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on Environmental Economics |
| By: | Stefan Baumgärtner (Centre of Sustainable Management, Leuphana University of Lüneburg); Frank Jöst (Alfred-Weber-Institute of Economics, Universtity of Heidelberg); Ralph Winkler (Center of Economic Research,ETH Swiss Federal Institute of Technology) |
| Abstract: | We analyze the optimal dynamic scale and structure of a two-sector-economy, where each sector produces one consumption good and ons specific pollutant. Both pollutants accumulate at different rates to stocks which damage the natural environment. This acts as a dynamic driving force for the economy. Our analysis shows that along the optimal time-path (i) the overall scale of economic acticity may be less than maximal; (ii) the time sclae economic dynamics (change of scale and structure) is mainly determined by the lifetime of pollutNTS, their harmfulness and the discount rate; and (iii) the optimal control of economic scale and structure may be non-monotonic. These results raise important questions about the optimal design of environmental policies. |
| Keywords: | dynamoic economy-environment interaction, multi-pollutant emissions, non-monotonic control, optimal scale, stock pollution, structural change, time scale |
| JEL: | Q20 O10 O41 |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:50&r=env |
| By: | Michael Rauscher (University of Rostock and ifo Institut München); Edward B. Barbier (University of Wyoming) |
| Abstract: | The paper combines an economic-geography model of agglomeration and periphery with a model of species diversity and looks at optimal policies of biodiversity conservation. The subject of the paper is "natural" biodiversity, which is inevitably impaired by anthropogenic impact. Thus, the economic and the ecological system compete for space and the question arises as to how this conflict should be resolved. The decisive parameters of the model are related to biological diversity (endemism vs. redundancy of species) and the patterns of economic geography (centrifugal and centripetal forces). As regards the choice of environmental-policy instruments, it is shown that Pigouvian taxes do not always establish the optimal allocation. |
| Keywords: | biodiversity, new economic geography, agglomeration, species redundancy vs. endemism, environmental regulation |
| JEL: | Q56 Q57 Q58 R12 R14 R23 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:ros:wpaper:79&r=env |
| By: | Arief Anshory Yusuf (Department of Economics, Padjadjaran University); Budy P. Resosudarmo (Australian National University) |
| Abstract: | This paper analyses the distributional impact of carbon tax in Indonesia, one of the largest carbon emitter developing countries. Using a Computable General Equilibrium (CGE) model with disaggregated households, the result suggests that in contrast to most studies from industrialised countries, the introduction of carbon tax in Indonesia is not necessarily regressive. Its structural change and resource reallocation effect, following the carbon tax, is in favor of factors endowed more proportionately by rural, and lower income households. In addition, the expenditure of lower income households, especially in rural area, are less sensitive to the prices of energy-related commodities. Revenue-recycling through uniform reduction in commodity tax rate may reduce the adverse aggregate output effect, whereas uniform lumpsum transfers may enhance the progressivity. This study demonstrates an example, that encouraging developing countries to reduce carbon emission, may not only increase the efficiency of carbon abatement globally, but also have desirable distributional implication in the developing countries themselves. |
| Keywords: | Carbon Tax, Climate Change, Distribution, CGE, Indonesia |
| JEL: | D30 D58 Q40 Q48 Q54 Q56 Q58 |
| Date: | 2007–05 |
| URL: | http://d.repec.org/n?u=RePEc:unp:wpaper:200705&r=env |
| By: | Broberg, Thomas (Department of Economics, Umeå University) |
