Prof. Matti Liski, Aalto University School of Business
Chair Prof. Sergio Vergalli, University of Brescia
March 3rd 2022 h. 16 CET (UTC +1)
Live presentationon Go To Webinar
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ABSTRACT
How to plan for catastrophes that may be under way? In a simple but general model of
experimentation, a decision-maker chooses a flow variable contributing to a stock that may trigger a
catastrophe at each untried level. Once triggered, the catastrophe itself occurs only after a stochastic delay.
Consequently, the rhythm of past experimentations determines the arrival of information. This has strong
implications for policies in situations where the planner inherits a history of experiments, like climate
change and pandemic crisis. The structure encompasses canonical approaches in the literature.