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on Energy Economics |
| By: | Christa N. Brunnschweiler (Center of Economic Research (CER-ETH), Swiss Federal Institute of Technology Zurich (ETH)); Erwin H. Bulte (Department of Economics, Tilburg University) |
| Abstract: | We critically evaluate the empirical basis for the so-called resource curse and find that, despite the topic’s popularity in economics and political science research, this apparent paradox is a red herring. The most commonly used measure of ‘resource abundance’ can be more usefully interpreted as a proxy for ‘resource dependence’—endogenous to underlying institutional factors. In multiple estimations that combine resource abundance and dependence, institutional and constitutional variables, we find that (i) resource abundance, constitutions and institutions determine resource dependence, (ii) resource dependence does not affect growth, and (iii) resource abundance positively affects growth and institutional quality. |
| Keywords: | Natural resource curse, economic growth, growth regressions, political regimes, institutions, constitutions |
| JEL: | O11 O13 Q0 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:06-61&r=ene |
| By: | Luís Francisco Aguiar-Conraria (Universidade do Minho - NIPE); Yi Wen (Federal Reserve Bank of St. Louis) |
| Abstract: | We show that dependence on foreign energy can increase economic instability by raising the likelihood of equilibrium indeterminacy, hence making fluctuations driven by self-fulfilling expectations easier to occur. This is demonstrated in a standard neoclassical growth model. Calibration exercises, based on the estimated share of imported energy in production for several countries, show that the degree of reliance on foreign energy for many countries can easily make an otherwise determinate and stable economy indeterminate and unstable. |
| Keywords: | Indeterminacy, Energy Imports, Externality, Returns to Scale, Sunspots, Self-Fulfilling Expectations. |
| JEL: | E13 E20 E30 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:3/2007&r=ene |
| By: | Hagstromer, Bjorn; Wlazlowski, Szymon |
| Abstract: | The world market of crude oil has three well established benchmarks used for pricing of other crudes: West Texas Intermediate, Europe Brent and Dubai Fateh. The relevance of these are however declining, as the output of the benchmarks is decreasing, and as an increasing share of world crude produced is of worse quality than the benchmarks (pointed out by e.g. Montepeque, 2005). Particularly the segment of medium density, sour crudes is lacking a reliable benchmark. We apply Granger causality tests to study the price dependencies of 32 crude oils empirically. The aim is to establish what crudes are setting the prices and what crudes are just follow the general market trend. The investigation is performed globally as well as for different quality segments, geographical segments and the segments of OPEC and non-OPEC crudes. The results indicate that crude oil price analysts should follow at least four different crudes that are if not benchmarks, at least good price indicators. While the well-established benchmarks WTI and Brent still lead the market, they are not the only crude prices worth paying attention to. In particular, Russian Urals drives global prices in a significant way, and Iran Seri Kerir is a significant price setter within OPEC. Dubai Fateh does not display any significant influence as a price setter. The lack of a reliable benchmark for medium density, sour crudes is thereby confirmed. |
| Keywords: | Granger causality; crude oil; benchmark; West Texas Intermediate; Europe Brent; Dubai Fateh; Russian Urals; Iran Seri Kerir; price dynamics |
| JEL: | G19 |
| Date: | 2007–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:1577&r=ene |
| By: | Wohltmann, Hans-Werner; Winkler, Roland |
| Abstract: | The paper analyzes the dynamic effects of anticipated raw materials price increases for small open oil-dependent economies and investigates the con- sequences of several monetary policy rules in response to commodity price shocks. Based on a calibrated New Keynesian open economy model the analysis shows that anticipated increases in the price of oil will involve oil- dependent economies both in temporary inflation and deflation as well as in output expansion and contraction. Compared to an interest rate Taylor rule a money growth rule is more appropriate to reduce the volatility of the CPI in°ation rate whereas just the opposite holds for stabilizing the output gap. |
| Keywords: | Oil price shocks, Monetary Policy, Open Economy |
| JEL: | E32 E52 F41 Q43 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cauewp:5175&r=ene |
| By: | Pock, Markus (Department of Economics and Finance, HealthEcon, Institute for Advanced Studies, Vienna, Austria) |
| Abstract: | This study utilizes a panel data set from 14 European countries over the period 1990-2004 to estimate a dynamic model specification for gasoline and diesel demand. Previous studies estimating gasoline consumption per total passenger cars ignore the recent increase in the number of diesel cars in most European countries leading to biased elasticity estimates. We apply several common dynamic panel estimators to our small sample. Results show that specifications neglecting the share of diesel cars overestimate short-run income, price and car ownership elasticities. It appears that the results of standard pooled estimators are more reliable than common IV/GMM estimators applied to our small data set. |
| Keywords: | Dynamic panel data, Gasoline demand, Error components, Omitted variable |
| JEL: | C23 Q41 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:ihs:ihsesp:202&r=ene |
| By: | Nico van Leeuwen |
