Economics of uncertainty: analysis of precaution.

Summary This thesis reflects on precautionary behavior. Drawing on the definition of the precautionary principle, it examines the optimality of strategies that consist in preventing a risk without waiting for tangible information about it. This new standard of risk management - acting before knowing - is tested against the theory formalized in models of various inspirations. The first three chapters identify the basic economic concepts related to the notion of precaution that exist in the literature. Chapter 1 presents the notion of "prudence". Chapter 2 deals with the value of information. Chapter 3 is devoted to the study of the irreversibility effect. Chapter 4 proposes an application of the precautionary principle to the problem of global warming. We put in scene an agent in charge of deciding the level of CO2 emissions of the society. How does the prospect of receiving new scientific information about the risk of the greenhouse effect alter the optimal emission schedule? To date, studies on this issue have proposed simulation-based analyses. These have largely suggested the postponement of emission reductions. The model presented in this chapter makes it possible to distinguish the different effects involved. If the shape of the utility function is such that the decision-maker is "sufficiently cautious", these effects combine in such a way that they encourage immediate emission reductions, thus providing an economic basis for the precautionary principle. The last two chapters explore precautionary strategies in investment models. Chapter 5 considers the possibility of limiting present consumption for future risky investments. Chapter 6 considers the possibility of investing in an asset with a certain return to protect against financial fluctuations. In these two chapters, we show, as in chapter 4, that the overall effect of information on a sequence of financial decisions is entirely determined by the type of utility function selected.