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on Environmental Economics |
| By: | Amigues, Jean-Pierre (Toulouse School of Economics (INRA, IDEI and LERNA)); Chakravorty, Ujjayant (University of Alberta); Moreaux, Michel (Toulouse School of Economics (IUF, IDEI and LERNA)) |
| Abstract: | Regulation of environmental externalities like global warming from the burning of fossil fuels (e.g., coal and oil) is often done by capping both emission flows and stocks. For example, the European Union and states in the Northeastern United States have introduced caps on flows of carbon emissions while the stated goal of the Intergovernmental Panel on Climate Change (IPCC) which provides the science behind the current global climate negotiations is to stabilize the atmospheric stock of carbon. Flow regulation is often local or regional in nature, while stock regulation is global. How do these multiple pollution control efforts interact when a nonrenewable resource creates pollution? In this paper we show that local and global pollution control efforts, if uncoordinated, may exacerbate environmental externalities. For example, a stricter cap on emission flows may actually increase the global pollution stock and hasten the date when the global pollution cap is reached. |
| JEL: | Q12 Q32 Q41 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:21973&r=env |
| By: | Pezzey, John C.V; Mazouz, Salim; Jotzo, Frank |
| Abstract: | We thank two anonymous referees and the Department of Climate Change for helpful comments. This research was supported financially by the Environmental Economics Research Hub of the Australian Government's Commonwealth Environment Research Facilities program. |
| Keywords: | climate policy, Australia, targets, emission trading, carbon leakage, lobbying, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59577&r=env |
| By: | Strand, Jon |
| Abstract: | Interests in obtaining carbon offsets in host countries for Clean Development Mechanism projects may serve as an obstacle to implementing more stringent general environmental policies in the same countries. A relatively lax environmental policy, whereby carbon emissions remain high, can be advantageous for such countries as it leaves them with a higher than otherwise scope for future emissions reductions through Clean Development Mechanism and other offset projects. In this note, the potential to affect the availability of future Clean Development Mechanism projects is shown to distort environmental and energy policies of Clean Development Mechanism host countries in two ways. Measures to reduce use of fossil energy are weakened. Because this weakens private sector incentives to switch to lower-carbon technology through Clean Development Mechanism projects, host governments then also find it attractive to subsidize this switch, in order to maximize the country’s advantage from the Clean Development Mechanism. |
| Keywords: | Climate Change Mitigation and Green House Gases,Energy Production and Transportation,Environmental Economics&Policies,Environment and Energy Efficiency,Climate Change Economics |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5296&r=env |
| By: | Gregory C. Chow (Princeton University) |
| Abstract: | This paper reviews the basic laws and policies of the Chinese government on environmental problems and discusses the issues in policy implementation, the prospect of solving the environmental problems in the future and some recent successes in the development of alternative energy and in controlling pollution. It also includes two proposals for improving the regulation of industrial pollution in China and for controlling carbon emission in the world. |
| Keywords: | China, environmental policy, environmental problems, pollution |
| JEL: | D60 F18 O53 Q52 Q56 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:pri:cepsud:1221&r=env |
| By: | Hohnen, Laura |
| Abstract: | Environmental research has been increasing due to growing diverse environmental concerns regarding sustainability, climate change, natural resource depletion, waste management, and air and noise pollution. Economic valuation of environmental research can assist in guiding research planning and expenditure. Yet environmental research is difficult to evaluate due to the dominance of non-market benefits and difficulties identifying tangible outputs and outcomes from research. This paper attempts to apply an existing valuation framework to an empirical case study to examine the difficulties and limitations of economic valuations of environmental research. In the empirical case study environmental research and other technical and managerial inputs were used to develop a policy output. Policy implementation will result in environmental outcomes with subsequent economic benefits. The primary purpose of this paper is to explore the complexities and limitations of valuing environmental research, in particular the counterfactual and uncertainty. Section 2 outlines the generic framework for valuing environmental research. Section 3 describes the valuation method used in this empirical analysis. Section 4 provides background to the case study and applies the chosen method to value the environmental research. The limitations encountered during the assessment are highlighted in Section 5, and Section 6 concludes with final comments regarding economic valuations of environmental research. |
| Keywords: | Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59086&r=env |
| By: | Lapan, Harvey E.; Sikdar, Shiva |
| Abstract: | We analyze the effects of trade liberalization on environmental policies in a strategic setting when there is transboundary pollution. Trade liberalization can result in a race to the bottom in environmental taxes, which makes both countries worse o. This is not due to the terms of trade motive, but rather the incentive, in a strategic setting, to reduce the incidence of transboundary pollution. With command and control policies (emission quotas), countries are unable to influence foreign emissions by strategic choice of domestic policy; hence, there is no race to the bottom. However, with internationally tradable quotas, unless pollution is a pure global public bad, there is a race to the bottom in environmental policy. Under free trade, internationally nontradable quotas result in the lowest pollution level and strictly welfare- dominate taxes. The ordering of internationally tradable quotas and pollution taxes depends, among other things, on the degree of international pollution spillovers |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59160&r=env |
| By: | Kee, Hiau Looi; Ma, Hong; Mani, Muthukumara |
| Abstract: | Under the Kyoto Protocol, industrialized countries (called Annex I countries) have to reduce their combined emissions to 5 percent below 1990 levels in the first commitment period of 2008-12. Efforts to reduce emissions to meet Kyoto targets and beyond have raised issues of competitiveness in countries that are implementing these policies,as well as fear of leakage of carbon-intensive industries to non-implementing countries. This has also led to proposals for tariff or border tax adjustments to offset any adverse impact of capping carbon dioxide emissions. This paper examines the implications of climate change policies such as carbon tax and energy efficiency standards on competitiveness across industries, as well as issues related to leakage, if any, of carbon-intensive industries to developing countries. Although competitiveness issues have been much debated in the context of carbon taxation policies, the study finds no evidence that the energy intensive industries’ competitiveness is affected by carbon taxes. In fact, the analysis suggests that exports of most energy-intensive industries increase when a carbon tax is imposed by the exporting countries, or by both importing and exporting countries. This finding gives credence to the initial assumption that recycling the taxes back to the energy-intensive industries by means of subsidies and exemptions may be overcompensating for the disadvantage to those industries. There is, however, no conclusive evidence that supports relocation (leakage) of carbon-intensive industries to developing countries due to stringent climate change policies. |
| Keywords: | Climate Change Mitigation and Green House Gases,Climate Change Economics,Energy and Environment,Environment and Energy Efficiency,Transport Economics Policy&Planning |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5309&r=env |
| By: | Valentina Bosetti (Fondazione Eni Enrico Mattei and CMCC); Carlo Carraro (Fondazione Eni Enrico Mattei, University of Venice, CEPR, CESifo and CMCC); Romain Duval (OECD); Massimo Tavoni (Fondazione Eni Enrico Mattei, Princeton Environmental Institute and CMCC) |
| Abstract: | This paper addresses two basic issues related to technological innovation and climate stabilisation objectives: i) Can innovation policies be effective in stabilising greenhouse gas concentrations? ii) To what extent can innovation policies complement carbon pricing (taxes or permit trading) and improve the economic efficiency of a mitigation policy package? To answer these questions, we use an integrated assessment model with multiple externalities and an endogenous representation of technical progress in the energy sector. We evaluate a range of innovation policies, both as a stand-alone instrument and in combination with other mitigation policies. Even under fairly optimistic assumptions about the funding available for, and the returns to R&D, our analysis indicates that innovation policies alone are unlikely to stabilise global concentration and temperature. The efficiency gains of combining innovation and carbon pricing policies are found to reach about 10% for a stabilisation target of 535 ppm CO2eq. However, such gains are reduced when more plausible (sub-optimal) global innovation policy arrangements are considered. |
| Keywords: | Climate Change, Environmental Policy, Energy R&D Fund, Stabilisation Costs |
| JEL: | H0 H2 H3 H4 O3 Q32 Q43 Q54 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.42&r=env |
| By: | Lyons, Seán; Tol, Richard S. J. |
| Keywords: | environmental accounts |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:rb2010/1/4&r=env |
| By: | Ayong Le Kama, Alain; Fodha, Mouez; Lafforgue, Gilles |
| Abstract: | Following the IPCC's report (2005), which recommended the development and the use of carbon capture and sequestration (CCS) technologies in order to achieve the environmental goals, dened by the Kyoto Protocol, the issue addressed in this paper concerns the optimal strategy regarding the long-term use of CCS technologies. The aim of this paper is to study the optimal carbon capture and sequestration policy. The CCS technologies has motivated a number of empirical studies, via complex integrated assessment models. This literature always considers that the existing technology allows sequestrating a fraction of the carbon emissions and concludes that the early introduction of sequestration can lead to a substantial decrease in the cost of environmental externality. But, the level of complexity of such operational models, aimed at defining some specific climate policies. We develop a very simple growth model so as to obtain analytical and tractable results and therefore exhibit the main driving forces that should determine the optimal CSS policy. We show within on the cost of extractions, CSS may be a long-term solution for the carbon emissions problem. Besides, it is also shown that the social planner will optimally choose to decrease the rate of capture and sequestration. Besides, we also introduce the decentralization of this simple economy, by considering the individual program of the fossil resource-holder and the one of the representative consumer. This helps us to compute analytically the optimal environmental policy, that is the also the optimal fossil fuel price profile. |
| Date: | 2009–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:22199&r=env |
| By: | Patrick McCully |
| Abstract: | The world’s biggest carbon offset market, the Clean Development Mechanism, is a global shell game that is increasing greenhouse gas emissions behind the guise of promoting sustainable development. It is handing out billions of dollars to chemical companies and the developers of destructive dams and fossil fuel projects. A rapidly growing industry of carbon brokers and consultants is lobbying for the CDM to be expanded and its rules weakened further. If we want to sustain public support for effective global action on climate change, we cannot risk one of its central planks being a program that is so fundamentally flawed. In the short term the CDM must be radically reformed; in the longer term it must be replaced. |
| Keywords: | development, Kyoto protocol, greenhouse gas emission, projects, carbon, brokers, public support, global, climate change, rivers, dams, people, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2486&r=env |
| By: | Moss, Jonathan; Cacho, Oscar; Mounter, Stuart |
