nep-ene New Economics Papers
on Energy Economics
Issue of 2019‒09‒23
27 papers chosen by
Roger Fouquet
London School of Economics

  1. The Macro Effects of Anticipating Climate Policy By Stephie Fried; Kevin Novan; William Peterman
  2. About the relationship between renewable energy and oil markets. By Gaye Del Lo
  3. Does Increasing Block Pricing Decrease Energy Use? Evidence from the Residential Electricity Market By Becka Brolinson
  4. More Power to the People: Electricity Adoption, Technological Change and Social Conflict By Molinder, Jakob; Karlsson, Tobias; Enflo, Kerstin
  5. Three scenarios for coal power in Vietnam By Minh Ha-Duong
  6. Measuring inefficiency in international electricity trading By Montoya, L.; Guo, B.; Newbery, D. M.; Dodds, P.; Lipman, G.; Castagneto Gissey, G.
  7. Increased market transparency in Germany's gasoline market: What about rockets and feathers? By Frondel, Manuel; Horvath, Marco; Vance, Colin; Kihm, Alexander
  8. The Interplay between Oil and Food Commodity Prices: Has It Changed over Time? By Peersman, Gert; Rüth, Sebastian K.; Van der Veken, Wouter
  9. Promoting energy audits: Results from an experiment By Brutscher, Philipp-Bastian; Ravillard, Pauline
  10. The effectiveness of consumption tax on the reduction of car pollution in China By Arcila, Andres; Chen, Tao; Lu, Xiaolan
  11. The Energy Efficiency Conversation in the Australian Volume Home Building sector: Current practices and opportunities for change By Erika Bartak; Georgia Warren-Myers; Christopher Heywood
  12. The Social Cost of Carbon and the Ramsey Rule By Cees Withagen
  13. Oil prices, exchange rates, and interest rates By Lutz Kilian; Xiaoqing Zhou
  14. Carbon Consumption, the Carbon-Based Ecosystem, and Output By Roger Lagunoff; Cristian Figueroa; Rodrigo Harrison; Mario Miranda
  15. Tracking operational energy performance in existing office buildings By Jorn Van De Wetering
  16. The Role of ICT and Financial Development on CO2 Emissions and Economic Growth By Ibrahim D. Raheem; Aviral K. Tiwari; Daniel Balsalobre-lorente
  17. Carbon footprint, demography, and employment statusunion? By Carlhoff, Henrik
  18. Greenhouse Gases: A Review of Losses and Benefits By Ali, Amjad; Audi, Marc
  19. El papel del gas en la transición By María Sicilia Salvadores
  20. Impact of Fiscal Consolidation on the Mongolian Economy By Ragchaasuren Galindev; Tsolmon Baatarzorig; Nyambaatar Batbayar; Delgermaa Begz; Unurjargal Davaa; Oyunzul Tserendorj
  21. Managerial incentives and polluting Inputs under imperfect competition By Denis Claude; Mabel Tidball
  22. Dependence Structure between Business Cycles and CO2 Emissions in the U.S.: Evidence from the Time-Varying Markov-Switching Copula Models By Gozgor, Giray; Tiwari, Aviral; Khraief, Naceur; Shahbaz, Muhammad
  23. The Economic and Environmental Impact of Foreign Direct Investment on the Mongolian Coal-Export Sector By Ragchaasuren Galindev; Tsolmon Baatarzorig; Nyambaatar Batbayar; Delgermaa Begz; Unurjargal Davaa; Oyunzul Tserendorj
  24. Final assessment report. Assessment of development account project 14/15 BD: Strengthening the capacity of Central American and Caribbean countries in the preparation of sustainable energy policies and strategies By -
  25. México | La crisis por escasez de gasolina: un análisis de Big Data By Guillermo Jr. Cardenas Salgado; Luis Antonio Espinosa; Juan Jose Li Ng; Carlos Serrano
  26. Stranded assets risk derails Vietnam's plan for new coal power plants By Minh Ha-Duong
  27. Financing climate objectives in cities and regions to deliver sustainable and inclusive growth By OECD

  1. By: Stephie Fried (ASU); Kevin Novan (University of California, Davis); William Peterman (Federal Reserve Board of Governors)
    Abstract: While the U.S. does not currently have a federal carbon tax, households could expect the government will introduce a carbon tax policy in the future. To understand how the macroeconomy responds to the expectation of a potential future carbon tax, we develop a quantitative life cycle model that allows us to focus on investment in long-lived, sector-specific assets such as coal power plants or wind farms. We find that expectations of future climate policy reduce the return dirty (carbon-emitting) energy capital, shifting the economy towards cleaner energy production. As a result, the anticipation of future climate policy reduces carbon emissions even though there is not actual policy in place. In particular, we find that a five percent probability of a \$35 dollar per ton carbon tax reduces emissions by one quarter of the amount they would fall if the carbon tax was actually in place. However, the output cost of reducing emissions through expectations of future policy are considerably higher than the output cost of the carbon tax policy itself. This is because the potential costs of reallocating capital between energy producing technologies after the tax is implemented, such as from coal power plants to wind farms, along with the uncertainty depresses savings lowering the aggregate capital stock.