| Abstract: | This paper estimates the public benefit of preserving 126 000 hectares of old-growth forest in the sub-mountainous region of Sweden through contingent valuation. The primary benefit of this in-situ conservation of biodiversity is the forest’s relative diversity and richness, which provides important habitat for threatened species. Thus, benefits arise predominantly from nonuse values. We find that a majority of the Swedish population is unwilling to contribute financially to the preservation project (median WTP equals zero). The estimated mean WTP is SEK 300, implying an aggregate benefit of SEK 9 billion. We estimate two types of valuation functions in order to reject the hypothesis that respondents state random numbers as their WTP. Firstly, a binary logit model indicates that variables related to a respondent’s education level, income level and concern about the environment are positively correlated with the likelihood of supporting the preservation project, while being a male and having an anti-environmental attitude towards public expenditures are negatively correlated. After controlling for whether or not locals are employed in forest-related industries, we find that locals, in general, are more likely to have a positive WTP. Secondly, we estimate a valuation function conditioned on respondents with a positive WTP and find that the size of their contribution is explained by income, general concern about the environment, and the motive underlying their valuation (e.g., use versus nonuse). No differences between locals and non-locals were found. |
| Keywords: | contingent valuation; willingness to pay; social benefit; nonuse values; non-timber value; old-growth forest; preservation; conservation |
| JEL: | Q20 Q23 Q26 Q28 Q38 |
| Date: | 2007–05–16 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:umnees:0712&r=env |
| By: | Serban Scrieciu (Department of Land Economy, University of Cambridge, UK); Lindsay C Stringer (School of Environment and Development, University of Manchester, UK) |
| Abstract: | Since Communism collapsed at the end of the 1980s, the transition towards a market-based economy has been considerably influenced by the neoclassical economic approach to the reform process. This has often ignored the establishment of adequate institutional frameworks, resulting in high transition costs and the side-lining of environmental concerns. This paper takes a holistic approach to the transformation of post-Communist economies that emphasises, in addition to socio-economic and political dimensions, the importance of appropriate institutional developments in the area of environmental sustainability. Core development values and objectives need to be significantly re-evaluated, if long-term sustainability prospects are to be effectively pursued. |
| Keywords: | Post-Communist societies, transition, environment, sustainability, neoclassical economics, post Keynesianism |
| JEL: | Q2 Q4 R4 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:lnd:wpaper:200725&r=env |
| By: | Ekin Birol (Department of Land Economy, University of Cambridge, UK); Phoebe Koundouri; Yiannis Kountouris (Department of Land Economy, University of Cambridge, UK) |
| Abstract: | This paper employs the contingent valuation (CV) method, to investigate Cypriot farmers’ willingness to adopt a new water resource, namely recycled wastewater, and to estimate farmers’ willingness to pay for varying quantities and qualities of recycled wastewater. A pilot CV study is undertaken with 97 farmers located in the Akrotiri aquifer area in Cyprus, a common-pool water resource with rapidly deteriorating water quality and quantity. The results reveal that farmers are willing to adopt this new water resource, and they derive the highest economic values from a recycled wastewater use program, which provides high quality recycled wastewater, and high water quantity in the aquifer. |
| Keywords: | contingent valuation, willingness to pay, water quantity, water quality, recycled wastewater, aquifer recharge |
| JEL: | Q2 Q4 R4 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:lnd:wpaper:200724&r=env |
| By: | Emek Baris Kepenek |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:met:stpswp:0611&r=env |
| By: | Tagbata, D.; Sirieix, L. |
| Abstract: | Previous research has extensively studied the gap between environmental or social concern, and behaviour. However, measuring environmental or social dimension valuation remains challenging. This paper therefore fills this gap by measuring fair trade and organic labels valuation, using an experimental method (BDM mechanism). Two "organic and fair trade" and two conventional chocolate products have been tested by 102 consumers (blind test and full products test). Results show that organic and fair trade labels increase consumers willingness to pay (WTP), and allow to identify three consumers clusters : in the first one, consumers do not value these labels; on the contrary, consumers' WTP for organic and fair trade products in the second segment is significantly higher than their WTP for conventional products. In the last segment, taste is the most important criterion, and