nep-env New Economics Papers
on Environmental Economics
Issue of 2009‒10‒10
thirteen papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Unilateral measures and global emissions mitigation By Chatterji, Shurojit; Ghosal, Sayantan; Walsh, Sean; Whalley, John
  2. Environmental tax in a green market By Dorothée Brécard
  3. The World Trade Organization and Climate Change: Challenges and Options By Gary Clyde Hufbauer; Jisun Kim
  4. Minimum Participation Rules with Heterogeneous Countries By Hans-Peter Weikard; Leo Wangler; Andreas Freytag
  5. Carbon leakage from the clean development mechanism By Knut Einar Rosendahl and Jon Strand
  6. Optimal Taxation and Environmental Policy in a Decentralized Economic Federation with Environmental and Labor Market Externalities By Sjögren, Tomas
  7. To what extent can environmental issues play a role in the traveller's choice of a holiday destination ? By Solenn Mornet
  8. A Paradox for Agro-Environmental Land Policy By David A. Hennessy; Hongli Feng
  9. Options introduction and volatility in the EU ETS By Julien Chevallier; Yannick Le Pen; Benoît Sévi
  10. An analysis of various policy instruments to reduce congestion, fuel consumption and CO2 emissions in Beijing By Anas, Alex; Timilsina, Govinda R.; Zheng, Siqi
  11. Yes, we should discount the far-distant future at its lowest possible rate: a resolution of the Weitzman-Gollier puzzle By Freeman, Mark C.
  12. Appraising the integration of sustainable development into sectoral policies: The case of Turkish Science & Technology policies By Erkan Erdil; Cédric Gossart
  13. L'effet des transferts migratoires sur la déforestation dans les pays en développement By Laetitia Duval; François-Charles Wolff

  1. By: Chatterji, Shurojit (Singapore Management University); Ghosal, Sayantan (University of Warwick); Walsh, Sean (Center for International Governance Innovation); Whalley, John (Center for International Governance Innovation, University of Western Ontario and NBER)
    Abstract: In this paper we discuss global climate change mitigation that builds on existing unilateral actions to deliver ever deepening emission cuts over time. A wide array of unilateral environmental measures have been documented. We discuss the rationale for such measures and argue that unilateral initiatives have the potential to generate positive spillover e¤ects both within and across countries. Using a simple dynamic model of learning, we show how global negotiations can accelerate convergence to a global low emissions regime by building on and strengthening the positive spillovers inherent in unilateral initiatives.
    Keywords: Unilateral initiatives ; mitigation ; technology ; cumulative ; emissions reduction ; learning ; global ; negotiations.
    JEL: Q54 F53 Q50
    Date: 2009
  2. By: Dorothée Brécard (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)
    Abstract: We examine the impact of an emission tax in a green market characterized by consumers' environmental awareness and competition between firms for both environmental quality and product prices. The unique aspect of this model comes from the assumption that the cost for an increase in quality is fixed. We show that the emission tax improves welfare, thanks to a decline in pollution and despite an accentuation of product differentiation. The higher the marginal environmental damage is, the higher the optimal tax will be. The optimal tax, however, becomes lower than the marginal damage when the market is not too large. Finally, when marginal environmental damage is not too low, the optimal tax leads to a green product monopoly.
    Date: 2009
  3. By: Gary Clyde Hufbauer (Peterson Institute for International Economics); Jisun Kim (Peterson Institute for International Economics)
    Abstract: Trade and environment intersect in many ways. Aside from the broad debate as to whether economic growth and trade adversely affect the environment, there are linkages between existing rules of the World Trade Organization (WTO) and rules established in various multilateral environmental agreements. Controlling greenhouse gas emissions promises to be a top priority for both national and international agendas, and special attention must be given to the relationship between the WTO and the emerging international regime on climate change. This working paper examines the nexus of the WTO and climate change and discusses challenges and options.
