|
on Energy Economics |
| By: | Timothy J. Brennan (University of Maryland-Baltimore County) |
| Abstract: | Among the many complex issues of technology, governance, and market design affecting the electricity sector, climate policy has become dominant. From the perspective of a nonspecialist looking at this changing dominance, a quiz illuminates some of the peculiar uses of language one can find in climate change and energy efficiency policy. Six economic challenges are then examined: cap-and-trade vs. taxes, non-price regulations, energy efficiency policies, mitigation vs. adaptation, trade effects, and transmission planning. Three additional challenges affect not just the means to the climate policy end but also the end itself: the “fat tails†problem, discount rates, and whether environmental protection should be evaluated by aggregating willingness to pay across persons. Planners in the public and private sectors need to be aware of not only the economic policy challenges but also arguments that may influence the intensity of the climate policies with which they have to cope. |
| Keywords: | climate change, energy policy, electricity |
| JEL: | Q54 Q48 L94 |
| Date: | 2009–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:umb:econwp:09111&r=ene |
| By: | Jacob Funk Kirkegaard (Peterson Institute for International Economics); Thilo Hanemann (Rhodium Group); Lutz Weischer (World Resources Institute); Matt Miller |
| Abstract: | Policymakers seem to face a trade-off when designing national trade and investment policies related to clean energy sectors. They have pledged to address climate change and accelerate the large-scale deployment of renewable energy technologies, which would benefit from increased global integration, but they are also tempted to nurture and protect domestic clean technology markets to create green jobs at home and ensure domestic political support for more ambitious climate policies. This paper analyzes the global integration of the solar photovoltaic (PV) sector and looks in detail at the industry’s recent growth patterns, industry cost structure, trade and investment patterns, government support policies and employment generation potential. In order to further stimulate both further growth of the solar industry and local job creation without constructing new trade and investment barriers, we recommend the following: (1) Governments must provide sufficient and predictable long-term support to solar energy deployment. Such long-term frameworks bring investments forward and encourage cost cutting and innovation, so that government support can decrease over time. A price on carbon emissions would provide an additional long-term market signal and likely accelerate this process. (2) Policymakers should focus not on solely the manufacturing jobs in the solar industry, but on the total number of jobs that could possibly be created including those in research, project development, installation, operations and maintenance. (3) Global integration and broader solar PV technology deployment through lower costs can be encouraged by keeping global solar PV markets open. Protectionist policies risk slowing the development of global solar markets and provoking retaliatory actions in other sectors. Lowering existing trade barriers—by abolishing tariffs, reducing non-tariff barriers and harmonizing industry standards—would create a positive policy environment for further global integration. |
| Keywords: | Solar PV, climate change, renewable energy, government support, green protectionism, green jobs, global integration |
| JEL: | F14 F18 F23 H23 Q27 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:iie:wpaper:wp10-6&r=ene |
| By: | David Wheeler; Saurabh Shome |
| Abstract: | Until recently, India’s intransigent negotiating posture has conveyed the impression that it will not accept any carbon emissions limits without full compensation and more stringent carbon limitation from rich countries. However, our assessment of India’s proposed renewable energy standard (RES) indicates that this impression is simply wrong. India is seriously considering a goal of 15 percent renewable energy in its power mix by 2020, despite the absence of any meaningful international pressure to cut emissions, no guarantees of compensatory financing, and a continuing American failure to adopt stringent emissions limits. If India moves ahead with this plan, it will promote a massive shift of new power capacity toward renewables within a decade. The estimated cost of this change from coal-fired to renewable power to be about $50 billion—an enormous sum for a society that must still cope with widespread extreme poverty. If India moves ahead with its current plan, it should give serious pause to those who have resisted U.S. carbon regulation on the grounds on that it will confer a cost advantage on “intransigent†countries such as India. |