| Abstract: | With the impending introduction of an Australian Carbon Pollution Reduction Scheme, farmers and landholders in rural Australia have increased opportunities to participate in the market. This includes the adoption of land-use change to sequester additional carbon in exchange for carbon credits and the production of a renewable energy source (biofuels). However, these land-use changes compete with existing farm enterprises and may contain significant transaction costs. Therefore it is necessary for the institutional arrangements to provide adequate incentives for landholders to adopt these land-use changes. This paper examines the potential supply of these land-use changes for climate mitigation from landholders in a northern NSW catchment. These results will allow further investigation of how incentive structures and policy instruments may be developed to increase the supply of these goods from landholders. |
| Keywords: | Border Rivers-Gwydir, carbon sequestration, land-use change, Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59104&r=env |
| By: | Vaclav Vojtech |
| Abstract: | This report focuses on the developments in the overall range of policies addressing environmental issues in agriculture in OECD countries in the past decade (since the mid 1990s). It is undertaken from the perspective of the environmental objectives pursued by the policies and from the perspective of the policy measures used. OECD countries use different mixes of policy instruments to achieve their various environmental objectives where markets for externalities and public goods are missing. The policy instruments applied are the reflection of the overall policy approach to the sector; the specific environmental issues and their perceived linkage to agriculture activities; the nature of property rights related to the use of natural resources (land, water); and societal concerns related to environmental issues. |
| Keywords: | agricultural policy, agri-environmental measures, agri-environmental payments, environmental regulations, environmental policies |
| Date: | 2010–03–16 |
| URL: | http://d.repec.org/n?u=RePEc:oec:agraaa:24-en&r=env |
| By: | ZhongXiang Zhang (East-West Center) |
| Abstract: | With countries from around the world set to meet in Copenhagen to try to hammer out a post-2012 climate change agreement, no one would disagree that a U.S. commitment to cut greenhouse gas emissions is essential to such a global pact. However, despite U.S. president Obama’s recent announcement to push for a commitment to cut U.S. greenhouse gas emissions by 17% by 2020, in reality it is questionable whether U.S. Congress will agree to specific emissions cuts, although they are not ambitious at all from the perspectives of both the EU and developing countries, without the imposition of carbon tariffs on Chinese products to the U.S. market, even given China’s own recent announcement to voluntarily seek to reduce its carbon intensity by 40-45% over the same period. This dilemma is partly attributed to flaws in current international climate negotiations, which have been focused on commitments on the two targeted dates of 2020 and 2050. However, if the international climate change negotiations continue on their current course without extending the commitment period to 2030, which would really open the possibility for the U.S. and China to make the commitments that each wants from the other, the inclusion of border carbon adjustment measures seems essential to secure passage of any U.S. legislation capping its own greenhouse gas emissions. Moreover, the joint WTO-UNEP report indicates that border carbon adjustment measures might be allowed under the existing WTO rules, depending on their specific design features and the specific conditions for implementing them. Against this background, this paper argues that, on the U.S. side, there is a need to minimize the potential conflicts with WTO provisions in designing such border carbon adjustment measures. The U.S. also needs to explore, with its trading partners, cooperative sectoral approaches to advancing low-carbon technologies and/or concerted mitigation efforts in a given sector at the international level. Moreover, to increase the prospects for a successful WTO defence of the Waxman-Markey type of border adjustment provision, there should be: 1) a period of good faith efforts to reach agreements among the countries concerned before imposing such trade measures; 2) consideration of alternatives to trade provisions that could reasonably be expected to fulfill the same function but are not inconsistent or less inconsistent with the relevant WTO provisions; and 3) trade provisions that should allow importers to submit equivalent emission reduction units that are recognized by international treaties to cover the carbon contents of imported products. Meanwhile, being targeted by such border carbon adjustment measures, China needs to, at the right time, indicate a serious commitment to address climate change issues to challenge the legitimacy of the U.S. imposing carbon tariffs by signaling well ahead that it will take on binding absolute emission caps around the year 2030, and needs the three transitional periods of increasing climate obligations before taking on absolute emissions caps. This paper argues that there is a clear need within a climate regime to define comparable efforts towards climate mitigation and adaptation to discipline the use of unilateral trade measures at the international level. As exemplified by export tariffs that China applied on its own during 2006-08, the paper shows that defining the comparability of climate efforts can be to China’s advantage. Furthermore, given the fact that, in volume terms, energy-intensive manufacturing in China values 7 to 8 times that of India, and thus carbon tariffs have a greater impact on China than on India, the paper questions whether China should hold the same stance on this issue as India as it does now, although the two largest developing countries should continue to take a common position on other key issues in international climate change negotiations. |
| Keywords: | Post-2012 Climate Negotiations, Border Carbon Adjustments, Carbon Tariffs, Emissions Allowance Requirements, Cap-And-Trade Regime, Lieberman-Warner Bill, Waxman-Markey Bill, World Trade Organization, Kyoto Protocol, China, United States |
| JEL: | F18 Q48 Q54 Q56 Q58 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.34&r=env |
| By: | Helen Ding (University of Venice and FEEM); Silvia Silvestri (University of Venice); Aline Chiabai (FEEM); Paulo A.L.D. Nunes (University of Venice and FEEM) |
| Abstract: | In this paper we present a systematic attempt to assess economic value of climate change impact on forest ecosystems and human welfare. In the present study, climate change impacts are downscaled to the different European countries, which in turn constitute the elements of our analysis. First, we anchor the valuation exercise in the Millennium Ecosystem Assessment (MEA) Approach and therefore the link between the different forest ecosystem goods and services, including provisioning, regulating and cultural services, human well-being and climate change. Second, climate change is operationalized by exploring the different storylines developed by the International Panel on Climate Change (IPCC) and applied, downscaled, for each of the European countries under consideration. Third, and bearing in mind the different nature of the benefits provided by the different types of forest ecosystems under examination, we shall explore different economic valuation methodologies so as to shed light on the magnitude of the involved welfare changes. According to the estimation results the four different IPCC scenarios, i.e. A1F1, A2, B1 and B2, are associated to different welfare impacts. First, these reveal to depend on both the nature of the forest ecosystem service. For example, cultural values reveal to be more sensitive to the four IPCC scenarios than the other ones, with the wood forest products being more resilient to climate change. Second, the distributional impacts of climate change on the provision of these goods and services do also depend on the geo-climatic regions under consideration. For the Scandinavian group of countries, B1 is ranked with the highest level of provision of carbon sequestration services, amounting to 46.3 billion dollars. In addition, we can see that cultural services provided by forest ecosystems have their highest levels in the Mediterranean countries, ranging from 8.4 to 9.0 million dollars, respectively in the B2 and B1 scenarios. Finally, we can see that the total value of wood forest products ranges between 41.2 and 47.5 million dollars for Central Europe to 5.4 and 7.2 million dollars in Northern Europe, respectively A1 and A2 scenarios. For this service, Mediterranean Europe provides a relatively weak role in the provision with values ranging from 6.4 million dollars in A1 scenario to 8.7 million dollars in the B2. In short, and to conclude, the valuation results (1) may contribute to a better understanding of the potential welfare loss in the context of climate change and the economic trade-offs between potential mitigation or adaptation strategies; and (2) confirm that climate change will be responsible for a re-distribution of welfare among the European countries, signalling the potential for a(n) agreement(s) among these same countries focus on the re-allocation of potential trade-offs among the countries. |
| Keywords: | Wood Products, Biodiversity, Climate Change, Market and Non-market Valuation Methods, Ecosystem Goods and Services, Millennium Ecosystem Assessment |
| JEL: | Q57 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.50&r=env |
| By: | Laukkanen, Marita; Nauges, Céline |
| Abstract: | No-till has been promoted as a cultivation method that reduces both production costs and the environmental impacts of farming relative to conventional tillage. Using farmlevel data from Finland, we show that no-till has no statistically significant effect on total variable costs but that it increases the use of plant protection products and fertilizers, and decreases the use of labor. An environmental impact simulation combining the results on input use with a nutrient and herbicide runoff model predicts that no-till produces environmental benefits on highly erodible land, but may be even detrimental to the environment in average conditions. |
| Keywords: | Conservation agriculture, no-till, technology adoption, Agricultural and Food Policy, Farm Management, Land Economics/Use, |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa114:61077&r=env |
| By: | Moreno Sanchez, Rocio del Pilar; Maldonado, Jorge Higinio |
| Abstract: | Complexities associated with the management of common pool resources (CPR) threaten governance at some marine protected areas (MPA). In this paper, using economic experimental games (EEG), we investigate the effects of both external regulation and the complementarities between internal regulation and non-coercive authority interventionâwhat we call co-managementâon fishermenâs extraction decisions. We perform EEG with fishermen inhabiting the influence zone of an MPA in the Colombian Caribbean. The results show that co- management exhibits the best results, both in terms of resource sustainability and reduction in extraction, highlighting the importance of strategies that recognize communities as key actors in the decision-making process for the sustainable use and conservation of CPR in protected areas. |
| Keywords: | Common-pool resources, governance, co-management, experimental economic games, fisheries, Latin America., Environmental Economics and Policy, C93, C72, D02, D70, Q01, Q22, Q28, C23, C25, |
| Date: | 2009–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ulaedd:60731&r=env |
| By: | Dasgupta, Susmita; Huq, Mainul; Khan, Zahirul Huq; Ahmed, Manjur Murshed Zahid; Mukherjee, Nandan; Khan, Malik Fida; Pandey, Kiran |
| Abstract: | This paper integrates information on climate change, hydrodynamic models, and geographic overlays to assess the vulnerability of coastal areas in Bangladesh to larger storm surges and sea-level rise by 2050. The approach identifies polders (diked areas), coastal populations, settlements, infrastructure, and economic activity at risk of inundation, and estimates the cost of damage versus the cost of several adaptation measures. A 27-centimeter sea-level rise and 10 percent intensification of wind speed from global warming suggests the vulnerable zone increases in size by 69 percent given a +3-meter inundation depth and by 14 percent given a +1-meter inundation depth. At present, Bangladesh has 123 polders, an early warning and evacuation system, and more than 2,400 emergency shelters to protect coastal inhabitants from tidal waves and storm surges. However, in a changing climate, it is estimated that 59 of the 123 polders would be overtopped during storm surges and another 5,500 cyclone shelters (each with the capacity of 1,600 people) to safeguard the population would be needed. Investments including strengthening polders, foreshore afforestation, additional multi-purpose cyclone shelters, cyclone-resistant private housing, and further strengthening of the early warning and evacuation system would cost more than $2.4 billion with an annual recurrent cost of more than $50 million. However, a conservative damage estimate suggests that the incremental cost of adapting to these climate change related risks by 2050 is small compared with the potential damage inthe absence of adaptation measures. |
| Keywords: | Climate Change Mitigation and Green House Gases,Climate Change Economics,Science of Climate Change,Hazard Risk Management,Global Environment Facility |
| Date: | 2010–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5280&r=env |
| By: | Odile Blanchard (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II) |