    Date: 2019
  2. By: Gaye Del Lo
    Abstract: This paper examines the link between oil and renewable energy markets. To this end, on the one hand, we identify high and low volatility states of oil markets, using the regime-switching EGARCH (1,1) model, and analyze its effects on the renewable energy market. On the other hand, we develop a methodology to identify positive and negative oil shocks and investigate their implications for renewable energy markets. We show that: (1) state shifts are clearly present in the oil and renewable energy data; (2) the volatility links between oil and renewable energy markets are regime-dependent. When the oil market is in a high-volatility regime, it exacerbates the volatility of renewable energy markets, but in a low-volatility regime, it has no effect or a stabilizing effect on the volatility of renewable energy market; (3) the results also reveal that the renewable energy market reacts positively to extreme upward movements of oil prices and negatively to extreme downward movements. These results have several implications in terms of policies, portfolio optimization and risk management.
    Keywords: Cliometrics, renewable energy; oil price; EGARCH(1,1); markov-switching; VaR.
    JEL: Q42 E44 C58
    Date: 2019
  3. By: Becka Brolinson (Department of Economics, Georgetown University)
    Abstract: Many electric utilities in the United States have replaced flat pricing schedules with increasing block prices (IBPs) in an effort to decrease aggregate energy use without imposing costs on low-income households. IBPs are step functions where the price per kilowatt-hour increases as a household uses more electricity. It is not clear, however, in theory or in practice, whether IBPs decrease aggregate energy use and protect low-income households relative to a revenue-neutral flat rate. I use detailed monthly billing records combined with demographic data for 11,745 California households and price differences over time across utility climate zones to estimate price elasticities of energy demand by income. The resulting estimates find that wealthier households are more price elastic than low-income households. I use these elasticities to show that IBPs increase total electricity use relative to a revenue-neutral flat price, therefore failing to achieve their goal of conservation. Finally, this paper finds that IBPs decrease electricity bills for low-income households while pushing costs to high-income households.
    Keywords: Consumer Economics: Empirical Analysis; Production, Pricing, and Market Structure; Electric Utilities; Government Policy; Energy Demand
    JEL: D12 L11 L94 L98 Q41
    Date: 2019–09–16
  4. By: Molinder, Jakob (Department of Economic History, Uppsala University); Karlsson, Tobias (Department of Economic History, Lund University); Enflo, Kerstin (Department of Economic History, Lund University)
    Abstract: There is a wide-spread concern that technical change may spur social conflicts, especially if workers are replaced with machines. To empirically analyze whether job destruction drives protests, we study a historical example of a revolutionary new technology: the adoption of electricity. Focusing on the gradual roll-out of the Swedish electricity grid between 1900 and 1920 enables us to analyze 2,487 Swedish parishes in a difference-in-differences framework. Proximity to large-scale water-powered electricity plants is used to instrument for electricity adoption. Our results confirm that the labor saving nature of electricity was followed by an increase of local conflicts in the form of strikes. But displaced workers were not likely to initiate conflicts. Instead, strikes were most common in sectors with employment growth. Similarly,we find that the strikes were of an offensive rather than a defensive nature. Thus, electrification did not result in rebellions driven by technological anxiety. It rather provided workers with a stronger bargaining position from which they could voice their claims through strikes.
