nep-env New Economics Papers
on Environmental Economics
Issue of 2007‒02‒24
sixteen papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Economic and Poverty Impacts of a Voluntary Carbon Reduction for a Small Liberalized Developing Economy: The Case of the Philippines By Erwin L. Corong
  3. The Production and Consumption Accounting Principles as a Guideline for Designing Environmental Tax Policy By Mònica Serrano
  4. Forestry and the Carbon Market Response to Stabilize Climate By Massimo Tavoni; Valentina Bosetti; Brent Sohngen
  5. Uncertain R&D, Backstop Technology and GHGs Stabilization By Valentina Bosetti; Massimo Tavoni
  6. La dépollution dans les pays en transition est-elle volontaire ? Le cas des émissions industrielles de carbone. By Natalia Zugravu; Katrin Millock; Gérard Duchêne
  8. CO2 Emissions vs. CO2 Responsibility: An Input-Output Approach for the Turkish Economy By G. Ipek Tunc; Serap Turut-Asik; Elif Akbostanci
  9. Robustness of Sharing Rules under Climate Change - The Case of International Fisheries Agreements By Urs Steiner Brandt; Lone Grønbæk Kronbak
  10. Environmental Impact of Customs Union Agreement with EU on Turkey’s Trade in Manufacturing Industry By Elif Akbostanci; G. Ipek Tunc; Serap Turut-Asik
  11. A CGE-Analysis of Energy Policies Considering Labor Market Imperfections and Technology Specifications By Robert Küster; ingo Ellersdorfer; Ulrich Fahl
  12. Economic Valuation of Environmental Values of the Landscape Development and Protection Area of Volcji Potok By Verbic, Miroslav; Erker, Renata
  13. Effects on competitiveness and innovation activity from the integration of strategic aspects with social and environmental management. By Marcus Wagner
  14. Economic Implications of Differences in Member State Regulations for the European Union Emission Trade System By Adriaan Perrels
  15. Anonymity, Reciprocity, and Conformity: Evidence from Voluntary Contributions to a National Park in Costa Rica By Alpizar, Francisco; Carlsson, Fredrik; Johansson-Stenman, Olof
  16. Guía metodológica para el cálculo de la huella ecológica corporativa By Juan Luis Doménech Quesada

  1. By: Erwin L. Corong (De La Salle University-Manila)
    Abstract: This paper analyzes the economic and poverty effects of a voluntary carbon emission reduction for a small liberalized economy—the Philippines. The simulation results indicate that tariff reductions undertaken by the Philippine government between 1994 and 2005 reduced the cost of fossil fuels thereby resulting in an increase in carbon emissions. The economic cost of reducing carbon emissions by imposing a carbon tax appears minimal as the reduction in consumer prices due to tariff reductions outweigh the increase in production cost from the imposition of a carbon tax. Overall results suggest that maintaining carbon emissions relative to 1994 levels appears to be a sensible alternative for the country
    Keywords: Climate Change, Carbon Emissions, International Trade, Computable General Equilibrium, Micro-Simulation, Macro-Micro Models, Philippines
    JEL: C68 D58 F18 I39 Q56
    Date: 2007–01
  2. By: Valeria Costantini; Salvatore Monni
    Abstract: Over the last few years, environmental issues have entered into policy design, particularly development and growth policies. Natural resources are considered necessary production inputs and environmental quality is considered a welfare determinant. The integration of environmental issues into economic growth and development theories and empirics is currently widely analyzed in the literature. The effects of natural resources endowment on economic growth are mainly analyzed through the so-called Resource Curse Hypothesis (RCH) whereas the effects of economic growth on environmental quality are part of the Environmental Kuznets Curve (EKC). Furthermore, recent contributions on RCH and EKC have shown the important role of institutions and human development dimensions in building a sustainable development path. In this paper, we attempt to analyze the causal relationships between economic growth, human development and sustainability combining the RCH and EKC models and adopting a human development perspective.
    Keywords: Natural resources, Sustainability, Human Development, Trade
    JEL: O15 Q01 Q56
    Date: 2006–12
  3. By: Mònica Serrano (Universitat de Barcelona)
    Abstract: This paper evaluates two alternative tax policies aimed at reducing atmospheric pollutant emissions. One based upon an environmental tax that burdens directly firms’ emissions, and the other one that burdens both directly and indirectly household consumption’s emissions. Applying input-output approach, we reallocate the emissions generated in the economy according to the responsibility definition, i.e. the production or the consumption accounting principle. Afterwards, we analyse the effects on the products’ prices of implementing an ad-quantum environmental tax based on the Producer Pays Principle (PPP) and/or on the User Pays Principle (UPP). The results obtained, show that both PPP and UPP environmental tax have the same effect on the final products’ prices. However, the price of the intermediate products is only affected by the PPP environmental tax, whereas the UPP environmental tax keeps the prices unchanged.
