nep-agr New Economics Papers
on Agricultural Economics
Issue of 2015‒07‒04
twenty papers chosen by

  1. Individual Farm Model for Common Agricultural Policy Analysis (IFM-CAP) By Kamel Louhichi; Pavel Ciaian; Maria Espinosa; Liesbeth Colen; Angel Perni; Sergio Gomez y Paloma
  2. Russian Agriculture: the impact of sanctions By Natalia Karlova; Vasily Uzun; Natalia Shagaida; Renata Yanbykh
  3. Agriculture in Europe's little divergence: the case of Spain By Carlos Álvarez Nogal; Leandro Prados de la Escosura; Carlos Santiago Caballero
  4. Economic and ecological trade-offs of agricultural specialization at different spatial scales By Stephan Klasen; Katrin M. Meyer; Claudia Dislich; Michael Euler; Heiko Faust; Marcel Gatto; Elisabeth Hettig; Dian N. Melati; I. Nengah Surati Jaya; Fenna Otten; César Perez; Stefanie Steinebach; Suria Tarigan; Kerstin Wiegand
  5. Policies with Varying Costs and Benefits: A Land Conservation Classroom Game By Sarah Jacobson; Sahan Dissanayake
  6. Irrigation Technology Adoption, Water Effectiveness and Productivity Measurement By Konstantinos Chatzimichael; Dimitris Christopoulos; Spyro Stefanou; Vangelis Tzouvelekas
  7. Documentation of the European Comission’s EU module of the Aglink-Cosimo modelling system By Sergio René Araujo Enciso; Ignacio Pérez Domínguez; Fabien Santini; Sophie Helaine
  8. A study on market inclusion through enhanced eco-management in Bulgarian farms By Bachev, Hrabrin
  9. Rapid Appraisal of the Postharvest Facilities Projects in the Philippines By Manalili, Nerlita M.; Yaptenco, Kevin F.; Manilay, Alessandro A.
  10. Relative willingness to pay and surplus comparison mechanism in experimental auctions By COMBRIS Pierre; SEABRA PINTO Alexandra; GIRAUD HERAUD Eric
  11. Water Use and Conservation in Manufacturing: Evidence from U.S. Microdata By Randy A. Becker
  12. On the relevance of ideological identification and environmental values for beliefs and attitudes toward climate change: An empirical cross country analysis By Andreas Ziegler
  13. Rural-urban social accounting matrixes for modelling the impact of rural development policies in the EU By M. Alejandro Cardenete; M. Carmen Delgado; Patricia D. Fuentes; M. Carmen Lima; Alfredo J. Mainar; Jose M. Rueda-Cantuche; Sébastien Mary; Fabien Santini; Sergio Gomez y Paloma
  14. Pro farmer, pro industry land acquisition act By Varma, Vijaya Krushna Varma
  15. Biogas : clean energy access with low-cost mitigation of climate change By Somanathan,E.; Bluffstone,Randall
  16. Plant functional traits as a promising tool for the ecological restoration of degraded tropical metal-rich habitats and revegetation of metal-rich bare soils: A case study in copper vegetation of Katanga, DRC By Edouard Ilunga wa ilunga; Grégory Mahy; Julien Piqueray; Maxime Séleck; Mylor Ngoy M.N. Shutcha; Pierre Jacques Meerts; Michel-Pierre Faucon
  17. Volatility Spillovers Between Energy and Agricultural Markets: A Critical Appraisal of Theory and Practice By Chia-Lin Chang; Yiying Li; Michael McAleer
  18. Investing in the cheapest form of energy: efficiency practices of SMEs in rural Ghana. By Ackah, Ishmael
  19. Environmental efficiency of energy, materials, and emissions By Yagi, Michiyuki; Hidemichi, Fujii; Hoang, Vincent; Managi, Shunsuke
  20. Beneficial Leakage: The Effect of the Regional Greenhouse Gas Initiative on Aggregate Emissions By Harrison Fell; Peter Maniloff

  1. By: Kamel Louhichi (European Commission – JRC - IPTS); Pavel Ciaian (European Commission – JRC - IPTS); Maria Espinosa (European Commission – JRC - IPTS); Liesbeth Colen (European Commission – JRC - IPTS); Angel Perni (European Commission – JRC - IPTS); Sergio Gomez y Paloma (European Commission – JRC - IPTS)
    Abstract: This report presents the first EU-wide individual farm-level model (IFM-CAP) aiming to assess the impacts of CAP on farm economic and environmental performance. The rationale for such a farm-level model is based on the increasing demand for a micro-simulation tool able to model farm-specific policies and to capture farm heterogeneity across the EU in terms of policy representation and impacts. Based on positive mathematical programming, IFM-CAP seeks to improve the quality of policy assessment upon existing aggregate and aggregated farm-group models and to assess distributional effects over the EU farm population. To guarantee the highest representativeness of the EU agricultural sector, the model is applied to every EU-FADN (Farm Accountancy Data Network) individual farm (around 60 500 farms). The report provides a detailed description of the IFM-CAP model prototype in terms of design, mathematical