| Keywords: | India, American, climate change, carbon emissions, poverty, US, regulation, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2492&r=ene |
| By: | Maurizio Ciaschini, Rosita Pretaroli, Francesca Severini, Claudio Socci (University of Macerata, Politechnical University of Marche) |
| Abstract: | <div style="text-align: justify;">In the last decade, as many other European countries, the Italian Government adopted several reforms in order to increase the use of Renewable Energy Sources (RES). The liberalization of the electricity market that represent one of these reforms aims to reach environmental benefits from the substitution of fossil fuel with renewable sources.The Italian Green Certificate market was introduced in 2002 in order to accomplish this objective and represents a mechanism where a quota of renewable electricity is imposed to suppliers in proportion to their sales. The electricity industries are obliged to meet this condition by producing the quantity of renewable electricity by means of a change in their production process, otherwise they must buy a number of certificates corresponding to the quota. This mechanism changes the importance of the electricity industry first in promoting climate protection, than in terms of the impact in the economy as a whole. A policy aimed to develop the market of green certificates may lead to environmental improvement by switching the energy production process to renewable resources. But above all an increase in demand for green certificates, resultant from a reform on the quota of renewable electricity, can generate positive change in all components of the industrial production. For this purpose, the paper aims to quantify the economic impact of a reform on Green Certificate market for the Italian system by means of the Macro Multiplier (MM) approach. The analysis is performed through the Hybrid Input-Output (I-O) model that allows expressing the energy flows in physical terms (GWh) while all other flows are expressed in monetary terms (e). Moreover, through the singular value decomposition of the inverse matrix of the model, which reveals he set of key structures of the exogenous change of final demand, we identify the appropriate key structure ble to obtain both the expected positive total output change and the increase of electricity roduction from RES.</div> |
| Keywords: | Hybrid I-O model,Macro Multiplier,Environmental Policy |
| JEL: | O1 O11 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mcr:wpaper:wpaper00026&r=ene |
| By: | Vogelsang, Ingo; Rosellon, Juan; Weigt, Hannes |
| Abstract: | Electricity transmission has become the pivotal industry segment for electricity restructuring. Yet, little is known about the shape of transmission cost functions. Reasons for this can be a lack of consensus about the definition of transmission output and the complexitity of the relationship between optimal grid expansion and output expansion. Knowledge of transmission cost functions could help firms (Transcos) and regulators plan transmission expansion and could help design regulatory incentive mechanisms. We explore transmission cost functions when the transmission output is defined as point-to-point transactions or financial transmission right (FTR) obligations and particularly explore expansion under loop-flows. We test the behavior of FTR-based cost functions for distinct network topologies and find evidence that cost functions defined as FTR outputs are piecewise differentiable and that they contain sections with negative marginal costs. Simulations, however, illustrate that such unusual properties do not stand in the way of applying price-cap incentive mechanisms to real-world transmission expansion. |
| Keywords: | Electricity transmission; cost function; incentive regulation; merchant investment;congestion management |
| JEL: | L51 L91 L94 Q40 |
| Date: | 2009–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:22842&r=ene |
| By: | Massimo Filippini (Center for Energy Policy and Economics CEPE, Department of Management, Technology and Economics, ETH Zurich, Switzerland); Mehdi Farsi (Center for Energy Policy and Economics CEPE, Department of Management, Technology and Economics, ETH Zurich, Switzerland); Marie-Anne Plagnet (EDF, France); Roxana Saplacan (EDF, France) |
