nep-ene New Economics Papers
on Energy Economics
Issue of 2017‒05‒21
28 papers chosen by
Roger Fouquet
London School of Economics

  1. Harnessing Policy Complementarities to Conserve Energy: Evidence from a Natural Field Experiment By John A. List; Robert D. Metcalfe; Michael K. Price; Florian Rundhammer
  2. Antidumping and Feed-In Tariffs as Good Buddies? Modeling the EU-China Solar Panel Dispute By Patrice Bougette; Christophe Charlier
  3. Assessing the Impact of Renewable Energy Sources: Simulation analysis of the Japanese electricity market By YOSHIHARA Keisuke; OHASHI Hiroshi
  4. dynELMOD: A Dynamic Investment and Dispatch Model for the Future European Electricity Market By Clemens Gerbaulet; Casimir Lorenz
  5. The coordination of centralised and distributed generation By René Aïd; Matteo Basei; Huyên Pham
  6. Decentralized Local Pricing – Improving Network Usage in a Smart-Grid Environment under Limited Informationation By Jessica Raasch; Christoph Weber
  7. Energy and Institution Size By Fix, Blair
  8. The Effect of Education on a Country’s Energy Consumption: Evidence from Developed and Developing Countries By Roula Inglesi-Lotz; Luis Diez del Corral Morales
  9. Eficiência Financeira das Distribuidoras de Energia no Período de 2011 a 2014: uma análise comparativa usando DEA By Fabrício Eduardo Jacob; Gabriel Godofredo Fiuza de Bragança
  10. Reforming Energy Policy in India; Assessing the Options By Ian W.H. Parry; Victor Mylonas; Nate Vernon
  11. Sensitivity of energy system investments to policy regulation changes: Application of the blue sky catastrophe By Anton Bondarev; Hannes Weigt
  12. Cidades Cicláveis: avanços e desafios das políticas cicloviárias no Brasil By Osmar Coelho Filho; Nilo Luiz Saccaro Junior
  13. Strategic Infrastructure Planning: International Best Practice By ITF
  14. Reform des Erneuerbare-Energien-Gesetzes (EEG): Ausbautempo bleibt hoch By Chrischilles, Esther
  15. Charging Drivers by the Pound: The Effects of the UK Vehicle Tax System By Davide Cerruti; Anna Alberini; Joshua Linn
  16. La demanda de energía del sector transporte y el cambio climático en Honduras: informe final By Vásquez Lavín, Felipe; Ponce Oliva, Roberto; Hernández, José Ignacio
  17. A Retrospective Evaluation of the GDF/Suez Merger: Effects on Gas Hub Prices By Elena Argentesi; Albert Banal-Estanol; Jo Seldeslachts; Meagan Andrews
  18. Extracting Information or Resource? The Hotelling Rule Revisited under Asymmetric Information By David Martimort; Jérôme Pouyet; Francesco Ricci
  19. Taking Stock; Who Benefited from the Oil Price Shocks? By Diego A. Cerdeiro; Dmitry Plotnikov
  20. Disobedient Things. The Deepwater Horizon Oil Spill and Accounting for Disaster By Cochrane, DT
  21. Environmental policy and inequality: A matter of life and death By Karine Constant
  22. Air Quality and Manufacturing Firm Productivity: Comprehensive Evidence from China By Fu, Shihe; Viard, Brian; Zhang, Peng
  23. Can French environmental taxes really turn into green taxes ? By Mireille Chiroleu-Assouline
  24. Intertemporal Abatement Decisions under Ambiguity Aversion in a Cap and Trade By Simon Quemin
  25. Engaging the Private Sector for Green Growth and Climate Action: An Overview of Development Co-Operation Efforts By Naeeda Crishna Morgado; Bérénice Lasfargues
  26. Rapid innovation to mitigate global warming By Taishi Sugiyama; John A. “Skip” Laitner
  27. Should the Carbon Price Be the Same in All Countries? By Antoine D'Autume; Katheline Schubert; Cees Withagen
  28. Averting Catastrophes that Kill By Ian Martin; Robert S. Pindyck

  1. By: John A. List; Robert D. Metcalfe; Michael K. Price; Florian Rundhammer
    Abstract: The literature has shown the power of social norms to promote residential energy conservation, particularly among high usage users. This study uses a natural field experiment with nearly 200,000 US households to explore whether a financial rewards program can complement such approaches. We observe strong impacts of the program, particularly amongst low-usage and low-variance households, customers who typically are less responsive to normative messaging. Our data thus suggest important policy complementarities between behavioral and financial incentives: whereas non-pecuniary interventions disproportionately affect intense users, financial incentives are able to substantially affect the low-user, “sticky households.”
