We show that housing markets provide information about the appropriate discount rates for valuing investments in climate change abatement. Real estate is exposed to both consumption and climate risk and that its term structure of discount rates is downward sloping, reaching 2.6% for payoffs beyond 100 years. We use a tractable asset pricing model that incorporates features of climate change to show that the term structure of discount rates for climate-hedging investments is thus upward sloping but bounded above by the risk-free rate. At horizons at which risk-free rates are unavailable, the estimated housing discount rates provide an upper bound.
Abstract-The recently emerging High Speed Downlink Packet Access (HSDPA) enhances conventional WCDMA systems according to the UMTS standard with data rates of up to 14MBit/s in the downlink direction. This is achieved by using adaptive modulation and coding as well as a fast Hybrid Automatic Repeat Request (HARQ) mechanism. This functionality is implemented close to the air interface in the Node B. In addition to the data buffer in the RNC, this requires a second data buffer in the Node B. Consequently, a flow control mechanism is needed which controls the amount of data to be transmitted from the RNC's buffer to the Node B's buffer. The spatial separation of RNC and Node B imposes significant signaling constraints and control dead time limitations to the flow control mechanism. Additionally, due to the time-varying nature of the radio channel, the data rate towards a particular user may be highly variable. In this paper, we study the impact of the flow control on system performance. We will show that it is essential to jointly consider scheduling and flow control in an HSDPA system as the constraints imposed by the flow control may dominate the system performance.
Is prioritisation of funding in elite sport effective? An analysis of the investment strategies in 16 countries
Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The optimal investment to mitigate climate change crucially depends on the discount rate used to evaluate the investment's uncertain future benefits. The appropriate discount rate is a function of the horizon over which these benefits accrue and the riskiness of the investment. In this paper, we estimate the term structure of discount rates for an important risky asset class, real estate, up to the very long horizons relevant for investments in climate change abatement. We show that this term structure is steeply downward-sloping, reaching 2.6% at horizons beyond 100 years. We explore the implications of these new data within both a general asset pricing framework that decomposes risks and returns by horizon and a structural model calibrated to match a variety of asset classes. Our analysis demonstrates that applying average rates of return that are observed for traded assets to investments in climate change abatement is misleading. We also show that the discount rates for investments in climate change abatement that reduce aggregate risk, as in disasterrisk models, are bounded above by our estimated term structure for risky housing, and should be below 2.6% for long-run benefits. This upper bound rules out many discount rates suggested in the literature and used by policymakers. Our framework also distinguishes between the various mechanisms the environmental literature has proposed for generating downward-sloping discount rates. Terms of use: Documents inJEL-Codes: G110, G120, R300.
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