An alternative perspective is offered by Daniel Osberghaus through his papaer titled “Prospect theory, mitigation and adaptation to climate change”. Osberghaus uses prospect theory to analyze mitigation and adaption in climate change. Prospect theory provides a number of climate-relevant insights, such as the notion that evaluations of outcomes are reference dependent.
According to Osberghaus, climate change is one of the most pressing challenges in current environmental policy. “Appropriate policies intended to stimulate efficient adaptation and mitigation should not exclusively rely on the assumption of the homo oeconomicus, sayas Osberghaus.
Osberghaus reviews what prospect theory can offer to analyse mitigation and adaptation. “Accounting for reference dependence and certainty effects contributes to a better understanding of some well-known puzzles in the climate debate, including (but not limited to) the different uptake of mitigation and adaptation amongst individuals and nations, the role of technical vs. financial adaptation, and the apparent preference for hard protection measures in coastal adaptation, ” argues Osberghaus in his abstract.