| Abstract: | Climate change is definitely a huge challenge for the 21st century. Models in energy economics show that efficiency gains through energy productivity improvement, technical change and technological innovations towards lower carbon technologies will not be sufficient to achieve the ultimate objective of the UNFCCC, ie stabilize greenhouse gas concentrations at a level that would prevent dangerous anthropogenic interference with the climate system. Mitigation actions that stem from individual behaviour change towards a lower individual carbon footprint are also part of the response to the climate challenge. However, barriers are numerous for individuals to change their behaviour and actually reduce their greenhouse gas emissions. Even individuals with positive attitudes may show much reluctance to behave in a climate-friendly way : cognitive dissonance often emerges between people's statements and people's actual actions. The paper aims to investigate how these barriers can be overcome so that individuals take action. It draws on the climate-friendly initiative that has been carried out at Grenoble university for six years. The first part of the paper presents the university actors, and their mission in the initiative. The second part identifies the actors' main motivations and barriers to a climate-friendly behaviour. The third part discusses potential responses provided by various social sciences in order to address the barriers and remove them as much as possible. Digging alternatively into economics, sociology, psychology, or marketing is obviously not sufficient to entice behaviour change. Adopting an interdisciplinary approach drawing simultaneously on those social sciences may bring better results. |
| Keywords: | climate change ; attitude ; behaviour ; social sciences |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00483037_v1&r=env |
| By: | Laukkanen, Marita; Nauges, Céline |
| Abstract: | No-till has been promoted as a cultivation method that reduces both production costs and the environmental impacts of farming relative to conventional tillage. Using farmlevel data from Finland, we show that no-till has no statistically significant effect on total variable costs but that it increases the use of plant protection products and fertilizers, and decreases the use of labor. An environmental impact simulation combining the results on input use with a nutrient and herbicide runoff model predicts that no-till produces environmental benefits on highly erodible land, but may be even detrimental to the environment in average conditions. |
| Date: | 2009–12–11 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:22248&r=env |
| By: | Strand, Jon |
| Abstract: | This paper uses some simple conceptual models to draw out various implications of infrastructure investments with long lifetimes for the ability of societies to reduce their future greenhouse gas emissions. A broad range of such investments, related both to energy supply and demand systems, may commit societies to high and persistent levels of greenhouse gas emissions over time, that are difficult and costly to change once the investments have been sunk. There are, the author argues, several strong reasons to expect the greenhouse gas emissions embedded in such investments to be excessive. One is that infrastructure investment decisions tend to be made on the basis of (current and expected future) emissions prices that do not fully reflect the social costs of greenhouse gas emissions resulting from the investments. A second, related, set of reasons are excessive discounting of future project costs and benefits including future climate damages, and a too-short planning horizon for infrastructure investors. These issues are illustrated for two alternative cases of climate damages, namely with the possibility of a"climate catastrophe,"and with a sustained increase in the marginal global damage cost of greenhouse gas emissions. |
| Keywords: | Climate Change Economics,Energy Production and Transportation,Climate Change Mitigation and Green House Gases,Transport Economics Policy&Planning,Environment and Energy Efficiency |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5295&r=env |
| By: | Bastone, Chris; Stewart-Carbines, Megan; Kerr, Geoff; Sharp, Basil; Meister, Anton |
| Abstract: | This paper describes the design and implementation of a choice experiment to understand Aucklandersâ preferences for environmental qualities associated with the effects of urban run-off on marine coastal environments. Aucklandâs coastal environments are affected by a range of ecological and human factors. While much research has been undertaken in the area of ecology, little is understood of human preferences for coastal environments and their management. An unlabelled choice experiment was developed with three environmental quality attributes specified at three broad coastal categories. The environmental qualities are ecological health, water clarity, and underfoot conditions. Willingness to pay estimates for these attributes indicates that respondents show a strong preference for improved environmental quality at outer coastal beach locations over middle and upper harbour locations. Water quality leads ecological health, then underfoot conditions in importance at beach locations. An application is discussed in which a hypothetical project consisting of policy and engineering components delivers changes in water quality and underfoot conditions in the Auckland upper harbour areas. A 95% confidence estimate of the money value of that change ranges from $ 783 m. to $ 1,122 b. The key outcome is demonstration of the choice experiment as a statistically robust and flexible approach to making sense of Aucklandersâ complex preferences for coastal ecosystem management. |
| Keywords: | Environmental Economics and Policy, Research Methods/ Statistical Methods, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59578&r=env |
| By: | Donaghy, Peter; Rolfe, John; Gowen, Rebecca; Bray, Steven; Madonna, Hoffman |
| Abstract: | Although agriculture generates a significant portion of Australiaâs greenhouse gas emissions, it also has the potential to sequester large quantities of emissions through changed land use management such as agroforestry. Whilst there is an extensive amount of agroforestry literature, little has been written on the economic consequences of adopting silvopastoral systems in northern Australia. This paper reports the economic feasibility of adopting complimentary agroforestry systems in the low rainfall region of northern Australia. The analysis incorporates the dynamic tradeoffs between tree and pasture growth, carbon sequestration, cleared regrowth decomposition rates and livestock methane emissions in a bioeconomic model. The results suggest there are financial benefits for landholders who integrate complimentary agroforestry activities into existing grazing operations depending on the rules of the carbon accounting framework used. |
| Keywords: | carbon sequestration, financial analysis, carbon accounting framework, Agroforestry, Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59069&r=env |
| By: | Carlo Carraro (Department of Economics, University Of Venice Cà Foscari); Francesco Bosello (University of Milan, Fondazione Enrico Mattei, and CMCC); Enrica De Cian (University of Venice, Fondazione Enrico Mattei) |
| Abstract: | It has become commonly accepted that a successful climate strategy should compound mitigation and adaptation. The accurate combination between adaptation and mitigation that can best address climate change is still an open question. This paper proposes a framework that integrates mitigation, adaptation, and climate change residual damages into an optimisation model. This set-up is used to provide some insights on the welfare maximising resource allocation between mitigation and adaptation, on their optimal timing, and on their marginal contribution to reducing vulnerability to climate change. The optimal mix between three different adaptation modes (reactive adaptation, anticipatory adaptation, and investment in innovation for adaptation purposes) within the adaptation bundle is also identified. Results suggest that the joint implementation of mitigation and adaptation is welfare improving. Mitigation should start immediately, whereas adaptation somehow later. It is also shown that in a world where the probability of climate-related catastrophic events is small and where decision makers have a high discount rate, adaptation is unambiguously the preferred option. Adaptation needs, both in developed and developing countries, will be massive, especially during the second half of the century. Most of the adaptation burden will be on developing countries. International cooperation is thus required to equally distribute the cost of adaptation. |
| Keywords: | Climate change impacts, mitigation, adaptation, integrated assessment model |
| JEL: | Q54 Q56 Q43 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2010_09&r=env |
| By: | Innes, James; Pascoe, Sean; Wilcox, Chris |
| Abstract: | Using the example of commercial fishing, this paper explores the potential of incentive based management measures as a means of reducing the undesirable impacts of industries operating within the marine environment. Despite having been successfully applied for similar purposes in the management of terrestrial environments, and their potential to achieve environmental gains in an economically efficient manner, examples of incentive based management mechanisms are still relatively limited in the marine context. We assess the potential of a number of alternative market based management measures by reviewing and considering the successes and limitations of previous applications and how these would translate in the case of commercial fishing. Several fishing methods and conservation values are considered and the circumstances in which incentive measures may be most applicable are identified. Where appropriate, and by either replacing or (more likely) complimenting existing management arrangements, incentive based measures have the potential to improve upon the performance of existing measures. This has a number of implications. From the environmental perspective they should allow the expected level of undesirable impact to be reduced. They can also reduce the costs imposed upon the industry by letting them develop the solutions. Further, in the increasingly relevant case of MPAs the potential costs to Government may also be significantly reduced if increasing environmental performance makes it possible for certain industry members to continue operating, reducing the necessity of often costly structural adjustment programs. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59850&r=env |
| By: | Creese, Jonathan; Marks, Nicki |
| Abstract: | Purpose â The purpose of this paper is to alert food producers to emerging market demands associated with climate change. Design/methodology/approach â The study draws on literature review and applied market research. Findings â Many food retailers are applying pressure to their value chains to measure and manage carbon emissions. Although consumers play a role, consumers are not the main driver compelling retailers to respond to climate change. Research limitations/implications â This study only interviewed retailers in the United Kingdom and Japan as these are markets that are of particular interest for Australian food exporters. Originality/value â Consumers and retailers in export markets are responding to climate change. The research suggests that food producers may need to consider market signals in addition to regulatory pressure and/or environmental concern when assessing their response to climate change. |
| Keywords: | climate change, food, agriculture, value chain, retailer, Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, Research and Development/Tech Change/Emerging Technologies, Risk and Uncertainty, |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iefi09:59186&r=env |
| By: | Crowe, Bronwyn; White, Ben; Pannell, David |
| Abstract: | Paying private landholders for environmental services, rather than input-based payments, has been proposed as a way to improve the performance of contracts for conservation agencies. A challenge is that the assessment of environmental services is subjective, raising the question of how assessment accuracy impacts on landholder behaviour and contract design. A model is developed of a contract between a conservation agency and a private landholder for the provision of environmental services. The model is used to estimate the impact of inaccurate and costly assessment on the optimal landholder labour effort and the optimal incentive payment. The model shows that inaccurate and costly assessment reduces the cost-effectiveness of the contract. Application of the model to Western Australian broad acre agriculture suggests that remote assessment by field assessment by a scientist is preferred to remote assessment by satellite. The study also shows the feasibility of contracts for environmental services is potentially dependent on the ability of the conservation agency to observe the landholder's behaviour during the contract. |
| Keywords: | Agribusiness, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:58876&r=env |
| By: | Enrica De Cian (Fondazione Eni Enrico Mattei and University of Venice); Massimo Tavoni (Princeton Environmental Institute, Fondazione Eni Enrico Mattei, and Centro Euro-Mediterraneo per i Cambiamenti Climatici (CMCC)) |
