nep-ene New Economics Papers
on Energy Economics
Issue of 2020‒04‒13
thirty papers chosen by
Roger Fouquet
London School of Economics

  1. The Conditional Relationship between Renewable Energy and Environmental Quality in Sub-Saharan Africa By Simplice A. Asongu; Chimere O. Iheonu; Kingsley O. Odo
  2. Green Growth Pathways for Saudi Arabia By KAPSARC, King Abdullah Petroleum Studies and Research Center
  3. Facilitating Electric Vehicle Adoption with Vehicle Cost Calculators By Sanguinetti, Angela; Alston-Stepnitz, Eli; Cimene, Angelika
  4. Dynamic Behaviour of Hydro/Thermal Electrical Operators Under an Environmental Policy Targeting to Preserve Ecosystems Integrity and Air Quality By Houeida Hedfi; Ahlem Dakhlaoui; Abdessalem Abbassi
  5. Forecasting Models for Daily Natural Gas Consumption Considering Periodic Variations and Demand Segregation By Ergun Yukseltan; Ahmet Yucekaya; Ayse Humeyra Bilge; Esra Agca Aktunc
  6. Flickering Lifelines: Electrification and Household Welfare in India By Sedai, Ashish Kumar; Nepal, Rabindra; Jamasb, Tooraj
  7. Complexity of Electricity Markets and their Regulation: Insights from the Turkish Experience. By Oguz, Fuat
  8. Technology Policy and Market Structure: Evidence from the Power Sector By Moritz Bohland; Sebastian Schwenen
  9. Determining feature importance for actionable climate change mitigation policies By Romit Maulik; Junghwa Choi; Wesley Wehde; Prasanna Balaprakash
  10. Analyzing Small Industrial and Commercial User Demand for Electricity By Allen, Keighton R.; Fullerton, Thomas M., Jr.
  11. Environmental Kuznets Curve and Pollution Haven Hypothesis By Sinha, Apra; Kumar, Abhishek; Gopalakrishnan, Badri Narayanan
  12. The 2020 Power Trading Agent Competition By Ketter, W.; Collins, J.; de Weerdt, M.M.
  13. Climate policy costs of spatially unbalanced growth in electricity demand: the case of datacentres By Fitiwi, Desta; Lynch, Muireann Á.
  14. Managing Power Supply Interruptions: A Bottom-Up Spatial (Frontier) Model with an Application to a Spanish Electricity Network By Argüelles, Pablo; Orea, Luis
  15. Essence of Multilateral Energy Technology Collaboration:A Case Study of International Energy Agency (IEA) Technology Collaboration Programmes (TCPs) By Takashi Hattori; Hoseok Nam
  16. Effects of Oil Resource Endowment, Natural Gas and Agriculture Output: Policy Options for Inclusive Growth By Ekundayo P. Mesagan; Juliet I. Adenuga
  17. Firm-level total factor productivity convergence in German electricity and gas industry By Claudiu Albulescu; Serban Miclea
  18. Foreign Direct Investment, Domestic Investment and Green Growth in Nigeria: Any Spillovers? By Akintoye V. Adejumo; Simplice A. Asongu
  19. Worker mobility and the purchase of low CO2 emission vehicles in France: a datamining approach By Raphaël Homayoun Boroumand; Stéphane Goutte; Thomas Péran; Thomas Porcher
  20. Effects of competition forms and market structure on green innovation incentives By Iwata, Hiroki
  21. Mind your Ps and Qs! An Experiment on Variable Allowance Supply in the US Regional Greenhouse Gas Initiative By Lana Friesen; Lata Gangadharan; Peyman Khezr; Ian A. MacKenzie
  22. The Role of ICT and Financial Development on CO2 Emissions and Economic Growth By Ibrahim D. Raheem; Aviral K. Tiwari; Daniel Balsalobre-lorente
  23. Political Economy of Oil Resources Management in Nigeria: Lessons from Other Countries By Perekunah B. Eregha; Ekundayo P. Mesagan
  24. Extension du domaine de la prédation - La vente d'Alstom à General Electric By Olivier Coussi; Nicolas Moinet
  25. Regional Integration and Energy Sustainability in Africa: Exploring the Challenges and Prospects for ECOWAS By Opeyemi Akinyemi; Uchenna Efobi; Evans Osabuohien; Philip Alege
  26. Promoting Green or Restricting Gray? An Analysis of Green Portfolio Standards By Hiroaki Ino; Toshihiro Matsumura
  27. Kernel density decomposition with an application to the social cost of carbon By Richard S. J. Tol
  28. The Effect of Open-Air Waste Burning on Infant Health: Evidence from Government Failure in Lebanon By Mouganie, Pierre; Ajeeb, Ruba; Hoekstra, Mark
  29. Is Environmental Tax Harmonization Desirable in Global Value Chains? By Cheng, Haitao; Kato, Hayato; Obashi, Ayako
  30. Hydraulic power project of U.S. federal government in the provinces \Case studies of four early Reclamation Projects \ By Takuro Hidaka

  1. By: Simplice A. Asongu (Yaoundé/Cameroon); Chimere O. Iheonu (University of Nigeria, Nsukka); Kingsley O. Odo (University of Nigeria, Nsukka)
    Abstract: This paper complements existing literature by assessing the conditional relationship between renewable energy and environmental quality in a sample of 40 African countries for the period 2002 to 2017. The empirical evidence is based on fixed effects regressions and quantile fixed effects regressions. The findings from both estimation techniques show that renewable energy consistently decreases carbon dioxide (CO2) emissions. Moreover, the negative effect is a decreasing function of CO2 emissions or the negative effect of renewable energy on CO2 emissions decreases with increasing levels of CO2 emissions. In other words, countries with higher levels of CO2 emissions consistently experience a less negative effect compared to their counterparts with lower levels of CO2 emissions. Policy implications are discussed.