    JEL: C93 D03 Q4
    Date: 2017–04
  2. By: Patrice Bougette (Université Côte d'Azur; GREDEG CNRS); Christophe Charlier (Université Côte d'Azur; GREDEG CNRS)
    Abstract: The paper analyzes the interactions between trade and renewable energy policies based on the EU--China Solar Panel dispute which is the most significant antidumping (AD) complaint in Europe. We build a price competition duopoly model with differentiated products and intra-industry trade in photovoltaic equipment. We provide two relevant types of AD duties. The optimal AD which maximizes social domestic welfare always increases with the feed-in tariff (FIT) program set in the home country. The appropriate AD -- equalizing the foreign firm's price on the domestic market with the foreign market price -- decreases with the FIT program. We show that the optimal FIT increases with the AD duty. Therefore, trade and renewable energy optimal policies may complement one another. When setting AD duties in clean energy sectors, it is important not to ignore the extent to which renewable energy is subsidized.
    Keywords: Antidumping, FIT, Solar Panels, Renewable Energy, Trade disputes, EU, China
    JEL: F18 L52 Q42 Q48 Q56
    Date: 2017–05
  3. By: YOSHIHARA Keisuke; OHASHI Hiroshi
    Abstract: This paper evaluates the impact of renewable energy (RE) sources on market outcomes in Japan. We develop a simulation model to compute the kWh-market equilibrium, and conduct simulation exercises for 2015 and 2030. Using scenarios proposed by the government, we find that the diffusion of RE sources would lower the kWh-market prices and greenhouse gases by reducing fossil fuel consumption in 2030. It would also mothball many of the thermal power plants, which were active and profitable in 2015.
    Date: 2017–04
  4. By: Clemens Gerbaulet; Casimir Lorenz
    Abstract: This Data Documentation presents a dynamic investment and dispatch model for Europe named dynELMOD. The model endogenously determines investments into conventional and renewable power plants, different storage technologies including demand side management measures, and the electricity grid in five-year steps in Europe until 2050 under full or myopic foresight. The underlying electricity grid and cross-border interaction between countries is approximated using a flow-based market coupling approach using a PTDF matrix. Carbon emission restictions can be modeled using an emission path, an emission budget, or an emission price. For the investment decisions a time frame reduction technique is applied, which is also presented in this document. The code and the dataset are made publicly available under an open source license on the website of DIW Berlin. The model results show that under almost complete decarbonization renewable energy sources in conjunction with storage capacities will provide the majority of the electricity generation in Europe. At the same time with a rising renewables share, especially after 2040, the need for storage capacities increases. No additional capacity from nuclear energy or fossil fuels is installed, due to high costs and in order to meet the greenhouse gas emission target.
    Date: 2017
  5. By: René Aïd (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine); Matteo Basei (LPMA - Laboratoire de Probabilités et Modèles Aléatoires - UPMC - Université Pierre et Marie Curie - Paris 6 - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique); Huyên Pham (CREST - Centre de Recherche en Économie et Statistique - INSEE - ENSAE ParisTech - École Nationale de la Statistique et de l'Administration Économique, LPMA - Laboratoire de Probabilités et Modèles Aléatoires - UPMC - Université Pierre et Marie Curie - Paris 6 - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper analyses the interaction between centralised carbon emissive technologies and distributed intermittent non-emissive technologies. In our model, there is a representative consumer who can satisfy her electricity demand by investing in distributed generation (solar panels) and by buying power from a centralised firm at a price the firm sets. Distributed generation is intermittent and induces an externality cost to the consumer. The firm provides non-random electricity generation subject to a carbon tax and to transmission costs. The objective of the consumer is to satisfy her demand while minimising investment costs, payments to the firm and intermittency costs. The objective of the firm is to satisfy the consumer's residual demand while minimising investment costs, demand deviation costs, and maximising the payments from the consumer. We formulate the investment decisions as McKean-Vlasov control problems with stochastic coefficients. We provide explicit, price model-free solutions to the optimal decision problems faced by each player, the solution of the Pareto optimum, and the Stackelberg equilibrium where the firm is the leader. We find that, from the social planner's point of view, the carbon tax or transmission costs are necessary to justify a positive share of distributed capacity in the long-term, whatever the respective investment costs of both technologies are. The Stackelberg equilibrium is far from the Pareto equilibrium and leads to an over-investment in distributed energy and to a much higher price for centralised energy.
