Credibility Denials

A traditional bank run starts whe

- information about potential prob
Perceived Risk of
Bank failure Liquid Fraction
a bank failure. More fear leads to
+ running Anger withdraw personal savings. An in
to a decrease of the perceived so
+ + + leads to more fear of a bank failu
Perceived Perceived Liquid
Liquid deposits
withdrawals also leads to a decre
Likelihood solvency deposits
Liquidity failure and loans and loans lost and hence to a lower liquidity of
Failure turn more and more illiquid asset
- - +
- have sufficient liquid assets to pa
Concerted liquid to the speed required to liquidate
+ fraction
Liquid asset lost
are often made, resulting in a red
Liquid Asset bank. The lower the solvency of t
+ perceived solvency of the bank, w
Liquidation bank failure. Weak or uncertain e
Premium
more fear and lower perceived so
 Weak/Uncertain
Potential problem Economic condition
Information
- +
Perceived Fear of

+
Bank failure + Withdrawal of liquid
asset by customer

+ -
Perceived Liquid
Likelihood deposits Liquid Bank
Liquidity and loans Reserve lost
Perceived
Failure solvency
-
- -
Decliing liquid
reserves

+
Liquidation
Premium
 Properties Supply
Delay
+
- -

Property Prices
Area +
New Projects
+

+
-
Demand
 Below you find a description of a very simple fisheries
Death model, also known as the basic Fish Banks model. The
Fraction
+ two main variables in a fisheries model are fish and ships.
Fish Price
Death Suppose the number of fish only increases through the
+ Rate
fish hatch rate and decreases both through the fish
Revenue - + Fish death rate and the total catch per year. Suppose that the
Regeneration
fish hatch rate equals the fish times the hatch fraction.
Density
Total The fish death rate is equal to the death fraction times
+ Catch/y the fish. The death fraction is a function of the carrying
ear
+ capacity and the number of Fish. The total catch per year
Birth Catch/
Birth Rate
Fraction + ship depends on the number of ships and the annual catch
+ per ship which is a function of the fish density. The
Operating
Cost density is defined as the amount of fish in the fishing area
-
divided by the area. Suppose that the number of Ships
+
Annual increases via the ship building rate which is a function of
Profit
+ Ships
the investment costs per ship, annual profits and fraction
+ reinvested. The annual profits are calculated as the
Investment + revenues minus the costs. Assume that the revenues
Fraction Ship equal the total catch per year times the fish price a
reinvested build rate

+
 Death
Fraction
+
Death Rate

Fish + -
- + fish breeding
Density Regeneration
conservation
Total +
Catch/year
+ + + +
Operating +
Cost
- - Catch/ship
Birth Rate
+ Birth Fraction
Annual
+
Profit
+ Ships
Catch limit
+
Investment + Regulation

Fraction Ship
reinvested build rate

+
 Self- Perceived Risk
reinforcing
uncertainties

Confidence in Energy Transitions a

ET Certainty long delays. Energy
+ individuals, particul
- Mass the energy field– ar
Adoption
overcome many hur
technologies battle
willingness to make effort
• One of these hurd
ET
Uncertainty to make ET comes true technology develop
of investments, it d
technology develop
forbidden. It is hard
New ET
Technolog which might possibl
y • Many self-reinforc
Revenue Investment in technology. The low
from ET ET technology entrepreneurial wil
technology to the p
Gov. Subsidy actions to reduce un
Profitabiility
perceived certainty
in turn reinforces (i
Research & reduction of the pe
operational cost
preconditions to fur
entrepreneurs and
Energy Transitions are dynamically complex: they are governed by many feedback effects and
long delays. Energy transitions are also deeply uncertain: major uncertainties –related to
individuals, particular technologies, the entire system, and hence for policy/decision makers in
the energy field– are omnipresent. Energy technologies face many uncertainties and need to
overcome many hurdles, even before becoming commercially viable and entering the energy
technologies battlefield.
• One of these hurdles is the so-called ‘valley of death’. That is, quite often, entrepreneurs and
technology developers bring a new technology to the pre-commercial stage, but due to a lack
of investments, it does not survive the phase between (subsidized) entrepreneurial
technology development and large-scale commercial take-off in which subsidies are (often)
forbidden. It is hard to predict which promising technologies will actually make it, and hence,
which might possibly become the technologies of the future. • Many self-reinforcing
uncertainties influence perceived certainty related to each new technology. The lower the
perceived certainty, the higher the perceived risk and the lower the entrepreneurial willingness