    Keywords: Panel econometrics; Renewable energy; Carbon emissions; Africa
    JEL: Q32 Q40 O55
    Date: 2019–01
  2. By: KAPSARC, King Abdullah Petroleum Studies and Research Center (King Abdullah Petroleum Studies and Research Center)
    Abstract: Green growth emphasizes that positive environmental outcomes can be consistent with economic prosperity and that greater social wellbeing can be achieved through ‘less use, more value’ policies.
    Keywords: Carbon Dioxide Emissions, Circular Carbon Economy, Climate Change, Diversification, Economic Growth, Energy Efficiency, Energy Price Reform, Renewable Energy, Sustainable Development
    Date: 2019–03–09
  3. By: Sanguinetti, Angela; Alston-Stepnitz, Eli; Cimene, Angelika
    Abstract: Consumer education regarding the costs of electric vehicles (EVs), particularly in comparison with similar gasoline vehicles, is important for adoption. However, the complexity of comparing gasoline and electricity prices, and balancing long-term return-on-investment from fuel and maintenance savings with purchase premiums for EVs, makes it difficult for consumers to assess potential economic advantages. Online vehicle cost calculators (VCCs) may help consumers navigate this complexity by providing tailored estimates of different types of vehicles costs for users and enabling comparisons across multiple vehicles. However, VCCs range widely and there has been virtually no behavioral research to identify functionalities and features that determine their usefulness in engaging and educating consumers and promoting EV adoption. This research draws on a behavioral theory, systematic review of available VCCs, and user research with three VCCs to articulate design recommendations for effective VCCs. View the NCST Project Webpage
    Keywords: Social and Behavioral Sciences, Electric vehicles, consumer adoption, cost calculators, usability, user experience
    Date: 2020–04–01
  4. By: Houeida Hedfi (UR MASE - Modélisation et Analyse Statistique et Economique - ESSAIT - Ecole Supérieure de la Statistique et de l'Analyse de l'Information - Université de Carthage - University of Carthage); Ahlem Dakhlaoui (LEGI - Laboratoire d'Économie et de Gestion Industrielle [Tunis] - Ecole Polytechnique de Tunisie); Abdessalem Abbassi (Centre de Recherche en économie de l'Environnement, de l'Agroalimentaire, des Transports et de l'Énergie (CREATE) - Université Laval)
    Abstract: In this paper, we analyse the effect of an environmental policy that targets to enhance ecosystems integrity as well as air quality in the wholesale electricity market. We developed a dynamic Cournot game between a hydro and a thermal risk adverse electricity producers under demand uncertainty. We demonstrate that while improving air quality necessarily raises the market price, enhancing ecosystems integrity can, under water abundance hypothesis, reduce it. Moreover, in order to establish a statement about the environmental policy efficiency, we examine interactions between both environmental measures and their potential side effects. We show that prioritizing natural flow regime minimises necessarily the taxation efficiency on lowering air pollution and emphasizes the price rise due to the taxation. Nevertheless, the effect of the taxation policy on the efficiency of the ecosystems integrity policy depends on the hydro producer's ability to substitute thermal units. In order to establish a precise environmental statement, the regulation authority needs to compare, using appropriate criteria , the importance of an avoided unit of surrounding ecosystem alteration to an avoided unit of air polluting production, in the whole ecosystem functioning.