    Keywords: stochastic game,decarbonation,distributed generation,McKean-Vlasov
    Date: 2017–05–02
  6. By: Jessica Raasch; Christoph Weber (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen (Campus Essen))
    Abstract: With a smart grid environment, flexible load devices and provided local price incentives a more efficient grid usage may be achieved in the future. Bidirectional communication, smart devices and shiftable loads as electric vehicles and heat pumps have the potential to be coordinated with local supply when suitable incentives are provided. This can bring relief especially for distribution grid areas where infeeds from fluctuating renewable energy sources increase. This paper presents a decentralized local pricing mechanism, aiming at local prices that reflect the current load situation. That is in case of congestion a local price, deviating from the wholesale market price, is determined. With an iterative search algorithm suitable prices can be computed without gathering full-fledged bidding data. Simultaneously self-reinforcing effects are avoided. Further on this concept can be implemented rather easily precisely where and when required so that only areas with grid congestion are affected.
    Keywords: Smart Grid, Real-Time Pricing, Network Pricing, Agent-Based Modeling, Price-Elastic Behavior
    JEL: Q40
    Date: 2017–03
  7. By: Fix, Blair
    Abstract: Why do institutions grow? Despite nearly a century of scientific effort, there remains little consensus on this topic. This paper offers a new approach that focuses on energy consumption. A systematic relation exists between institution size and energy consumption per capita: as energy consumption increases, institutions become larger. I hypothesize that this relation results from the interplay between technological complexity and human biological limitations. I also show how a simple stochastic model can be used to link energy consumption with firm dynamics.
    Keywords: Power,Production,Region - North America,Business Enterprise,Conflict & Violence,Cooperation & Collective Action,Distribution,Growth,Industrial Organization,Institutions
    Date: 2016
  8. By: Roula Inglesi-Lotz (Department of Economics, University of Pretoria); Luis Diez del Corral Morales (Department of Economics, University of Pretoria)
    Abstract: Education has been regarded throughout history as one of the main drivers of economic development and innovation, and can be viewed as one of the means available to nations for encouraging energy education, implementation of renewable energy and reduced energy consumption. This paper analyses the causal and empirical relationship between primary energy consumption and education for a group of developed and developing countries as well as an aggregate panel of the developed and developing country groups for the period 1980-2013. The results confirm a unidirectional relationship between energy consumption and education, flowing from education to energy consumption. Another interesting result is the confirmation of a non-linear relationship between energy consumption and education: energy consumption is increased by higher education levels in developing countries while energy consumption falls with higher education levels in developed countries. Lastly this paper provides a brief description of the impact of these results on energy policy and recommends that developed countries implement pro-education policies to reduce energy consumption while developing countries should make use of education coupled with environmental awareness programs to reduce the effect increased education will have on energy consumption
    Keywords: energy consumption, education, developed and developing countries
    Date: 2017–05
  9. By: Fabrício Eduardo Jacob; Gabriel Godofredo Fiuza de Bragança
    Abstract: Contribuindo para o debate acerca do aprimoramento da regulação do setor elétrico e para o melhor monitoramento financeiro das empresas reguladas, este trabalho analisa a sustentabilidade financeira das distribuidoras brasileiras de energia elétrica, usando informações de contabilidade, regulação e qualidade do serviço no período compreendido entre 2011 e 2014. Relaciona os resultados encontrados com o perfil dessas empresas quanto a porte, gestor estatal ou privado e grupo controlador. A ferramenta utilizada é a metodologia conhecida como análise por envoltória de dados (Data Envelopment Analysis – DEA). Os resultados mostraram que enquanto as empresas Elektro, Coelba, Mux Energia e CPFL Paulista são referências para as demais na maioria dos indicadores, a maior parte das distribuidoras apresentou um desempenho muito aquém. Verificou-se ainda que a escala de operação não é fator preponderante sobre o desempenho das empresas, e o resultado das empresas estaduais e do grupo Eletrobras em relação a qualquer outra empresa ou grupo foi classificado como crítico. This paper uses Data Envelopment Analysis (DEA) to evaluate the financial sustainability of the Brazilian electricity distributors taking into account financial statements, regulatory and quality information in the period between 2011 and 2014. It also analyzes characteristics of the companies such as size, private or state ownership and controlling group. The results show that while Elektro, Coelba, Mux Energia and CPFL Paulista are benchmarks in most indicators, the majority of the other firms presents poor performances when compared to them. The finds also indicate that whether scale is not an important financial performance determinant, state owned companies had critically worse indicators than their private peers.
