News

Discussion panel on decision-making under risk and uncertainty

Published on 15 June 2026

On June 11–12, TSE hosted a scientific conference on the occasion of the 65th anniversary of Christian Gollier, a leading figure in the economics of risk and uncertainty. Co-founder of TSE alongside Jean Tirole, Gollier has made pioneering contributions to the analysis of decision-making under uncertainty, with far-reaching implications for public policy, financial economics, and environmental challenges such as climate change.

The Long View: Risk, Time, and our Collective Future Conference brought together scholars and practitioners to discuss recent advances in understanding how individuals and institutions evaluate risks and trade-offs over time. Gollier’s work, particularly on risk preferences, intertemporal choice, and the valuation of uncertain future outcomes, has played a central role in shaping modern economic thinking and informing policy debates, notably in the field of climate economics and carbon pricing.

A highlight of the event was a panel discussion on public decision-making under risk and uncertainty, featuring leading economists and experts from academia, the transport sector, and the insurance sector, including long-standing research partners.

Panel summary: "Public decision-making under risk and uncertainty"

The panel gathered distinguished speakers including Catherine Wolfram (Professor of Energy Economics at the MIT), Robert S. Pindyck (Professor in Finance and Economics and a Professor of Applied Economics at the MIT), Alain Quinet (Deputy Chief Executive Officer for Regulation and Sustainable Strategy at SNCF Réseau), and Philippe Trainar (Chief Economist Officer at SCOR), who offered complementary perspectives on how risk and uncertainty influence public policy decisions.

Bridging Theory and Policy

Christian Gollier opened the discussion by reflecting on the evolution of his work from theoretical research to real-world policy applications. He highlighted the importance of incorporating modern asset pricing theory into public decision-making, particularly through the use of risk-adjusted discount rates rather than uniform rates. This approach, now partly applied in France, aims to improve how governments evaluate long-term investments under uncertainty.

Climate policy and international cooperation

Catherine Wolfram presented recent work on climate policy coordination, focusing on the development of international climate coalitions. These coalitions aim to promote carbon pricing across countries, while allowing flexibility depending on income levels. She emphasized the political and economic importance of inclusive mechanisms that can bring both high-income and developing countries into a shared framework. Recent initiatives, supported by countries representing a significant share of global emissions, illustrate growing momentum toward coordinated carbon markets.

Infrastructure investment under uncertainty

Alain Quinet provided a practitioner’s perspective based on major infrastructure projects, such as the high-speed rail line between Bordeaux and Toulouse. He explained how economic theory (especially work on risk, discounting, and irreversibility) has progressively improved project evaluation. Tools such as probabilistic modeling, long-term scenario analysis, and differentiated discount rates are increasingly used, although challenges remain in fully integrating uncertainty and ambiguity into decision-making processes.

Understanding and managing complex risks

Philippe Trainar highlighted the multidimensional nature of risk in real-world contexts, particularly in insurance and finance. He stressed that risks are rarely isolated, but instead interact and evolve over time, requiring a systemic approach. He also underscored the distinction between measurable risk and deeper uncertainty, as well as the importance of diversification and behavioral responses in shaping outcomes.

The role of catastrophic risk

Robert S. Pindyck focused on the implications of catastrophic risks (such as pandemics, climate disasters, nuclear or cyber wars) for public policy and economic evaluation. He argued that these risks are often underestimated, yet they have major implications for discounting and investment decisions. Incorporating the possibility of large-scale disruptions can significantly lower discount rates, reinforcing the case for stronger preventive action today.

Key Takeaways

Across the discussion, several common themes emerged:

Public decision-making must better account for uncertainty, long-term risks, and potential extreme events
Advances in economic theory have improved policy tools, but implementation remains incomplete
Climate change provides a key example where risk, uncertainty, and collective action intersect
Collaboration between academics, policymakers, and industry is essential to translate theory into practice