| Abstract: | This paper analyzes the cost structure of the French electricity distribution sector prior to the re-structuring reforms that have been initiated in 2005 and gradually implemented in the form of re-grouping certain activities across distribution units. The aim of this study is to assess the empirical evidence in support of these re-structuring measures. We explore the cost structure of the distribution units operating in France over the three year period. The data include 279 observations from 93 distribution units from 2003 to 2005, operating within the French electricity distribution network namely, Electricité Réseau Distribution France (ERDF). A Cobb-Douglas cost function is estimated using several specifications focusing on the analysis of the economies of scale and customer density. In order to account for the unobserved heterogeneity and its impacts on the economies of scale, we use a latent class specification. The results suggest that a majority of the distribution units can exploit statistically significant economies of scale. Further, the empirical analysis indicates that the unexploited economies of scale can vary considerably from one unit to another, not only because of variations in outputs but also because of the unobserved differences in networks and technological characteristics. In particular, the latent class approach can identify a group of distribution units that do not show any significant economies of scale. Further analysis suggests that such distributors are often located in metropolitan areas with high customer density. |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:cee:wpcepe:10-73&r=ene |
| By: | Boyd, James (Resources for the Future) |
| Abstract: | The paper addresses the definition and measurement of liability for marine oil pollution accidents. The economic value of lost or injured ecosystem goods and services is argued to be the most legally, economically, and ecologically defensible measure of damages. This is easier said than done, however. Calculating lost ecological wealth with any precision is an enormous scientific and economic undertaking. The paper proposes practical ways to improve our future ability to calculate such losses. |
| Keywords: | environmental liability, ecosystem services, marine pollution |
| Date: | 2010–05–20 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-31&r=ene |
| By: | Hooi Hooi Lean; Michael McAleer (University of Canterbury); Wing-Keung Wong |
| Abstract: | This paper examines investor preferences for oil spot and futures based on mean-variance (MV) and stochastic dominance (SD). The mean-variance criterion cannot distinct the preferences of spot and market whereas SD tests leads to the conclusion that spot dominates futures in the downside risk while futures dominate spot in the upside profit. It is also found that risk-averse investors prefer investing in the spot index, whereas risk seekers are attracted to the futures index to maximize their expected utilities. In addition, the SD results suggest that there is no arbitrage opportunity between these two markets. Market efficiency and market rationality are likely to hold in the oil spot and futures markets. |
| Keywords: | Stochastic dominance; risk averter; risk seeker; futures market; spot market |
| JEL: | C14 G12 G15 |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cbt:econwp:10/22&r=ene |
| By: | Kareem Ismail |
| Abstract: | This study derives structural implications of the Dutch disease in oil-exporting countries due to permanent oil price shocks from a typical model. We then test these implications in manufacturing sector data across a wide group of countries including oil-exporters covering 1977 to 2004. The results on oil-exporting countries are four folds. First, we find that permanent increases in oil price negatively impact output in manufacturing as consistent with the Dutch disease. Second, Evidence in the data shows that oil windfall shocks have a stronger impact on manufacturing sectors in countries with more open capital markets to foreign investment. Third, we find that the relative factor price of labor to capital, and capital intensity in manufacturing sectors appreciate as windfall increases. Fourth, we find that manufacturing sectors with higher capital intensity are less affected by windfall shocks than their peers, possibly due to a larger share of the effect being absorbed by more laborintensive tradable sectors. An implication of the fourth result is that having diverse manufacturing sectors in capital intensity helps cushion the volatility of oil shocks. |
| Keywords: | Capital , Cross country analysis , Economic models , External shocks , Industrial sector , International trade , Labor costs , Manufacturing sector , Oil exporting countries , Oil prices , Price increases , Production , Resource allocation , |
| Date: | 2010–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:10/103&r=ene |
| By: | Jan Gottschalk; Jihad Dagher; Rafael Portillo |
