Academic Article/Working Paper
Real Options, Natural Resources, and Offshore Oil
Consideration of real options is necessary to maximize economic return from non-renewable natural resource extraction. But ecisions over drilling are often framed as a now-or-never choice, so the option to wait (or “real option” value) is improperly treated in administrative processes that determine whether, when, and how offshore oil resources will be tapped.
One year after crude oil began gushing into the Gulf of Mexico, little action has been taken to prevent a similar disaster. A report authored by Gaia Larsen and Michael A. Livermore finds that overly simplistic economic analysis by the government may have helped lead to the accident.
The Unseen Costs of Using Dirty Oil in New York City Boilers
In about 9,000 big apartment and commercial buildings in Manhattan, Brooklyn, Queens, and the Bronx, boilers burn a dirty fuel to heat their units. “Residual Risks” analyses the health, environmental, and economic benefits of switching away from this dirty fuel to cleaner alternatives like natural gas.