    Keywords: technological change; electrification; labor demand; labor conflicts; strikes; infrastructure investments
    JEL: N14 N34 N74 O14
    Date: 2019–09–19
  5. By: Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CNRS - Centre National de la Recherche Scientifique - ENPC - École des Ponts ParisTech - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech)
    Abstract: This note offers three narratives about the future of coal based electricity generation in Vietnam. "Blazing up" corresponds to the power development plan 7 revised and updated as of March 2019. "Closed window" tells what we think would happen under pure market forces. "Coal peak" tells what could happen if the State continues to steer the electricity system into the energy transition, decisively and without imposing high costs to stakeholders.
    Date: 2019–08–07
  6. By: Montoya, L.; Guo, B.; Newbery, D. M.; Dodds, P.; Lipman, G.; Castagneto Gissey, G.
    Abstract: We show that established metrics used to monitor electricity trading inefficiency become increasingly inaccurate in several trading conditions. We devise the Unweighted and Price-Weighted Inefficient Interconnector Utilisation indices to address these deficiencies. These metrics are substantially more accurate than existing ones and perform equally well whether or not markets are coupled. Our results show a substantial decrease in inefficient trading between Great Britain and both France and the Netherlands after the European Union’s market coupling regulations were introduced in 2014. In view of Great Britain’s likely withdrawal from the European Union, the paper also evaluates how market uncoupling would affect cross-border trade. We find that uncoupling would lead to inefficiencies in trade, the electricity price differential between GB and France (Netherlands) rising by 3% (2%), net imports into GB decreasing by 26% (13%), congestion income decreasing by 10% (5%), and infra-marginal surplus decreasing by 1.6% (1.6%) of coupled congestion income. We also show that, should the EU decide to implement an equivalent carbon tax to GB’s Carbon Price Floor, uncoupling impacts would be slightly magnified due to electricity prices converging (by about 1% of coupled congestion income).
    Keywords: Electricity trading efficiency, cross-border allocation, interconnector, market coupling, metrics
    JEL: C81 F14 F15 Q41
    Date: 2019–09–18
  7. By: Frondel, Manuel; Horvath, Marco; Vance, Colin; Kihm, Alexander
    Abstract: Drawing on panel data on daily fuel prices covering over 5,000 filling stations in Germany, this paper documents a change in the stations' price setting behavior following the introduction of a legally mandated online price portal in 2013. Prior to the portal, positive asymmetry is found on the basis of error correction models, with prices following the "rockets and feathers" pattern that is typically found for fuels. In the aftermath of the portal, by contrast, negative asymmetry is observed: fuel price decreases in response to refinery price decreases are stronger than fuel price increases due to refinery price increases.
    Keywords: retail markets,competition,error correction model
    JEL: D12 Q41
    Date: 2019
  8. By: Peersman, Gert; Rüth, Sebastian K.; Van der Veken, Wouter
    Abstract: Using time-varying BVARs, we find that oil price increases caused by oil supply shocks did not affect food commodity prices before the start of the millennium, but had positive spillover effects in more recent periods. Likewise, shortfalls in global food commodity supply —resulting from bad harvests — have positive effects on crude oil prices since the early 2000s, in contrast to the preceding era. Remarkably, we also document greater spillover effects of both supply shocks on metals and minerals commodity prices in recent periods, as well as a stronger impact on the own price compared to earlier decades. This (simultaneous) time variation of commodity price dynamics cannot be explained by the biofuels revolution and is more likely the consequence of heightened informational frictions and information discovery in more globalized and financialized commodity markets.
    Keywords: commodity markets; food prices; oil prices; spillovers
    Date: 2019–09–16
  9. By: Brutscher, Philipp-Bastian; Ravillard, Pauline
    Abstract: Energy audits are key to increase investments in energy efficiency, as they allow to overcome the 'information gap'- one of the biggest obstacles to this type of investment. However, on average only 30% of SMEs said to have carried out an energy audit between 2015 and 2018. This paper assesses the effectiveness of policy interventions in promoting energy audits by relying on evidence from a unique online experiment, as part of the European Investment Bank's annual Investment Survey. 1,178 EU firms were asked about their willingness to invest in an energy audit, given different scenarios of randomly drawn policy interventions. These are a level of support, whether it comes in the form of a grant or a tax credit, and whether the audit is conditional on investing in an energy efficiency project after. Findings allow us to quantify by how much the probability that firms invest in energy audits increases, as the combinations of policy interventions vary.
