Pricing Climate Change Risk in the Markets

Pricing greenhouse gas emissions involves making trade-offs between consumption today and unknown damages in the (distant) future. This setup calls for an optimal control model to determine the carbon dioxide (CO2) price. The Epstein-Zin Climate model suggests a high optimal carbon price today that is expected to decline over time as uncertainty about the damages is resolved. It also points to the importance of backstop technologies and to very large deadweight costs of delay. Join Robert Litterman as he discusses pricing climate change risk in markets.


Bob Litterman, Chairman of the Risk Committee, Kepos Capital

Read the research before the event.

October 20, 2020 - 9:00am
Robert H. Smith School of Business
Map of Robert H. Smith School of Business
University of Maryland
Robert H. Smith School of Business
Van Munching Hall
College Park MD 20742