    Date: 2017–03
  10. By: Ian W.H. Parry; Victor Mylonas; Nate Vernon
    Abstract: Spreadsheet models are used to assess the environmental, fiscal, economic, and incidence effects of a wide range of options for reducing fossil fuel use in India. Among the most effective options is ramping up the existing coal tax. Annually increasing the tax by INR 150 ($2.25) per ton of coal from 2017 to 2030 avoids over 270,000 air pollution deaths, raises revenue of 1 percent of GDP in 2030, reduces CO2 emissions 12 percent, and generates net economic benefits of approximately 1 percent of GDP. The policy is mildly progressive and (at least initially) imposes a relatively modest cost burden on industries.
    Date: 2017–05–03
  11. By: Anton Bondarev; Hannes Weigt (University of Basel)
    Abstract: In this paper we argue, that the interaction of technology and economic policy regulations in the energy sector may be described by the so-called slow-fast class of dynamical systems. It is known that such systems may exhibit the blue sky catastrophe, a special type of bifurcation. Application of this result allows us to argue that caution is needed when updating economic policies in the energy sector to avoid the onset of catastrophic developments in the system's transformation, when energy system dynamics becomes unresponsive to policy updates.
    Keywords: energy infrastructure, investments cycle, economic policy, slow-fast systems, blue sky catastrophe
    JEL: L51 Q48 C6 C02
    Date: 2017
  12. By: Osmar Coelho Filho; Nilo Luiz Saccaro Junior
    Abstract: A demanda por uma mobilidade sustentável é impulsionada no Brasil pelo progressivo crescimento das cidades, causando aumento do tempo de deslocamento nos diferentes modais de transporte, crescimento do número de mortes de motociclistas que migram dos modos ativos de transporte movidos pelo crescimento da renda familiar, maior incidência de acidentes em geral e mais danos à saúde, provocados pela poluição do ar vinculada aos motores de combustão. O Brasil tem mais bicicletas que carros, respectivamente 50 milhões contra 41 milhões. Em torno de 7% do total de viagens é feita por bicicletas, com potencial de atingir 40%. Esta é uma pesquisa qualitativa que buscou entender quais os cenários de futuro e os fatores de sustentabilidade para as redes cicloviárias que são capazes de guiar as políticas cicloviárias e de mobilidade sustentável no Brasil. Utilizou-se a metodologia de pressão-estado-resposta (PER), associada à metodologia do pensamento de ciclo de vida (PCV) para compreender as percepções dos stakeholders (atores-chaves) sobre as redes cicloviárias. Os entrevistados pertencem a academia, governo, associações de cicloativistas e associações empresariais. Os cenários de curto prazo indicaram a necessidade de uma base de dados que apoie a formação de indicadores sociais, econômicos e ambientais, além do fortalecimento da participação dos atores sociais no processo de institucionalização da política cicloviária. Os cenários de médio prazo indicaram a construção de uma política de alianças estratégicas e o fortalecimento da bicicultura ou onda bike por meio de eventos e geração de informação que atenda aos atores em diferentes escalas territoriais (local, nacional e internacional). Os fatores de sustentabilidade para o fortalecimento das políticas cicloviárias foram: o tempo de implementação da política; o tipo de abordagem de mobilidade utilizada para orientar a política cicloviária; os níveis de incentivos econômicos e fiscais; a utilização de metodologias de participação; a formação de banco de dados sobre o número e a localização dos conflitos entre ciclistas, motoristas e pedestres; o grau de integração das políticas cicloviárias com outras políticas públicas; e a área de espaço urbano disponível para a expansão das redes cicloviárias. Além disso, a metodologia do PCV indicou a necessidade de uma avaliação de ciclo de vida (ACV) que modele os impactos da presença de cada modal (pedestre, bicicleta, metrô, trem e ônibus) no território urbano. Esta ACV pode produzir indicadores para apoiar um sistema integrado de mobilidade