    Date: 2019
  10. By: Arcila, Andres; Chen, Tao; Lu, Xiaolan
    Abstract: Exposure to airborne pollution has substantial adverse health consequences (Cohen et al, 2004). Governments around the world have paid attention to this problem and started to take actions to mitigate it harmful effects. In this paper, we investigate how a change in the consumption tax structure affects car emissions by exploiting exogenous variation from a natural experiment that took place in China. Our results show that this tax policy, which doubled the imposition paid on cars with large engines, reduced the emissions of all the pollutants studied, with the most significant decrease of 11% noted in Particulate Matter and Carbon Monoxide.
    Date: 2018
  11. By: Erika Bartak; Georgia Warren-Myers; Christopher Heywood
    Abstract: Housing with high operational energy efficiency has the potential to positively contribute towards the global environmental challenge of climate change. These types of homes contribute to climate change mitigation through reduced operational energy demand and associated greenhouse gas emissions. In addition, such homes can improve household resilience in a changing climate, by providing social and financial benefits such as improved comfort, health and wellbeing, and reduced cost of living. Although these potential benefits are well known, the adoption of higher standards of energy efficiency in new Australian housing is not widespread. This is in part a result of limited mandatory requirements (compared to the benchmarks of other developed economies), and limitations to demand creation by consumers – two contributing features of an on-going ‘blame game’ between consumer, government and industry stakeholders. This study focuses on the dominant providers of new housing in Australia, the volume home builders. These organisations occupy an influential position in the system of new housing supply, informing and directing the choices of inexperienced homebuyers, and providing work opportunities to a large construction supply chain. But recent studies reveal that sustainability measures such as energy efficiency are not well promoted or prioritised by the sector. This paper presents preliminary findings from the study, exploring the current energy efficiency ‘conversation’ within the Australian volume home building sector. A content analysis of selected organisational websites is used to establish an evidence base of the current conversation between volume home builders and their potential homebuyers. These results then inform the design of semi-structured interviews with a range of volume home building organisations and staff. Interviews explore relevant organisational practices, and identify opportunities for a more productive energy efficiency conversation, as a means of mainstreaming higher energy efficiency performance in new housing.
    Keywords: content analysis; Energy Efficiency; Homebuyers; housing; Volume home builders
    JEL: R3
    Date: 2019–01–01
  12. By: Cees Withagen (IPAG Business School, Paris and Vrije Universiteit Amsterdam)
    Abstract: The objective of this paper is to critically assess the use of simple rules for the social cost of carbon (SCC) that employ a rudimentary form of the Ramsey Rule. Two interrelated caveats apply. First, if climate change poses a serious problem, it is hard to justify an exogenous constant growth rate of consumption and GDP, as is done in several contributions by prominent scholars. Second, to derive the optimal SCC one needs full knowledge of the entire future, in spite of the use of popular ways to try to get around this. Moreover, it is shown that some simple rules suffer from inconsistencies in their derivation.
    Keywords: Social cost of carbon, Ramsey rule
    JEL: Q30 Q54
    Date: 2019–09
  13. By: Lutz Kilian (University of Michigan); Xiaoqing Zhou (Bank of Canada)
    Abstract: There has been much interest in the relationship between the price of crude oil, the value of the U.S. dollar, and the U.S. interest rate since the 1980s. For example, the sustained surge in the real price of oil in the 2000s is often attributed to the declining real value of the U.S. dollar as well as low U.S. real interest rates, along with a surge in global real economic activity. Quantifying these effects one at a time is difficult not only because of the close relationship between the interest rate and the exchange rate, but also because demand and supply shocks in the oil market in turn may affect the real value of the dollar and real interest rates. We propose a novel identification strategy for disentangling the causal effects of oil demand and oil supply shocks from the effects of exogenous shocks to the U.S. real interest rate and exogenous shocks to the real value of the U.S. dollar. We empirically evaluate popular views about the role of exogenous real exchange rate shocks in driving the real price of oil, and we examine the extent to which shocks in the global oil market drive the U.S. real exchange rate and U.S. real interest rates. Our evidence for the first time provides direct empirical support for theoretical models of the link between oil prices, exchange rates, and interest rates.