structure, data preparation, modelling livestock activities, allocation of input costs and the calibration process. The theoretical background, the technical specification and the outputs that can be generated from this prototype are also briefly presented and discussed. The report also presents an application of the model to the assessment of the effects of the crop diversification measure. The results show that most non-compliant farms (80 %) chose to reduce their level of non-compliance following the introduction of the diversification measure owing to the sizable subsidy reduction imposed. However, the overall impact on farm income is rather limited: farm income decreases by less than 1 % at EU level, and only 5 % of the farm population will be negatively affected. Nevertheless, for a small number of farms, the income effect could be more substantial (more than –10 %).
    Keywords: Farm model; IFM-CAP; CAP; Subsidies; CAP greening; Policy impact analysis; Positive Mathematical Programming (PMP); FADN; EU; Micro simulations, Modelling, Agriculture.
    JEL: Q12 Q18
    Date: 2015–06
  2. By: Natalia Karlova (Gaidar Institute for Economic Policy); Vasily Uzun (Gaidar Institute for Economic Policy); Natalia Shagaida (Gaidar Institute for Economic Policy); Renata Yanbykh (Gaidar Institute for Economic Policy)
    Abstract: This paper deals with the issues related to restrictions imposed by the Russian government on import of agricultural products.
    Keywords: Russian economy, Russian agricultural production, sanctions
    Date: 2015
  3. By: Carlos Álvarez Nogal; Leandro Prados de la Escosura; Carlos Santiago Caballero
    Abstract: This paper explores the role of agriculture in Spain's contribution to the little divergence in Europe. On the basis of tithes collected by historians over the years, long-run trends in agricultural output are drawn. After a long period of relative stability, output suffered a severe contraction during 1570-1590, followed by milder deterioration to 1650. Output per head moved from a relatively high to a low path that persisted until the Peninsular War. The demand contraction, resulting from the collapse of domestic markets, monetary instability, and war in Iberia, helps to explain a less intensive use of labour and land as incentives to produce for the market sharply diminished. Agricultural output per head moved along population up to 1750. This finding confirms the view of Spain as a land abundant frontier economy. Only in the late eighteenth century a Malthusian pattern emerged.
    Keywords: Agriculture , Little divergence , Early modern Spain , Tithes , Output per head
    JEL: N53 O13 Q10
    Date: 2015–06
  4. By: Stephan Klasen (Georg-August-University Göttingen); Katrin M. Meyer (Georg-August-University Göttingen); Claudia Dislich (Georg-August-University Göttingen); Michael Euler (Georg-August-University Göttingen); Heiko Faust (Georg-August-University Göttingen); Marcel Gatto (Georg-August-University Göttingen); Elisabeth Hettig (GIGA Hamburg); Dian N. Melati (Georg-August-University Göttingen); I. Nengah Surati Jaya (Bogor Agricultural University); Fenna Otten (Georg-August-University Göttingen); César Perez (Georg-August-University Göttingen); Stefanie Steinebach (Georg-August-University Göttingen); Suria Tarigan (Bogor Agricultural University); Kerstin Wiegand (Georg-August-University Göttingen)
    Abstract: Specialization in agricultural systems leads to trade-offs between economic gains and ecosystem functions. Economic gains can be maximized when production activities are specialized at increasingly broader scales (from the household to the village, region or above), particularly when markets for outputs and inputs function well and allow specialization as well as high levels of food security. Conversely, a tendency toward specialization likely reduces biodiversity and significantly limits ecosystem functions at the local scale. When agricultural specialization increases and moves to broader scales as a result of improved infrastructure and markets, ecosystem functions can also be endangered at broader spatial scales. Policies to improve agricultural incomes through improvements in infrastructure and the functioning of markets thus affects the severity of the trade-offs. This paper takes Jambi province in Indonesia, a current hotspot of rubber and oil palm monoculture, as a case study to illustrate these issues. In doing so, it empirically investigates the trade-offs between economic gains and ecosystem functions for three spatial levels of scale (i.e. household, village, and region) and discusses ways to resolve these trade-offs.