| Abstract: | We use a calibrated multi-sector DSGE model to analyze the likely impact of oil windfalls on the Ghanaian economy, under alternative fiscal and monetary policy responses. We distinguish between the short-run impact, associated with demand-related pressures, and the medium run impact on competitiveness and growth. The impact on inflation and the real exchange rate could be moderate, especially if the fiscal authorities smooth oil-related spending or increase public spending’s import content. However, a policy mix that results in both a fiscal expansion and the simultaneous accumulation of the foreign currency proceeds from oil as international reserves—to offset the real appreciation—would raise demand pressures and crowd-out the private sector. In the medium term, the negative impact on competitiveness—resulting from â€Dutch Disease†effects—could be small, provided public spending increases the stock of productive public capital. These findings highlight the role of different policy responses, and their interaction, for the macroeconomic impact of oil proceeds. |
| Keywords: | Demand , Economic models , Exchange rate appreciation , Fiscal policy , Ghana , Government expenditures , Inflation , Monetary policy , Nonoil sector , Oil production , Oil revenues , Reserves accumulation , |
| Date: | 2010–05–06 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:10/116&r=ene |
| By: | Nir Klein |
| Abstract: | Recent empirical studies have shown an inverse relation between natural resource intensity and long-term growth, implying that the natural resources generally impede economic growth through various channels (the “natural resource curseâ€). This paper departs from these studies by exploring the intersectoral linkages between oil and non-oil sectors in a cross-country perspective. The paper shows that the applicability of “natural resource curse†across oilbased economies should be treated with caution as the externalities of the oil sector highly depend on the countries’ degree of oil-intensity. In particular, the results show that, in low oil-intensity economies, the incentives to strengthen both fiscal and private sector institutions lead to positive inter-sectoral externalities. In contrast, weaker incentives in high oil-intensity economies adversely affect fiscal and private sector institutions and consequently lead to negative inter-sectoral externalities. |
| Keywords: | Angola , Cross country analysis , Economic growth , Economic models , Exchange rate appreciation , Natural resources , Nonoil sector , Oil exporting countries , Oil sector , Political economy , Real effective exchange rates , |
| Date: | 2010–05–10 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:10/118&r=ene |
| By: | Nuno Torres (Faculdade de Economia, Universidade do Porto, Portugal); Óscar Afonso (CEF.UP, OBEGEF and Faculdade de Economia, Universidade do Porto, Portugal); Isabel Soares (CEF.UP, Faculdade de Economia, Universidade do Porto) |
| Abstract: | This study shows that the cross-section “curse” result found with oil abundance indicators for producing countries disappears in a panel estimation considering the most important growth factors. This happens even excluding institutional quality, which is hindered by oil and ores abundance in several cross-section studies, causing the resource curse. In our estimations, neither of the oil indicators shows a significant impact on growth, but when we consider rig productivity there is a positive effect by capital efficiency in: (i) countries with medium and low income per head from East Asia & Pacific and Latin America & the Caribbean, all technological followers; (ii) countries with high income inequality. These results can reflect the broader scope for factor efficiency increases in less developed countries arising from the oil industry, which is described by a highly globalised know-how. |
| Keywords: | Energy, Economic growth, Institutions, Natural resource curse, Panel data |
| JEL: | C23 O13 O47 O50 Q0 Q40 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:377&r=ene |
| By: | Acemoglu, Daron (Harvard); Aghion, Philippe (Institute for International Economic Studies, Stockholm University); Bursztyn, Leonardo (Harvard); Hemous, David (Harvard) |
| Abstract: | This paper introduces endogenous and directed technical change in a growth model with environmental constraints. A unique final good is produced by combining inputs from two sectors. One of these sectors uses “dirty” machines and thus creates environmental degradation. Research can be directed to improving the technology of machines in either sector. We characterize dynamic tax policies that achieve sustainable growth or maximize intertemporal welfare. We show that: (i) in the case where the inputs are sufficiently substitutable, sustainable long-run growth can be achieved with temporary taxation of dirty innovation and production; (ii) optimal policy involves both “carbon taxes” and research subsidies, so that excessive use of carbon taxes is avoided; (iii) delay in intervention is costly: the sooner and the stronger is the policy response, the shorter is the slow growth transition phase; (iv) the use of an exhaustible resource in dirty input production helps the switch to clean innovation under laissez-faire when the two inputs are substitutes. Under reasonable parameter values and with sufficient substitutability between inputs, it is optimal to redirect technical change towards clean technologies immediately and optimal environmental regulation need not reduce long-run growth. |
