  We study strategic interactions between firms with heterogeneous beliefs
about future climate impacts. To that end, we propose a Cournot-type
equilibrium model where firms choose mitigation efforts and production
quantities such as to maximize the expected profits under their subjective
beliefs. It is shown that optimal mitigation efforts are increased by the
presence of uncertainty and act as substitutes; i.e., one firm's lack of
mitigation incentivizes others to act more decidedly, and vice versa.
