nep-env New Economics Papers
on Environmental Economics
Issue of 2007‒06‒11
eighteen papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Estimating Individual Emissions in a Nonpoint Source Pollution Problem: A Bayesian Perspective By Efthymios Tsionas; Vangelis Tzouvelekas; Anastasios Xepapadeas
  2. Carbon Tax and Investment in Low-Carbon Technology in a Model of Co-ordination Failure By Geethanjali Selvaretnam; Kannika Thampanishvong
  3. SEED Paper 3: Environmental Volunteering: Motivations, Modes and Outcomes By Thomas G Measham; Guy B Barnett
  5. SEED Paper 4: Deliberative Monetary Valuation (DMV) in Practice By Clive L Spash
  6. China's Carbon Emissions 1971-2003 By Chunbo Ma; David I. Stern
  7. SEED Paper 6: Encouraging Revegetation in Australia with a Groundwater Recharge Credit Scheme By Wendy Proctor; Jeffery D. Connor; John?Ward; Darla Hatton MacDonald
  8. An Economic Analysis of Drawing Lines in the Sea By Paul Hallwood
  9. Combien valent les décès évités par la prévention? By Olivier Chanel; Jean-Christophe Vergnaud
  10. Les vertus environnementales et économiques de la participation des citoyens au marché de permis d’émission : Une alternative efficiente à la compensation volontaire des émissions de CO2 By ROUSSE O.
  11. How to correctly assess mortality benefits in public policies By Olivier Chanel; Pascale Scapecchi; Jean-Christophe Vergnaud
  12. Estimating the Value of Water Use Permits: A hedonic approach applied to farmland in the southeastern US By Ragan A. Petrie; Laura O. Taylor
  13. Using Meta Analysis for Benefits Transfer: Theory and Practice By John C. Bergstrom; Laura O. Taylor
  14. Recreational Boater Willingness to Pay for a Dredging and Maintenance Program for the Atlantic Intracoastal Waterway in North Carolina By John C. Whitehead; Jim Herstine; Christopher F. Dumas
  15. Population Growth and Local Home Environment Externality in an Endogenous Growth Model with Two Engines of Growth By Shirou Kuwahara; Katsunori Yamada
  16. SEED Paper 2: Putting Theory into Practice: Market failure and Market Based Instruments (MBIs) By Stuart Whitten; Anthea Coggan; Andrew Reeson; Russell Gorddard
  17. SEED Paper 5: Socio-Ecological Regime Transitions in Austria and the United Kingdom By Fridolin Krausmann; Heinz Schandl; Rolf?Peter Sieferle
  18. Consumer trust and willingness to pay for certified animal-friendly products By Giuseppe Nocella; Lionel Hubbard; Riccardo Scarpa

  1. By: Efthymios Tsionas (Department of Economics, Athens University of Economics and Business, Greece); Vangelis Tzouvelekas (Department of Economics, University of Crete, Greece); Anastasios Xepapadeas (Department of Economics, University of Crete, Greece)
    Abstract: The present paper aims to provide an alternative approach for estimating individual nitrate emission levels in a nonpoint source (NPS) pollution problem using Bayesian inference. The proposed model by taking into account the stochastic nature of nitrate improves the reliability of the estimates of individual nitrogen loadings. Simulation with artificial data reveals that the suggested model performs quite well even for small sample sizes while the posterior results are rather robust to changes in the prior distribution. The proposed framework is applied to a small catchment area in Ierapetra Valley in Crete, Greece.
    Keywords: Nonpoint source pollution, nitrate leaching, bayesian analysis
    JEL: C11 Q15 Q20
    Date: 2007–05–29
  2. By: Geethanjali Selvaretnam; Kannika Thampanishvong
    Keywords: carbon tax, climate change, low-carbon technology, coordination failure, global games.