    Keywords: Electricity generation,Environmental policy,Dynamic modelling,Imperfect competi- tion,Ecosystems integrity,Air quality
    Date: 2020–03–28
  5. By: Ergun Yukseltan; Ahmet Yucekaya; Ayse Humeyra Bilge; Esra Agca Aktunc
    Abstract: Due to expensive infrastructure and the difficulties in storage, supply conditions of natural gas are different from those of other traditional energy sources like petroleum or coal. To overcome these challenges, supplier countries require take-or-pay agreements for requested natural gas quantities. These contracts have many pre-clauses; if they are not met due to low/high consumption or other external factors, buyers must completely fulfill them. A similar contract is then imposed on distributors and wholesale consumers. It is thus important for all parties to forecast their daily, monthly, and annual natural gas demand to minimize their risk. In this paper, a model consisting of a modulated expansion in Fourier series, supplemented by deviations from comfortable temperatures as a regressor is proposed for the forecast of monthly and weekly consumption over a one-year horizon. This model is supplemented by a day-ahead feedback mechanism for the forecast of daily consumption. The method is applied to the study of natural gas consumption for major residential areas in Turkey, on a yearly, monthly, weekly, and daily basis. It is shown that residential heating dominates winter consumption and masks all other variations. On the other hand, weekend and holiday effects are visible in summer consumption and provide an estimate for residential and industrial use. The advantage of the proposed method is the capability of long term projections and to outperform time series methods.
    Date: 2020–02
  6. By: Sedai, Ashish Kumar (Department of Economics, Colorado State University, Fort Collins, USA); Nepal, Rabindra (Department of Economics, University of Wollongong, Wollongong, Australia); Jamasb, Tooraj (Department of Economics, Copenhagen Business School)
    Abstract: Access to reliable energy is central to improvements in living standards and is a Sustainable Development Goal. This study moves beyond counting the electrified households and examines the effect of the hours of electricity households receives on their welfare. We hypothesize that additional hours of electricity have different effects on the poor, the middle income and the rich, as well as in rural and urban areas. The methods used are panel fixed effects instrumental variables, cross sectional fixed effects instrumental variables, and logistic regression with data from the Indian Human Development Survey 2005-2012. We focus on extensive and the intensity margins, i.e. how access and additional hours of electricity affect household welfare in terms of consumption expenditure, income, assets and poverty status. The results show large gaps between the benefits and costs of electricity supply among consumer groups. We also find that electricity theft is positively correlated with the net returns from electrification. Progressive pricing with targeted subsidies for the poor can increase household welfare while reducing the financial losses of the State Electricity Boards.
    Keywords: Reliable energy; Electrification; Household welfare; Panel fixed effects; Instrumental variables approach
    JEL: D12 D31 E21 I32
    Date: 2020–03–26
  7. By: Oguz, Fuat
    Abstract: Electricity pricing models were designed at a time when technology was relatively stable. The natural monopoly model was based on a uni-directional pricing mechanism. Electricity was generated at one end and transferred to the other end. Pollution was not a big issue. There were no solar panels over the houses of consumers. Many contemporary issues of the ecosystem of electricity were not relevant. The tariff model was meant to be a simple one, even though it included many variables. It was not a complex system. This paper argues that a model that was designed within a simple system cannot efficiently adapt to a multidimensional and interdependent system. The use of the old regulatory model within a complex system creates rents and inefficiencies. This paper evaluates the electricity tariff model in Turkey under the light of recent technological advances and changes in the structure of electricity markets. The changes in the institutional environment of the market bring electricity markets closer to a complex system. We argue that the tariff mechanism should also be revised accordingly. We use the Turkish electricity industry as an example, as it reflects the issues in a developing country.