    Date: 2019
  14. By: Roger Lagunoff (Department of Economics, Georgetown University); Cristian Figueroa (Department of Economics, Boston College); Rodrigo Harrison (Facultad de Ingenieria y Ciencias Universidad Adolfo Ibanez); Mario Miranda (Department of Agricultural, Environmental, and Development Economics, The Ohio State University)
    Abstract: This paper studies the effects of changes in the carbon-based ecosystem on a country's output. We propose and estimate a dynamic production model in which a country's ecosystem, as measured by its reservoir of carbon in land biomass and soils, enters explicitly as a productive input. Land use is the key endogenous decision in the model. We characterize a country's optimal land use policy given its direct effects on the ecosystem, and the indirect feedback effects from land sink absorption of atmospheric GHG concentrations. We estimate the model's land sink absorption rates and output elasticities with respect to land use, fossil fuel emissions, and land carbon stock for 162 countries. Globally, a 1% decline in a country's land carbon leads to an estimated 0.3% decline in its GDP per year, even after it optimally adjusts its land use policy. We then simulate the model to 2100 under four standard Representative Concentration Pathway scenarios. In the simulations, developed countries experience higher GDP growth by 2100 under low concentration scenarios. For these countries, GDP initially grows faster in high concentration scenarios. By 2050 it declines in high concentration scenarios but continues to grow in low ones. Developing countries, by contrast, experience higher GDP growth under high concentration scenarios throughout the century. Global growth in GDP is maximal under low to moderate GHG concentration scenarios.
    Keywords: Carbon-based ecosystem, land stocks, GHG Emissions, optimal land use policy, output elasticities
    JEL: C73 D82 F53 Q54 Q58
    Date: 2019–08–25
  15. By: Jorn Van De Wetering
    Abstract: In 2008, the European Energy Performance of Buildings Directive (EPBD) facilitated the introduction of two mandatory energy assessment methods in the UK. Energy Performance Certificates (EPCs) reveal the modelled energy performance of buildings when they are constructed, sold or let based on their intrinsic energy attributes, whereas Display Energy Certificates (DECs) reveal operational energy performance in a subset of buildings that is operated by the public sector, based on annual energy consumption data.EPCs were conceived as a marketing mechanism for property market participants and they have been used in studies that have sought to investigate the links between energy performance and financial performance of buildings. Yet they are based on modelled energy performance and the ratings that they express are hypothetical, whereas DECs are based on actual energy consumption figures. Furthermore, EPCs are valid for 10 years, whereas DECs need to be renewed annually.This study will investigate energy performance patterns as recorded in DEC certificates in existing office buildings over time. The study uses detailed DEC data for commercial office buildings from the Department for Communities and Local Government. This dataset is matched to data on building attributes from CoStar UK to investigate the relationship between energy performance and building features such as age and building quality. This study models the magnitude of observed changes in operational energy performance in existing buildings, to investigate how operational energy performance assessment can be used to track energy performance improvements over time, and reveal how different control variables may impact on recorded changes. These findings will provide further insights into the effects and impacts of the introduction of energy certification for buildings. The further aim of this study is to develop a building typology based on commonly shared building and energy performance attributes.
    Keywords: Commercial Office Space; Display Energy Certificate; Energy Performance Certificate; Environmental Assessment; Operational energy performance
    JEL: R3
    Date: 2019–01–01
  16. By: Ibrahim D. Raheem (EXCAS, Liège, Belgium); Aviral K. Tiwari (Kochi, India); Daniel Balsalobre-lorente (Ciudad Real, Spain)
    Abstract: This study explores the role of the information and communication Technology (ICT) and financial development (FD) on both carbon emissions and economic growth for the G7 countries for the period 1990-2014. Using PMG, we found that ICT has a long run positive effect on emissions, while FD is a weak determinant. The interactive term between the ICT and FD produces negative coefficients. Also, both variables are found to impact negatively on economic growth. However, their interactions show they have mixed effects on economic growth (i.e., positive in the short-run and negative in the long-run). Policy implications were designed based on these results.
    Keywords: ICT; Financial development; Carbon emissions; Economic growth and G7 countries
    JEL: E23 F21 F30 O16
    Date: 2019–01
  17. By: Carlhoff, Henrik
    Abstract: This paper investigates the interplay between aging of a society and its carbon dioxide emissions. The existing literature based on US data predicts lower overall emissions due to the lower emission intensity of consumption of a growing old-age share of the population. This conjecture is reexamined by a multivariate approach. The underlying hypothesis is that the individual levels of emissions do not only depend on age but also on income and employment status, which are correlated with age. Thus, bivariate analyses, neglecting other relevant variables, might overstate the decline in emissions for older cohorts. The paper shows that this hypothesis is correct. A bivariate approach overestimates the decline of emissions caused by population aging. Policy decisions favoring a longer work life may reverse the dampening effect of aging on emissions.
