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on Environmental Economics |
| By: | Marina Vornovytskyy; James Boyce |
| Abstract: | This paper utilizes the Russian Statistical Agency's data on air pollution in Russia to analyze the impact of economic inequalities among Russia's regions on environmental degradation. Controlling for the absolute level of income, we find that regions with lower incomes relative to those of neighboring regions have more uncontrolled air pollution. Differences in uncontrolled pollution do not appear to be attributable to differences in spending on pollution control, suggesting that facility siting provides the dominant explanation. In addition, we find that greater within-region inequalities in income and in the provision of public goods are associated with greater uncontrolled air pollution.<p></p> |
| Keywords: | Air pollution; environmental inequality; pollution shifting; regional inequality; environmental Kuznets curve; Russia - environment |
| JEL: | P25 P28 Q53 Q56 R11 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:uma:periwp:wp217&r=env |
| By: | K S Kavi Kumar |
| Abstract: | Climate change impact studies on agriculture can be broadly divided into those that employ agro-economic approaches and those that employ the Ricardian approach. This study uses the Ricardian approach to examine the impact of climate change on Indian agriculture. Using panel data over a twenty year period and on 271 districts, we estimate the impact of climate change on farm level net revenue. |
| Keywords: | Environmental valuation; Spatial panel data, analysis; Adaptation, climate change, agriculture, agro-economic, ricardian approach, revenue, Indian, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2408&r=env |
| By: | Dobrescu, Emilian M.; Susanu, Monica; Oprea, Raducan |
| Abstract: | Mankind has witnessed many outstanding weather happenings which determined radical climate changes and thus, the draught is expected further to grow. Many experts, academics and scientists all over the continents have strongly called for attention about the importance of saving the water, either for housing and industrial consumers. According to the February - 2007 UNO Report, Terra is the subject of an accelerated global heating process, firstly due to the carbon emissions. Several decades further the climate changes will continue even if, theoretically, these emissions could partly be stopped. As one of the official UNO’s institutions, the World Meteorology Organisation certified the global heating and alerts about another worrying phenomenon,namely the soil disaster. |
| Keywords: | environment; climate changes; global warming; greenhouse effect; sustainable development; EU policy on the environment; climate protection |
| JEL: | Q50 Q53 Q51 Q54 Q58 |
| Date: | 2009–12–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20483&r=env |
| By: | Min Bikram Malla Thakuri |
| Abstract: | This study generates some evidence on the costs and benefits of a particular indoor air pollution control initiative. The study is based on a survey of 400 households in Rasuwa district, Nepal, |
| Keywords: | Nepal, costs, benefits, air pollution, indoor, Cooking energy, Solid biomass fuel, health problems, Green House Gases, Cost Benefit Analysis |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2398&r=env |
| By: | Andrea Podhorsky (York University, Toronto) |
| Abstract: | This paper studies how information disclosed by voluntary environmental labels creates in- centives for firms to invest in environmentally-friendly production technologies. I develop a model with differentiated products and imperfectly-informed consumers. Consumers care about the environmental characteristics of goods (for example, how they were produced), but cannot directly observe these product characteristics. Firms differ in their abilities to develop "clean" technologies, but have no incentive to do so absent government regulation or a policy that pro- vides information to consumers. A scheme of voluntary labels, awarded to firms that achieve some chosen level of environmental friendliness, gives some firms enough incentive to develop clean technologies, while others choose to produce "dirty" goods. Each consumer is individu- ally ineffective in reducing aggregate environmental damage but consumers purchase products according to how they privately value environmental quality. I parameterize the relationship between the environmental quality consumers experience privately from their own consumption of a product and the intensity of its environmental damage. I use the model to explain how voluntary labels improve consumer welfare and characterize the welfare maximizing labeling standard. I also contrast the effects of a labeling program on consumer welfare with those of compulsory environmental regulation. |
| Keywords: | credence goods, disclosure, environmental policy, firm heterogeneity and product labeling. |
| JEL: | L15 Q58 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:yca:wpaper:2009_3&r=env |
| By: | Akira Yanagisawa (The Institute of Energy Economics, Japan) |