    JEL: N5 Q3 D7 D8
  3. By: Thomas G Measham; Guy B Barnett (CSIRO Sustainable Ecosystems, Australia)
    Abstract: Volunteers play a key role in natural resource management: their commitment, time and labour constitute a major contribution towards managing environments in Australia and throughout the world. From the point of view of environmental managers much interest has focussed on defining tasks suitable to volunteers. However, we argue that an improved understanding of what motivates volunteers is required to sustain volunteer commitments to environmental management in the long term. This is particularly important given that multiple government programs rely heavily on volunteers in Australia, a phenomenon also noted in the UK, Canada, and the USA. Whilst there is considerable research on volunteering in other sectors (e.g. health), there has been relatively little attention paid to understanding environmental volunteering. Drawing on the literature from other sectors and environmental volunteering where available, we present a set of six broad motivations underpinning environmental volunteers and five different modes that environmental volunteering is manifested. We developed and refined the sets of motivations and modes through a pilot study involving interviews with volunteers and their coordinators from environmental groups in Sydney and the Bass Coast. The pilot study data emphasise the importance of promoting community education as a major focus of environmental volunteer groups and demonstrate concerns over the fine line between supporting and abusing volunteers given their role in delivering environmental outcomes.
    Keywords: environment, volunteering, motivation, Natural Resource Management (NRM)
    JEL: Q57 J29 Z10
    Date: 2007–05
  4. By: Vanessa E. Daniel (Department of Spatial Economics, Vrije Universiteit); Raymond J.G.M. Florax (Department of Agricultural Economics, Purdue University); Piet Rietveld (Department of Spatial Economics, Vrije Universiteit)
    Abstract: Climate change, the ‘boom and bust’ cycles of rivers, and altered water resource management practice have caused significant changes in the spatial distribution of the risk of flooding. Hedonic pricing studies, predominantly for the US, have assessed the spatial incidence of risk and the associated implicit price of flooding risk. Using these implicit price estimates and their associated standard errors, we perform a meta-analysis and find that houses located in the 100-year floodplain have a –0.3 to –0.8% lower price. The actual occurrence of a flooding event or increased stringency in disclosure rules causes ex ante prices to differ from ex post prices, but these effects are small. The marginal willingness to pay for reduced risk exposure has increased over time, and it is slightly lower for areas with a higher per capita income. We show that obfuscating amenity effects and risk exposure associated with proximity to water causes systematic bias in the implicit price of flooding risk.
    Keywords: Manufactured Housing; valuation, environmental risk, meta-analysis, hedonic pricing
    JEL: D81 Q51 Q54
    Date: 2007
  5. By: Clive L Spash (CSIRO Sustainable Ecosystems, Australia)
    Abstract: Economists concerned with validity, defined internally to the profession, are combining stated preference methods with participatory deliberation to address on-going criticism. DMV uses formal methods of deliberation to express values for environmental change in monetary terms. However, the results have begun to define different realms of value, reflecting pluralism in public concern over environmental change. Reviewing empirical DMV studies evidences a range of issues regarded as external to economics and the validity of its methods, issues which are typically kept at arms length by economists namely, multiple values, incommensurability and lexicographic preferences, social justice, fairness, and non-human values.
    Keywords: Deliberative Monetary Valuation (DMV), economy, environment, sustainability
    JEL: D46 Q00 Q51
    Date: 2007–05
  6. By: Chunbo Ma (Department of Economics, Rensselaer Polytechnic Institute, Troy, NY 12180-3590, USA); David I. Stern (Department of Economics, Rensselaer Polytechnic Institute, Troy, NY 12180-3590, USA)
    Abstract: A number of previous studies on China's carbon emissions have mainly focused on two facts: 1) the continuous growth in emissions up till the middle of the 1990s; 2) the recent stability of emissions from 1996 to 2001. Decomposition analysis has been widely used to explore the driving forces behind these phenomena. However, since 2002, China's carbon emissions have resumed their growth at an even greater rate. This paper investigates China's carbon emissions during 1971-2003, with particular focus on the role of biomass, and, the fall and resurgence in emissions since the mid-1990s. We use an extended Kaya identity and the well-established logarithmic mean Divisia index (LMDI I) method. Carbon emissions are decomposed into effects of various driving forces. We find that: (1) A shift from biomass to commercial energy increases carbon emissions by a magnitude comparable to that of the increase in emissions due to population growth; (2) The technological effect and scale effect due to per capita GDP growth are different in the pre-reform period versus the post-reform period; (3) The positive effect of population growth has been decreasing over the entire period; (4) The fall in emissions in the late 1990s and resurgence in the early 2000s may be overstated due to inaccurate statistics. The rapid growth since the early 2000s, therefore, may not indicate a "new trend"; (5) Carbon emissions exhibit a correlation of 0.99 with coal consumption, which points to explicit policy suggestions.
