Investment decisions in adaptation are usually made under significant uncertainty due to climate change and socio-economic trends. Extreme events cause damage and may become more frequent over time. In this study we propose three ways to incorporate climate and socioeconomic uncertainty into the assessment of adaptation infrastructures in the city of Bilbao. The first suggestions is to use stoc...

We present a novel framework for the valuation of investments to mitigate catastrophic risk of climate impacted hazards. Our model incorporates the impact of uncertainty and continuous Bayesian information updating on investment decisions. We show that the model is relevant even when the time required to resolve uncertainty is indefinite. The model is applied to bushfire risk management in a lo...

a Interdisciplinary Centre on Climate Change (IC), University of Waterloo, Waterloo, Ontario N2L 3G1, Canada b Department of Geography and Environmental Management, University of Waterloo, Waterloo, Ontario N2L 3G1, Canada c Climate Research Division, Environment Canada, 4905 Dufferin Street, Toronto, Ontario M3H 5T4, Canada d Finnish Meteorological Institute, Arctic Research, P.O. Box 503, FI-...

EMELIE-ESY is a partial equilibrium model with focus on electricity markets. Private investors optimize their generation capacity investment and dispatch over the horizon 2010 to 2050. In the framework of the Energy Modeling Forum 28, we investigate how climate policy regimes affect market developments under different technology availabilities and climate policies on the European power markets....

This research proposes a novel MCDMmodel, including DEMATEL, ANP, and VIKOR for exploring portfolio selection based on CAPM. We probe into the influential factors and relative weights of risk-free rate, expected market return, and beta of the security. The purpose of this research is to establish an investment decision model and provides investors with a reference of portfolio selection most su...

This paper examines the optimal time to adapt to climate change. We take the perspective of a farmer growing a crop in a stochastic environment. The farmer faces stochastic seasonal growth, which makes harvest at the end of any season a random variable. Within a season, crop biomass is assumed to grow according to a continuoustime Itô process. The standard deviation rate of the Itô process is i...

Purpose Climate risk greatly increases the exposure of global investments. Both climate risks home countries and host may affect international investment behaviors. The purpose this paper is to explore impact distance on foreign direct (FDI) inflows outflows. Targeted proposals are provided promote economic trade cooperation authors provide suggestions for FDI strategies multinational enterpris...

In the climate change issue, the environmental irreversibility (risk of an acceleration of mitigation policies if the worse happen) has to be balanced with the investment irreversibility (risk of over-cautious policies). To explore this balance, we define an option value for a precautionary climate policy. Using the simplest decision-making model, we expose how option value relates to the expec...