there is an additional WTP for fair trade and organic label only if consumers like the product. Our research is a contribution to a better understanding of consumers' valuation of fair trade and organic label, leading to managerial proposals as regard to this market (importance of taste, usefulness of double labels). ...French Abstract : Cet article répond à la question théorique des liens entre préoccupations environnementales et sociales, et à la question pratique de l'intérêt du double label " bio-équitable ", en s'appuyant sur une expérimentation économique basée sur le principe des enchères (mécanisme BDM). Quatre chocolats (deux bio-équitables, deux conventionnels) ont été dégustés et les personnes interrogées ont donné leur consentements à payer (CAP) sur la base de la dégustation ou/et des labels. Les résultats montrent qu'à l'aveugle, les deux chocolats bio-équitables ne sont pas les plus appréciés, mais qu'ils ont les CAP les plus élevés lorsque les labels sont apparents. Cependant, trois segments de consommateurs réagissant différemment au label " bio-équitable " ont été identifiés : près de la moitié sont insensibles à la présence du label ; pour un deuxième segment, l'influence du label " bio-équitable " sur la valorisation des produits est positive et importante ; enfin, pour le troisième segment, la valorisation du label " bio-équitable " est conditionnée au goût du produit. Notre étude apporte des résultats intéressants qu'il conviendra de vérifier sur des échantillons représentatifs dans plusieurs pays : le label bio-équitable entraîne une valorisation des produits ; cependant, la sensibilité des consommateurs à ce label est variable et le marché de ces produits ne doit pas être sur-estimé. Par ailleurs, les efforts sur l'amélioration de la qualité des produits bio-équitables doivent être maintenus. Enfin, le couplage des labels " bio " et " équitable " sur un même produit entraîne une sous-additivité du CAP par rapport aux CAP des deux labels considérés séparément et la double labellisation ne doit donc pas être systématique. |
| Keywords: | FAIR TRADE; ORGANIC PRODUCTS; LABELS; EXPERIMENTAL METHOD; WILLINGNESS TO PAY |
| JEL: | C90 D12 D64 M31 Q20 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:umr:wpaper:200702&r=env |
| By: | Andreas Kontoleon (Department of Land Economy, University of Cambridge, UK); Pauline Grosjean (LERNA, University of Toulouse and European Bank for Reconstruction and Development, France) |
| Abstract: | This paper undertakes a direct comprehensive assessment of the long-run sustainability of one the world’s largest sustainable development programs, the Slopping Land Conversion Program (SLCP) in China under different plausible post-SLCP scenarios. The analysis is based on farmer contingent behavior post-program land and labor decisions as well as choice experiment data. Our econometric results highlight the main obstacles to the program’s sustainability, which include specific shortfalls in program implementation as well as certain institutional constraints such as tenure insecurity, poor land renting rights, limited access to credit and limited land management rights. |
| Keywords: | sustainable development programs, sustainability, recursive probit, choice modeling, Asia, China |
| JEL: | Q2 Q4 R4 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:lnd:wpaper:200726&r=env |
| By: | Nori Tarui (Department of Economics, University of Hawaii at Manoa); Charles Mason (Department of Economics and Finance, University of Wyoming); Stephen Polasky (Department of Applied Economics, University of Minnesota); Greg Ellis (Department of Economics, University of Washington) |
| Abstract: | We model a dynamic common property resource game with unobservable actions and non-linear stock dependent costs. We propose a strategy profile that generates a worst perfect equilibrium in the punishment phase, thereby supporting cooperation under the widest set of conditions. We show under what set of parameter values for the discount rate, resource growth rate, harvest price, and the number of resource users, this strategy supports cooperation in the commons as a subgame perfect equilibrium. The strategy profile that we propose, which involves harsh punishment after a defection followed by forgiveness, is consistent with human behavior observed in experiments and common property resource case studies. |
| Keywords: | Common property resource, cooperation, dynamic game, unobservable actions |
| JEL: | D62 Q20 |
| Date: | 2006–11 |
| URL: | http://d.repec.org/n?u=RePEc:hai:wpaper:200712&r=env |