 https://doi.org/10.1111/nrm.12354 Hashem, I., & Marrouch, W. (2023). Polluting resource extraction and climate risk. Natural Resource Modeling, 36(1), e12354. http://libraries.lau.edu.lb/research/laur/terms-of-use/articles.php https://onlinelibrary.wiley.com/doi/full/10.1111/nrm.12354 |
| dc.language.none.fl_str_mv | en |
| dc.relation.none.fl_str_mv | Natural Resource Modeling |
| dc.rights.*.fl_str_mv | info:eu-repo/semantics/openAccess |
| dc.title.none.fl_str_mv | Polluting resource extraction and climate risk |
| dc.type.none.fl_str_mv | Article info:eu-repo/semantics/publishedVersion info:eu-repo/semantics/article |
| description | Using a fossil fuel extraction model that treats the atmosphere as a depletable resource, we study the optimal price of carbon in the presence of endogenous uncertainty around a climatic regime shift. We find that the optimal carbon tax should account an uncertainty-adjusted cost term associated with the environment's scarcity. This term is shown to be sensitive to the natural sequestration rate of the atmosphere and to the probability surrounding a climate tail event. Our analysis also shows that in the presence of uncertainty, the shadow price of the environment should grow at a faster rate. Lastly, compared to the endogenous uncertainty case, we find that if the probability surrounding a regime shift is exogenously given, this shadow price should even grow at a higher rate. |
| eu_rights_str_mv | openAccess |
| format | article |
| id | LAURepo_7a822bccfe628ce688c8593abcfae8c9 |
| identifier_str_mv | 0890-8575 Hashem, I., & Marrouch, W. (2023). Polluting resource extraction and climate risk. Natural Resource Modeling, 36(1), e12354. |
| language_invalid_str_mv | en |
| network_acronym_str | LAURepo |
| network_name_str | Lebanese American University repository |
| oai_identifier_str | oai:laur.lau.edu.lb:10725/17324 |
| publishDate | 2022 |
| repository.mail.fl_str_mv | |
| repository.name.fl_str_mv | |
| repository_id_str | |
| spelling | Polluting resource extraction and climate riskHashem, IsraaMarrouch, WalidUsing a fossil fuel extraction model that treats the atmosphere as a depletable resource, we study the optimal price of carbon in the presence of endogenous uncertainty around a climatic regime shift. We find that the optimal carbon tax should account an uncertainty-adjusted cost term associated with the environment's scarcity. This term is shown to be sensitive to the natural sequestration rate of the atmosphere and to the probability surrounding a climate tail event. Our analysis also shows that in the presence of uncertainty, the shadow price of the environment should grow at a faster rate. Lastly, compared to the endogenous uncertainty case, we find that if the probability surrounding a regime shift is exogenously given, this shadow price should even grow at a higher rate.Published2025-10-03T10:20:25Z2025-10-03T10:20:25Z20222023-02Articleinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/article0890-8575http://hdl.handle.net/10725/17324https://doi.org/10.1111/nrm.12354Hashem, I., & Marrouch, W. (2023). Polluting resource extraction and climate risk. Natural Resource Modeling, 36(1), e12354.http://libraries.lau.edu.lb/research/laur/terms-of-use/articles.phphttps://onlinelibrary.wiley.com/doi/full/10.1111/nrm.12354enNatural Resource Modelinginfo:eu-repo/semantics/openAccessoai:laur.lau.edu.lb:10725/173242025-10-03T10:20:25Z |
| spellingShingle | Polluting resource extraction and climate risk Hashem, Israa |
| status_str | publishedVersion |
| title | Polluting resource extraction and climate risk |
| title_full | Polluting resource extraction and climate risk |
| title_fullStr | Polluting resource extraction and climate risk |
| title_full_unstemmed | Polluting resource extraction and climate risk |
| title_short | Polluting resource extraction and climate risk |
| title_sort | Polluting resource extraction and climate risk |
| url | http://hdl.handle.net/10725/17324 https://doi.org/10.1111/nrm.12354 http://libraries.lau.edu.lb/research/laur/terms-of-use/articles.php https://onlinelibrary.wiley.com/doi/full/10.1111/nrm.12354 |