    Keywords: Ecosystem services; economies of scale; Indonesia; monoculture; oil palm; rubber
    JEL: Q13 Q57
    Date: 2015–06–25
  5. By: Sarah Jacobson (Williams College); Sahan Dissanayake (Colby College)
    Abstract: Some policies try to maximize net benefits by targeting different individuals to participate. This is difficult when costs and benefits of participation vary independently, as in land conservation. We share a classroom game that explores cases in which minimizing costs may not maximize benefits and vice versa. This game is a contextually rich pedagogical tool, putting students in the role of landowners who must decide whether to conserve land in different policy environments: flat conservation payments, agglomeration bonuses, and a conservation auction. Students learn about specific issues in land conservation, ecosystem services, preferences for non-money outcomes, and general issues in policymaking. The game is suited to classes in environmental, resource, agricultural, and policy economics, and more general classes in microeconomics and public policy.
    Keywords: classroom game, spatial agglomeration, conservation, land use, economic education
    JEL: A22 Q24 Q57
    Date: 2015–06
  6. By: Konstantinos Chatzimichael (Dept of Economics, University of Crete, Greece); Dimitris Christopoulos (Panteion University); Spyro Stefanou (Pennsylvania State University); Vangelis Tzouvelekas (Department of Economics, University of Crete, Greece)
    Abstract: This paper develops a consistent theoretical framework for measuring irrigation water effective- ness and it�s impact on productivity growth rates by assuming a smooth transition process from traditional to modern irrigation technologies among individual farmers. The econometric model is based on a two-stage estimation procedure incorporating the transition process within a primal TFP decomposition framework. An empirical investigation addresses a panel of 56 small-scale greenhouse farms in Crete, Greece during the 2010-13 period. The results indicate that technical change driven by irrigation water techology improvement constirbutes significantly to total factor productivity growth. Further, the impact of specific climatic and soil conditions do not allow farmers to fully explore the potential of the new irrigation technology delaying adoption rates.
    Keywords: irrigation technology adoption and diffusion; irrigation effectiveness; productivity growth; translog-transition model; greenhouse farms, Crete, Greece
    JEL: C41 O16 O33 Q25
    Date: 2015–06–24
  7. By: Sergio René Araujo Enciso (European Commission – JRC - IPTS); Ignacio Pérez Domínguez (European Commission – JRC - ISPRA); Fabien Santini (European Commission – JRC - IPTS); Sophie Helaine (European Commission – DG Agri)
    Abstract: This report documents the EU module of Aglink-Cosimo model. Aglink-Cosimo is a recursive-dynamic, partial equilibrium, supply demand model of world agriculture developed by the OECD and FAO Secretariats. The model is used to simulate development of annual supply, demand and prices for the main agricultural commodities produced, consumed and traded worldwide. Aglink-Cosimo covers 44 individual countries and 12 regions, and 40 commodities clearing markets at the world level. At the EU level, the Aglink-Cosimo model is used to produce the "Prospects for Agricultural Markets and Income in the EU". This is a yearly exercise that provides a detailed overview of EU agricultural markets with a 10 year time horizon. It incorporates information from policy makers and market experts in the European Commission, stakeholders, researchers and modellers. The EU Outlook intends to provide a broad consensus about the evolution of European Agriculture in the medium-term. It serves as reference timeline for counterfactual policy analysis and market analysis done in numerous research sites in Europe. The report includes a detailed presentation and discussion of the structure and specific features of the model, along with the theoretical underpinnings. It also documents the process of calibration such as to obtain a medium-term baseline and different efforts towards the validation of results. Nonetheless, different applications in the area of uncertainty analysis and the use of partial stochastics are also included.
