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What determines perceived value of seasonal climate forecasts? A theoretical analysis.

Authors :
Millner, Antony
Washington, Richard
Source :
Global Environmental Change Part A: Human & Policy Dimensions; Feb2011, Vol. 21 Issue 1, p209-218, 10p
Publication Year :
2011

Abstract

Abstract: Seasonal forecasts have potential value as tools for the management of risks due to inter-annual climate variability and iterative adaptation to climate change. Despite their potential, forecasts are not widely used, in part due to poor performance and lack of relevance to specific users’ decision problems, and in part due to a variety of economic and behavioural factors. In this paper a theoretical model of perceived forecast value is proposed and applied to a stylized portfolio-type decision problem with wide applicability to actual forecast users, with a view to obtaining a more complete picture of the determinants of perceived value. The effects of user wealth, risk aversion, and perceived forecast trustworthiness, and presentational parameters, such as the position of forecast parameter categories, and the size of probability categories, on perceived value is investigated. Analysis of the model provides several strong qualitative predictions of how perceived forecast value depends on these factors. These predictions may be used to generate empirical hypotheses which offer the chance of evaluating the model''s assumptions, and suggest several means of improving understanding of perceived value based on qualitative features of the results. [Copyright &y& Elsevier]

Details

Language :
English
ISSN :
09593780
Volume :
21
Issue :
1
Database :
Supplemental Index
Journal :
Global Environmental Change Part A: Human & Policy Dimensions
Publication Type :
Academic Journal
Accession number :
57515870
Full Text :
https://doi.org/10.1016/j.gloenvcha.2010.08.001