    JEL: Q43 Q25
    Date: 2007–06
  7. By: Wendy Proctor; Jeffery D. Connor; John?Ward; Darla Hatton MacDonald (CSIRO Land and Water, Australia)
    Abstract: This paper describes a comprehensive method to design, test and then implement a Payments for Ecosystem Services (PES) framework to combat the environmental consequences of extensive native vegetation clearance in Australia. Clearing of vegetation, primarily due to the expansion of farming areas, has often resulted in regional dryland and irrigation salinity. The market based approach adopted ? a groundwater recharge credit trading scheme ? was designed using empirical data from a social survey and experimental economics. The objective of the trial is to test the cost effectiveness of an incentive based recharge credit trade scheme designed to engage landholders in establishing and managing deep rooted pasture and woody perennials to reduce these adverse salinity impacts. The scheme, based on a voluntary ?cap and trade? approach, allows farmers to meet recharge obligations by land management actions or by trading credits. Assessment of the scheme so far suggests that an incentive for aggregate group outcome achievement included in the design may have motivated higher enrollment rates than would have otherwise resulted. A schedule has been developed relating land management practices and recharge credits. The audited performance based payment system, has provided increased motivation to manage for environmental outcomes compared to the previous policy.
    Keywords: Payments for Ecosystem Services (PES), market based instrument, cap and trade, salinity credit, revegetation, experimental economics
    JEL: Q57
    Date: 2007–05
  8. By: Paul Hallwood (University of Connecticut)
    Abstract: It is shown that low dispute costs relative to expected resource rents from oceanic resources favor drawn out disputes over maritime boundaries; asymmetric dispute costs favor agreement on boundaries wanted by the low dispute cost state party; and high symmetric dispute costs favor formation of joint development zones. The fact that most maritime boundaries have not yet been drawn suggests that state parties think that resource rents that can be drawn from the oceans are high relative to dispute costs. Moreover, the recent mini-trend towards JDZs in East Asia suggests that state parties in the area have recently reassessed dispute costs as being higher than previously believed.
    Keywords: Law of the Sea, joint development zones, maritime boundaries, marine boundaries, lines in the sea
    JEL: F51 Q22 Q58
    Date: 2007–05
  9. By: Olivier Chanel (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - [Université de la Méditerranée - Aix-Marseille II][Université de droit, d'économie et des sciences - Aix-Marseille III] - [Ecole des Hautes Etudes en Sciences Sociales]); Jean-Christophe Vergnaud (EUREQUA - Equipe Universitaire de Recherche en Economie Quantitative - [CNRS : UMR8594] - [Université Panthéon-Sorbonne - Paris I])
    Abstract: Cet article propose une méthode d'évaluation monétaire des politiques de prévntion dont les bénéfices sanitaires s'étalent dans le temps. La méthodologie proposée prend en compte l'effet de latence entre la mise en place de la politique et l'obtention de l'ensemble des bénéfices sanitaires relatifs à la mortalité. Ces bénéfices sont évalués en termes d'années de vie gagnées et de décès prématurés évités pour deux programmes de prévention : une réduction de la pollution de l'air et une politique de prévention routière. Les principaux enseignements sont que la comparaison relative des bénéfices des deux politiques s'avère très sensible aux choix de la technique de monétarisation et du taux d'actualisation.