    JEL: J11 Q54
    Date: 2019
  18. By: Ali, Amjad; Audi, Marc
    Abstract: This study provides a review of benefit and losses of greenhouse gases. For the last decades, the average global temperature is rising on the surface as well as on the oceans. There are a number of factors behind this rise, but the main cause of this rise is anthropogenic increase in greenhouse gases (GHG). The anthropogenic factors comprise of burning of fossil fuel, coal mining, industrialization etc. During the last century, the CO2 concentration increased by 391 PPM, CH4 and N2O have reached at warming levels. The rise in overall temperature is changing the living pattern of humans and it also damages the economy as well as ecosystem for other living species. The rising GHG concentration may also have some positive effects on the economy, but it has heavy costs as well. GHGs are responsible for the change in climate which include a rise in sea level, ice melting from ice sheets and ocean acidification and climate change is responsible for the other damages like low fresh water resources, damage to the coastal system, damage to human health and raise the issue of food security.
    Keywords: Greenhouse gases, health, food, natural resources
    JEL: N5 Q5
    Date: 2019
  19. By: María Sicilia Salvadores
    Abstract: En este artículo se analiza el papel que el Plan Nacional Integrado de Energía y Clima (PNIEC) 2021-2030 reconoce al gas natural y a los gases renovables como vector energético para cumplir con los compromisos medioambientales asumidos por España. El Escenario Objetivo muestra su relevancia en todos los sectores finales reemplazando a otros combustibles más contaminantes y como respaldo para la generación renovable intermitente. Asimismo se propone un Escenario Alternativo para el sector eléctrico, de cumplimiento con los objetivos climáticos, en el que una mayor utilización de las infraestructuras gasistas existentes resulta en un ahorro muy significativo de costes para el conjunto del sistema.
    Date: 2019–09
  20. By: Ragchaasuren Galindev; Tsolmon Baatarzorig; Nyambaatar Batbayar; Delgermaa Begz; Unurjargal Davaa; Oyunzul Tserendorj
    Abstract: The Government of Mongolia began implementing an IMF program under the Extended Fund Facility agreement (EFF) in May 2017. Under the program, the government has decreased expenditures and increased taxes to achieve debt sustainability via fiscal consolidation and stable growth. At the same time, the government has faced challenges because of its commitment of fiscal consolidation to the IMF: the rising price of fuel and its own fuel-subsidy policies. We used the PEP standard static CGE model to examine the impact of fiscal consolidation on the Mongolian economy under various conditions. Moreover, we used a poverty (microsimulation) model to analyze those impacts at a household level. Our analysis of the impact of fiscal consolidation under pessimistic and optimistic mineral-commodity-price scenarios showed that Mongolia’s economy was closely tied to international commodity prices. Our examination of the government’s alternative policies on fuel subsidies in an environment of fiscal consolidation demonstrated that the effect of increased fuel prices on the economy depended upon government fuel-subsidy policy.
    Keywords: CGE model, Mongolian economy, Mining, Fiscal consolidation
    JEL: D58 E62 I32 Q33
    Date: 2019
  21. By: Denis Claude (LEDi - Laboratoire d'Economie de Dijon [Dijon] - UB - Université de Bourgogne - UBFC - Université Bourgogne Franche-Comté [COMUE]); Mabel Tidball (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)
    Abstract: This paper explores the link between upstream input pricing and downstream strategic delegation decisions. It complements earlier contributions by studying how environmental emissions and tax payments alter the incentives business owners have to divert their managers from profit maximization in favor of sales revenue generation. Two scenarios are compared depending on whether the upstream supplier precommits to a fixed input price or adopts a flexible price strategy. Corresponding Subgame-Perfect Nash-Equilibria are characterized and elements of comparative statics analysis are presented. The analysis confirms that previous results—showing that a price precommitment makes the upstream supplier better off and downstream firms worse off—carry over to situations in which production generates pollution.
