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on Environmental Economics |
| By: | Simon, David |
| Abstract: | Cities-especially those with substantial poor populations-will face increasingly severe challenges in tackling the impacts of global environmental change (GEC). As economic dynamos and increasingly important population concentrations, cities both contribu |
| Keywords: | global environmental change, climate change, African cities, mitigation, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2010-51&r=env |
| By: | Wimolpat Bumbudsanpharoke (Scottish Agricultural College, University of Edinburgh) |
| Abstract: | The Ping river basin, one of the major tributaries in northern Thailand, is strategically interlinked with major waterways livening agricultural activities for centuries. The basin is considerably recognised as an area to be protected from potential water-consumption threats impacting downstream's agricultural and industrial activities and residential areas. Over decades, economic expansion has changed the pattern of land use putting pressures on natural resources. One of the main concerns in the Ping river basin is a deterioration of water quality. Emissions from point sources, exemplified by large industrial facilities and communities, are regulated under command and control strategies. However, diffuse discharges from agricultural activities pose pervasive difficulties in management and policy design. The recent government report highlights citrus cultivation as the activity with a high application rate of chemicals, coupled with forest encroachment. Recognition of the significant of nonpoint source pollution problems has stimulated policy makers to promote Best Management Practices (BMPs) to control farm emissions at the watershed level. A number of agricultural economics studies have made policy recommendation based on an assumption that farmers are homogenous and make decision to maximise their well-being. However, there is a lack of research around behavioural responses to agri-environmental policy. As such, this study is tailored to employ contemporary interests of economic and behavioural principles in order to tackle the problem by understanding farmers' perspective and serving correct requirements rather than traditionally campaigning policies without sound agreements. The main objective of this study is to consider psychological perspectives on farmer decision making in relation to BMP adoption. The study attempts to investigate beliefs that are associated with decision making, to understand subjectivity in conservation behaviour, to assess costs of various BMP, and to make relevant policy recommendations. Prior to the main analysis, a set of BMPs is defined. Twelve BMPs suitable for implementation in the Ping river basin are selected based on expert judgement. Two psychological theories, the Theory of Planned Behaviour and QMethodology, are proposed to investigate farmers' behavioural intentions and latent perceptions, respectively. Further, the economic analysis of BMP cost at farm level is conducted to investigate cost effects and adoption intention. |
| Keywords: | citrus farm, agri-environmental policy, Thailand |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:eep:tpaper:tp201003t2&r=env |
| By: | Sippel, Maike |
| Abstract: | While nation states debate climate policy at an international scale, on a local level, cities across the globe have committed to emission targets and mitigation activities. This study analyses the actual performance of municipal climate action against their targets. Official information material from large cities in Germany was collected and complemented with questionnaires from officials in 40 municipalities. While 77% of cities have adopted emission targets in a voluntary act, and 80% of these cities are engaged in at least basic emission reporting, only a quarter of them are on course to reach their targets. All of these ‘successful’ cities are situated in Eastern Germany – and their emission reductions can mainly be explained by the industrial decline in the 1990s after the German Reunification. Not a single city in Western Germany is on course to reach its reduction commitment. Cities average mitigation performance is slightly worse than the German average, and the effect of city networks on cities is not very clear. It can be concluded that cities are currently not living up to their ambitions. The practice of urban emission reporting does in many cases not allow for proper quality management of greenhouse gas policies. For a more meaningful contribution to the battle against climate change, cities could follow a double strategy: Firstly they could report emissions regularly and adopt realistic and city-specific targets and action plans based on their emission patterns. Secondly, they could complement their targets with a visionary approach: This would include pilot projects that demonstrate how low carbon cities could look like, as well as a more ambitious target which they would be able to reach – provided that optimal framework conditions for local mitigation activities would be put in place by other policy levels. |
| Keywords: | Cities; climate policy; mitigation; emission inventories; emission reporting; targets |