sustentável em que a bicicleta pode ter um papel múltiplo: modal de transporte, veículo de integração entre modais e símbolo de sustentabilidade. The demand for sustainable mobility in Brazil is driven by the Brazilian cities growing urban density, the increased travel time in different transportation modes, the increasing number of motorcyclists deaths who migrated from active modes driven by household income growth as well as drivers, pedestrians and cyclists deaths, and the worsening air pollution level linked to combustion engines which has serious consequences for health. Brazil has more bikes than cars, respectively 50 million to 41 million. Around 7% of all trips are made by bicycle with a potential to reach 40%. This qualitative research tried to understand what are the cycling networks future scenarios and sustainability factors that can guide the empowering of cycling policies and the sustainable mobility in Brazil. It used the pressure-state-response methodology associated with life cycle thinking methodology (PCV) to understand the cycling networks stakeholder perceptions from academia, government, cycling associations and business associations. Short-term scenarios indicated a database construction to support the development of social, economic and environmental indicators, and the empowering of the social actors’ participation in the cycling policy institutionalization. Medium-term scenarios indicated the construction of strategic alliances among stakeholders and the strengthening of bicycle culture or “bike wave” through events and production of information to social actors in different territory scales (local, national and international). The sustainability factors to empower cycling policies were: the policy implementation timing; the mobility approach strand used to guide the cycling policy; the levels of economic and tax incentives; the participatory methodologies use; the database on number and location conflicts among drivers, pedestrians and cyclists; the level of cycling policy integration with other public policies; and the urban space available area for the expansion of cycling networks. Moreover, the Life Cycle Thinking methodology indicated the development of a life cycle assessment (LCA) that models the impacts on each transportation mode and its available urban space (pedestrian, bicycle, subway, train, and bus). This LCA can produce indicators that support an integrated sustainable mobility where the bicycle may have multiple roles: transportation mode, integration vehicle among modes and sustainability symbol.
    Date: 2017–03
  13. By: ITF
    Abstract: This report reviews experiences with strategic infrastructure planning with a view to identifying international best practices. Governments play a critical role in providing the framework for investment in the transport, energy and water infrastructure on which economies depend. Long asset lives and large sunk costs make such investments particularly subject to risk and uncertainty. A long-term strategic plan that integrates specific projects reduces such risks by setting out a stable set of the priorities for future investment. This report is the product of a roundtable organised by the International Transport Forum at the OECD and the UK National Infrastructure Commission. This report is part of the International Transport Forum’s Case-Specific Policy Analysis series. These are topical studies on specific issues carried out by the ITF in agreement with local institutions.
    Date: 2017–03–23
  14. By: Chrischilles, Esther
    Abstract: Will ein Anlagenbetreiber, der Strom aus erneuerbaren Energien produziert, gefördert werden, muss er sich zukünftig darauf bewerben. Denn ab 2017 gibt der Gesetzgeber eine feste Menge an installierter Leistung vor, die im Jahr ans Netz gehen darf. Ziel ist es, den Ausbau insgesamt in den vorgesehenen Zielkorridoren zu halten. Kritiker sehen das Ende der Energiewende eingeläutet. Aufgrund des derzeitigen EEG-Entwurfs ist jedoch vielmehr mit einem Überschreiten des Zielkorridors zu rechnen. Weiterhin fehlt eine Beteiligung der Anlagenbetreiber am Preisrisiko.