| Abstract: | International carbon offsets have been promoted since the Kyoto Protocol and an increasing number of countries have implemented or proposed cap-and-trade schemes with international trading, even though with quantitative or qualitative restrictions. Those limits reflect the trade-off between economic efficiency, distributional issues, and the need for additionality of foreign mitigation measures. Ceilings are also justified on the ground that international offsets undermine the capability of climate policy to induce and diffuse technological change. This paper addresses these issues in a second-best setting that explicitly considers the interplay between multiple externalities. We evaluate numerically how limits to the size, the timing, and the participation in an international carbon market affect the macroeconomic costs of climate policy, international financial transfers, and the incentive to carry out innovation. Results indicate that when constraints on international offsets are moderate, such as limiting their use to at most 15% of regional abatement, efficiency losses are small because they are partly compensated by more technological change and energy market effects, although specific regional patterns are identified. Regarding financial outflows from OECD countries, already a 15% ceiling would limit financial transfers significantly. Provisions of this kind are in line with some of the most recent policy proposals in OECD countries. |
| Keywords: | Energy-economy Modelling, Climate Policy, Technology Spillovers |
| JEL: | Q54 Q55 Q43 H23 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.&r=env |
| By: | Scarborough, Helen |
| Abstract: | Recent modelling of the costs and benefits of climate change has renewed debate surrounding assumptions regarding the social discount rate in analysing the impacts of environmental change. Previous literature segments the social discount rate into being influenced by two key factors; the rate of pure time preference and the elasticity of marginal utility of future consumption. These components of the social discount rate reinforce the linkages between the choice of social discount rate and intergenerational distribution. In an extension of previous work by the author on intergenerational distributional preferences, this paper discusses the relationship between intergenerational equity and the social discount rate. The work has significant policy implications given the sensitivity of Cost Benefit Analysis outcomes to assumptions regarding the social discount rate. |
| Keywords: | Intergenerational equity, Social discount rate, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59156&r=env |
| By: | Pannell, David J.; Roberts, Anna M.; Park, Geoff; Curatolo, April; Marsh, Sally P. |
| Abstract: | INFFER (Investment Framework for Environmental Resources) was developed to help investors of public funds to improve the delivery of outcomes from environmental programs. It assists environmental managers to design projects, to select delivery mechanisms, and to rank competing projects on the basis of benefits and costs. The design of INFFER and the activities of the INFFER projects are based on extensive experience of working with environmental managers and policy makers. This experience has highlighted a number of important practical lessons, that have strongly influenced the design and implementation of INFFER. These lessons include the need for simplicity, training and support of users, trusting relationships with users, transparency, flexibility, compatibility with the needs and contexts of users, and supportive institutional arrangements. In additions, the developers have paid close attention to the need for processes that are theoretically rigorous, resulting in a tool that deals appropriately and consistently with projects for different assets types, of different scales and durations, consistent with Benefit: Cost Analysis. The paper outlines theoretical considerations underpinning the way that INFFER deals with asset valuation, time lags, uncertainty, and the design of the metric used to rank projects. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59148&r=env |
| By: | Rolfe, John; Windle, Jill |
| Abstract: | The focus of this paper is to compare different evaluation frameworks for selecting landholder proposals to improve water quality. The case study is a water quality tender performed in the Burdekin region in Northern Australia in 2007/2008 where bids could be assessed using an inputs-based best management practice scorecard or an outputs-based auction metric. The scorecard approach and other variants of multi-criteria analysis are commonly applied in grant schemes, where landholder proposals are rated by a range of inputs-based criteria. Output-based approaches are typically applied in water quality and conservation tenders, where an environmental benefits index is constructed to summarise the cost-effectiveness of each proposal. The case study evaluation reported in this paper demonstrates that multi-criteria analysis type assessments are flawed, and that the efficiency of public funding can be more than doubled by using auction metrics to assess proposals for landholders to improve water quality. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59262&r=env |
| By: | Frank Vöhringer (Ecole Polytechnique Fédérale de Lausanne); Alain Haurie (ORDECSYS); Dabo Guan (University of Cambridge); Maryse Labriet (KANLO Consultants); Valentina Bosetti (Fondazione Eni Enrico Mattei); Pryadarshi R. Shukla (Indian Institute of Management Ahmedabad); Philippe Thalmann (Ecole Polytechnique Fédérale de Lausanne) |
| Abstract: | The FP6 TOCSIN project has evaluated climate change mitigation options in China and India and the conditions for strategic cooperation on research, development and demonstration (RD&D) and technology transfer with the European Union. In particular, the project investigated the strategic dimensions of RD&D cooperation and the challenge of creating incentives to encourage the participation of developing countries in post-2012 GHG emissions reduction strategies and technological cooperation. This paper summarizes the main policy-relevant results of the project, including the requests for: (I) almost immediate decisions on ambitious mitigation; (II) a strong increase in Annex I support regarding R&D spending and technology transfer; (III) a well-designed mix of instruments and targets in an effective climate deal that addresses manifold national interests and concerns. |
| Keywords: | Climate Policy, Technology Transfers |
| JEL: | Q54 Q55 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.43&r=env |
| By: | Maureen L. Cropper (University of Maryland and Resources for the Future); Yi Jiang (Asian Development Bank); Anna Alberini (University of Maryland); Patrick Baur (National Academy of Sciences) |
| Abstract: | Ground level ozone remains a serious problem in the United States. Because ozone non-attainment is a summer problem, episodic rather than continuous controls of ozone precursors are possible. We evaluate the costs and effectiveness of an episodic scheme that requires people to buy permits in order to drive on high ozone days. We estimate the demand function for permits based on a survey of 1,300 households in the Washington, DC metropolitan area. Assuming that all vehicle owners comply with the scheme, the permit program would reduce VOCs by 50 tons and NOx by 42 tons per Code Red day at a permit price of $75. Allowing for non-compliance by 15% of respondents reduces the effectiveness of the scheme to 39 tons of VOCs and 33 tons of NOx per day. The cost per ozone season of achieving these reductions is approximately $9 million (2008 USD). This compares favorably with permanent methods of reducing VOCs that cost $645 per ton per year. |
| Keywords: | Ground-Level Ozone, Episodic Pollution Control Schemes, Mobile Sources, Volatile Organic Compounds (Vocs), Cost Per Ton of Vocs Removed |
| JEL: | Q52 Q53 Q58 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.46&r=env |
| By: | Polyakov, Maksym; Pannell, David; Rowles, Alexei; Park, Geoff; Roberts, Anna |
| Abstract: | The removal, alteration and fragmentation of habitat are key threats to the biodiversity of terrestrial ecosystems. Investment to protect biodiversity assets (e.g. restoration of native vegetation) in dominantly agricultural landscapes usually results in a loss of agricultural production. This can be a significant cost that is often overlooked or poorly addressed in analyses to prioritise such investments. Accounting for this trade-off is important for more successful, realistically feasible and cost-effective biodiversity conservation. We developed a spatially explicit bio-economic optimisation model that simulates the effect of conservation effort on the diversity of woodland-dependent birds in the Avoca catchment (330 thousand ha) in North-Central Victoria. The model minimises opportunity cost of agricultural production and cost of biodiversity conservation effort on a catchment level subject to achieving different levels of biodiversity outcome. We identify the locations and spatial arrangement of conservation efforts that offers the best value for money. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59152&r=env |
| By: | Hourcade, Jean-Charles; Nadaud, Franck |
| Abstract: | This paper sheds light on an implicit dimension of the climate policy debate: the extent to which supply-side response (emission-reducing energy technologies) may substitute for the transformation of consumption behavior and thus help get around the political difficulties surrounding such behavioral transformation. The paper performs a meta-review of long-term energy forecasts since the end of the 1960s in order to put in perspective the controversies around technological optimism about the potential for cheap, large-scale, carbon-free energy production. This retrospective analysis encompasses 116 scenarios conducted over 36 years and analyzes their predictions for a) fossil fuels, b) nuclear energy, and c) renewable energy. The analysis demonstrates how the predicted relative shares of these three types of energy have evolved since 1970, for two cases: a) predicted shares in 2010, which shows how the initial outlooks for the 2000-2010 period have been revised as a function of observed trends; and b) predicted shares for t+30, which shows how these revisions have affected medium-term prospects. The analysis shows a decrease, since 1970, in technological optimism about switching away from fossil fuels; this decrease is unsurprisingly correlated with a decline in modelers’ beliefs in the suitability of nuclear energy. But, after a trend of increasing optimism, a declining trend also characterizes renewable energies in the 1980s and 1990s before a slight revival of technological optimism about renewables in the aftermath of Kyoto. |
| Keywords: | Energy Production and Transportation,Energy and Environment,Environment and Energy Efficiency,Energy Demand,Climate Change Mitigation and Green House Gases |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5298&r=env |
| By: | Pannell, David J. |
| Abstract: | A number of Australian governments have established or planned programs to assist farmers in adapting to climate change. This paper considers a potential range of policy responses that may be appropriate for climate change adaptation in agriculture. It discusses the extent to which different policy responses may be justified on the basis of market-failure and the likelihood of positive net benefits. While research and extension have the potential to generate significant benefits, there is a need to carefully consider their rationales and emphases. Given the characteristics of climate change (slow, highly uncertain, small relative to climate variability, spatially heterogeneous), the value of information from research and extension to guide farmersâ decision making about adaptation is likely to be low for decisions about farming practices and land uses. Such information would be more valuable for decisions that are larger and indivisible, such as land purchase or the decision to exit from agriculture. Policy options that appear likely to generate relatively large benefits are technology development, quarantine/eradication/containment of pests and weeds, and water market reform. This assessment is not consistent with the emphasis of existing government programs. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59149&r=env |
| By: | Kragt, M.E; Bennett, J.W |
| Abstract: | Choice Experiments (CE) are increasingly used to estimate the values of environmental goods and services. CE questionnaires represent the environmental good under valuation by varying levels of non-market attributes. Inclusion of a cost attribute enables the estimation of monetary values for changes in the non-market attributes presented. The ways in which the levels of the attributes are described in the survey - the âattribute frameâ - may affect respondentsâ choices. Furthermore, varying levels of the cost attribute may impact CE value estimates. The challenge for CE practitioners is to identify the âappropriateâ attribute frames and cost levels. In this paper, the impacts of changing cost levels and the impacts of describing non-market attributes as absolute levels or in relative terms are assessed. These tests were performed using data from a CE on catchment management in Tasmania, Australia. Contrary to a priori expectations, including explicit information cues about relative attribute levels in the choice sets is found not to affect stated preferences. However, comparisons between different split samples provide evidence that respondentsâ preferences are impacted by changing the range in cost attribute levels, with higher levels leading to significantly higher estimates of WTP for one of the three environmental attributes. |