| Abstract: | The toll on expressways is reduced as one of the economic stimulation packages of the Japanese government. The effect, however, is disputable. There are two competing views on the effect on gasoline demand and carbon dioxide (CO2) emissions, which is related to climate change. One is that this measure increases gasoline demand and CO2 emissions and another is that this measure decreases them. In this paper, the effect on gasoline demand and CO2 emissions of the reduction in expressways toll is analysed quantitatively using a gasoline demand model. Additionally, the effect on gasoline demand and CO2 emissions by free expressways and by a repeal of the temporary taxes on gasoline is estimated. The current reduction in expressways toll may seem not to lead to significant increase in gasoline demand due to the recession. It, however, is estimated that the reduction in toll actually increases gasoline demand by about 1.3% (0.8 GL per year, or 1.8 Mt of CO2 per year). If expressways become free of charge, gasoline demand is estimated to increase by about 7.2% (4.1 GL per year, or 9.6 Mt of CO2 per year). If the temporary taxes on gasoline are repealed and the taxes are reduced to the principal rates, gasoline demand is estimated to increase by about 3.1% (1.8 GL per year, or 4.1 Mt of CO2 per year). If both of these two measures are enforced, gasoline demand is estimated to increase by about 10.5% (6.0 GL per year, or 14 Mt of CO2 per year). In this case, CO2 emissions from the transport passenger sector are estimated to increase by about 10 Mt - 14 Mt depending on how much traffic will be shifted to passenger cars from other modes. This is equivalent to an increase of about 0.8% - 1.1% of Japan’s all greenhouse gases emission in the base year of the Kyoto Protocol (1990). Launch of consistent policies toward reduction of greenhouse gases emissions is more important now as the very severe emission target, reduction by 25% from 1990 level, has been announced even being premised on the formulation of a fair and effective international framework by all major economies and agreement on their ambitious targets. |
| Keywords: | gasoline demand, carbon dioxide emissions, emissions target, international framework |
| JEL: | Q40 Q41 Q54 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:eab:energy:2133&r=env |
| By: | Christopher S. Decker (Department of Economics and Real Estate, College of Business Administration, University of Nebraska at Omaha); John W. Maxwell (Department of Business Economics and Public Policy, Indiana University Kelley School of Business) |
| Abstract: | In this paper we construct a ranking of states based on their proclivity to inspect facilities for environmental compliance. Our measure utilizes state-level inspections data supplied by the US Environmental Protection Agency. After developing our ranking, we use it to predict state-level growth in manufacturing establishments. In doing so, we find support for the notion that enforcement intensity adversely impacts such growth. Our results offer insight into why existing studies that examine the impact of environmental regulation on location and growth produce inconsistent results. |
| Keywords: | Monitoring and Enforcement, Environmental Regulations, Business Formation Growth |
| JEL: | K32 Q28 R58 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:iuk:wpaper:2010-02&r=env |
| By: | Robert S. Pindyck |
| Abstract: | Any economic analysis of climate change policy requires some model that describes the impact of warming on future GDP and consumption. Most integrated assessment models (IAMs) relate temperature to the level of real GDP and consumption, but there are theoretical and empirical reasons to expect temperature to affect the growth rate rather than level of GDP. Does this distinction matter in terms of implications for policy? And how does the answer depend on the nature and extent of uncertainty over future temperature change and its impact? I address these questions by estimating the fraction of consumption society would be willing to sacrifice to limit future increases in temperature, using probability distributions for temperature and impact inferred from studies assembled by the IPCC, and comparing estimates based on a direct versus growth rate impact of temperature on GDP. |
| JEL: | D81 Q5 Q54 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15692&r=env |
| By: | Mukherjee, Sacchidananda; Chakraborty, Debashis |
| Abstract: | Economic growth does not necessarily ensure environmental sustainability for a country. The relationship between the two is far more complicated for developing countries like India, given the dependence of a large section of the population on natural resources. Under this backdrop, the current study attempts to analyze the relationships among Environmental Quality (EQ), Human Development (HD) and Economic Growth (EG) for 14 major Indian States during post liberalisation period (1991-2004). Further, for understanding the changes in EQ with the advancement of economic liberalisation, the analysis is carried out by dividing the sample period into two: Period A (1990–1996) and Period B (1997–2004). For both the sub-periods, 63 environmental indicators have been clustered under eight broad environmental groups and an overall index of EQ has been constructed using the HDI methodology. The EQ ranks of the States exhibit variation over time, implying that