    Keywords: Input-Output Analysis, Environmental Taxes, Atmospheric Pollutants
    JEL: C67 H23 Q53
    Date: 2007–01
  4. By: Massimo Tavoni (Fondazione Eni Enrico Mattei); Valentina Bosetti (Fondazione Eni Enrico Mattei); Brent Sohngen (AED Economics, Ohio State University)
    Abstract: This paper investigates the potential contribution of forestry management in meeting a CO2 stabilization policy of 550 ppmv by 2100. In order to assess the optimal response of the carbon market to forest sequestration we couple two global models. An energy-economy-climate model for the study of climate policies is linked with a detailed forestry model through an iterative procedure to provide the optimal abatement strategy. Results show that forestry is a determinant abatement option and could lead to significantly lower policy costs if included. Linking forestry management to the carbon market has the potential to delay the policy burden, and is expected to reduce the price of carbon of 40% by 2050. Biological sequestration will mostly come from avoided deforestation in tropical forests rich countries. The inclusion of this mitigation option is demonstrated to crowd out some of the traditional abatement in the energy sector and to lessen induced technological change in clean technologies.
    Keywords: Forestry, Climate Policy, Technological Innovation
    JEL: Q23 Q52 Q55
    Date: 2007–01
  5. By: Valentina Bosetti (Fondazione Eni Enrico Mattei); Massimo Tavoni (Fondazione Eni Enrico Mattei)
    Abstract: This paper analyses optimal investments in innovation when dealing with a stringent climate target and with the uncertain effectiveness of R&D. The innovation needed to achieve the deep cut in emissions is modelled by a backstop carbon-free technology whose cost depends on R&D investments. To better represent the process of technological progress, we assume that R&D effectiveness is uncertain. By means of a simple analytical model, we show how accounting for the uncertainty that characterizes technological advancement yields higher investments in innovation and lower policy costs. We then confirm the results via a numerical analysis performed with a stochastic version of WITCH, an energy-economy-climate model. The results stress the importance of a correct specification of the technological change process in economy-climate models.
    Keywords: Climate Change, Information and Uncertainty, Environmental Policy, Optimal R&D Investments
    JEL: O32 Q54 Q55
    Date: 2007–01
  6. By: Natalia Zugravu (Centre d'Economie de la Sorbonne); Katrin Millock (Centre d'Economie de la Sorbonne); Gérard Duchêne (ERUDITE - Université Paris 12)
    Abstract: emissions between 1996 and 2001. Was this emission reduction just the fortuitous result of the major economic transformation undergone by those countries in the transition away from a centralized plan economy ? Or is the emission reduction rather a result of more stringent environmental policy ? The objective of the article is to answer this question through a model of the relation between environmental quality and enforcement, on the one hand, and environmental quality and economic growth, on the other hand. We develop structural equations for the demand (emissions) and supply (environmental stringency) of pollution. The supply equation takes into account the institutional quality of the country (control of corruption and political stability) as well as consumer preferences for environmental quality, as proxied by per capita revenue and unemployment. The system is estimated by three stage least squares on a sample of three groups of countries for comparative analysis : Central and Eastern European countries, Western European countries and emerging economies. The results indicate that, all else equal, the scale effect on its own would have increased industrial CO2 emissions in the Central and Eastern European countries in our sample by 44,6% between 1996 and 2001. The composition effect accounted for a corresponding reduction in emissions by 16%. The technique effect had the largest marginal impact corresponding to a 37,4% reduction in emissions.
    Keywords: Transition, CO2 emissions, environmental policy, scale, composition and technique effects.
    JEL: C33 D72 P5 P27 Q53 Q58
    Date: 2007–01
  7. By: Valeria Costantini
    Abstract: The aim of this paper is to describe a general overview of the large number of theoretical and empirical studies that analyze the relationships between trade openness and environment. In Section 1, the paper presents a first description of the multidimensional links between a general definition of globalization and the effects on environment and natural resources. In Section 2, there is a more specific analysis on the impacts of trade liberalization process on the environmental degradation caused by increasing polluting emissions. A comparative advantages model is therefore described as a general framework for evaluating degradation effects linked to increasing trade flows. In Section 3, the specific relationships between trade openness and natural resources exploitation are analyzed, distinguishing between exhaustible and renewable resources. Finally, a specific model analysing the effects of property rights regimes on the resource exploitation choices in case of trade openness is described.