    Keywords: Partial equilibrium model, recursive dynamic, trade, multi-commodity markets, agriculture, global model, baseline, medium-term outlook
    Date: 2015–06
  8. By: Bachev, Hrabrin
    Abstract: Enhancing environmental performance is a prospective way for increasing market inclusion, effectiveness and sustainability of small-scale farms in Eastern Europe and Central Asia. Nevertheless, with very few exceptions, there are no studies on forms, factors and efficiency of “eco-driven” market inclusion of smallholders in modern supply chains in Bulgaria. This paper presents findings of a first large-scale study on state, driving forces, and efficiency of market inclusion of farms through enhanced eco-management in Bulgaria. First, we identify diverse forms of eco-management in farms with different size, market orientation, product specialisation, and location. Second, we assess costs, effects, and efficiency of eco-management, including the extent it contributes to increased market inclusion of farms. Third, we specify critical personal, economic, contractual, institutional, etc. factors of managerial choice in the eco-active farms. Finally, we estimate perspectives of expansion of this particular mode of market inclusion, and suggest directions for improving public policies and business strategies of smallholders.
    Keywords: environmental management, market inclusion, forms of eco-management, Bulgarian agriculture
    JEL: Q12 Q15 Q18 Q24 Q25 Q28 Q3 Q5 Q57 Q58
    Date: 2015
  9. By: Manalili, Nerlita M.; Yaptenco, Kevin F.; Manilay, Alessandro A.
    Abstract: The Philippine government's postharvest loss reduction programs entail significant investments (manpower, facilities, and equipment) and their impacts need evaluating. Thus, the Philippine Institute for Development Studies and the National Economic and Development Authority commissioned NEXUS Agribusiness Solutions to undertake the "Rapid Appraisal of Selected Postharvest Facilities in the Philippines". The postharvest facilities (PHF) selection process considered at least one each for Luzon, Visayas, and Mindanao, and for the following PHF categories: 1. equipment and facilities required immediately after harvest; 2. processing and storage facilities; and 3. market infrastructure and transport facilities. Selected were four rice processing centers, established through a Korean International Cooperation Agency grant, in Pangasinan, Davao del Sur, Bohol, and Iloilo. Using these sites as hub, other nearby PHF such as food terminals, flatbed dryers, and threshers were included for evaluation. In the context of upgrading value chains, reducing postharvest losses and improving economic outcomes for smallholder farmers, selected PHF were characterized and assessed. Recommendations centered on project management enhancement (timeliness of preparatory activities, participatory planning, etc.) and on operational improvements (capacity utilization, viability, and sustainability).
    Keywords: Philippines, postharvest loss, postharvest facility, value chain, agricultural marketing, rapid appraisal
    Date: 2015
  10. By: COMBRIS Pierre; SEABRA PINTO Alexandra; GIRAUD HERAUD Eric
    Abstract: We study the relative willingness-to-pay (WTP) of consumers according to the diversity of supply in a market and we show how the presence of substitutes for a given product leads to question the incentive mechanisms commonly used in experimental auctions. We propose a Surplus Comparison Mechanism (SCM) in order to yield WTP estimates which better take into account the choice set available to consumers. After showing the efficiency of this mechanism we test the SCM in a laboratory experiment, reconsidering WTP for food environmental certifications (Integrated Pest Management and Organic certification). It appears that WTPs are decreasing when more alternative certifications are offered to consumers.
    Keywords: Experimental Auctions, Willingness to pay, Consumers’ surplus, Choice alternatives, Food certification.
    JEL: C91 D44 Q51
    Date: 2015
  11. By: Randy A. Becker
    Abstract: Water can be a scarce resource, particularly in certain places at certain times. Understanding both water use and conservation efforts can help ensure that limited supplies can meet the demands of a growing population and economy. This paper examines water use and recirculation in the U.S. manufacturing sector, using newly recovered microdata from the (defunct) Survey of Water Use in Manufacturing, merged with establishment-level data from the Annual Survey of Manufactures and the Census of Manufactures. Results suggest that water use per unit of output is largest for larger establishments, in part because larger establishments use water for more purposes. Larger establishments are also found to recirculate water more — satisfying water use needs without necessarily increasing water intake. Various costs also appear to play a role in water recirculation. In particular, the water circulation rate is found to be higher when water is purchased from a utility. Relatively low (internal) prices for self-supplied water could suppress the incentive to invest in recirculation. Meanwhile, establishments with higher per-gallon water intake treatment costs also recirculate more, as might be expected. The cost associated with water discharge – due to regulation or otherwise – also increases circulation rates. The aridity of a locale is found to have little effect on circulation rates.