environment has both spatial and temporal dimensions. Ranking of the States across different environmental criteria (groups) show that different States possess different strengths and weaknesses in managing various aspects of EQ. The HDI rankings of the States for the two periods are constructed by the HDI technique following the National Human Development Report 2001 methodology. We attempt to test for the Environmental Kuznets Curve hypothesis through multivariate OLS regression models, which indicate presence of non-linear relationship between several individual environmental groups and per capita net state domestic product. The relationship between EQ and economic growth however does not become clear from the current study. The regression results involving individual environmental groups and HDI score indicate a slanting N-shaped relationship. The paper concludes that individual States should adopt environmental management practices based on their local (at the most disaggregated level) environmental information. Moreover, since environmental sustainability and human well-being are complementary to each other, individual States should attempt to translate the economic growth to human well-being. |
| Keywords: | Environmental Quality Index (EQI); Human Development Index (HDI); Economic Liberalisation; Economic Growth; India. |
| JEL: | Q50 E21 K32 Q23 C43 I20 I0 O10 O15 Q24 O13 Q01 Q25 O40 I32 Q56 Q0 Q53 I10 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17207&r=env |
| By: | Theophile T. Azomahou; Micheline Goedhuys; Phu Nguyen-Van |
| Abstract: | Relying on a structural nonparametric estimation, we show that CO2 emissions clearly increase with income at low income levels. For higher income levels, we observe a decreasing relationship, though not significant. We also find that CO2 emissions monotonically increases with energy use at a decreasing rate. |
| Keywords: | Nonparametric triangular systems, EKC; Energy use; CO2 emissions. |
| JEL: | C14 O13 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ulp:sbbeta:2010-03&r=env |
| By: | Vincent Rious |
| Abstract: | The Clingendael International Energy Programme (CIEP), the Loyola de Palacio Chair on EU Energy Policy of the Robert Schuman Centre of Advanced Studies (European University Institute), the Fondazione Eni Enrico Mattei (FEEM) and Wilton Park Conferences (WPC) organize a four-tier program for discussing the potential for a smart EU Energy Policy. The Florence workshop is then the first one in a series of four where academics will discuss the various interactions between the three objectives of the EU Energy Policy with stakeholders from governments, regulators and the industry. This workshop addressed the internal energy market design and its consequences for energy supply security and climate change policies. The workshop gathered over one day and a half 42 experts to discuss current problems and possible solutions for a smart EU Energy Policy. |
| Keywords: | Smart energy policy,3d EU directive,Market design,Renewable energy,gas reform |
| Date: | 2009–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2009/37&r=env |
| By: | Steven Stoft |
| Abstract: | The Kyoto Protocol’s approach of assigning emission targets, or “caps,” promises certainty that it cannot deliver, because it exacerbates problems with international cooperation and commitment. Global carbon pricing addresses these problems and, with less risk and more reward, can generate and sustain stronger policies. This paper proposes a system, “flexible global carbon pricing,” designed to replace the Kyoto Protocol. It provides backward-compatibility with the Kyoto Protocol by allowing un-modified cap and trade as one form of national carbon pricing. Instead of many national “caps,” the proposal sets a global target price for carbon and specifies a pair of incentives. A Pricing Incentive rewards nations that set their carbon price higher than the global target and penalizes nations that underachieve. These rewards and penalties sum to zero by design. The strength of the Pricing Incentive is adjusted automatically so that the global average carbon price converges to the global target price. A Clean Development Incentive (CDI), free from the gaming problems that plague the U.N.’s Clean Development Mechanism, encourages full participation by low-emission countries. An example, based on a $20 price target, causes transfers from the United States of only seven cents per capita per day. Nevertheless, India’s CDI receipts cover its compliance costs. The example shows that low costs can be guaranteed. |
| Keywords: | Kyoto protocol,cap and trade,flexible global carbon pricing,international cooperation |
| Date: | 2009–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2009/35&r=env |
| By: | Erreygers G.; Ferede T. |