| Keywords: | Choice Experiments, Environmental Valuation, Bias, Tasmania, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59091&r=env |
| By: | Hearnshaw, Edward; Cullen, Ross; Hughey, Ken |
| Abstract: | Water projects are typically evaluated using benefit cost analysis. Ecosystem services are the direct and indirect benefits that people obtain from ecosystems. Many of these benefits are ignored in benefit cost analysis, because of the absence of markets and the limited information or understanding of how the benefits from ecosystem services are produced. Regional or local government may be interested in learning how the value of ecosystem services associated with projects may change if a project occurs. Ecosystem Service Reviews aim to make ecosystem services explicit and quantifiable so that they can be accounted for in the evaluation of water use projects. Water storage projects can enable land use intensification to occur, and confer environmental benefits in some instances (e.g., flow augmentation) and costs in others (e.g., groundwater contamination and flowâon effects). Water storage projects can have both positive and negative outcomes for the environment. More flow can lead led to better fishing, better clarity, more contaminant dilution and a healthier aquatic ecosystem. It can also result in loss of braided riverâbird habitat, and regulated flows can result in nuisance growths of potentially toxic algal species. Irrigation can increase productivity of land within the scheme, with attendant benefits to soil quality and other outâofâriver environmental characteristics. This paper reports the methods used to assess the impact of a water storage dam on the flow of ecosystem services in a river system. We review the range of ecosystem services that are available in a river system and examine how the flow of ecosystem services can be altered by water storage and flow augmentation through the construction of a dam. In order to list and quantify ecosystem services an attempt is made to determine a suitable site specific set of ecosystem service indicators for the OpuhaâOpihi river system case. We draw inferences about shifts in the value of ecosystem services that might arise from water projects in other contexts. |
| Keywords: | Ecosystem services review,  water projects , Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:58895&r=env |
| By: | De Villemeur, Étienne; Pineau, Pierre-Olivier |
| Abstract: | Electricity trade across regions is often considered welfare enhancing. We show in this paper that this could be reconsidered if environmental externalities are taken into account. We consider two cases where trade is beneficial, before accounting for environmental damages: first, when two regions with the same technology display some demand heterogeneity; second when one region endowed with hydropower arbitrages with its "thermal" neighbor. Our results show that under reasonable demand and supply elasticities, trade comes with an additional environmental cost. This calls for integrating environmental externalities into market reforms when redesigning the electricity sector. Two North American applications illustrate our results: trade between Pennsylvania and New York, and trade between hydro-rich Quebec and New York. |
| Keywords: | Electricity trade, hydropower, greenhouse gas emissions |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:21971&r=env |
| By: | Grimaud, André; Lafforgue, Gilles; Magné, Bertrand |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:22241&r=env |
| By: | Marsh, Sally P.; Curatolo, April; Pannell, David J.; Park, Geoff; Roberts, Anna M. |
| Abstract: | Investment in natural resource management (NRM) by regional organisations in Australia has been widely criticised for failing to achieve substantial environmental outcomes. The Investment Framework for Environmental Resources (INFFER) is a tool for developing and prioritising projects to address environmental issues such as water quality and biodiversity decline, environmental pest impacts and land degradation. It aims to achieve the most valuable environmental outcomes with the available resources. During 2008 and 2009 INFFER has been implemented with a number of catchment management organisations (CMOs) throughout Australia. In this paper, we report on lessons from and implications of this experience. Data on implementation were collected in formal and informal ways from staff of organisations that were using INFFER and state agencies, including: an on-line survey, benchmarking questions at training workshops, a formal on-going monitoring and evaluation process tracking the use of INFFER by CMOs, and comments made in correspondence and informal feedback to the INFFER team. In this paper we describe issues that arise when implementing INFFER with regions and organisations, and how the INFFER team has attempted to address these. Key issues include a desire to consider the community as an asset and emphasise capacity building, a rejection of the need for targeted investment, and various difficulties associated with specific aspects of the Framework. Existing institutional arrangements, and the legacy of past institutional arrangements, remain serious barriers to the adoption of methods to improve environmental outcomes from NRM investment. A lack of rigour in investment planning has become accepted as the norm, and resistance to processes to improve rigour is common. However, many CMOs want to achieve better environmental outcomes with their limited funds, and we report on our efforts to work with them to achieve this by using INFFER. |
| Keywords: | Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59100&r=env |
| By: | Chakravorty, Ujjayant; Leach, Andrew; Moreaux, Michel |
| Abstract: | In this paper, we show that the potential for endogenous technological change in alternative energy sources may alter the behaviour of resource-owning firms. When technological progress in an alternative energy source can occur through learning-by-doing, resource owners face competing incentives to extract rents from the resource and to prevent expansion of the new technology. We show that in such a context, it is not necessarily the case that scarcity-driven higher traditional energy prices over time will induce alternative energy supply as resources are exhausted. Rather, we show that as we increase the learning potential in the substitute technology, lower equilibrium energy prices prevail and there may be increased resource extraction and greenhouse gas emissions. We show that the effectiveness and the incidence of emissions reduction policies may be altered by increased potential for technological change. Our results suggest that treating finite resource rents as endogenous consequences of both technological progress and policy changes will be important for the accurate assessment of climate change policy. |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:22543&r=env |
| By: | Schilizzi, Steven; Breustedt, Gunnar; Latacz-Lohmann, Uwe |
| Abstract: | Policy makers aiming to get private landholders to provide non-marketed environmental services need to provide efficient economic incentives. Two ideas have been explored to achieve this: linking contract payments to environmental outcomes and putting the contracts up for tender. This paper investigates whether there are any gains to be had by combining the benefits of both approaches. Landholder risk aversion may offset incentive effects if the fall in participation outweighs any increases in individual effort. Using controlled lab experiments in two countries and across four subject groups, and systematically varying the rate at which payments are linked to uncertain outcomes, this paper clarifies the conditions under which incentives overcome risk-aversion â a parameter which was also measured. Results show that for risk averse landholders the most efficient approach is in general to tender contracts only moderately linked to environmental outcomes â that is, using a balanced combination of fixed input payments and of payments linked to uncertain outcomes. This paper also highlights how experiments can complement the inherent limitations of a purely theoretical analysis. |
| Keywords: | Conservation tenders, auctions, incentive contracts, agricultural policy, environmental policy, market-based instruments, experimental economics, Agricultural and Food Policy, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59159&r=env |
| By: | Gowen, Rebecca; Rolfe, John; Donaghy, Peter |
| Abstract: | This paper reports research seeking to understand the economic implications for central Queensland graziers of participating in a carbon trading scheme and to measure the likely participation of graziers in an emissions trading scheme under various market design scenarios. An initial desktop study was undertaken to compare an enterprise which produced only cattle to one which produced cattle and sequestered carbon. The findings from this analysis were used to inform the design of an experimental auction to test alternative carbon trading scenarios. An experimental workshop was conducted at seven locations across central Queensland with a range of beef producers, extension officers and consultants. Participants were presented with a scenario in which they had the choice of maintaining current management practices against altering management practices to reduce beef production and enter into a carbon sequestration contract (CSC). They were asked at what price they would enter into a CSC and how that price and likelihood of participating would change under a range of alternative contract conditions. The results of the experimental auctions found significantly higher than breakeven prices for carbon would be required before landholders would offer land as a carbon offset. Participation rates were influenced by price and also the carbon contract rules. Five rule changes were trialled and all were found to have a significant impact on reducing participation and increasing required payment levels. |
| Keywords: | Farm Management, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59082&r=env |
| By: | Barnett, Jon; Webber, Michael |
| Abstract: | This paper explains how climate change may increase future migration, and which risks are associated with such migration. It also examines how some of this migration may enhance the capacity of communities to adapt to climate change. Climate change is likely to result in some increase above baseline rates of migration in the next 40 years. Most of this migration will occur within developing countries. There is little reason to think that such migration will increase the risk of violent conflict. Not all movements in response to climate change will have negative outcomes for the people that move, or the places they come from and go to. Migration, a proven development strategy, can increase the capacity of communities to adapt to climate change. The fewer choices people have about moving, however, the less likely it is that the outcomes of that movement will be positive. Involuntary resettlement should be a last resort. Many of the most dire risks arising from climate-motivated migration can be avoided through careful policy. Policy responses to minimize the risks associated with migration in response to climate change, and to maximize migration’s contribution to adaptive capacity include: ensuring that migrants have the same rights and opportunities as host communities; reducing the costs of moving money and people between areas of origin and destination; facilitating mutual understanding among migrants and host communities; clarifying property rights where they are contested; ensuring that efforts to assist migrants include host communities; and strengthening regional and international emergency response systems. |
| Keywords: | Population Policies,Climate Change Mitigation and Green House Gases,Health Monitoring&Evaluation,Climate Change Economics,Voluntary and Involuntary Resettlement |
| Date: | 2010–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5270&r=env |
| By: | Star, Megan; Donaghy, Peter; Rolfe, John |
| Abstract: | The Fitzroy Basin is one of the largest catchment areas in Australia covering 143,000 km² and is the largest catchment for the Great Barrier Reef (GBR) lagoon. Recent research has identified that poor water quality is having negative impacts on the GBR. Grazing beef cattle is the dominant land use in the Fitzroy Basin (90% by area) and has been identified as the major contributor of sediment (~%90) and organic nutrient loads to the GBR lagoon. A bioeconomic model has been developed which determines the cost ($/tonne of sediment) incurred by graziers in implementing strategies that increase ground cover and land condition. The results demonstrate the implications of land type, grazing pressure, tree basal area and enterprise operation on optimal grazing pressure for profit and for sediment reduction. The type of enterprise operation and initial start condition have a large impact on the profit made and sediment exported. This allows the tradeoffs between beef production and sediment reduction to be explored and is a useful tool in the design of natural resource management policy and change programs. It was concluded that land initially in poor condition with a reduced grazing pressure provides the cheapest reduction in sediment export if incentive payments are the chosen policy method. However graziers who are utilizing pasture past the optimal rate will require extension actives through education to reduce grazing pressure and sediment runâoff. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59163&r=env |