| Keywords: | environment; exhaustible resources; directed technological change; innovation |
| JEL: | C65 O30 O31 O33 |
| Date: | 2010–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iiessp:0762&r=ene |
| By: | Alexandra Ferreira Lopes (Departamento de Economia, ISCTE); Tiago Sequeira e Catarina Roseta Palma (Departamento de Gestão e Economia, Universidade da Beira Interior; Departamento de Economia, ISCTE.) |
| Abstract: | We derive a model of endogenous growth with physical capital, human capital and technological progress through quality-ladders. We introduce welfare-decreasing pollution in the model, which can be reduced through the development of cleaner technologies. From the quantitative analysis of the model we show clear evidence that the new externality from technological progress to pollution considered in this model is sufficiently strong to induce underinvestment in R&D as an outcome of the decentralized equilibrium. An important policy implication of the main result of this article is a justification to subsidize the research in cleaner technologies. |
| Keywords: | Environmental Pollution, R&D, Social Capital, Human Capital, Economic Growth |
| JEL: | O13 O15 O31 O41 Q50 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csh:wpecon:td09_2010&r=ene |
| By: | Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University); Kataria, Mitesh (Max Planck Institute of Economics, Jena, Germany); Krupnick, Alan (Resources for the Future, Washington, DC, USA); Lampi, Elina (Department of Economics, School of Business, Economics and Law, Göteborg University); Löfgren, Åsa (Department of Economics, School of Business, Economics and Law, Göteborg University); Qin, Ping (Department of Economics, School of Business, Economics and Law, Göteborg University); Chung, Susie (Resources for the Future, Washington, DC, USA); Sterner, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Unique survey data from a contingent valuation study conducted in three different countries (China, Sweden, and the United States) were used to investigate the ordinary citizen’s willingness to pay (WTP) for reducing CO2 emissions. We find that a large majority of the respondents in all three countries believe that the mean global temperature has increased over the last 100 years and that humans are responsible for the increase. A smaller share of Americans, however, believes these statements, when compared to the Chinese and Swedes. A larger share of Americans is also pessimistic and believes that nothing can be done to stop climate change. We also find that Sweden has the highest WTP for reductions of CO2, while China has the lowest. Thus, even though the Swedes and Chinese are similar to each other in their attitudes toward climate change, they differ considerably in their WTP. When WTP is measured as a share of household income, the willingness to pay is the same for Americans and Chinese, while again higher for the Swedes.<p> |
| Keywords: | Climate change; willingness to pay; multi-country; China; United States; Sweden |
| JEL: | Q51 Q54 |
| Date: | 2010–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0447&r=ene |
| By: | Maurizio Ciaschini, Rosita Pretaroli, Francesca Severini, Claudio Socci (University of Macerata, Politechnical University of Marche) |
| Abstract: | <div style="text-align: justify;">The increasing attention to environmental damage and the problem of climate changes have led many studies to concentrate on environmental taxation as an incentive-based instrument of environmental policy. Focusing on the relationship among environmental, labour market policies and institutional sectors, this paper aims to investigate the economic effects of a fiscal reform designed with the intent of reducing the Greenhouse Gas (GHG) emissions, according to Kyoto Protocol. For this purpose, a Computable General Equilibrium (CGE) model is used with imperfection market for labour factor and a green tax on commodity output depending on the level of CO2 emission is introduced. Tax revenues are than completely distributed to the economy in order to reduce the income tax or to cut the regional tax on commodity value added. In this way a revenue-neutral environmental policy is tested and the double dividend and any other effect on national economy are assessed. The application will be done on a Social Accounting Matrix (SAM) for Italy for the 2003 year.</div> |
| Keywords: | Environmental taxation,CGE model,SAM |
| JEL: | O1 O11 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mcr:wpaper:wpaper00025&r=ene |
| By: | Christiansen, V.; Smith, S. |