| Abstract: | In settings characterized by weak human capital and agricultural land degradation, investments in human capital formation and land conservation can be key candidates for triggering sustained economic growth. In this study, based on insights from growth literature and models of economic transformation, we develop a framework to examine the dynamic interactions between income, human and natural capital in rural Ethiopia. In addition, the trade-offs and complementarities of economic and environmental policies in terms of their impact on growth, investments in human capital formation and land conservation are assessed. The study underscores the centrality of interconnectedness and reciprocal influences between growth and investments in human and natural capital in understanding the long-run implications of policy reforms. Development interventions that are crucial for achieving broad-based and sustainable improvements in household income, human and natural capital are identified, which have wider implications for settings sharing similar socioeconomic characteristics. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:ant:wpaper:2009008&r=env |
| By: | Rupayan Pal (Indira Gandhi Institute of Development Research) |
| Abstract: | This paper examines how product differentiation as well as strategic managerial delegation affects optimal emission tax rate, environmental damage and social welfare, under alternative modes of product market competition. It shows that, under pure profit maximization, the (positive) optimal emission tax rate is not necessarily decreasing in degree of product differentiation, irrespective of the mode of competition. The possibility of emission tax rate to be positive and lower for more differentiated products, under quantity (price) competition, is higher (lower) in case of delegation than that in case of no delegation. It also shows that, under quantity (price) competition, the equilibrium emission tax rate environmental damage and social welfare are higher (lower) in case of delegation than that in case of no delegation. |
| Keywords: | Emission tax, price competition, product differentiation, quantity competition, strategic managerial delegation |
| JEL: | H23 Q50 Q58 L13 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ind:igiwpp:2009-007&r=env |
| By: | Ratna Kumar Jha; Adhrit Prasad Regmi |
| Abstract: | In Nepal, agriculture is commercializing day by day and levels of agro-chemical use are growing. This is beginning to raise concerns about the health and environmental impacts of farm chemicals such as pesticides.The brief looks at the effectiveness of pesticides in reducing crop losses amongst vegetable farmers in Nepal. |
| Keywords: | procutivity, vegetable farming, Nepal, chemicals, pesticides, farmers, agriculture, health, environmental, production, crop, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2416&r=env |
| By: | Yuji Takagi (The Institute of Energy Economics, Japan) |
| Abstract: | It was a long 35 years ago that Richard Nixon proclaimed, “Our national goal should be to meet our own energy needs without depending on any foreign sources.” Even now that goal of energy security remains elusive although it has occupied an attention almost continuously. Under the sharp increase in oil prices until last year, the past several years have made a huge impact on public awareness and have contributed to a growing concern about energy independence. At the same time, a big difference has come about in attitudes toward climate change. In December 1997, when tough negotiators agreed to the Kyoto Protocol, the United States Senate was at odds with the international community, voting 95-0 against the accord. Now the cultural landscape is full of cover articles in major media publications on such topics as powerful hurricanes, 100 year storms, disappearing species, as well as Al Gore’s book and film “An Inconvenient Truth” and his Nobel Peace Prize. Global warming has arrived at center stage as a major concern for economics and national security. Governors are taking dynamic steps to fight climate change, major companies are working for strategic measures, venture capitalists are pouring money into alternative energy, military specialists are engaged by the global security dangers of climate change, and civil societies are demonstrating against global warming. |
| Keywords: | climate change, energy security, energy forecasting |
| JEL: | Q54 Q40 Q42 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:eab:energy:2116&r=env |
| By: | Joshua Graff Zivin; Matthew J. Neidell |
| Abstract: | In this paper we estimate the impacts of climate change on the allocation of time using econometric models that exploit plausibly exogenous variation in daily temperature over time within counties. We find large reductions in U.S. labor supply in industries with high exposure to climate and similarly large decreases in time allocated to outdoor leisure. We also find suggestive evidence of short-run adaptation through temporal substitutions and acclimatization. Given the industrial composition of the US, the net impacts on total employment are likely to be small, but significant changes in leisure time as well as large scale redistributions of income may be consequential. In developing countries, where the industrial base is more typically concentrated in climate-exposed industries and baseline temperatures are already warmer, employment impacts may be considerably larger. |
| JEL: | J22 Q54 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15717&r=env |
| By: | Philippe Aghion; Reinhilde Veugelers; David Hemous |
