Sjak Smulders, Tilburg University
We consider the economics of Geo-engineering, Solar Radiation Management (SRM) in particular. As an alternative to emissions reduction, climate change can be made harmless through increasing Albedo and preventing sunlight to reach the earth surface. Although currently considered by climate scientists as a cheap alternative to emissions reduction, unforeseen costs of mitigation might become visible in future. If this happens we would need to stop suddenly employing SRM, which might be costly. We study how the anticipation of new information of SRM costs in future affects early use of SRM. Our model is fully solvable analytically. We perform comparative statics and dynamics. We also calibrate the model.