    Keywords: Complexity; electricity distribution; electricity tariffs; regulation; renewables; Turkish electricity industry
    JEL: K2 L9 L94
    Date: 2020–03
  8. By: Moritz Bohland; Sebastian Schwenen
    Abstract: We show how policies to trigger clean technologies change price competition and market structure. We present evidence from electricity markets, where regulators have implemented different policies to subsidize clean energy. Building on a multi-unit auction model, we show that currently applied subsidy designs either foster or attenuate competition. Fixed, price-independent output subsidies decrease firms’ mark-ups. In contrast, designs that subsidize clean output via a regulatory premium on the market price lead to higher mark-ups. We confirm this finding empirically using auction data from the Spanish power market. Our empirical results show that the design choice for technology subsidies significantly impacts pricing behavior of firms and policy costs for consumers
    Keywords: Subsidies, Clean Energy, Pricing, Electricity
    JEL: D22 D44 D47
    Date: 2020
  9. By: Romit Maulik; Junghwa Choi; Wesley Wehde; Prasanna Balaprakash
    Abstract: Given the importance of public support for policy change and implementation, public policymakers and researchers have attempted to understand the factors associated with this support for climate change mitigation policy. In this article, we compare the feasibility of using different supervised learning methods for regression using a novel socio-economic data set which measures public support for potential climate change mitigation policies. Following this model selection, we utilize gradient boosting regression, a well-known technique in the machine learning community, but relatively uncommon in public policy and public opinion research, and seek to understand what factors among the several examined in previous studies are most central to shaping public support for mitigation policies in climate change studies. The use of this method provides novel insights into the most important factors for public support for climate change mitigation policies. Using national survey data, we find that the perceived risks associated with climate change are more decisive for shaping public support for policy options promoting renewable energy and regulating pollutants. However, we observe a very different behavior related to public support for increasing the use of nuclear energy where climate change risk perception is no longer the sole decisive feature. Our findings indicate that public support for renewable energy is inherently different from that for nuclear energy reliance with the risk perception of climate change, dominant for the former, playing a subdued role for the latter.
    Date: 2020–03
  10. By: Allen, Keighton R.; Fullerton, Thomas M., Jr.
    Abstract: This study employs duality theory to develop a theoretical model for small commercial and industrial (CIS) electricity usage. The CIS production function is posited such that output is a function of three variable inputs (electricity, natural gas, and labor) and one fixed input (capital). A profit function dual to this production function is specified using a normalized quadratic functional form. CIS profits are functionally dependent upon output price, an electricity input price, and natural gas and labor input prices for a fixed quantity of capital. The derived input-demand equation results from differentiating the profit function with respect to the price of electricity. The input-demand equation for electricity is dependent upon the own-price of electricity, the CIS output price, and input cross-prices. The model may be of use to utilities and regulators for the analysis of CIS electricity usage.
    Keywords: Duality Theory; Derived Demand; Electricity; Small Industrial and Commercial Customers
    JEL: M21 Q47 R15
    Date: 2018–09–15
  11. By: Sinha, Apra; Kumar, Abhishek; Gopalakrishnan, Badri Narayanan
    Abstract: There has been limited empirical work done in the recent past to test the hypotheses of EKC and PH. Results obtained in this paper validate EKC hypothesis for total carbon dioxide emissions and carbon dioxide emissions from liquid fuel consumption from a panel of countries. This is robust to inclusion of additional covariates and division of countries on the basis of income. Financial development increases total emissions in high income countries whereas it decreases emissions in non high income countries in the long run. Trade to GDP ratio does not affect emissions significantly in case of high income countries. In case of non high income countries, trade to GDP ratio increases the emissions from solid fuel in the long run. Also in case of non high income countries increase in trade to GDP ratio increases total emissions and emissions from liquid fuel consumption in short run. Therefore, there is evidence in favour of pollution haven hypothesis in short run. It is logical as we expect the emissions shifting aspect of trade to be operative in short run whereas in long run the trade should be determined by comparative advantages.
    Keywords: Environment; CO2 emissions; Kuznets Curve; International Trade; Development
    JEL: Q43 Q56
    Date: 2020–03–04
  12. By: Ketter, W.; Collins, J.; de Weerdt, M.M.
    Abstract: This is the specification for the Power Trading Agent Competition for 2020 (Power TAC 2020). Power TAC is a competitive simulation that models a “liberalized” retail electrical energy market, where competing business entities or “brokers” offer energy services to customers through tariff contracts, and must then serve those customers by trading in a wholesale market. Brokers are challenged to maximize their profits by buying and selling energy in the wholesale and retail markets, subject to fixed costs and constraints; the winner of an individual “game” is the broker with the highest bank balance at the end of a simulation run. Costs include fees for publication and withdrawal of tariffs, for rectifying supply-demand imbalances, for contributions to peak demand, and for customer connections. The simulation environment models a wholesale market, a regulated distribution utility, and a population of energy customers, situated in a real location on Earth during a specific period for which weather data is available. The wholesale market is a relatively simple call market, similar to many existing wholesale electric power markets, such as Nord Pool in Scandinavia or FERC markets in North America, but unlike the FERC markets we are modeling a single region, and therefore we approximate the effects of locational-marginal pricing through manipulation of the wholesale supply curve. Customer models include households, electric vehicles, and a variety of commercial and industrial entities, many of whom have production capacity such as solar panels or wind turbines. All have “real-time” metering to support allocation of their hourly supply and demand to their subscribed brokers, and all are approximate utility maximizers with respect to tariff selection, although the factors making up their utility functions may include aversion to change and complexity that can retard uptake of marginally better tariff offers. A distribution utility models the regulated natural monopoly that owns the regional distribution network, and is responsible for maintenance of its infrastructure. Real-time balancing of supply and demand is managed by a market-based mechanism that uses economic incentives to encourage brokers to achieve balance within their portfolios of tariff subscribers and wholesale market posi- tions, in the face of stochastic customer behaviors and weather-dependent renewable energy sources. Changes for 2020 are focused on stability and on making customer evaluation of regulation rates more realistic, and are highlighted by change bars in the margins. See Section 4.1.1 for details.