    Keywords: water use, water recirculation, U.S. manufacturing
    JEL: Q25 L6
    Date: 2015–06
  12. By: Andreas Ziegler (University of Kassel)
    Abstract: Based on unique data from representative computer-based surveys among more than 3400 citizens, this paper empirically examines the determinants of climate change beliefs, the support of publicly financed climate policy, and the (stated)willingness to pay a price premium for climate-friendly products in three countries which are key players in international climate policy, namely the USA, Germany (as largest country in the European Un-ion), and China. Our econometric analysis focuses on the effect of ideological identification and especially considers the interrelationship between a right-wing or a left-wing orientation and environmental values. Our estimation results imply that environmental aware-ness is in all three countries the major factor for beliefs and attitudes toward climate change. In Germany, citizens with a conservative, but not social or green orientation significantly less often support the considered climate policy and particularly have a significantly lower willingness to pay a price premium, whereas ideological differences are negligible for climate change beliefs. In contrast, a right-wing orientation has significantly negative effects on all beliefs and attitudes toward climate change in the USA. Furthermore, an increasing environmental awareness decreases ideological differences in the support of publicly financed climate policy in Germany and the USA and especially in general climate change beliefs and beliefs in anthropogenic climate change in the USA. Our estimation results suggest alternative strategies such as specific communication campaigns in order to reduce the climate change skepticism in conservative and right-wing circles in the USA and to increase the support of climate policies among such population groups.
    Keywords: Climate change beliefs, climate policy, price premium for climate-friendly products, ideological identification, environmental values, econometric analysis
    JEL: Q54 Q58 A13
    Date: 2015
  13. By: M. Alejandro Cardenete (Universidad Loyola Andalucia); M. Carmen Delgado (Universidad Loyola Andalucia); Patricia D. Fuentes (Universidad Pablo de Olivade); M. Carmen Lima (Universidad Pablo de Olivade); Alfredo J. Mainar (Universidad de Sevilla); Jose M. Rueda-Cantuche (Universidad Pablo de Olivade); Sébastien Mary (European Commission – JRC - IPTS); Fabien Santini (European Commission – JRC - IPTS); Sergio Gomez y Paloma (European Commission – JRC - IPTS)
    Abstract: This report complements previous work and builds NUTS3 SAMs for twelve regions, following a careful approach, that we call the expert approach. This report investigates the results of this approach by running some simple policy simulations and providing the structural descriptions of these regions. Further, this report aims at producing testing a more automatic approach to the construction of NUTS3 SAMs, to a view of reducing the necessary time and data requirements. Using several examples, this report examines whether such automatic approach can provide reliable SAMs at NUTS3 level. It finally draws conclusions as to the usefulness of both approaches in providing tools for further policy analysis in the field of rural development policy analysis.
    Keywords: rural development, social accounting matrix, common agricultural policy, input-output, economic modelling
    JEL: D57 Q18 R15
    Date: 2015–02
  14. By: Varma, Vijaya Krushna Varma
    Abstract: Varma suggests a new land acquisition act which is pro farmer, pro industry and pro development, and which leads to faster economic growth. My suggestions for new land acquisition act consist of 6 segments 1. Land acquisition 2. Categorisation of Land allotment 3. Time table for completion of projects 4. Compensation 5. Rehabilitation
    Keywords: land acquistion act
    JEL: Q00 Y90
    Date: 2015–02–09
  15. By: Somanathan,E.; Bluffstone,Randall
    Abstract: With data from the nearly 6,000 households in the Nepal Living Standards Survey of 2010?11, this paper finds that the mean reduction in household firewood collection associated with use of a biogas plant for cooking is about 1,100 kilograms per year from a mean of about 2,400 kilograms per year. This estimate is derived by comparing only households with and without biogas in the same village, thus effectively removing the influence of many potential confounders. Further controls for important determinants of firewood collection, such as household size, per capita consumption expenditure, cattle ownership, and unemployment are used to identify the effect of biogas adoption on firewood collection. Bounds on omitted variable bias are derived with the proportional selection assumption. The central estimate is much smaller than those in the previous literature, but is still large enough for the cost of adopting biogas to be significantly reduced via carbon offsets at a modest carbon price of $10 per ton of CO2e when using central estimates of emission factors and global warming potentials of pollutants taken from the scientific literature.