| By: | Stéphanie Monjon (Centre International de Recherche sur l’Environnement et le Développement (CIRED), CNRS); Philippe Quirion (Centre International de Recherche sur l’Environnement et le Développement (CIRED), CNRS) |
| Abstract: | Border adjustments are currently discussed to limit the possible adverse impact of climate policies on competitiveness and carbon leakage. We discuss the main choices that will have to be made if the European Union implements such a system alongside with the EU ETS. Although more analysis is required on some issues, on others some design options seem clearly preferable to others. First, the import adjustment should be a requirement to surrender allowances rather than a tax. Second, the general rule to determine the amount of allowances per ton imported should be the product-specific benchmarks that the European Commission is currently elaborating for a different purpose (i.e. to determine the amount of free allowances). Third, this obligation should apply when the exported product is registered at the EU border, and not after the end of the year as is the case for domestic emitters. Fourth, the export adjustment should take the form of a rebate on the amount of allowances a domestic emitter has to surrender. Five, this rebate should equal the above-mentioned product-specific benchmarks, not the emissions of the particular exporting plant or firm. Finally, the adjustment does not have to apply to consumer products but mostly to basic products. |
| Keywords: | Carbon Leakage, Border Adjustment, Border Tax Adjustment, EU ETS, Competitiveness |
| JEL: | Q38 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.36&r=env |
| By: | Ajani, Judith |
| Abstract: | The widespread shift of Australiaâs wood products industry away from native forests to an agricultural regimeâwood plantationsâhas enhanced forestry industry competitiveness. Wood now competes against food for agricultural land, water and other resources (including government support). New plantings have increased substantially since the mid 1990s via plantation managed investment schemes (MIS), arousing protest in the traditional agricultural sector and claims of unfair government policy treatment. This claim is investigated in an analysis that integrates the taxation treatment of plantation MIS with economics and forestry industry knowledge. Three methods are developed, and applied, to estimate the plantation MIS tax-based subsidy. Preliminary estimates indicate a tax-based subsidy to forestry through plantation MIS of between $0.9-1.2 billion over the five years ending 2008. The estimated subsidy is then incorporated in the Productivity Commissionâs calculations of the effective rate of assistance (ERA) to industry groups from tariff, budget outlay and tax-based government policy. The ERA to Forestry & logging in 2008 was estimated to be 41.8 per cent: government assistance is equivalent to 42 per cent of Forestry & loggingâs unassisted value added. The estimated plantation MIS tax based subsidy accounted for 77 per cent of the assistance. Assistance to Forestry & logging exceeds substantially the assistance (including drought related payments) to food growers: 7.2 per cent to Grain, sheep & beef and 17.3 per cent to Dairy cattle farming (a significant proportion was assistance that ceased in April 2008). A detailed examination of Australiaâs proposed climate change policy concerning the land use sector indicates that agricultural resource use distortions created through plantation MIS arrangements are lightly to intensify. |
| Keywords: | Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:58877&r=env |
| By: | David F. Hendry |
| Abstract: | We consider information from many sciences bearing on the causes and consequences of climate change, focusing on lessons from past mass extinctions of life on Earth. The increasing atmospheric levels of the main greenhouse gases are now established, as is their source in human activity. World-wide temperatures are rising on a high variance stochastic trend. Evidence from the past 500 million years provides a major warning: climate change is the main culprit in previous mass extinctions, with several different triggers - humanity is the latest trigger. The different approaches and sources of evidence across so many disciplines make a compelling case. Economic analysis offers a number of ideas, but the key problem is that distributions can shift, making action to avoid possible future shifts urgent. Adaptation ceases to be meaningful if food, water and land resources become inadequate, whereas the first migration steps are not costly and should stimulate innovation, creating opportunities as new technologies develop. |
| Keywords: | Climate change, Mass extinction, Greenhouse gases, Location shifts |
| JEL: | Q54 Q51 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:485&r=env |
| By: | Chalak, Morteza; Pannell, David |
| Abstract: | Weeds can cause significant problems to natural ecosystems. Although there have been numerous studies on the economics of weed control, relatively few of these studies have focused on natural ecosystems. This paper addresses this gap in the literature by assessing the cost-effectiveness of a comprehensive range of control strategies for blackberry (Rubus anglocandicans) in natural environments in Australia. We developed a stochastic dynamic simulation model and a deterministic dynamic optimisation model. The stochastic model calculates the expected net present value (NPV) of a range of control strategies, including any combination of treatment options. The optimisation model identifies the treatment combination that maximises NPV. Both models represent the costs and efficacies of control options over 25 years. The results indicate that using rust (Phragmidium violaceum) as a biological control agent only marginally increases NPV and excluding rust does not affect the optimal choice of other control options. The results also show for a wide range of parameter values that a strategy which combines the herbicide grazon (Triclopyre and picloram) and mowing is optimal. If chemical efficacy decreases by 20 percent it becomes optimal to include grazing blackberry by goats in the control strategy. |
| Keywords: | Environment, Economics, Weed, Stochastic, Optimisation, Management, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:58886&r=env |
| By: | Godden, David |
| Abstract: | Although there has been much writing about ecosystem services in the last decade, there has been insufficient which clearly elucidates their value. Rather, much of the writing has been classificatory rather than analytical (e.g. the Millennium Ecosystem Assessment, Total Economic Value (TEV), and environmental accounting) and has tended to complicate rather than enlighten. Further, these classification systems are not necessarily internally consistent, nor consistent with each other. There is no systematic analysis of what economic values to report within these frameworks although the SEEA would account in value added terms, consistent with a national accounting framework, and TEV focuses on economic surpluses but is often inter-temporally muddled. This paper explores the necessary modelling that is required to properly identify the value of ecosystem services, and to distinguish them from "supporting" biophysical processes that only have indirect and derivative anthropogenic values. The paper also explores the limitations of environmental accounting - comparable to national accounting - as policy-relevant analysis. |
| Keywords: | Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59081&r=env |
| By: | Zokaei, Keivan |
| Abstract: | This paper looks at the socio-environmental sustainability of agri-food systems and addresses the key issue of measuring âsustainabilityâ. The paper begins by providing an overview of the environmental impacts of the global agri-food systems especially focusing on the UK. The author generated a comprehensive analysis of the key hotspots within food systems in a previous paper presented at the 2nd International European Forum on Systems Dynamics and Innovation in Food Networks in 2008. This article takes the discussion further by looking at the key tools for supply chain environmental measurement and contributes establishing a new measure of sustainable production/consumption. |
| Keywords: | Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iefi09:59203&r=env |
| By: | Hennessy, Hugh; Tol, Richard S. J. |
| Abstract: | We construct a model of the stock of private cars in the Republic of Ireland. The model distinguishes cars by fuel, engine size and age. The modelled car stock is build up from a long history of data on sales, and calibrated to recent data on actual stock. We complement the data on the number of cars with data on fuel efficiency and distance driven ? which together give fuel use and emissions ? and the costs of purchase, ownership and use. We use the model to project the car stock from 2010 to 2025. The following results emerge. The 2009 reform of the vehicle registration and motor tax has lead to a dramatic shift from petrol to diesel cars. Fuel efficiency has improved and will improve further as a result, but because diesel cars are heavier, carbon dioxide emissions are reduced but not substantially so. The projected emissions in 2020 are roughly the same as in 2007. In a second set of simulations, we impose the government targets for electrification of transport. As all-electric vehicles are likely to displace small, efficient, and little-driven petrol cars, the effect on carbon dioxide emissions is minimal. We also consider the scrappage scheme, which has little effect as it applies to a small fraction of the car stock only. |
| Keywords: | Carbon dioxide emissions/Climate policy/Policy/Private car transport/Republic of Ireland/scenarios |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp342&r=env |
| By: | Wilson, Amanda |
| Abstract: | North Shore Cityâs coastline has been subject to intensive development pressure over the last 15 years. In this time, new developments have established along previously undeveloped areas of coastline and existing sites have redeveloped with much larger houses. This paper provides a description of the planning controls that currently affect coastal development and an assessment of the effectiveness of these controls. This is followed by an analysis of the role of local government in controlling future development. Contention arises when attempts are made to control the property rights of landowners to protect their properties from coastal erosion. The impacts of private coastal protection works on the coastline have wider impacts than their immediate location and can influence public perception of the coastal environment. Coastal erosion is a prominent issue for North Shore City and this increase in development has increased the risk to both property owners and potentially the Council. Authorities are concerned that current coastal planning controls do not address coastal erosion to a great enough degree. A methodology for assessing change along the coastline is described and used to identify where planning controls are not being effective by using indicators such as the presence of coastal protection structures and signs of erosion. Alternative policy approaches are identified and evaluated using a cost-benefit analysis framework. It is envisaged that this preliminary cost-benefit analysis will identify policy aspects requiring future in-depth investigation. The practical implications for different policy approaches regarding coastal erosion and private property rights are also explored. |
| Keywords: | coast, erosion, planning, cost, benefit, development, protection, structures., Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59260&r=env |
| By: | Hazuki Ishida (Faculty of Symbiotic Systems Science, Fukushima University) |
| Abstract: | The fact that harnessing renewable energy depends heavily upon fossil fuels implies that a continuous rise in energy prices is inevitable without technological progress in saving fossil fuel use. Using a simple Hotelling model of optimal nonrenewable resource extraction, this paper explores the conditions under which the continuous price rise of renewable energy is restrained in the presence of technological progress in harnessing renewable energy. In these circumstances, the results show that the growth rate of technology in harnessing renewable energy has to be larger than the discount rate to sustain the age of cheap energy. |
| Keywords: | renewable energy; fossil fuels; technological progress |
| JEL: | Q31 Q41 Q42 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1016&r=env |
| By: | Sanderson, Todd; Ahmadi-Esfahani, Fredoun Z. |