    Keywords: politique de prévention; pollution de l'air;prévention routière;analyse coûst-bénéfices; effet de latence;monétarisation de la mortalité
    Date: 2007–05–29
  10. By: ROUSSE O.
    Abstract: L’objectif de ce papier est de présenter une solution permettant de satisfaire de manière « coût efficiente » la demande de dépollution des personnes physiques et morales disposées à payer pour réduire le niveau global d’émissions de gaz à effet de serre. Cette solution peut être résumée comme un service de dépollution fournit par l’Etat ou une ONG consistant à acheter et détruire des quotas d’émission de CO2. En d’autres termes, nous nous proposons de faciliter l’accès des pollués au marché de permis d’émission de CO2 en regroupant d’abord les demandes d’achat de nombreuses petites quantités de permis, puis en procédant au trading de gré à gré ou via une maison de courtage, et enfin en retirant pour toujours ces permis du marché. Avant d’aborder cette solution à proprement dit, nous présentons et critiquons d’un point de vu économique les initiatives de compensation des émissions de carbone (carbon offsetting) qui se multiplient depuis quelques mois. Cette présentation sert ensuite de support à la compréhension de notre alternative et de son intérêt.
    Keywords: marché de permis d’émission, participation des citoyens, compensation volontaire des émissions.
    JEL: Q5
    Date: 2007
  11. By: Olivier Chanel (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - [Université de la Méditerranée - Aix-Marseille II][Université de droit, d'économie et des sciences - Aix-Marseille III] - [Ecole des Hautes Etudes en Sciences Sociales]); Pascale Scapecchi (OECD - [Organisation for Economic Cooperation and Development]); Jean-Christophe Vergnaud (CES - Centre d'économie de la Sorbonne - [CNRS : UMR8174] - [Université Panthéon-Sorbonne - Paris I])
    Abstract: Abstract<br />This paper concerns the difficulty of taking long-term effects on health into account in an economic valuation. Indeed, public decision makers should incorporate the cessation lag between implementation of an abatement policy and achievement of all of the expected mortality-related benefits for any projects involving health impacts. This paper shows how this time lag problem can be handled by proposing two approaches - either in terms of deaths avoided or of life years saved - within a dynamic perspective. The main findings are that long-term health benefits calculated by standard methods and widely applied to adverse health effects should be corrected downwards when incorporated into an economic analysis. The magnitude of correction depends on the discount rate, on technical choices dealing with epidemiology and on the method chosen to assess mortality benefits.
    Keywords: air pollution; health effect; lattency effect
    Date: 2007–05–30
  12. By: Ragan A. Petrie; Laura O. Taylor
    Abstract: In the State of Georgia, agricultural irrigation permits in the Flint River Basin had been routinely granted until a moratorium was placed on permit issuance in 1999. This research exploits this policy change within a hedonic pricing framework to estimate the value of irrigation rights in the Southeast US. While the value of irrigation rights has been studied extensively in the western US, differences in property rights and legal regimes, as well as a lack of established water-rights markets in the East, leave us with little information regarding the value of irrigation rights in this setting.
  13. By: John C. Bergstrom; Laura O. Taylor
    Abstract: Meta-analysis, or the "study of studies", attempts to statistically measure systematic relationships between reported valuation estimates for an environmental good or service and attributes of the study that generated the estimates including valuation methods, human population and sample characteristics, and characteristics of the good or service itself. In this paper, we discuss the general theory behind and practice of the emerging use of meta-analysis for benefits transfer. If carefully conducted following systematic protocols for model development, data collection, and data analysis and interpretation, we believe that meta-analysis may prove to be a useful tool for benefits transfer in particular applications. However, before widespread application of this method, more convergent validity tests are needed. One of the greatest strengths of using meta-analysis for benefits transfer is the ability to combine and summarize large amounts of information from previous studies. This strength can also lead to one of the greatest weaknesses of this method which is the loss of important valuation details across time and space in the aggregation process. Thus, application of this method to policy questions and issues should always proceed with caution.
  14. By: John C. Whitehead; Jim Herstine; Christopher F. Dumas
    Abstract: We estimate the changes in value of recreational boating with a dredging program along the Atlantic Intracoastal Waterway (AIWW) in North Carolina. We use willingness to pay data from the contingent valuation method and stated preference data on trip changes. Willingness to pay depends in expected ways on the magnitude of trip change and income. We find that each recreational boater would be willing to pay $97 annually in the form of a surcharge on their boat registration fee. The aggregate annual benefits of the dredging and maintenance policy are $20.5 million.