    Keywords: Autonomous Agents, Electronic Commerce, Energy, Preferences, Portfolio Management, Power, Policy Guidance, Sustainability, Trading Agent Competition
    Date: 2020–03–30
  13. By: Fitiwi, Desta; Lynch, Muireann Á.
    Date: 2020
  14. By: Argüelles, Pablo (EDP España and University of Oviedo); Orea, Luis (University of Oviedo and Oviedo Efficiency Group)
    Abstract: In December 2013 a new electricity law was approved in Spain as part of an electricity market reform including a new remuneration scheme for distribution companies. This remuneration scheme was updated in December 2019 and the new regulatory framework introduced a series of relevant modifications that aim to encourage the regulated firms to reduce their power supply interruptions using a benchmarking approach. While some managerial decisions can prevent electricity power supply interruptions, other managerial decisions are more oriented to mitigate the consequences of these interruptions. This paper examines the second type of decisions using a unique dataset on the power supply interruptions of a Spanish distribution company network between 2013 and 2019. We focus on the effect of grid automatization on the restoration times, the relative efficiency of the maintenance staff, and the importance of its location. We combine a bottom-up spatial model and a stochastic frontier model to examine respectively external and internal power supply interruptions at municipal level. This model resembles the conventional spatial autoregressive models but differs from them in several important aspects.
    Keywords: Electricity distribution; Power supply interruptions; Spatial econometrics; Frontier models
    JEL: H54 L97 L98
    Date: 2020–03–26
  15. By: Takashi Hattori (Institute of Economic Research, Kyoto University); Hoseok Nam (Institute of Economic Research, Kyoto University)
    Abstract: Energy transition has been an important issue in achieving climate action. A “multilateral energy technology cooperation” is often considered a driver that leads to multilateral cooperation being successful. International Energy Agency (IEA) Technology Collaboration Programmes (TCPs) are an interesting case study because they have a long history. For over 40 years, they have worked toward the achievement of energy and climate goals. Statistical analysis was performed to explore the increase in entities’ participation in and the distribution of 38 TCPs. An email survey was administered to learn about the opinions and thoughts of representatives in 18 TCPs. The survey’s purpose was to understand current evidence on the roles and effectiveness of IEA TCPs in energy technology cooperation. The survey responses were analyzed to understand the correlation among input, output, and outcome as well as goal and implementing capacity. The results revealed that most respondents were satisfied with input and output. The current energy policy situation and possible greenhouse gas reduction in one’s country were selected as the main reasons for four outcomes: policy adoption, technology deployment, economic benefit, and social acceptance. Regression analysis demonstrated the correlation among input, output, and outcome of IEA TCPs. These findings have ramifications for future multilateral cooperation and implications for energy collaboration development.
    Keywords: Energy; Technology; Multilateral cooperation; Survey
    JEL: F53 O33 P48 Q48
    Date: 2020–03
  16. By: Ekundayo P. Mesagan (Pan Atlantic University, Lagos, Nigeria); Juliet I. Adenuga (University of Lagos, Nigeria)
    Abstract: The fact that inclusive growth involves the width of growth, benefit-sharing, and human development pertaining to health care makes this study to examine the impact of crude oil, natural gas and agriculture output on inclusive growth in Nigeria between 1970 and 2017. We use employment, life expectancy, and income per capita to capture inclusive growth, from where we compute inclusive growth index using the Principal Component Analysis. The result of the Autoregressive Distributed Lag suggests that crude oil and natural gas production insignificantly impact inclusive growth while agriculture output is significant. It means that oil resource wealth has neither been maximised to widen growth contribution nor used to deepen the growth spread in Nigeria whereas the agriculture resource is critical for inclusive growth. It is important to focus on expanding human capacity by improving employment, health care delivery, and investing in modular mechanised farming for agriculture graduates to promote inclusive growth.