| Abstract: | The tax rates of deliveries of energy products to industry and households in the GTAP-6 database are in some countries for the year 2001 rather different from the ones reported by the International Energy Agency (IEA). Especially the rates for deliveries to industry seem to be too high. This paper shows the rates derived from IEA with observations from Energy Prices and Taxes statistics and documents a new dataset with adjusted tax rates. Comparison with the GTAP-6 database reveals some striking differences. The rates are further adjusted for petroleum and coal products after comparing the implied taxes calculated as a percentage of GDP with the OECD Revenue Statistics. For other energy carriers we have not corrected the rates any further. <P> This paper is a contribution to the paper "The EU-ETS and existing energy taxes", which was delivered as a contribution to the EU TAXBEN-project (www.taxben.org). |
| Keywords: | energy usage; tax rates |
| JEL: | H20 H25 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:memodm:174&r=ene |
| By: | John Cubbin (Department of Economics, City University, London); Jon Stern (Department of Economics, City University, London) |
| Abstract: | This paper assesses for 28 developing countries over the period 1980-2001 whether the existence of a regulatory law and higher quality regulatory governance are significantly associated with superior electricity outcomes. The analysis draws on theoretical and empirical work on the impact of independent central banks and of developing country telecommunications regulators. The empirical analysis concludes that, controlling for other relevant variables and allowing for country specific fixed effects, a regulatory law and higher quality governance is positively and significantly associated with higher per capita generation capacity levels and higher generation capacity utilisation rates. In addition, at least for three years or more, this positive regulatory impact appears to increase with experience. |
| Date: | 2005–05–07 |
| URL: | http://d.repec.org/n?u=RePEc:cty:dpaper:0404&r=ene |
| By: | Jens Korunig (Institute of Economics, University of Lüneburg) |
| Abstract: | Peak-load pricing of natural monopolies was analyzed until now as a one-step production process with constant average rate costs. However, electric current underlies a multi-step process with decreasing average costs for power transmission. A private, vertically separated network opertor will charge profit maximizing peak-load prices and will cause a high welfare loss due to its monopolisic position. The paper examines in a two-stage model with decreasing average cost on the transmission stage, which consequences there are of prohibiting the monopolist to take different prices. Here, this interdiction enhances welfare, if the monopolist continues to serve customers in both markets (peak and off-peak). The analyzed regulation rule "only one price" is easy to apply and to supervise, as a consequence it is practicable and cost-effecitve. |
| Date: | 2007–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:36&r=ene |
| By: | Bruce A. Babcock (Center for Agricultural and Rural Development (CARD); Midwest Agribusiness Trade Research and Information Center (MATRIC)) |
| Abstract: | Presented at the Iowa Pork Congress, Des Moines, Iowa, January 25 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:07-tr48&r=ene |
| By: | Hans Gersbach (Center of Economic Research (CER-ETH), Swiss Federal Institute of Technology Zurich (ETH)) |
| Abstract: | We propose a global refunding scheme as a new international approach to addressing climate change. A global refunding system allows each country to set its carbon emission tax, while aggregate tax revenues are partially refunded to member countries in proportion to the relative emissions reduction they achieve within a period. Nationally determined environmental policies and global refunding create increasing incentives to reduce emissions and may achieve e±ciency and equity objectives of global climate policy. |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:07-62&r=ene |
| By: | John M. Gowdy (Department of Economics, Rensselaer Polytechnic Institute, Troy NY 12180-3590, USA) |
| Abstract: | The policy recommendations of most economists are based on the rational actor model of human behavior. Behavior is assumed to be self-regarding, preferences are assumed to be stable, and decisions are assumed to be unaffected by social context or frame of reference. The related fields of behavioral economics, game theory, and neuroscience have confirmed that human behavior is other regarding, and that people exhibit systematic patterns of decision-making that are "irrational" according to the standard behavioral model. This paper takes the position that it is these "irrational" patterns of behavior that uniquely define human decision making and that effective economic policies must take these behaviors as the starting point. This argument is supported by game theory experiments involving humans, closely related primates, and other animals with more limited cognitive ability. The policy focus of the paper is global climate change. The research surveyed in this paper suggests that the standard economic approach to climate change policy, with its almost exclusive emphasis on rational responses to monetary incentives, is seriously flawed. In fact, monetary incentives may actually be counter-productive. Humans are unique among animal species in their ability to cooperate across cultures, geographical space and generations. Tapping into this uniquely human attribute, and understanding how cooperation is enforced, holds the key to limiting the potentially calamitous effects of global climate change. |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:rpi:rpiwpe:0701&r=ene |