    Date: 2007
  15. By: Shirou Kuwahara (Graduate School of Systems and Information Engineering, University of Tsukuba); Katsunori Yamada (Graduate School of Economics, Osaka University)
    Abstract: This paper presents an endogenous growth model with population growth and an inter-generational spillover of human capital: we consider the ``local home environment externality conceptualized by Galor and Tsiddon (1997a). The model will generate a negative relationship between the population growth rate and the per capita GDP growth rate, which is also present in the data. Furthermore, multiple equilibrium paths will result. As far as we know, this is the first paper that derives a multiplicity of steady growth paths in a model with two sources of growth and the Jones technology. The paper also casts a paradox that the GDP growth rate may be higher in the society without the externality than the one in the economy with externality
    Keywords: multiple equilibria; R&D; Jones technology; the local home environment externality
    JEL: O11 O31 O41
    Date: 2007–06
  16. By: Stuart Whitten; Anthea Coggan; Andrew Reeson; Russell Gorddard (CSIRO Sustainable Ecosystems, Australia)
    Abstract: The use of market-based instruments (MBIs) to provide and protect ecosystem services has gained significant attention in Australia. Despite their popularity, MBIs are not appropriate for the provision of all ecosystem services. Rather, MBIs must be carefully designed given the ecosystem service outcomes desired, while meeting the needs of participants. In this paper we detail the importance of a robust theoretical structure to underpin the selection and design of an MBI. In particular, we demonstrate the role of identifying and analysing the nature of the market failures present, and their implications for instrument design. Our conclusions are illustrated using several regional MBI case studies.
    Keywords: Market Based Instruments (MBIs), ecosystem services, conservation
    JEL: Q57
    Date: 2007–05
  17. By: Fridolin Krausmann (Institute for Social Ecology, University of Klagenfurt, Austria); Heinz Schandl (CSIRO Sustainable Ecosystems, Australia); Rolf?Peter Sieferle (Department of History, University of St. Gallen, Switzerland)
    Abstract: We employ the concepts of socio-ecological regime and regime transition to better understand the biophysical causes and consequences of industrialization. For two case studies, the United Kingdom and Austria, we describe two steps in a major transition from an agrarian to an industrial socio-ecological regime and the resulting consequences for energy use, land use and labour organization. As the first step, the coal based industrial regime co-existed with an agricultural sector remaining within the bounds of the old regime. In the second step, the oil/electricity based industrial regime, agriculture was integrated into the new pattern and the socio-ecological transition had been completed. Industrialization offers answers to the input and growth related sustainability problems of the agrarian regime but creates new sustainability problems of a larger scale. While today?s industrial societies are stabilizing their resource use, albeit at an unsustainable level, large parts of the global society are in the midst of the old industrial transition. This poses severe problems for global sustainability.
    Keywords: socio-ecological regimes, metabolic profiles, transition, social metabolism, energy flows, land use, labour, industrialization, United Kingdom, Austria
    JEL: N5 O3 O5 Q1 Q4
    Date: 2007–05
  18. By: Giuseppe Nocella (University of Bologna); Lionel Hubbard (University of Newcastle); Riccardo Scarpa (University of Waikato)
    Abstract: Increasing animal welfare standards requires changes along the supply chain which involve several stakeholders: scientists, farmers and people involved in transportation and slaughtering. The majority of researchers agree that compliance with these standards increases costs along the livestock value chain, especially for monitoring and certifying animal-friendly products. Knowledge of consumer willingness to pay (WTP) in such a decision context is paramount to understanding the magnitude of market incentives necessary to compensate all involved stakeholders. The market outcome of certification programs is dependent on consumer trust. Particularly, there is a need to understand to what extent consumers believe that stakeholders operating in the animal-friendly supply chain will respect certification standards. We examine these issues using a contingent valuation survey administered in five economically dominant EU countries. The implied WTP estimates are found to be sensitive to robust measures of consumer trust for certified animal-friendly products. Significant differences across countries are discussed.
    Keywords: Animal welfare ; Certification ; Consumer trust ; Contingent Valuation ; Willingness to Pay ; Budget approach ;
    JEL: Q26 H41 C25
    Date: 2007–05–28

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