    Keywords: World Trade Organization, WTO, climate change, global warming, border adjustments
    JEL: F13 F18 Q54 Q56
    Date: 2009–09
  4. By: Hans-Peter Weikard (Department of Social Sciences, Wageningen University, The Netherlands); Leo Wangler (Department of Economics, Friedrich Schiller University Jena, Germany); Andreas Freytag (Department of Economics, Friedrich Schiller University Jena, Germany)
    Abstract: Almost all international environmental agreements include a minimum participation rule. Under such a rule an agreement becomes legally binding if and only if a certain threshold in terms of membership or contribution is reached. We analyze a cartel game with open membership and heterogeneous countries to study the endogenous choice of a minimum participation rule and its role for the success of international environmental agreeme
    Keywords: Minimum participation rules, international environmental agreements, coalition formation, transboundary pollution, environmental policy coordination
    JEL: D62 H41 D02 C72
    Date: 2009–09–25
  5. By: Knut Einar Rosendahl and Jon Strand (Statistics Norway)
    Abstract: The Clean Development Mechanism (CDM) is an offset mechanism designed to reduce the overall cost of implementing a given target for greenhouse gas (GHG) emissions in industrialized Annex B countries of the Kyoto Protocol, by shifting some of the emission reductions to Non-Annex B countries. This paper analyzes how CDM projects may lead to leakage of emissions elsewhere in Non-Annex B countries, taking into account also potential (negative) leakage effects from less emission reductions in Annex B. Leakage occurs because emissions reductions under a CDM project may affect market equilibrium in regional and/or global energy and product markets, and thereby increase emissions elsewhere. We find that overall leakage typically will be positive and sizeable, thus leading to an overall increase in global GHG emissions when CDM projects are undertaken. The leakage rate is greatest when the different fossil fuel markets are more segregated.
    Keywords: Carbon leakage; Clean Development Mechanism; Kyoto protocol
    JEL: F18 H23 Q41 Q54
    Date: 2009–09
  6. By: Sjögren, Tomas (Department of Economics, Umeå University)
    Abstract: This paper concerns optimal taxation and environmental policy in the presence of transboundary environmental damage and labour market distortions, where the latter gives rise to wage bargaining externalities between countries. I consider a decentralized economic federation where the federal government chooses emission targets to be implemented by the national governments. The results show that the labour market externality will influence the target levels for emissions chosen by the central government. I then proceed to characterize the optimal tax policy at the national level. The decentralized federation structure produces incentives for the national governments to use the tax policy to influence the policies chosen by the federal level. It is shown how these objectives interact with the additional objective to minimize the distortion on the national labour market.
    Keywords: Transboundary Externalities; Labour Market Distortions; Economic Federation; Optimal Taxation
    JEL: H21 H23 H77 J51
    Date: 2009–10–02
  7. By: Solenn Mornet (USTV - Université du Sud Toulon-Var - UFR Lettres et Sciences Humaines - Ministère de l'Enseignement Supérieur et de la Recherche Scientifique)
    Abstract: It has been decades since we could hear about sustainable tourism with such buzzwords as “ecotourism”, “green tourism” and many others. Today the tourism sector is the world's biggest economic activity. Travel responsibly is gaining importance due to the now rampant awareness regarding environmental issues all over the World. It is nowadays fashionable to sell something “green” and not only in the tourism sector. It has become a commercial argument and that is why we can wonder about the real commitments it involves. In a meantime, if “green” is a marketing purpose, does it mean anything to the consumer and does it influence their choices? Taking care of the environment may be a fad these years, but it is a worldwide one. What does it mean in terms of actions? And as we know travelling is felt as something important to everyone and as everybody feels concerned by environmental issues, then why is ecotourism still marginal within the tourism sector?
    Keywords: Ecotourisme, Environnement, Green
    Date: 2009–09
  8. By: David A. Hennessy (Center for Agricultural and Rural Development (CARD)); Hongli Feng
    Abstract: A regulator with a fixed budget to spend on securing environmental benefits from farmed land has to choose between how many acres to enroll and the extent of benefits to require of each enrolled acre. Here we consider, given heterogeneous land, what properties of the environmental benefit-to-cost ratio imply for the choice of optimal program as the available budget varies. Conditions are found such that a program of high benefits on few acres is preferred for any budget level. It is also possible that a program delivering low benefits per acre at low cost is preferred on each land type, and yet a high benefit program is optimal policy, a variant of Simpson's paradox.
    Keywords: benefit-to-cost ratio, environmental policy, land heterogeneity, Simpson's paradox.
