Environmental policy choice under uncertainty

The Markovian model provides an insightful structure for analyzing environmental policy decisions. This framework is applied to a variety of conceptual issues. The analysis of reswitching phenomena shows that when multiple risks are involved, there is unlikely to be an unambiguous ranking of policies according to their future-mindedness. The discussion of irreversibilities demonstrates that irreversibilities differ only in degree from other probabilistic structures; they create no special analytic complications. In the final section, the Markovian decision framework is extended to incorporate the impact of budgetary constraints on optimal decisions.