    Keywords: International Trade, Environment, Natural resources, Pollution
    JEL: F18 H23 O13 Q56
    Date: 2006–12
  8. By: G. Ipek Tunc (Department of Economics, METU); Serap Turut-Asik (Department of Economics, METU); Elif Akbostanci (Department of Economics, METU)
    Abstract: Recently, global warming (greenhouse effect) and its effects have become one of the hottest topics in the world agenda. There have been several international attempts to reduce the negative effects of global warming. Kyoto Protocol can be cited as the most important agreement which tries to limit the countries’ emissions within a time horizon. For this reason it becomes important to calculate the greenhouse gas emissions of countries. The aim of this study is to estimate the amount of CO2 -the most important greenhouse gas- emissions, for the Turkish economy. An extended input-output model is estimated by using 1996 data in order to identify the sources of CO2 emissions and to discuss the share of sectors in total emission. Besides ‘CO2 responsibility’, which takes into account the CO2 content of imports, is estimated for the Turkish economy. The sectoral CO2 emissions and CO2 responsibilities are compared and these two notions are linked to foreign trade volume. One of the main conclusions is that the manufacturing industry has the first place in both of the rankings for CO2 emissions and CO2 responsibilities; while agriculture and husbandry has the last place.
    Keywords: CO2 responsibility, Turkey, input-output analysis
    Date: 2006–03
  9. By: Urs Steiner Brandt (Department of Environmental and Business Economics, University of Southern Denmark); Lone Grønbæk Kronbak (Department of Environmental and Business Economics, University of Southern Denmark)
    Abstract: Many international fisheries agreements involve sharing rules. The current pa-per analysis the stability of sharing rules when coping with long run changes in the composition of fish stocks in an international setting due to climate change. The exploitation of the cod stock in the Baltic Sea serves as an illustrative ex-ample. These rules are normally stable rules, but this is only true if they are not contingent on shifts in the relative distribution of density of the resource. Given the projected climatic changes in the latest IPCC report the stability of these agreements is not guaranteed. The lack of robustness of management systems of shared fish stocks with respect to exogenous changes has been addressed in sev-eral papers (see e.g. Miller (2005) and Miller and Munro (2004)). This paper builds, however, on a more rigorous game theoretic analysis conducted by Kronbak and Lindroos (2005). The main findings of this paper is that, when ex-ternalities are present, a decrease in the resource rent implies that the threat for not free riding become less serious and thereby leave less room for stable solu-tion. Generally speaking, this implies that climatic changes with a negative ef-fect on the resource rent make joint solutions less likely.
    Keywords: Climate Change, Cooperative Games, Stability of Fisheries Agreements
    JEL: C62 C70 Q22 Q54
    Date: 2006–12
  10. By: Elif Akbostanci (Department of Economics, METU); G. Ipek Tunc (Department of Economics, METU); Serap Turut-Asik (Department of Economics, METU)
    Abstract: In this study, we analyze Turkey’s manufacturing industry trade by estimating sectoral import and export demand equations for 1980-2000. The study aims to understand whether the trade in the manufacturing industry complies with pollution haven hypothesis, and whether the free trade environment provided by the customs union (CU) agreement altered the trade pattern of the clean and dirty industries. Results of our econometric models have shown that while CU positively affects the import demand, it does not have any significant impact on the export demand of Turkish manufacturing industry. In terms of the environmental impact, distinction between clean and dirty industries turns out to be significant for both import and export demand. In general, our findings suggest that both clean and dirty industries’ import demand increase during the study period. In terms of export demand, clean industries’ export demand declines whereas dirty industries’ export demand increases compared to the total demand.
    Keywords: Environmental impact analysis, EU, Turkey, manufacturing industry
    Date: 2006–03
  11. By: Robert Küster (Universität Stuttgart); ingo Ellersdorfer (Universität Stuttgart); Ulrich Fahl (Universität Stuttgart)
    Abstract: The paper establishes a CGE/MPSGE model for evaluating energy policy measures with emphasis on their employment impacts. It specifies a dual labor market with respect to qualification, two different mechanisms for skill specific unemployment, and a technology detailed description of electricity generation. Non clearing of the dual labor market is modeled via minimum wage constraints and via wage curves. The model is exemplarily applied for the analysis of capital subsidies on the application of technologies using renewable energy sources. Quantitative results highlight that subsidies on these technologies do not automatically lead to a significant reduction in emissions. Moreover, if emission reductions are achieved these might actually partly result from negative growth effects induced by the promotion of cost inefficient technologies. Inefficiencies in the energy system increase unemployment for both skilled and unskilled labor.
    Keywords: CGE, Energy Economic Analysis, Employment Impact, Choice of Technology
    JEL: Q42 Q43 Q48 Q52
    Date: 2007–01
  12. By: Verbic, Miroslav; Erker, Renata
    Abstract: When the market for a certain good is competitive enough, economic activities can be studied by the market pricing mechanism. Because this is usually not feasible in case of environmental goods with embodied natural and cultural heritage, particular methods for economic valuation of such goods have to be applied. The present article represents the economic valuation of the Landscape Development and Protection Area of Vol誩 Potok, which is an important Slovenian cultural landscape area with internationally recognized characteristics. For this purpose we have chosen the method of contingent valuation and performed an econometric analysis of stated and true willingness-to-pay. We obtained the value of willingness-to-pay and determined its determinants. We also made an attempt to control for different biases that arise in such analyses. At last, we used the adjusted average individual value of willingness-to-pay to calculate the aggregate willingness-to-pay.
