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Satisficing is a decision-making heuristic, created by Herbert Simon that involves decision makers searching through all available alternatives until they find the one that meets the most basic acceptability threshold. It combines the words satisfy and suffice, essentially a short-cut to finding a solution that either satisfies the a more simplistic version of the issue or is sufficient enough in solving a more complicated and realistic problem. Humans are not able to evaluate all options perfectly because they will never have all the perfect information or the limitless cognitive capability to be able to perfectly calculate every outcome of every option, giving them bounded rationality. In environmental policy creation, the problems these policies need to address are often very uncertain and complex and involve lots of varying stakeholders so it is extremely difficult to have all of the information necessary to create the perfect policy, so policy makers will satisfice in order to find the most direct and simple answer.

Within the setting of climate change, there are two fundamental challenges that the economics of climate change have to address which include uncertainty regarding how the climate responds to emissions and how higher temperatures and climate mitigation can affect economic activity as well as the ethical objectives that these climate policies should strive to meet. Trying to balance both of these fundamental challenges is difficult but can be simplified by using a satisficing model. Satisficing asks, “Given the uncertainty surrounding environmental decision making, which policy would ensure the least adverse effects with the highest confidence?” Essentially, the satisficing model gives the decision and policymakers a streamlined approach to choosing the alternative that provides the least harmful effects. They must understand all the tradeoffs and challenges of the problem first in order to determine which solution will provide the most benefits with the least negative effects on stakeholders.

Satisficing in environmental policy is often used as a very cost-effective model. Tradable permits would be an example of satisficing in creating policies that are meant to help offset the effects of carbon emissions while still giving companies economic opportunities. However, satisficing also explains why there is still an ‘energy gap’ created by the unreaped economic benefits that could come from energy conservation. In order to make more effective decisions and policies, relying less on the satisficing shortcut will be important. Trying to create policies that utilize as much research as possible and take into account all of the stakeholders at risk will be the most effective in helping to curb the effects of environmental and economic degradation.