    JEL: D6 Q2
    Date: 2009–10
  9. By: Julien Chevallier (EconomiX - CNRS : UMR7166 - Université de Paris X - Nanterre); Yannick Le Pen (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272); Benoît Sévi (GRANEM - Department of Law, Economics, and Management - Université d'Angers)
    Abstract: To improve risk management in the European Union Emissions Trading Scheme (EU ETS), the European Climate Exchange (ECX) has introduced option instruments in October 2006 after regulatory authorization. The central question we address is: can we identify a potential destabilizing effect of the introduction of options on the underlying market (EU ETS futures)? Indeed, the literature on commodities futures suggest that the introduction of derivatives may either decrease (due to more market depth) or increase (due to more speculation) volatility. As the identification of these effects ultimately remains an empirical question, we use daily data from April 2005 to April 2008 to document volatility behavior in the EU ETS. By instrumenting various GARCH models, endogenous break tests, and rolling window estimations, our results overall suggest that the introduction of the option market had no effect on the volatility in the EU ETS. These finding are robust to other likely influences linked to energy and commodity markets.
    Date: 2009–09–23
  10. By: Anas, Alex; Timilsina, Govinda R.; Zheng, Siqi
    Abstract: Using a nested multinomial logit model of car ownership and personal travel in Beijing circa 2005, this paper compares the effectiveness of different policy instruments to reduce traffic congestion and CO2 emissions. The study shows that a congestion toll is more efficient than a fuel tax in reducing traffic congestion, whereas a fuel tax is more effective as a policy instrument for reducing gasoline consumption and emissions. An improvement in car efficiency would also reduce congestion, fuel consumption, and CO2 emissions significantly; however, this policy benefits only richer households that own a car. Low-income households do better under the fuel tax policy than under the efficiency improvement and congestion toll policies. The congestion toll and fuel tax require the travel cost per mile to more than triple. The responsiveness of aggregate fuel and CO2 are, approximately, a 1 percent drop for each 10 percent rise in the money cost of a car trip.
    Keywords: Transport Economics Policy&Planning,Airports and Air Services,Roads&Highways,Transport and Environment,Transport in Urban Areas
    Date: 2009–10–01
  11. By: Freeman, Mark C.
    Abstract: In this paper the author proves that the Expected Net Future Value (ENFV) criterion can lead a risk neutral social planner to reject projects that increase expected utility. By contrast, the Expected Net Present Value (ENPV) rule correctly identifies the economic value of the project. While the ENFV increases with uncertainty over future interest rates, the expected utility decreases because of the planner's desire to smooth consumption across time. This paper therefore shows that Weitzman (1998) is right and that, within his economy, the far-distant future should be discounted at its lowest possible rate.
    Keywords: Discount rates,term structure,capital budgeting,interest rate uncertainty,environmental planning
    JEL: D61 E43 G12 G31 Q51
    Date: 2009
  12. By: Erkan Erdil (TEKPOL-STPS, Science and Technology Policy Studies, Middle East Technical University); Cédric Gossart (Institut TELECOM, TELECOM & Management SudParis, ETOS/CEMANTIC)
    Abstract: This paper presents the results of a study investigating how sustainable development can be integrated in Turkish science and technology policies. It contributes to the elaboration of the national sustainable development strategy and to the implementation of the EU acquis. The project’s originality for Turkey lies in its methodology (a participatory approach), and in its topic since sustainable development integration has never been dealt with in Turkey. Suggestions to improve this integration include strengthening the links between S&T institutions by entrusting the State Planning Organisation with the sustainable development integration mission, and raising awareness about its win-win advantages.
    Keywords: Science and technology policy, Sustainable development integration, Participatory public policy, Environment, Turkey
    Date: 2009–05
  13. By: Laetitia Duval (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272); François-Charles Wolff (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)
    Abstract: Cet article s'intéresse à l'effet des transferts monétaires des migrants internationaux sur l'environnement, à travers l'exemple de la déforestation dans les pays en développement. D'un point de vue théorique, l'effet des transferts migratoires sur la réduction des surfaces forestières apparaît indéterminé. Nous examinons cette relation à partir d'un échantillon comprenant 102 pays pour la période allant de 1990 à 2005. Le profil observé pour le PIB par tête s'avère contraire à l'hypothèse de courbe environnementale de Kuznets, tandis que la part des transferts migratoires reçus dans le PIB vient réduire le taux de déforestation pour l'ensemble des pays considérés
    Date: 2009

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