    Keywords: bivariate probit model; contingent valuation method; discrete choice method; embedding effects; environmental values; starting point bias; willingness-to-pay
    JEL: Q51 Q56 C51
    Date: 2007–01
  13. By: Marcus Wagner
    Abstract: This paper analyses the nature and details of the impact which the integration of social and environmental considerations with business strategy has on different dimensions of competitiveness and innovation activity on the firm level. Its objective is to answer the question as to whether a positive link exists between integration and the effects of environmental and social performance on competitiveness and innovation activity. After presenting a theoretical framework based on extant work, the paper introduces the research methods and variables. Subsequently results are presented for four different dimensions of competitiveness, namely market-related, image-related, efficiency-related and risk-related advantage as well as for innovatory activity in terms of product and process innovation. These raise the possibility that the process of integration is more important for bringing about a positive link than a resulting integration type. Based on the results, implications are discussed and we shall draw the conclusions from the findings.
    Keywords: stakeholder, environmental management, integration, strategy, quality, social performance, environmental performance, competitiveness, innovation
    Date: 2007
  14. By: Adriaan Perrels
    Abstract: This report discusses the economic implications of the regulatory organisation of the European Emission Trade System (EU ETS) in the member states, and more in particular the consequences of differences between national regulations. It is part of a larger study regarding juridical aspects of the implementation of EU-ETS (Upston-Hooper et al, 2006), which has been carried out in the framework of the CLIMBUS programme funded by TEKES.
    Keywords: Emission trading, level playing field, regulation
    Date: 2007–02–14
  15. By: Alpizar, Francisco (Environment for Development Center, Tropical Agricultural and Higher Education Center (CATIE)); Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University); Johansson-Stenman, Olof (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: We investigate the role of anonymity, reciprocity, and conformity for voluntary contributions, based on a natural field experiment conducted at a national park in Costa Rica. Contributions made in public in front of the solicitor are 25% higher than contributions made in private. Giving subjects a small gift before requesting a contribution increases the likelihood of a positive contribution. At the same time, the conditional contribution decreases. The total effect of giving a gift is positive but small, and taking the cost of the gift into account, it is far from profitable. When the subjects are told that the typical contribution of others is $2 (a small contribution), the probability of a contribution increases and the conditional contribution decreases, compared with providing no reference information. Providing a high reference level ($10) increases the conditional contributions. Overall, the total effects have the expected signs, although the magnitudes are smaller than what one might have expected based on existing evidence from laboratory experiments. <p>
    Keywords: Voluntary contributions; anonymity; reciprocity; conformity; natural field experiment
    JEL: C93 Q50
    Date: 2007–02–21
  16. By: Juan Luis Doménech Quesada
    Abstract: La huella ecológica es un indicador de sostenibilidad de índice único, desarrollado por Rees y Wackernagel en 1996, que mide todos los impactos que produce una población, expresados en hectáreas de ecosistema o “naturaleza”. Utilizada habitualmente para regiones o países, en anteriores trabajos hemos constatado que dicho indicador podía utilizarse también en las empresas y en cualquier tipo de organización. En este artículo se amplía y se describe con detalle la metodología utilizada y se calcula la huella ecológica de la Autoridad Portuaria de Gijón para el año 2004. Esta equivale a lo que producirían 6.483 hectáreas de ecosistemas en un año o a la emisión de 30.485 toneladas de CO2/año. La huella ecológica corporativa permite establecer objetivos claros y concretos de sostenibilidad ambiental; permite la integración de indicadores, ciclo de vida y eco-etiquetado, en una única herramienta; y aporta un nuevo método de decisión política para luchar, de forma más justa, contra el cambio climático. Como conclusión final, se propone un nuevo modelo de desarrollo sostenible y una nueva ética empresarial, basados en la aplicación tanto de la huella ecológica corporativa, como de la huella social que la complementa, la cual también se menciona en este trabajo. Se propone que la empresa responsable incorpore entre sus estrategias la cooperación al desarrollo, a través de eficaces herramientas, como los Mecanismos de Desarrollo Limpio y la Responsabilidad Social Corporativa. Se acompaña una Hoja de Cálculo para que cualquier organización pueda calcular su huella ecológica y su huella social.
    Keywords: Huella ecológica corporativa, huella social, desarrollo sostenible,sostenibilidad, ecoeficiencia, ética empresarial

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