| Abstract: | Australia has long been a major exporter of wheat, a commodity well suited to the economic and climatic conditions of Australia. According to the conventional wisdom, Australia holds a comparative advantage in wheat. However, the future validity of this proposition is sensitive to the proposed impacts of climate change. This paper develops a framework with which to examine the future patterns of comparative advantage in wheat given the projections of several global climate models. We find support for the conventional wisdom, and identify the presence of substantial resilience in Australiaâs comparative advantage to adverse yield change. |
| Keywords: | International Relations/Trade, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59155&r=env |
| By: | Zylbersztajn, Decio |
| Abstract: | The exhaustion of natural resources is a central problem in the international agenda. The particular case of Amazon forest is at the top on the international environmental discussion. Two related problems are keys to be considered in the discussion of sustainable development in this region. First the predatory use of the natural resources of the forest mainly timber and genetic resources. Second the recognition of the existence of a population of around 20 million inhabitants in the region defined as âLegal Amazon Areaâ, aiming the improvement on the living conditions, enhancement of income level and acceleration of development. How to match both objectives is a puzzle faced by the present generation. The region is populated by initiatives of international non-governmental-organizations, most of them carrying good intentions but lacking the necessary knowledge on local formal and informal institutions to find ways to reach sustainable development. The result is the accelerated process of natural resources depletion, and social disorganization. The case of the production of Brazilian Nuts stands as a corollary of the lack of an institutional structure of property rights that does not provide incentives for sustainable development. The opposite effect is being observed as a result of the fragility of observable institutional arrangements. The case provides the counterfactual for the analysis of Ostrom (1990,2008), where she presents virtuous cases of sustainable exploration of natural resources, mostly based on informal but solid institutions. |
| Keywords: | Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, Research and Development/Tech Change/Emerging Technologies, Risk and Uncertainty, Q01, Q56, D23, |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:iefi09:59117&r=env |
| By: | Mazur, Kasia; Bennett, Jeff |
| Abstract: | The incentives that motivate respondents to reveal their preferences truthfully have been a long-standing area of research in the non-market valuation literature. A number of studies have been undertaken to investigate incentive compatibility in nonmarket valuation. Most of these used laboratory environments rather than field surveys (e.g. Carson and Burton, 2008, Harrison, 2007, Lusk and Schroeder, 2004, Racevskis and Lupi, 2008). Only a few studies investigating incentive compatibility have considered multi-attribute public goods with an explicit provision rule in a choice experiment (Carson and Groves, 2007, Collins and Vossler, 2009, Carson and Burton, 2008). The design of a choice modelling study that avoids strategic behaviour has proven particularly difficult because of multiple choices and difficulties in developing a majority voting provision rule. This study investigates the impact of the inclusion of a framing statement for incentive compatibility in a field survey choice modelling study. An incentive compatible statement (provision rule) that sets out to respondents the rule relating to when the good under consideration will be provided was employed. The impact of a provision rule across three alternative choice modelling multiple choice questionnaires was tested by comparing results between split samples with and without a provision rule. Four split samples were used to test the impact of a provision rule on preferences across different communities including local/rural residents and distant/urban residents. A choice modelling analysis that involved a conditional logit model and a random parameter model was used to elicit household willingness to pay for improvements in environmental quality in the Hawkesbury-Nepean catchment. The results of the study show that the inclusion of a provision rule had an effect on preferences in the distant/urban communities. However, the impact of a provision rule in the local/rural community sub-samples was negligible. This study suggests that the impact of a provision rule should be analysed in the context of different community characteristics. |
| Keywords: | Choice modelling, Incentive comparability, Provision rule, Non-market valuation, Environment, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59101&r=env |
| By: | Rolfe, John; Windle, Jill |
| Abstract: | Valuing protection of the Great Barrier Reef with choice modelling by management policy options |
| Keywords: | Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59153&r=env |
| By: | Pant, Hom M. |
| Abstract: | Forestry poses a challenge to computable general equilibrium (CGE) modellers working with recursively dynamic models. This is because of the lag between its inputs and output, which do not correspond to the same time period as other sectors. Inputs are applied for a number of years before a forest is ready for harvest. As a result, attempts in the past to incorporate a well-specified forestry sector in a recursive CGE model have been only partly successful. The purpose of this paper is to fill this gap by presenting a consistent analytical framework which can be used to incorporate forestry into a recursively dynamic global CGE model. A key feature of the framework is that it splits the forestry activity into three partsâplanting, holding and harvesting. Planting and harvesting are done by standard production sectors and holding is done by investors, whose behaviour is already modelled in these CGE models. In addition, global forests are classified into three groupsâcommercial plantation forests, environmental plantation forests and native forests. All harvested forest land is made available for competition for alternative agricultural uses and will be allocated to the activity it is best suited for, given productivity differences for different activities. This framework can be used in a CGE modelling framework to support implementation of the proposed reduced emissions from deforestation and forest degradation (REDD) schemes as well as being applied to study land allocations, nationally and globally, across activities under alternative scenario assumptions. For example, the model can be used to project the effects on food production and prices of an increase in bio-fuel subsidies. |
| Keywords: | Agribusiness, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59150&r=env |
| By: | Norlida Hanim, Mohd Salleh; Redzuan, Othman |
| Abstract: | Abstract The purpose of this research is to evaluate the importance and satisfaction level of tourists at the Tioman Island Marine Park (TIMP) toward the island’s environmental attributes and service quality offered. This research analyses the overall tourists, as well as comparison between the local and foreign tourists. The measurement of importance and satisfaction is based on the mean analysis, i.e. the importance mean (estimated/expected mean) and the perceived mean (satisfactory mean). The difference between these mean values shows the gap value. The gap analysis in this research is assisted by the t-analysis in explaining the existence of difference, if any. If there is no difference in this analysis, it shows that the tourists get what they expected from their trips to the TIMP. However, if there is existence of difference, it must be ascertained as to whether the trips satisfy their expectations or otherwise. Again, the gap analysis will be able to answer this question. The research result shows that all tourists (both locals and foreign) agree on the importance and satisfaction toward the TIMP‘s environmental attributes and service quality offered. Besides the existence of difference in value between the said means, whether through the gap analysis or the paired t-test; the gap analysis finds that the mean values for most of the environmental attributes and service quality evaluated, are negative. Thus, these negative values indicate a relatively low satisfaction level. |
| Keywords: | Keywords: Tourists’ perceptions; Environmental attributes; Environmental Service Quality; Tioman Island Marine Park |
| JEL: | O13 Q57 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:22679&r=env |
| By: | Millock, Katrin; Nauges, Céline |
| Abstract: | Using unique survey data of 10,000 households from 10 OECD countries, we identify the driving factors of household adoption of water-efficient equipment by estimating Probit models of a household's probability to invest in such equipment. The results indicate that the adoption of water-efficient equipment is the most strongly affected by ownership status, by being metered and charged a volumetric charge on water consumption, and by behavioural factors. Environmental attitudes are strong predictors of adoption of water-efficient equipment, with a marginal effect that exceeds ownership status in some cases. In terms of policy, we find that households that were both metered and charged for their water individually had a much higher probability to invest in water-efficient equipment compared to households that were not charged for their water. |
| Keywords: | attitudes, metering, residential water use |
| JEL: | D12 O33 Q25 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:22182&r=env |
| By: | Pandit, Ram; Laband, David N. |
| Abstract: | Trees cast shade on homes and buildings, lowering the inside temperatures and thus reducing demand for power to cool these buildings during hot times of the year. Drawing from a large sample of residences in Auburn, Alabama, we develop a statistical model that produces specific estimates of the electricity savings generated by shade-producing trees in a suburban environment. This empirical model links residential energy consumption to hedonic characteristics of the structures, characteristics and behaviors of the occupants, and the extent, density, and timing of shade cast on the structures. Our estimates suggest that if an additional 10 percent of the 125 million home owners in America started using tree shade to reduce electricity consumption an average of 10 kwh/day for 100 days per year, the annual amount of electricity conserved would be approximately 12,500 thousand megawatts. At the 2007 average residential price of electricity ($0.1065/kwh), this would save each household an estimated $106/year and $1.3 billion in the aggregate. Moreover, the electricity saved would represent approximately one-third of the electricity produced annually in the U.S. by wind power. |
| Keywords: | Environmental Economics and Policy, Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59147&r=env |
| By: | Gollier, Christian |
| JEL: | G12 E42 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:21927&r=env |
| By: | Walpole, S.C.; Enders, G.R.; Roe, M.L. |
| Abstract: | The Living Murray Initiative was established to recover 500 Gigalitres in average annual flows to address the declining environmental health of the Murray-Darling river system. The NSW Market Purchase Measure was initiated by the New South Wales Government as part of The Living Murray Initiative with the aim of purchasing up to 125 Gigalitres of high and medium reliability entitlements within the NSW southern connected part of the Murray-Darling Basin. The commencement of this measure provided an opportunity to survey participants in permanent water trading for an environmental outcome to determine general land use and socio-economic information as well as specific information regarding their current water use, future intentions and their opinion of the implementation of the water purchase process. The results of the survey will also assist in understanding the nature of the participants in this process relative to the broader irrigator/regional population. Importantly, the survey outcomes will help to improve understanding of participant circumstances and provide important lessons for future water purchase programs. |
| Keywords: | Resource /Energy Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59258&r=env |
| By: | Dallas Burtraw (Resources for the Future); Jacob K. Goeree (California Institute of Technology); Charles A. Holt (University of Virginia); Erica Myers (University of California, Berkeley); Karen Palmer (Resources for the Future); William Shobe (University of Virginia) |
| Abstract: | Auctions are increasingly being used to allocate emissions allowances (“permits”) for cap and trade and common-pool resource management programs. These auctions create thick markets that can provide important information about changes in current market conditions. This paper reports a laboratory experiment in which half of the bidders experienced unannounced increases in their willingness to pay for permits. The focus is on the extent to which the predicted price increase due to the demand shift is reflected in sales prices under alternative auction formats. Price tracking is comparably good for uniform-price sealed-bid auctions and for multi-round clock auctions, with or without end-of-round information about excess demand. More price inertia is observed for “pay as bid” (discriminatory) auctions, especially for a continuous discriminatory format in which bids could be changed at will during a pre-specified time window, in part because “sniping” in the final moments blocked the full effect of the demand shock. |