| Abstract: | This Policy Brief, co-written by Senior Non-Resident Fellow Philippe Aghion, Senior Resident Fellow Reinhilde Veugelers and David Hemous of Harvard University, attempts to change the terms of the debate surrounding climate change policy. The authors argue that policymakers should do more to encourage innovation and investment in green? research and development rather than focusing solely on the setting of a carbon price. Using a model developed by Aghion in a previous paper, they argue that a carbon price would have to be about 15 times higher in the first five years and 12 times higher in the next five years if innovation is not properly subsidized by governments. The authors also provide several policy recommendations for incentivising this type of green growth? in the private sector. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polbrf:369&r=env |
| By: | Ivan Diaz-Rainey; Dionisia Tzavara |
| Abstract: | This paper develops a formal model that links the willingness to pay (WTP) literature with the established innovation diffusion literature. This concern arises from an attempt to reconcile the large disparities that have been observed between actual adoption of green energy tariffs and WTP for such tariffs. These disparities have often been attributed to upward response bias and the free rider problem. However, empirical research indicates that other factors have hindered the development of green energy markets, including supply side problems and poor regulation. Using an epidemic diffusion framework our model shows how increasing consumer environmental concern driven by word of mouth and mass media communication channels results in a growing number of people who state they are WTP for green energy. The presence of upward response bias and the free rider problem result in 'feasible adoption' being below stated WTP. Feasible adoption is, in turn, differentiated from actual adoption by the extent of market imperfections. It is concluded that; (1) the potential of such markets may take time to reap and that the low penetration rates of today may reflect a conventional diffusion trajectory and (2); low and stable energy prices appear to be a precondition if consumers are to contribute substantively to the funding of renewables investments through green tariffs. |
| Keywords: | Willingness-to-pay, innovation diffusion, green energy, environmental valuation |
| Date: | 2009–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2009/33&r=env |
| By: | Philippe Aghion; Reinhilde Veugelers; Clément Serre |
| Abstract: | This Policy Contribution accompanies the Policy Brief, No Green Growth Without Innovation?. Written by Senior Non-Resident Fellow Philippe Aghion, Senior Resident Fellow Reinhilde Veugelers and Researcher Clément Serre, this paper discusses the state of green innovation and goes into more depth in discussing the current problems in the area. Examining research and development, patent, and venture capital data, the authors point out that there is momentum for private investment in green technologies. However, they argue that, thus far, the implicit tax rate on energy in the EU27 is too low and fragmented, the carbon price in the EU Emissions Trading System is too volatile, and the public R&D expenditures dedicated to energy and environment are too low. They conclude that immediate state intervention is necessary, at least at the onset, to ensure that the green innovation machine? gets properly started. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polcon:370&r=env |
| By: | Patrick Bajari; Jane Cooley; Kyoo il Kim; Christopher Timmins |
| Abstract: | We propose a new strategy for a pervasive problem in the hedonics literature—recovering hedonic prices in the presence of time-varying correlated unobservables. Our approach relies on an assumption about homebuyer rationality, under which prior sales prices can be used to control for time-varying unobservable attributes of the house or neighborhood. Using housing transactions data from California’s Bay Area between 1990 and 2006, we apply our estimator to recover marginal willingness to pay for reductions in three of the EPA’s “criteria” air pollutants. Our findings suggest that ignoring bias from time-varying correlated unobservables considerably understates the benefits of a pollution reduction policy. |
| JEL: | C01 Q51 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15724&r=env |
| By: | Benjamin F. Jones; Benjamin A. Olken |
| Abstract: | This paper uses international trade data to examine the effects of climate shocks on economic activity. We examine panel models relating the annual growth rate of a country’s exports in a particular product category to the country’s weather in that year. We find that a poor country being 1 degree Celsius warmer in a given year reduces the growth rate of that country’s exports by between 2.0 and 5.7 percentage points, with no detectable effects in rich countries. We find negative effects of temperature on exports of both agricultural products and light manufacturing products, with little apparent effects on heavy industry or raw materials. The results confirm large negative effects of temperature on poor countries’ economies and suggest that temperature affects a much wider range of economic activity than conventionally thought. |
| JEL: | F18 Q54 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15711&r=env |