Abstract
The global nature of the climatic challenge requires a high level of cooperation among agents, especially since most of the related coping strategies produce some kind of externalities toward others. Whether they are positive or negative, the presence of externalities may lead the system towards Pareto-dominated states. In this work, we study under and over-adoption of environmental adaptation technologies which enhance environmental quality for the individual while transferring externalities to other agents. We distinguish adaptation technologies between maladaptation and mitigation ones, depending on the sign of the externalities. In particular, we show that over adoption may occur for maladaptive technologies, whereas under-adoption may occur in case of mitigation. We study a model with two regions at different stages of development, which allows us to draw considerations on well-being consequences of environmental dumping.
Highlights
Environmental hazards are gaining relevance at an increasing pace, requiring humans to change their behaviour and decision making criteria
When a strategy is such that it shifts environmental hazards to others, it postpones them for future generations to bear, or it disproportionally affects the most vulnerable, the literature defines it no more as adaptation, but rather as maladaptation
X > 0 above line (6a) and z > 0 above line (6b), whereas the reverse occurs below these lines. This is very informative with respect to the behaviour of agents: for a higher value of x, z must be lower in order for agents in either region to be indifferent to the maladaptation technology, or else they would all adopt strategy A
Summary
The global nature of the climatic challenge requires a high level of cooperation among agents, especially since most of the related coping strategies produce some kind of externalities toward others. Whether they are positive or negative, the presence of externalities may lead the system towards Pareto-dominated states. We study under and over-adoption of environmental adaptation technologies which enhance environmental quality for the individual while transferring externalities to other agents. We distinguish adaptation technologies between maladaptation and mitigation ones, depending on the sign of the externalities. We show that over adoption may occur for maladaptive technologies, whereas under-adoption may occur in case of mitigation.
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