    Keywords: Crude Oil Production; Natural Gas; Agriculture Output; Inclusive Growth
    JEL: O13 Q10 Q32 Q33
    Date: 2019–01
  17. By: Claudiu Albulescu (CRIEF - Centre de Recherche sur l'Intégration Economique et Financière - Université de Poitiers); Serban Miclea
    Abstract: This paper investigates the degree of total factor productivity convergence for the German electricity and gas firms. We use different approaches to compute the productivity level and several old and new panel unit root tests from the second generation to check the existence of a convergence process. For robustness purpose we compare the convergence between small and medium-sized enterprises and large companies. Our findings show the existence of the convergence process in terms of total factor productivity, result confirmed by all categories of tests we use. Therefore, an innovation transfer is recorded between German electricity and gas firms, transfer that is slightly higher for small and medium-sized enterprises. JEL codes: D24, O33
    Keywords: total factor productivity,convergence,panel unit root tests,firm-level data,German electricity and gas industry
    Date: 2020–03–20
  18. By: Akintoye V. Adejumo (Obafemi Awolowo University, Ile-Ife, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: Globally, investments in physical and human capital have been identified to foster real economic growth and development in any economy. Investments, which could be domestic or foreign, have been established in the literature as either complements or substitutes in varying scenarios. While domestic investments bring about endogenous growth processes, foreign investment, though may be exogenous to growth, has been identified to bring about productivity and ecological spillovers. In view of these competing–conflicting perspectives, this chapter examines the differential impacts of domestic and foreign investments on green growth in Nigeria during the period 1970-2017. The empirical evidence is based on Auto-regressive Distributed Lag (ARDL) and Granger causality estimates. Also, the study articulates the prospects for growth sustainability via domestic or foreign investments in Nigeria. The results show that domestic investment increases CO2 emissions in the short run while foreign investment decreases CO2 emissions in the long run. When the dataset is decomposed into three sub-samples in the light of cycles of investments within the trend analysis, findings of the third sub-sample (i.e. 2001-2017) reveal that both types of investments decrease CO2 emissions in the long run while only domestic investment has a negative effect on CO2 emissions in the short run. This study therefore concludes that as short-run distortions even out in the long-run, FDI and domestic investments has prospects for sustainable development in Nigeria through green growth.
    Keywords: Investments; Productivity; Sustainability; Growth
    JEL: E23 F21 F30 O16 O55
    Date: 2019–01
  19. By: Raphaël Homayoun Boroumand (ESG Research Lab - ESG Management School); Stéphane Goutte (Cemotev - Centre d'études sur la mondialisation, les conflits, les territoires et les vulnérabilités - UVSQ - Université de Versailles Saint-Quentin-en-Yvelines, LED - Laboratoire d'Economie Dionysien - UP8 - Université Paris 8 Vincennes-Saint-Denis); Thomas Péran (Paris School of Business); Thomas Porcher (Paris School of Business)
    Date: 2019
  20. By: Iwata, Hiroki
    Abstract: This paper analyzes the effects of environmental policy on green innovation. We compare the incentives for green innovation in both the Cournot and Bertrand competition. It is shown that positive incentives for green innovation exist in both competition models. When environmental regulations are imposed, the effects of the probability of success on green innovation incentives differ between the Bertrand and Cournot competition. Additionally, we clarify the conditions necessary for the establishment of the Porter hypothesis in both competition models.
    Keywords: Cournot and Bertrand competition, Green innovation, Porter hypothesis
    JEL: L13 Q52 Q55
    Date: 2020–03–27
  21. By: Lana Friesen (School of Economics, University of Queensland); Lata Gangadharan (Department of Economics, Monash University, Australia); Peyman Khezr (School of Economics, University of Queensland); Ian A. MacKenzie (School of Economics, University of Queensland)
    Abstract: Using an experimental approach, we investigate the new institutional design for the US Regional Greenhouse Gas Initiative (RGGI). The proposed scheme incorporates two allowance reserves that adjust the initial supply of allowances in the event of unexpectedly high or low allowance demand. In particular, allowance supply is increased when the initial clearing price is above a pre-determined upper trigger price, and decreased when the initial clearing price is below a pre-determined lower trigger price. We provide evidence that these two trigger prices act as focal points: the distribution of clearing prices is bimodal and aligns with the trigger prices. We also show that decreasing the range between the two trigger prices increases total revenue but decreases allocative efficiency. Importantly, we find the regulation is more sensitive to changes in trigger prices than reserve quantities.
