Setting Environmental Policy When Experts Disagree

Stergios Athanassoglou () and Valentina Bosetti
Authors registered in the RePEc Author Service: Stergios Athanasoglou

Environmental & Resource Economics, 2015, vol. 61, issue 4, 497-516

Abstract: How can a decision-maker assess the potential of environmental policies when a group of experts provides divergent estimates on their effectiveness? To address this question, we propose and analyze a variant of the well-studied $$\alpha $$ α -maxmin model in decision theory. In our framework, and consistent to the paper’s empirical focus on renewable-energy R&D investment, experts’ subjective probability distributions are allowed to be action-dependent. In addition, the decision maker constrains the sets of priors to be considered via a parsimonious measure of their distance to a benchmark “average” distribution that grants equal weight to all experts. While our model is formally rooted in the decision-theoretic framework of Olszewski (Rev Econ Stud 74:567–595, 2007 ), it may also be viewed as a structured form of sensitivity analysis. We apply our framework to original data from a recent expert elicitation survey on solar energy. The analysis suggests that more aggressive investment in solar energy R&D is likely to yield significant dividends even, or rather especially, after taking expert ambiguity into account. Copyright the European Atomic Energy Community (EU-Euratom) 2015

Keywords: Expert elicitation; Expert aggregation; Decision theory; Renewable energy R&D; C60; D81; Q42; Q48 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (7)

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Working Paper: Setting environmental policy when experts disagree (2012)
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DOI: 10.1007/s10640-014-9804-x

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