    Date: 2016
  15. By: Davide Cerruti (ETH Zurich, Switzerland); Anna Alberini (University of Maryland,USA); Joshua Linn (Resources of the Future, USA)
    Abstract: Policymakers have been considering vehicle and fuel taxes to reduce transportation greenhouse gas emissions, but there is little evidence on the relative efficacy of these approaches. We examine an annual vehicle registration tax, the Vehicle Excise Duty (VED), which is based on carbon emissions rates. The UK first adopted the system in 2001 and made substantial changes to it in the following years. Using a highly disaggregated dataset of UK monthly registrations and characteristics of new cars, we estimate the effect of the VED on new vehicle registrations and carbon emissions. The VED increased the adoption of low-emissions vehicles and discouraged the purchase of very polluting vehicles, but it had a small effect on aggregate emissions. Using the empirical estimates, we compare the VED with hypothetical taxes that are proportional either to carbon emissions rates or to carbon emissions. The VED reduces total emissions twice as much as the emissions rate tax but by half as much as the emissions tax. Much of the advantage of the emissions tax arises from adjustments in miles driven, rather than the composition of the new car sales.
    Keywords: CO2 emissions, vehicle registration fees, carbon taxes, vehicle excise duty, UK
    JEL: H23 Q48 Q54 R48
    Date: 2017–05
  16. By: Vásquez Lavín, Felipe; Ponce Oliva, Roberto; Hernández, José Ignacio
    Abstract: El objetivo de este estudio, realizado por la CEPAL a solicitud del gobierno de Honduras, en el marco del Programa EUROCLIMA, es revisar la literatura teórica y empírica sobre cambio climático, la importancia de la demanda de energía del transporte y sus relaciones con las actividades económicas, el medio ambiente y el cambio climático a nivel internacional y en Honduras.
    Date: 2017–04
  17. By: Elena Argentesi; Albert Banal-Estanol; Jo Seldeslachts; Meagan Andrews
    Abstract: We present an ex-post analysis of the effects of GDF’s acquisition of Suez in 2006 created one of the world’s largest energy companies. We perform an econometric analysis, based on Difference-in-Difference techniques on the market for trading on the Zeebrugge gas hub in Belgium. Removing barriers to entry and facilitating access to the hub through ownership unbundling were an important part of the objectives of the remedies imposed by the European Commission. Our analysis shows a price decline after the merger. This decline suggests the remedies were effective in limiting the potential anti-competitive effects of the merger. Moreover, it suggests that ownership unbundling has generated improved access to the hub. Therefore, the remedies may have done more than simply mitigate the potential anticompetitive effects of the merger; they may have effectively created competition.
    Keywords: Mergers, ex-post evaluation, gas sector, hub prices
    JEL: L4 Q4
    Date: 2017
  18. By: David Martimort (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Jérôme Pouyet (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Francesco Ricci (ART-Dev - Acteurs, Ressources et Territoires dans le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - UPVD - Université de Perpignan Via Domitia - Université Paul Valéry - Montpellier III - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique)
    Abstract: We characterize the optimal extraction path when a concessionaire has private information on the initial stock of resource. Under asymmetric information, a `virtual Hotelling rule' describes how the resource price evolves over time and how extraction costs are compounded with information costs along an optimal extraction path. In sharp contrast with the case of complete information, elds which are heterogeneous in terms of their initial stocks follow di erent extraction paths. Some resource might be left unexploited in the long-run as a way to foster incentives. The optimal contract may sometimes be implemented through royalties and license fees. With a market of concessionaires, asymmetric information leads to a `virtual Her ndahl principle' and to a new form of heterogeneity across active concessionaires. Under asymmetric information, the market price converges faster to its long-run limit, exhibiting more stability.
    Keywords: Non-Renewable resource, Delegated Management, Optimal,Contract, Asymmetric Information
    Date: 2017–01
  19. By: Diego A. Cerdeiro; Dmitry Plotnikov
    Abstract: The effect that the recent decline in the price of oil has had on growth is far from clear, with many observers at odds to explain why it does not seem to have provided a significant boost to the world economy. This paper aims to address this puzzle by providing a systematic analysis of the effect of oil price shocks on growth for 72 countries comprising 92.8% of world GDP. We find that, on net, shocks driving the oil price in 2015 shaved off 0.2 percentage points of growth for the median country in our sample, and 0.17 percentage points in GDP-weighted terms. While increases in oil supply and shocks to oil-specific demand actually boosted growth in 2015 (by about 0.2 and 0.4 percentage points, respectively), weak global demand more than offset these gains, reducing growth by 0.8 percentage points. Counterfactual simulations for the 72 countries in our sample underscore the importance of diversification, rather than low levels of openness, in shielding against negative shocks to the world economy.