    Keywords: supply reserve; pollution allowances; experiment.
    JEL: C91 C92 Q58
    Date: 2020–03–31
  22. 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
  23. By: Perekunah B. Eregha (Pan-Atlantic University, Lekki-Lagos. Nigeria); Ekundayo P. Mesagan (Pan-Atlantic University, Lekki-Lagos. Nigeria)
    Abstract: The study focuses on the political economy of oil resources management in Nigeria with the sole purpose of showcasing how far the country has gone in effectively managing its crude oil proceeds. It presents a brief history on the excess crude account as well as the sovereign wealth fund in Nigeria and then presents the models of excess oil resource management of some other countries. This is to enable Nigeria to draw some lessons and then take steps that guarantees the sustenance of growth and development.
    Keywords: Crude Oil; Political Economy; Sovereign Wealth Fund; Excess Crude Account; Growth; Nigeria.
    JEL: D72 D73 D78 Q34 Q43
    Date: 2019–01
  24. By: Olivier Coussi (CE.RE.GE - CEntre de REcherche en GEstion - IAE Poitiers - Institut d'Administration des Entreprises (IAE) - Poitiers - Université de Poitiers - Université de Poitiers - ULR - Université de La Rochelle); Nicolas Moinet (CE.RE.GE - CEntre de REcherche en GEstion - IAE Poitiers - Institut d'Administration des Entreprises (IAE) - Poitiers - Université de Poitiers - Université de Poitiers - ULR - Université de La Rochelle)
    Abstract: In 2014, the energy branch of the Alstom group is sold to General Electric, causing a number of tribulations at the highest level of French institutional spheres to the point of triggering a parliamentary commission of inquiry as well as a judicial inquiry. This case invites an analysis of the events through the theoretical prism of the agility/strategic paralysis couple. An in-depth study of the mechanisms at work reveals a new mode of economic predation, the armed arm of which is the extraterritoriality of American law, combined with persistent cultural behaviour linked to arrogance.
    Abstract: En 2014, la branche énergie du groupe Alstom est cédée à General Electric, provoquant nombre de tribulations au plus niveau des sphères institutionnelles françaises au point de déclencher une commission d'enquête parlementaire ainsi qu'une enquête judiciaire. Ce cas d'école invite à une analyse des évènements au prisme théorique du couple agilité/paralysie stratégique. L'étude approfondie des mécanismes à l'œuvre révèle un nouveau mode de prédation économique dont le bras armé est l'extraterritorialité du droit américain qui se conjugue avec des persistances de comportement culturel liées à l'arrogance.
    Date: 2019
  25. By: Opeyemi Akinyemi (Covenant University, Ota, Ogun State, Nigeria); Uchenna Efobi (CEPDeR, Covenant University, Ota, Nigeria); Evans Osabuohien (CEPDeR, Covenant University, Ota, Nigeria); Philip Alege (Covenant University, Ota, Nigeria)
    Abstract: This study explores the extent to which regional integration can be a viable tool in driving energy sustainability in the Economic Community of West African States (ECOWAS) sub-region of Africa, and vice versa. It examines the existing opportunities and the attendant challenges for improved firms’ productivity in the sub-region through the appraisal of the ECOWAS West African Power Pool (WAPP). Using three measures of energy sustainability, namely: energy security, energy equity, and environmental sustainability; the study presents the performance of the ECOWAS sub-region in ensuring regional integration for energy sustainability. The findings from the study reveal, inter alia, that there are prospects and benefits for energy integration for sustainable development in the region. Though some progress had been made, there are many challenges. Also, where progress had been made, it is not uniform across the sub-region, though factors such as rising population and political instability could be responsible. It is recommended that the political economy surrounding regional energy integration should be given a priority among the Member States to ensure that there is positive political will for speedy achievement of set goals. Also, investment in human capital to manage the different projects and maintain the facilities cannot be overemphasised.
    Keywords: ECOWAS, Energy, Green growth, Sustainable development, Regional Integration
    JEL: F15 P28 Q43 R11 R58
    Date: 2019–01
  26. By: Hiroaki Ino (School of Economics, Kwansei Gakuin University); Toshihiro Matsumura (Institute of Social Science, The University of Tokyo)
    Abstract: This study theoretically examines green portfolio standards with monetary penalties in an oligopoly market. We find that green portfolio standards are inefficient policy tools if the purpose of the government is to promote green products, whereas they attain firstbest optimality if the purpose is to restrict non-green products. Green portfolio standards may work well under the mixed aims of promoting green and restricting non-green products. Moreover, by applying the principle of our results, we highlight the inefficiency of an employment promotion program for handicapped workers in Japan.