| Abstract: | Much of the literature on externalities has considered taxes and direct regulation as alternative policy instruments. Both instruments may in practice be imperfect, reflecting informational deficiencies and other limitations. We analyse the use of taxes and regulation in combination, to control externalities arising from individual consumption behaviour. We consider cases where taxes are either imperfectly differentiated to reflect individual differences in externalities, or where some consumption escapes taxation. In both cases we characterise the optimal instrument mix, and show how changing the level of direct regulation alters the optimal externality tax. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:ner:ucllon:http://eprints.ucl.ac.uk/18270/&r=ene |
| By: | Fell, Harrison; Burtraw, Dallas; Morgenstern, Richard; Palmer, Karen; Preonas, Louis (Resources for the Future) |
| Abstract: | We use a stochastic dynamic framework to compare price collars (price ceilings and floors) in a cap-and-trade system. Sources of uncertainty include shocks to baseline emissions, affecting corresponding abatement costs, and shocks to the supply of offsets. We consider a continuum between soft collars, which have a limited volume of additional emission allowances (a reserve) available at the price ceiling, and hard collars, which provide an unlimited supply of additional allowances, thereby preventing allowance prices from exceeding the price ceiling. For all cases considered, we set the price floors and ceiling such that the expected cumulative emissions net of offsets are equal to the cumulative allowances. Consequently, increasing the size of the allowance reserve requires higher price ceilings and floors, and a lower probability of reaching the ceiling. Across most parameter values examined, we find that increasing the size of the allowance reserve leads to lower expected net present values of compliance costs, although the differences are not large. However, when offset supply shocks are highly persistent and exhibit strong (negative) correlation with baseline emission shocks, hard collars deliver noticeably lower expected costs, though with a wider range of emission outcomes than the soft collars. |
| Keywords: | climate change, offsets, cap-and-trade, price collars, stochastic dynamic programming |
| JEL: | Q54 Q58 C61 |
| Date: | 2010–05–07 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-27&r=ene |
| By: | Cooke, Roger M. (Resources for the Future); Kelly, G.N. |
| Abstract: | Between 1990 and 2000 the U.S. Nuclear Regulatory Commission and the Commission of the European Communities conducted a joint uncertainty analysis of accident consequences for nuclear power plants. This study remains a benchmark for uncertainty analysis of large models involving high risks with high public visibility, and where substantial uncertainty exists. The study set standards with regard to structured expert judgment, performance assessment, dependence elicitation and modeling and uncertainty propagation of high dimensional distributions with complex dependence. The integrated assessment models for the economic effects of climate change also involve high risks and large uncertainties, and interest in conducting a proper uncertainty analysis is growing. This article reviews the EU-USNRC effort and extracts lessons learned, with a view toward informing a comparable effort for the economic effects of climate change. |
| Keywords: | uncertainty analysis, expert judgment, expert elicitation, probabilistic inversion, dependence modeling, nuclear safety |
| Date: | 2010–05–20 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-10-29&r=ene |
| By: | Luis-Miguel Chevin; Georgina M Mace; Russell Lande |
| Abstract: | A simple evolutionary model is used to understand the critical rate of environmental change beyond which a population must decline and go extinct. The model is used to highlight the major determinants of extinction risk in a changing environment, and identify research needs for improved predictions based on projected changes in environmental variables. |
| Keywords: | climate change, demography, ecologically, heritability, quantitative trait, evolutionary model, environmental change, extinction risk, environment, vaiables, population, Adaptation, Plasticity, Predictive Theory, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2494&r=ene |
| By: | Owen, Ann L.; Conover, Emily; Videras, Julio; Wu, Stephen |
| Abstract: | Using data from a new household survey on environmental attitudes, behaviors, and policy preferences, we find that current weather conditions affect preferences for environmental regulation. Individuals who have recently experienced extreme weather (heat waves or droughts) are more likely to support laws to protect the environment even if it means restricting individual freedoms. We find evidence that the channel through which weather conditions affect policy preference is via perceptions of the importance of the issue of global warming. Furthermore, individuals who may be more sophisticated consumers of news are less likely to have their attitudes towards global warming changed by current weather conditions. |