    Keywords: Energy Production and Transportation,Renewable Energy,Climate Change Mitigation and Green House Gases,Energy and Environment,Environmental Economics&Policies
    Date: 2015–06–30
  16. By: Edouard Ilunga wa ilunga; Grégory Mahy; Julien Piqueray; Maxime Séleck; Mylor Ngoy M.N. Shutcha; Pierre Jacques Meerts; Michel-Pierre Faucon
    Abstract: Ecological restoration of degraded metal-rich habitats and bare metal-rich soils created by mining activities has nowadays become a major environmental issue to reduce mining impacts on the erosion of biodiversity and the degradation of landscape, soil and water.Studies based on species identification for restoration purposes without reference to plant trait are limited only to local pool of species which makes the interpretation and applications in various ecological contexts rather difficult. This study aims at trait analysis of metal-rich habitats in order to test the differences in plant traits in degraded primary habitat and along a successional gradient in secondary habitats. In this context, investigation of the existence of resilience or the need for ecological restoration is attempted. A second aim of this work is also the identification of traits candidates for appropriate species selection for revegetation of metal-rich bare soils purposes.Results showed that the cover of xylopodia trait values decreases according to the intensity of degradation among habitats, and can be considered an indicator of habitat degradation. Differences of traits values among primary and old secondary habitats highlighted that the absence of resilience of degraded primary steppic savanna was not explained by 14 soil factors measured.The main plant traits for revegetation of metal-rich bare soils are the following: annual life cycle, growth phenology in wet season, depth 0-10. cm of underground system. bud bank by seeds, dispersule size <2. mm. ×. 2. mm and dispersal mode by adhesion.Future challenge would be to develop new functional ecosystem on metal-rich bare soils promoting biodiversity conservation and ecosystem services related to water and soil protection. This would require the association of species selected for revegetation and phytostabilization from plant traits occurring in secondary metalliferous habitats and species selected from plant traits specific to primary habitats.
    Keywords: Bare soil; Colonizing ability; Ecological restoration; Functional plant traits; Heavy metals; Metallophyte; Phytostabilization; Post-mining; Revegetation
    Date: 2015
  17. By: Chia-Lin Chang (Department of Applied Economics, Department of Finance, National Chung Hsing University, Taiwan); Yiying Li (Department of Quantitative Finance National Tsing Hua University, Taiwan); Michael McAleer (Econometric Institute, Erasmus School of Economics, Erasmus University Rotterdam and Tinbergen Institute, The Netherlands, Department of Quantitative Economics, Complutense University of Madrid, and Institute of Economic Research, Kyoto University.)
    Abstract: Energy and agricultural commodities and markets have been examined extensively, albeit separately, for a number of years. In the energy literature, the returns, volatility and volatility spillovers (namely, the delayed effect of a returns shock in one asset on the subsequent volatility or covolatility in another asset), among alternative energy commodities, such as oil, gasoline and ethanol across different markets, have been analysed using a variety of univariate and multivariate models, estimation techniques, data sets, and time frequencies. A similar comment applies to the separate theoretical and empirical analysis of a wide range of agricultural commodities and markets. Given the recent interest and emphasis in bio-fuels and green energy, especially bio-ethanol, which is derived from a range of agricultural products, it is not surprising that there is a topical and developing literature on the spillovers between energy and agricultural markets. Modelling and testing spillovers between the energy and agricultural markets has typically been based on estimating multivariate conditional volatility models, specifically the BEKK and DCC models. A serious technical deficiency is that the Quasi-Maximum Likelihood Estimates (QMLE) of a full BEKK matrix, which is typically estimated in examining volatility spillover effects, has no asymptotic properties, except by assumption, so that no statistical test of volatility spillovers is possible. Some papers in the literature have used the DCC model to test for volatility spillovers. However, it is well known in the financial econometrics literature that the DCC model has no regularity conditions, and that the QMLE of the parameters of DCC has no asymptotic properties, so that there is no valid statistical testing of volatility spillovers. The purpose of the paper is to evaluate the theory and practice in testing for volatility spillovers between energy and agricultural markets using the multivariate BEKK and DCC models, and to make recommendations as to how such spillovers might be tested using valid statistical techniques. Three new definitions of volatility and covolatility spillovers are given, and the different models used in empirical applications are evaluated in terms of the new definitions and statistical criteria.
