Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/67347
Authors: 
Narita, Daiju
Quaas, Martin F.
Year of Publication: 
2012
Series/Report no.: 
Kiel Working Paper 1809
Abstract: 
As growing attention is paid to climate change adaptation as an actual policy issue, the significant meaning of climate variability in adaptation decisions is beginning to be recognized. By using a real option framework, we shed light on how climate change and climate variability affect individuals' (farmers') investment decisions with regard to adaptation. As a plausible case in which the delay carries policy implications, we investigate farmers' choices when adaptation involves the use of an open-access resource (water). The results show that uncoordinated farmers with a high risk aversion may under-adapt while farmers with a low risk aversion would over-adapt under the same conditions. Private adaptation should be supported or discouraged accordingly if farmers are not convinced about the possibilities of collective resource management in the long run.
Subjects: 
adaptation to climate change
climate variability
risk and uncertainty
real option
water
open-access resources
JEL: 
D81
Q20
Q54
Document Type: 
Working Paper

Files in This Item:
File
Size
570.38 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.