| Keywords: | environmental regulation; global warming; environmental attitudes |
| JEL: | Q58 |
| Date: | 2010–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:22787&r=ene |
| By: | Kousky, Carolyn (Resources for the Future); Rostapshova, Olga (Harvard U); Toman, Michael (Resources for the Future); Zeckhauser, Richard (Harvard U) |
| Abstract: | There is a low but uncertain probability that climate change could trigger "mega-catastrophes," severe and at least partly irreversible adverse effects across broad regions. This paper first discusses the state of current knowledge and the defining characteristics of potential climate change mega-catastrophes. While some of these characteristics present difficulties for using standard rational choice methods to evaluate response options, there is still a need to balance the benefits and costs of different possible responses with appropriate attention to the uncertainties. To that end, we present a qualitative analysis of three options for mitigating the risk of climate mega-catastrophes--drastic abatement of greenhouse gas emissions, development and implementation of geoengineering, and large-scale ex ante adaptation--against the criteria of efficacy, cost, robustness, and flexibility. We discuss the composition of a sound portfolio of initial investments in reducing the risk of climate change mega-catastrophes. |
| JEL: | D81 Q54 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp10-008&r=ene |
| By: | Thomas F. Rutherford (Center for Energy Policy and Economics CEPE, Department of Management, Technology and Economics, ETH Zurich, Switzerland); D. Sigrist |
| Abstract: | The goal of this paper is to build up and apply a simple static model of world oil markets. |
| Keywords: | CGE, static model, oil markets |
| JEL: | C68 D58 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:cee:wpcepe:10-72&r=ene |
| By: | Pizer, William A.; Morgenstern, Richard (Resources for the Future); Shih, Jhih-Shyang (Resources for the Future) |
| Abstract: | Despite serving as the principal basis of U.S. climate policy over the past two decades, corporate voluntary environmental programs have been subject to quite limited evaluation. The self-selection of participants—an essential element of such initiatives—poses particular challenges to researchers because the decision to participate may not be random and, in fact, may be correlated with the outcomes. The present study is designed to overcome these problems by gauging the environmental effectiveness of two early voluntary climate change programs with established track records, the U.S. Environmental Protection Agency’s Climate Wise program and the U.S. Department of Energy’s Voluntary Reporting of Greenhouse Gases Program, or 1605(b). Both programs provide quite flexible criteria for firms to participate. Particular attention is paid to the participation decision and how various assumptions affect estimates of program outcomes using propensity score matching methods applied to plant-level Census data. Overall, we find quite modest effects: the reductions in fuel and electricity expenditures from Climate Wise and 1605(b) are no more than 10 percent and probably less than 5 percent. Virtually no evidence suggests a statistically significant effect of either Climate Wise or 1605(b) on fuel costs. Some evidence indicates that participation in Climate Wise led to a slight (3–5 percent) increase in electricity costs that vanished after two years. Stronger evidence suggests that participation in 1605(b) led to a slight (4–8 percent) decrease in electricity costs that persisted for at least three years. |
| Keywords: | voluntary, regulation, energy, climate change |
| JEL: | Q2 Q4 |
| Date: | 2010–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-08-13-rev&r=ene |
| By: | James Forder |
| Abstract: | The idea of the ‘L-shaped aggregate supply curve’, supposedly a feature of primitive macroeconomic models, is in fact a reasonable reconstruction of a well developed way of thinking that specifically denied a relation between wage change and aggregate employment. Neither that approach nor the idea of cost-push inflation to which it is related need be crude or superficial. Although the ideas in question were swept away by the Phillips curve, they have much merit and their reintroduction to mainstream macroeconomics might pay large dividends. |
| Keywords: | Phillips curve, Wage determination, Keynesianism |
| JEL: | B22 E24 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:486&r=ene |