    Keywords: Energy markets, Agricultural markets, Volatility and covolatility spillovers, Univariate and multivariate conditional volatility models, BEKK, DCC, Definitions of spillovers.
    JEL: C22 C32 C58 G32 O13 Q42
    Date: 2015–06
  18. By: Ackah, Ishmael
    Abstract: Efficiency has been identified as the cheapest and cleanest source of fuel. Whilst effort has been made in the advanced countries to promote technology and efficiency, little is known about efficiency in emerging economies in Africa. The purpose of this study is to identify the energy efficiency practices of SMEs in rural Ghana and also examine the barriers to energy efficiency practices. First, a descriptive analysis was used to examine the barriers and energy efficiency indicators. Finally, autometrics is used to examine the relationship between energy efficiency and productivity at the aggregate level. The study finds that lack of information on energy efficiency practices is the most important barrier to energy efficiency. On the practices, methods such as putting off electrical appliances when not in use or when closed, using new electrical appliances and using less appliances to achieve the same goal are some of the common ones adopted by SMEs in rural Ghana. The study recommends that the Ghana Energy Commission should intensify its energy efficiency education and extend this to rural areas.
    Keywords: Efficiency, Small and Medium Scale Enterprises (SMEs), autometrics, Energy Consumption
    JEL: Q2 Q20 Q21 Q4 Q42
    Date: 2015–05–14
  19. By: Yagi, Michiyuki; Hidemichi, Fujii; Hoang, Vincent; Managi, Shunsuke
    Abstract: This study estimates the environmental efficiency of international listed firms in 10 worldwide sectors from 2007-2013 by applying an order-m method, a non-parametric approach based on free disposal hull with subsampling bootstrapping. Using a conventional output of gross profit and two conventional inputs of labor and capital, this study examines the order-m environmental efficiency accounting for the presence of each of 10 undesirable inputs/outputs and measures the shadow prices of each undesirable input and output. The results show that there is greater potential for the reduction of undesirable inputs rather than bad outputs. On average, total energy, electricity, or water usage has the potential to be reduced by 50%. The median shadow prices of undesirable inputs, however, are much higher than the surveyed representative market prices. Approximately 10% of the firms in the sample appear to be potential sellers or production reducers in terms of undesirable inputs/outputs, which implies that the price of each item at the current level has little impact on most of the firms. Moreover, this study shows that the environmental, social, and governance activities of a firm do not considerably affect environmental efficiency.
    Keywords: Data envelopment analysis; Environmental efficiency; Shadow price; Free disposal hull; Linear programming
    JEL: C14 D24 Q50
    Date: 2015–05–23
  20. By: Harrison Fell (Division of Economics and Business, Colorado School of Mines); Peter Maniloff (Division of Economics and Business, Colorado School of Mines)
    Abstract: Subglobal and subnational policies aimed at reducing greenhouse gases are often thought to be less effective than more geographically comprehensive policies as production, and thus emissions, of trade exposed industries may move from the regulated to the unregulated regions. This so-called leakage may negate all emission reductions from the regulated regions and, even worse, may lead to an overall increase in emissions if the unregulated regions have equally or more emissions intensive production. However, if the unregulated regions have less emissions intensive production, the regional regulation may prompt more switching to the relatively cleaner producers than would otherwise occur, creating a type of beneficial leakage. We use detailed electricity generation and transmission data to show that this might be the case for the Regional Greenhouse Gas Initiative (RGGI), a CO$_2$ cap-and-trade program for the electricity sector in select Northeastern U.S. states. We find evidence that electricity generation did leak out of the RGGI region to surrounding state, but electricity generation in the non-capped jurisdictions is less emissions intensive than in the RGGI region, resulting in a net decrease in aggregate emissions. Back-of-the-envelope calculations suggest that one-quarter of apparent emissions reductions actually leaked but that this served to reduce total combined emissions by an additional one percent.
    Date: 2015–06

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