Decision-making under uncertainty: the political economy of shale gas

Petersen, H. (2016). Decision-making under uncertainty: the political economy of shale gas. (Unpublished Doctoral thesis, City, University of London)

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This thesis explores the factors influencing governmental policy preferences on the uncertain issue of shale gas development. I argue that there is no convincing expected utility of shale gas development, and that, in light of conflicting evidence, governmental decision-makers cannot believe it to be so. The notion of a ‘rational actor’ government deciding on shale gas based on its utility offers limited explanatory value. I am telling a more comprehensive story of shale gas and by using different clues taken from political economy and behavioural economics theory, develop several narratives about respective dimensions of the decision-making process: a rational expected utility analysis, a perspective on the influence of private interest groups, and a narrative on capture through ideational repertoire and cognitive biases. To this end classical literature of decision-making under risk and uncertainty is reviewed and political economy theory is brought in to widen the debate. The key arguments of this study are that policy decisions on shale gas are irrational from a classical political science perspective; that economic claims made about policy decisions are defying economic logic; that strong interest groups are distorting a market-based energy policy; and that pre-existing ideas about the energy system unduly influence the decision process regardless of their actual applicability. I suggest that fracking is simply so compatible with the current repertoire of ideas, practices and tools around energy policy, that engaging in it becomes a logical conclusion, whereas not to engage in it would require a paradigmatic change. These arguments are taken forward by an in-depth analysis of the decision-making around shale gas made by the United States government and the United Kingdom government since the commercial development of shale gas became possible through technological innovation in the 21st century. The thesis serves to shine light on the story of shale gas policy, but also to explore separate dimensions of policy-making under uncertainty in which cognitive and parochial factors prove more influential than so-called rational calculations.

Item Type: Thesis (Doctoral)
Subjects: H Social Sciences > HD Industries. Land use. Labor
J Political Science > JA Political science (General)
Divisions: City University London PhD theses
School of Social Sciences > Department of International Politics

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