    Keywords: green industrial policy, negative externality of gray products, positive externality of green products, renewable portfolio standards, zero emission vehicle program, employment promotion program
    JEL: Q58 Q48 L51
    Date: 2020–04
  27. By: Richard S. J. Tol
    Abstract: A kernel density is an aggregate of kernel functions, which are itself densities and could be kernel densities. This is used to decompose a kernel into its constituent parts. Pearson's test for equality of proportions is applied to quantiles to test whether the component distributions differ from one another. The proposed methods are illustrated with a meta-analysis of the social cost of carbon. Different discount rates lead to significantly different Pigou taxes, but not different growth rates. Estimates have not varied over time. Different authors have contributed different estimates, but these differences are insignificant. Kernel decomposition can be applied in many other fields with discrete explanatory variables.
    Date: 2020–03
  28. By: Mouganie, Pierre (American University of Beirut); Ajeeb, Ruba (American University of Beirut); Hoekstra, Mark (Texas A&M University)
    Abstract: An estimated 40 percent of the world's garbage is burned in open-air fires, which are responsible for as much as half of the global emissions of some pollutants. However, there is little evidence on the health consequences of open-air waste burning. In this paper, we estimate the effect of in utero exposure to open-air waste burning on birth outcomes. We do so by examining the consequences of the Lebanese garbage crisis of 2015, which led to an abrupt, unanticipated increase in waste burning in residential neighborhoods in Beirut and Mount Lebanon. To identify effects, we exploit variation in exposure across neighborhoods before and after the crisis. Results indicate exposure had large impacts on birth outcomes; in utero exposure to at least one open-air waste burn increased premature births by 4 percentage points (50%) and low birth weight by 5 to 8 percentage points (80 - 120%). Given previous research documenting the long-run effects of prenatal shocks on adult health, human capital, and labor market outcomes, this suggests open-air waste burning imposes significant costs on populations worldwide.
    Keywords: prenatal health, in utero pollution exposure, open-air waste burning
    JEL: I18 H41
    Date: 2020–03
  29. By: Cheng, Haitao; Kato, Hayato; Obashi, Ayako
    Abstract: The spatial unbundling of parts production and assembly currently characterizes globalization, leading to the worldwide dispersion of pollution. We consider socially optimal (cooperative) environmental taxes in a two-country model of global value chains in which the location of both parts and assembly can differ. When unbundling costs are so high that parts and assembly must colocate in the pre-globalized world, pollution is spatially concentrated, and harmonizing environmental taxes maximizes global welfare. In contrast, with low unbundling costs triggering the dispersion of parts and thus pollution throughout the world as today, harmonization fails to maximize global welfare. Similar results hold when the two countries non-cooperatively choose their environmental taxes.
    Keywords: Environmental policy; Fragmentation; Emission tax competition; International coordination; Trade in parts and component
    JEL: F18 F23 Q56 Q58
    Date: 2020–03–27
  30. By: Takuro Hidaka (Graduate School of Economics, Osaka University)
    Abstract: This paper examines the continuity between nineteenth and early twentieth century public policies of the U.S. federal government with respect to the West. The development of water resources in the West, embarked upon by the federal government in the early twentieth century, has been regarded as an extension of nineteenth century economic development stimulus measures. However, there has been insufficient consideration of hydropower projects, which may have played a different role from supporting economic development, through the suppression of electricity rate by private power companies. This paper looks at the decisions made by Reclamation Bureau in early four Reclamation Projects, in response to the consultation received from the people in each area, to identify their contribution to the control of electricity rates. The results did not confirm the contribution of the bureau to the control of electricity rates and did not observe any characteristics that differed from the measures to support economic development. The continuity of nineteenth- and early twentieth-century federal public policy with respect to the West is also supported by these four case studies. However, this paper also found that the bureau had taken decisions that facilitated the formation of regional monopolies and had prepared a situation in which high electricity rates were likely to be set. The hydroelectric projects of the bureau were a supportive measure for economic development that was an extension of 19th century policy, but they also brought adverse effects.
    Keywords: Water resource development, Irrigation, Reclamation Project, Bureau of Reclamation
    JEL: N41 N42 N51 N52

This nep-ene issue is ©2020 by Roger Fouquet. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.