| Keywords: | auction, greenhouse gases, price discovery, cap and trade, emission allowances, laboratory experiment |
| JEL: | C92 D44 Q54 Q58 |
| Date: | 2010–04–05 |
| URL: | http://d.repec.org/n?u=RePEc:vac:wpaper:wp10-01&r=env |
| By: | d'Albis, Hippolyte; Ambec, Stefan |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:22273&r=env |
| By: | Key, Nigel; Latruffe, Laure; Sauer, Johannes |
| Abstract: | The effect of subsidies on production and technical change of crop farms in France and the United Kingdom (UK) during 1980-2006 is investigated. Subsidies were not neutral on production decisions, in terms of production intensity and type. Crop farms in both countries have experienced technical progress during the period studied, higher in France. Technical progress has favoured labour and chemicals in both countries, land in France, capital in the UK, while it has disfavoured land in the UK and capital in France. Technical change has been slowed down by crop area subsidies but increased by agri-environmental subsidies in both countries. |
| Keywords: | technical change, subsidies, input bias, crop farms, Agricultural and Food Policy, Farm Management, Land Economics/Use, |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa114:61109&r=env |
| By: | Fleming, Euan; Hadley, David; Holloway, Garth |
| Abstract: | Interest has been growing in the nature of synergies in agroecosystems, prompted in part by growing concerns about the effects of environmental degradation on agricultural productivity and interrelations between agricultural outputs and ecosystem outputs. Most productivity analyses focus on technology, technical inefficiency and scale effects on productivity; yet scope economies derived from synergies can also have substantial effects that are likely to increase in the future. Scope economies take on special importance when farms diversify to halt declining biodiversity and other forms of environmental degradation. We present results of an empirical case study based on panel data on farms in England and Wales. A stochastic input distance function is estimated using Bayesian methods that enable economies of scope to be calculated between pairs of outputs based on the derivatives of the input distance function. Results confirm the presence of scope economies from diversity, providing prima facie evidence that diversity is beneficial in farming systems in England and Wales. But a number of challenges lie ahead to improve the data set and method of measuring scope economies for further substantiation of this evidence. Chief among them is the need to obtain a better measure of ecosystem outputs. The complexity of agroecosystems, with their diverse elements and numerous interactions between elements, presents a major challenge for data collection. |
| Keywords: | Biodiversity, ecosystem outputs, scope economies, synergy, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59076&r=env |
| By: | Richard Green |
| Abstract: | This chapter discusses the implications of an increasing proportion of renewable energy for the way in which energy companies are regulated. While the scope of regulation varies from country to country, depending on the degree of liberalisation, an increase in the overall cost of energy, and a shift from operating to capital costs will be relevant for all regulators. Where there is third party access to transmission, the tariffs may need to send stronger signals of the relative costs imposed by generators in different places, and may have significant effects on their profitability. Regulators responsible for generation revenues will have to allow peaking plants to recover their costs, even if those are rarely-used reserves to cope with intermittent renewable generation. Regulators in control of final prices charged to consumers will probably have to pass on a higher cost of energy, and determine how much is paid by different groups. The shift to renewable energy, however, will not change the fundamental tasks or nature of economic regulation. |
| Keywords: | Economic regulation, renewable energy, electricity, transmission pricing |
| JEL: | L94 Q42 L95 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:bir:birmec:10-16&r=env |
| By: | Smith, Harley; Webster, Stewart |
| Abstract: | Australian governments spend millions of dollars each year on pre border, border and post border biosecurity programs. While the resourcing of some of these programs is determined by existing deeds of agreement, others, particularly in relation to environmental and social pests and diseases, fall outside of existing decision frameworks. This paper presents a new biosecurity investment decision framework based on economic principles that aims to produce more objectively determined decisions. It determines whether a role for government exists in relation to a specific problem through the application of market failure tests and then guides the user to the most efficient cost recovery mechanism. The framework is presently under active consideration for use by Industry & Investment NSW and would be suitable for wider application. |
| Keywords: | Biosecurity, investment decision framework, biosecurity policy, market failure test, cost recovery, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59161&r=env |
| By: | Windle, Jill; Rolfe, John |
| Abstract: | Comparing responses from web and paper-based collection modes in a choice modelling experiment |
| Keywords: | web-based surveys, internet surveys, paper-based surveys, stated preference, collection mode, choice experiments, Environmental Economics and Policy, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59261&r=env |
| By: | Norlida Hanim, Mohd Salleh; Redzuan, Othman; Nurul Fahana Aini , Harun |
| Abstract: | ABSTRACT In order to protect and conserve the threatened and endangered marine life, the government has gazetted a total of 40 islands as marine parks. With the gazettement, all activities that disrupt the stability of marine’s eco-system are prohibited. These prohibited activities include fishing, the locals’ main source of income. Thus, what about the locals’ livelihoods post- gazettement? This research is to analyze the livelihood sustainability of the locals at the Pulau Tioman Marine Park (TIMP) and Pulau Redang Marine Park (PRMP). The analysis on livelihood sustainability is based on the locals’ perceptions after the islands’ gazettement as marine parks. The five standard of living/living standard indicators which are human, physical, natural/environment, social, finance as well as threats/uncertainties towards socio-economic changes will be analysed in this research. The research results show that in general, the RIMP and TIMP’s communities’ livelihoods are satisfactory in terms of human, physical and social assets; but are still lacking in terms of the financial and natural/environment assets. The education element also needs to be addressed as there are still school dropouts among these islands’ communities’ children. Nonetheless, the locals are still safe from socio-economic threats/uncertainties and disease outbreaks/disasters. In comparing the RIMP and TIMP, it is found that the TIMP’s community has better sustainable livelihood than that of the RIMP’s locals. |
| Keywords: | Keywords: Sustainable livelihood; Pulau Tioman Marine Park; Pulau Redang Marine Park and Sustainability Indicators |
| JEL: | Q01 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:22680&r=env |
| By: | Jennings, Sarah; Yamazaki, Satoshi; Lyle, Jeremy |
| Abstract: | This paper explores the extent and nature of anchoring and shift effects in a double-bounded contingent valuation of recreational fishing in Tasmaniaâs inshore saltwater fishery. In particular we model the situation where respondents, when answering the second valuation question, evaluate the bid amount partly with reference to the size of the first bid amount. The estimates of the coefficients and mean WTP for a day of fishing are compared across different contingent valuation models, including a single-bounded model, a conventional double-bounded model and models that control anchoring and exogenous shift effects in both homogeneous and heterogeneous forms. Overall we find consistent evidence of anchoring, but mixed evidence of a shift effect. Results show that both males and females anchor in the same way, but that respondents who have a mainstream view of what recreational fishing represents anchor more strongly than those whose view of fishing is not mainstream. The estimated mean WTP for a dayâs recreational fishing is consistently higher in all models which account for bias in responses than in either the single-bounded or double-bounded models. We indicate the possibility that anchoring behaviour may be more complex than is captured in our models and suggest that this needs to be addressed if the results of contingent valuations are to reliably inform resource allocation decisions and recreational fishing management. |
| Keywords: | Contingent valuation, anchoring bias, shift effect, heterogeneity, recreational fishing, Environmental Economics and Policy, C35, Q26, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare10:59089&r=env |
| By: | Ramirez, Juan Andres; Rosales Alvarez, Ramon |
| Abstract: | Las altas concentraciones de gases de efecto invernadero, especÃficamente CO2, han sido señaladas como la principal causa del cambio climático. La adopción de prácticas agrÃcolas capaces de incrementar el contenido de carbono en el suelo, ha sido propuesta como una estrategia de bajo costo y disponibilidad inmediata para enfrentar este fenómeno. La Bio-carbonización es una de estas prácticas agrÃcolas, la cual implica la aplicación de carbón vegetal al suelo, de modo que el carbono queda capturado en una forma altamente recalcitrante al tiempo que se mejora la calidad del suelo. Este artÃculo es el primero en evaluar la viabilidad financiera y considerar algunos de los efectos económicos de la práctica, estimados para una finca tipo en la altillanura colombiana. Los resultados permiten determinar la viabilidad financiera de la Bio-carbonización, el valor presente neto del incremento en los beneficios es US$ 534,139, lo cual representa un incremento del 39.2% con relación a la lÃnea base. Igualmente, los beneficios económicos asociados con la Bio-carbonización, hacen de esta una práctica adecuada para la captura de carbono. |
| Keywords: | agricultura sostenible, altillanura colombiana, análisis costobeneficio, programación lineal, secuestro de carbono, servicios ambientales., Agribusiness, Agricultural and Food Policy, Environmental Economics and Policy, Farm Management, C6, D60, O30, Q10, Q24, Q50, |
| Date: | 2009–10–20 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ulaedd:60734&r=env |
| By: | Buysse, Jeroen; Van der Straeten, Bart; Nolte, Stephan; Claeys, Dakerlia; Lauwers, Ludwig; Van Huylenbroeck, Guido |
| Abstract: | The paper analyses the governance choices in production quota with the Flemish nutrient production rights as a case. A static model of quota trade in the short run shows the inefficiency of discrete non-auctioned trade with fixed transaction costs. This model also shows that an obligation to quota sellers to stop their production stimulates structural change. A dynamic model of trade indicates that the measures taken to prevent speculative behaviour causes inefficiencies and stimulates overuse of quota if the penalties are too low. Finally, the dynamic model indicates that a flat rate reduction on traded quota combined with too low penalties for overuse stimulate the total production. |
| Keywords: | production rights, quota, dynamic programming, transaction costs, Agricultural and Food Policy, Farm Management, Land Economics/Use, |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa114:61084&r=env |
| By: | Luke Brander (Institute for Environmental Studies); Andrea Ghermandi (FEEM); Onno Kuik (Institute for Environmental Studies); Anil Markandya (BC3 Basque Centre for Climate Change); Paulo A.L.D. Nunes (FEEM, Università Ca' Foscari di Venezia); Marije Schaafsma (Institute for Environmental Studies); Alfred Wagtendonk (Institute for Environmental Studies) |
| Abstract: | The approach of using existing data on economic values of local ecosystem services for an assessment of these values at a larger geographical scale can be called “scaling up”. In a scaling-up exercise, economic values from a particular study site are transferred to another geographical setting, for instance to the regional, national or global scale. This paper proposes a methodology for scaling up ecosystem service values to a European level, assesses the availability of data for conducting this method, and illustrates the procedure with a case study on wetland values. The proposed methodology makes use of meta-analysis to produce a value function that is subsequently applied to individual European wetland sites. Site-specific, study-specific and context-specific variables are used to define a price vector that captures differences between sites and over time. The proposed method is shown to be practicable and to produce reasonably reliable aggregate value estimates. |
| Keywords: | Ecosystem Services, Value Transfer, Meta-Analysis, Wetland Values |
| JEL: | C81 Q24 Q57 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.41&r=env |