    Date: 2017–05–04
  20. By: Cochrane, DT
    Abstract: Analysis of the Deepwater Horizon disaster and the accumulatory decline of BP demonstrates both the analytical efficacy of the capital-as-power (CasP) approach to value theory, and the irreducible role of objects in the process of accumulation. Rather than productivity per se, accumulation depends on control of productivity. Owners’ control is over both the human and non-human components of systems of production, which transcend the standard categories of culture/politics/economics/technology. Capitalization translates the irreducible social order, things and all, that bear on accumulation into commensurable units of capital. The decline of BP in the wake of the disaster expressed the market’s falling confidence in the obedience of the entities that bear on its profits, including the things that comprise its productive capacity.
    Keywords: Methodology,Money & Finance,Power,Production,Region - North America,Science & Technology,Agency,Value & Price,Business Enterprise,Capital & Accumulation
    Date: 2016
  21. By: Karine Constant (Université Paris Est, Erudite)
    Abstract: This paper analyzes the economic implications of an environmental policy when we take into account the life expectancy of heterogeneous agents. In a framework in which everyone suffers from pollution, but health status depends also on individual human capital, we find that the economy may be stuck in a trap in which inequalities persistently grow, when the initial pollution intensity of production is too high. Moreover, we emphasize that such inequalities are costly in the long run for the economy, in particular in terms of health and growth. Therefore, we study whether a tax on pollution associated with an investment in pollution abatement can be used to overcome this situation. We show that a stricter environmental policy may allow the economy to escape from the inequality trap while it enhances its long-term growth rate, when initial inequalities are not too high.
    Keywords: Endogenous growth, Environmental policy, Human capital, Inequality, Longevity
    JEL: I14 O44 Q56 Q58
    Date: 2017–05
  22. By: Fu, Shihe; Viard, Brian; Zhang, Peng
    Abstract: We provide comprehensive estimates of air pollution’s effect on short-run labor productivity for manufacturing firms in China from 1998 to 2007. An emerging literature estimates air pollution’s effects on labor productivity but only for small groups of workers of particular occupations or sets of firms to ensure causality. To provide more comprehensive estimates necessary for policy analysis, we estimate effects for all but some small firms (90% of manufacturing output in China) and capture all channels by which pollution influences productivity. We instrument for reverse causality between pollution and output using thermal inversions. Our causal estimates imply that a one
    Keywords: air pollution; productivity; environmental costs and benefits; firm competitiveness
    JEL: D62 Q51 Q53 R11
    Date: 2017–04–20
  23. By: Mireille Chiroleu-Assouline (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)
    Abstract: French environmental taxes are not really ecologically oriented. Their main aim is to raise revenues. Clear signs of this inappropriate direction are given by the large share of the energy taxes and by the low level of most tax rates, which for the most part, are only implicit tax rates on the polluting goods. An ecological tax reform would imply a global green tax shift with tax rates proportionate to the marginal damages. The success and the acceptation of such a reform by the taxpayers rely on the chosen recycling mechanism for the tax revenues, on government’s efforts in information and pedagogy, on transparency about the policy choices but also, somehow paradoxically, on audacity of actions.
    Abstract: Actuellement, la fiscalité environnementale française répond moins à une finalité écologique qu’à un objectif plus traditionnel de fiscalité de rendement. Les signes manifestes de cette inadéquation sont la très grande part prise par la fiscalité de l’énergie et le faible niveau de la plupart des taux de taxe, qui souvent ne frappent qu’implicitement les produits polluants. Réformer la fiscalité française supposerait de la « verdir » dans son ensemble en appliquant des taux de taxes en relation avec les dommages marginaux. La réussite de la réforme et son acceptation par les contribuables sont conditionnées par le mécanisme de redistribution associé, les efforts de pédagogie et d’information, la transparence mais aussi, paradoxalement, par l’audace des mesures prises.
