Uncertainty and the Environment

Uncertainty and the Environment

Implications for Decision Making and Environmental Policy

New Horizons in Environmental Economics series

Richard Young

This thought provoking book is concerned with the need to deal adequately with uncertainty in environmental decision making. The author advances a critique of the use of traditional models and then develops an alternative model of decision making under uncertainty, based on the work of George Shackle.

Appendix 3: APotential surprise and ascendancy/weighting functions

Richard Young

Subjects: economics and finance, environmental economics, environment, environmental economics

Extract

Appendix 3: Potential surprise and ascendancy/weighting functions When the qualitative and quantitative results of the 23 respondents used in the analysis were collected together and analysed, two were discarded (respondents G&H) due to inconsistencies in the responses. In both cases the qualitative response to the questions asking them which gain and which loss scenarios they would weight highest (Q17 and Q18) was not consistent with the scenarios to which they had allocated the greatest weight quantitatively (Q19 and Q20). In both cases at the time of the interviews, in comparison to the other interviewees, much less time was taken during the weighting exercise, suggesting that little attention had been paid to the questions. 203 Respondent A Respondent B surprise 8 7 5 10 10 weighting 7 4 3 3 0 Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 Scenario 6 Scenario 7 Scenario 8 Scenario 9 Scenario 10 Degree of surprise Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 3 0 0 3 8 2 5 10 10 5 0 2 3 8 10 surprise 1 2 5 8 10 weighting 4 5 10 4 0 4 5 10 3 0 Scenario 6 Scenario 7 Scenario 8 Scenario 9 Scenario 10 Degree of surprise Benefits US$ million 110.5 119 135.5 165.5 200 Costs US$ million 73 95.5 134 176.5 230 Benefits US$ million 110.5 119 135.5 165.5 200 Costs US$ million 73 95.5 134 176.5 230 Degree of surprise 0 119 0 –73 200 –73...

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