    Keywords: Managerial incentives,Vertical relations,Delegation,Precommitment,Externality
    Date: 2019
  22. By: Gozgor, Giray; Tiwari, Aviral; Khraief, Naceur; Shahbaz, Muhammad
    Abstract: The relationship between CO2 emissions and economic growth is well-examined. However, there is a gap in the literature to examine the nexus by regime-switching models. For this purpose, this paper examines the interdependence relations between CO2 emissions and the industrial production index as a measure of business cycles at the monthly frequency in the United States. We use a new approach to modeling dependence between the underlying variables over time, combining the time-varying copula and the Markov switching models. We find that there is a significant dependence structure between business cycles and CO2 emissions, which has a regime-switching feature, for the period from January 1973 to January 2017. Specifically, during the recession episodes, we deduce that until 1982, the high dependence regime with the Gaussian copula is valid. Since the beginning of 1983, the low dependence structure regime becomes prominent.
    Keywords: carbon dioxide emissions; business cycles; Markov-switching models; copula models; regime-dependency
    JEL: Q5
    Date: 2019–09–02
  23. By: Ragchaasuren Galindev; Tsolmon Baatarzorig; Nyambaatar Batbayar; Delgermaa Begz; Unurjargal Davaa; Oyunzul Tserendorj
    Abstract: This paper examines the impact of Foreign Direct Investment (FDI) intended to increase the exporting capacity of the coal sector on the Mongolian economy and environment by using a recursive dynamic Computable General Equilibrium model. FDI was used to expand the coal-export sector as well as to construct a railway line connecting the Mongolian main coal reserve and the Chinese border. FDI had a positive impact on macroeconomic variables such as GDP, employment, investment, and household consumption but produced a Dutch disease effect in some sectors. The new railway reduced the environmental impact of transporting coal.
    Keywords: CGE model, Mongolian economy, Mining, Fiscal consolidation
    JEL: D58 E62 I32 Q33
    Date: 2019
  24. By: -
    Date: 2019–05
  25. By: Guillermo Jr. Cardenas Salgado; Luis Antonio Espinosa; Juan Jose Li Ng; Carlos Serrano
    Abstract: Se analizaron las operaciones por día y hora en TPVs de las gasolineras de la ZM del Valle de México. La crisis inició a las 12:00hrs del martes 8 de enero, duró 13 días, concluyó el 20 de enero, se cargó 16% más gasolina por operación, y se incrementó hasta 400% la compra a altas horas de la noche y en la madrugada. An analysis of the POS operations in gas stations in the Valle de Mexico metro-area are analyzed by day and hour. The crisis began at noon on Tuesday January 8, lasted 13 days, ended on January 20, 16% more gasoline was loaded per operation, and the purchase was increased up to 400% at late night and in the early morning.
    Keywords: trends, tendencias, Gasoline, Gasolina, Crisis, Crisis, Big Data, Big Data, Incomplete markets, Mercados incompletos, Mexico, México, Analysis with Big Data, Análisis con Big Data, Regional Analysis Mexico, Análisis Regional México, Consumption, Consumo, Energy and Commodities, Energía y Materias Primas, Working Papers, Documento de Trabajo
    JEL: D45 D52 H44 Q31
    Date: 2019–07
  26. By: Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CNRS - Centre National de la Recherche Scientifique - ENPC - École des Ponts ParisTech - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech, VIET - Vietnam Initiative for Energy Transition)
    Abstract: In 2016, Vietnam planned to build a fleet of new coal-fired power plants, expanding capacity to 54.5 GW in 2030, from 13.1 GW in 2015. Three years later, the risk of stranded assets not only made this plan sub-optimal, it also made it infeasible because investors are looking elsewhere.
    Date: 2019–08–05
  27. By: OECD
    Abstract: The investment choices we make in the coming years will either lock-in a climate-compatible, inclusive growth pathway, or a high-carbon, inefficient and unsustainable pathway for decades to come. Cities and regions, responsible for 60% of public investment in OECD countries, are significant contributes to spending and investment related to climate. With high levels of inequalities in many cities, the success of the transition will depend on the ability of local governments to engage in a “just” transition. This paper focuses on how national and sub-national governments can align subnational financial flows to transition towards low-carbon, resilient and inclusive cities. The paper is a contribution from the OECD Champion Mayors for Inclusive Growth initiative and to the OECD Programme on Subnational Finance and Investment.
    Date: 2019–09–17

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