    Keywords: tax progressivity,environmental tax,double dividend,contribution climat-énergie,écotaxe,double dividende,progressivité de l’impôt,fiscalité
    Date: 2015–06
  24. By: Simon Quemin (LEDa-CGEMP, Paris-Dauphine University – PSL Research University & Climate Economics Chair)
    Abstract: We study intertemporal abatement decisions by an ambiguity averse firm covered under a cap and trade. Ambiguity aversion is introduced to account for the prevalence of regulatory uncertainty in existing cap-and-trade schemes. Ambiguity bears on both the future permit price and the firm's demand for permits. Ambiguity aversion drives equilibrium choices away from intertemporal efficiency and induces two effects: a pessimistic distortion of beliefs that overemphasises ‘detrimental’ outcomes and a shift in the effective discount factor. Permit allocation is non neutral and the firm's intertemporal abatement decisions do not solely depend on expected future permit prices, but also on its own expected future market position. In particular, pessimism leads the expected net short (resp. long) firm to overabate (resp. underabate) early on relative to intertemporal efficiency. We show that there is a general incentive for early overabatement and that it is more pronounced under auctioning that under free allocation.
    Keywords: Emissions trading, Regulatory uncertainty, Permit banking, Ambiguity aversion
    JEL: D81 D92 Q58
    Date: 2017–05
  25. By: Naeeda Crishna Morgado; Bérénice Lasfargues
    Abstract: The private sector plays an important role in enabling or hindering green growth in developing countries. With increasing emphasis for development co-operation providers to engage private actors, there is a need for a sound understanding of the theory of change and the efficacy of private sector engagement approaches in supporting environment and development outcomes. This paper contributes to this agenda and helps inform efforts of development assistance provider. It maps the major approaches used to engage the private sector, i.e. to mobilise private climate investment, promote green private sector development and harness the skills and knowledge from private actors, and highlights some challenges and lessons learned. The paper also provides an estimate of climate-related development finance targeting private sector engagement.
    Keywords: climate change, development co-operation, green growth, Private sector engagement
    JEL: N5 O13 O16 O19 O44 P48 Q20 Q40 Q56
    Date: 2017–05–16
  26. By: Taishi Sugiyama; John A. “Skip” Laitner
    Abstract: The dynamics of recent innovations of Information and Communication Technologies (ICT) and others is better captured by the complex systems theory than traditional innovation systems theory. The analysis based upon complex systems theory leads us to distinct and more positive future prospects and cost-effective policy implications for mitigating global warming. Massive emission cut of greenhouse gas will be possible through the policies that promote innovation and economic development.
    Date: 2017–05
  27. By: Antoine D'Autume (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Katheline Schubert (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Cees Withagen (Department of Economics - UvA - University of Amsterdam [Amsterdam])
    Abstract: International di¤erences in fuel taxation are huge, and may be justi…ed by different local negative externalities that taxes must correct, as well as by di¤erent preferences for public spending. In this context, should a worldwide uniform carbon tax be added to these local taxes to correct the global warming externality? We address this question in a second best framework à la Ramsey, where public goods have to be …nanced through distortionary taxation and the cost of public funds has to be weighted against the utility of public goods. We show that when lump-sum transfers between countries are allowed for, the second best tax on the polluting good may be decomposed into three parts: one, country-speci…c, dealing with the local negative externality, a second one, country-speci…c, dealing with the cost of levying public funds, and a third one, global, dealing with the global externality and which can be interpreted as the carbon price. Our main contribution is to show that the uniformity of the carbon price should still hold in this second best framework. Nevertheless, if lump-sum transfers between governments are impossible to implement, international di¤erentiation of the carbon price is the only way to take care of equity concerns. keywords: carbon price, second best, Pigovian taxation
    Keywords: Pigovian taxation,carbon price, second best
    Date: 2016–03
  28. By: Ian Martin; Robert S. Pindyck
    Abstract: We face a variety of potential catastrophes; nuclear or bioterrorism, a climate catastrophe, and a "mega-virus" are examples. Martin and Pindyck (AER 2015) showed that decisions to avert such catastrophes are interdependent, so that simple cost-benefit analysis breaks down. They assumed that catastrophic events cause "destruction," i.e., a reduction in the stream of consumption. But some catastrophes cause death instead of, or in addition to, destruction. Here we incorporate death in a model of catastrophe avoidance, and show how it affects the interdependence of catastrophic events and the "willingness to pay" to avoid those events.
    JEL: D81 H12 H56 Q50 Q54
    Date: 2017–04

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