| JEL: | Q38 H77 Q28 D78 R59 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:23011&r=env |
| By: | Nadezhda V. Baryshnikova (School of Economics, University of Adelaide) |
| Abstract: | We study pollution abatement and environmental equity in a dynamic panel model using data for 236 plants in the US pulp and paper industry observed over the period 1985-1997. We suggest a theoretical model for the plant manager who incorporates regulatory pressures into his calculations of optimal amount of pollution. Assuming actual pollution abatement exhibits a sluggish adjustment process, the theoretical model leads to an empirical AR(1) panel model. We estimate our model using GMM with both ''temporally lagged'' and ''spatially lagged'' instruments. We find that children, people below the poverty line and the smallest minority races are exposed to higher levels of pollution. Our findings show no evidence of environmental inequity against African-Americans or Hispanics, and find that the neighborhoods with a higher percentage of elderly population face signicantly lower levels of pollution from the plants. |
| Keywords: | pollution abatement, environmental equity, dynamic panel, instrumental variable, fixed effects |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:adl:wpaper:2010-06&r=env |
| By: | Matthieu Glachant (CERNA - Centre d'économie industrielle - Mines ParisTech); Yann Ménière (CERNA - Centre d'économie industrielle - Mines ParisTech) |
| Abstract: | The paper deals with the diffusion of GHG mitigation technologies in developing countries. We develop a model where an abatement technology is progressively adopted by firms and we use it to compare the Clean Development Mechanism (CDM) with a standard Cap and Trade scheme (C&T). In the presence of learning spillovers, we show that the CDM yields a higher social welfare than C&T if the first adopter receives CDM credits whereas the followers don't. This result lends support to the policy proposal of relaxing the CDM additionality constraint for projects which generate significant learning externalities. |
| Keywords: | climate policy, technology diffusion, Kyoto Protocol, Clean Development Mechanism, emissions trading |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-00488238_v1&r=env |
| By: | Barnes, Douglas F.; Khandker, Shahidur R.; Samad, Hussain A. |
| Abstract: | Access to energy, especially modern sources, is a key to any development initiative. Based on cross-section data from a 2004 survey of some 2,300 households in rural Bangladesh, this paper studies the welfare impacts of household energy use, including that of modern energy, and estimates the household minimum energy requirement that could be used as a basis for an energy poverty line. The paper finds that although the use of both traditional (biomass energy burned in conventional stoves) and modern (electricity and kerosene) sources improves household consumption and income, the return on modern sources is 20 to 25 times higher than that on traditional sources. In addition, after comparing alternate measures of the energy poverty line, the paper finds that some 58 percent of rural households in Bangladesh are energy poor, compared with 45 percent that are income poor. The findings suggest that growth in electrification and adoption of efficient cooking stoves for biomass use can lower energy poverty in a climate-friendly way by reducing carbon dioxide emissions. Reducing energy poverty helps reduce income poverty as well. |
| Keywords: | Energy Production and Transportation,Energy and Environment,Environment and Energy Efficiency,Climate Change Mitigation and Green House Gases,Energy Demand |
| Date: | 2010–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5332&r=env |
| By: | Brian Blankespoor; Benoit Laplante; David Wheeler; Susmita Dasgupta |
| Abstract: | Without a better understanding of the interactions between international players, households and public sector, it will be difficult for climate negotiators and donor institutions to determine the appropriate levels and modes of adaptation assistance. This paper contributes by assessing the economics of adaptation to extreme weather events. [Working Paper 199] |
| Keywords: | weather, donor, institutions, developing countries, international assistance, public sector, climate change, geographically, vulnerability, communities, households, international, vulnerability, socio economic, demographic, population, droughts, economies, human development, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2509&r=env |
| By: | Antoine Dechezleprêtre (CERNA - Centre d'économie industrielle - Mines ParisTech, Grantham Research Institute on Climate Change and the Environment - London School of Economics and Political Science); Matthieu Glachant (CERNA - Centre d'économie industrielle - Mines ParisTech); Ivan Hascic (chercheur indépendant - Casa de Velázquez); Nick Johnstone (chercheur indépendant - Casa de Velázquez); Yann Ménière (CERNA - Centre d'économie industrielle - Mines ParisTech) |
| Abstract: | This paper uses the EPO/OECD World Patent Statistical Database (PATSTAT) to provide a quantitative description of the geographic distribution of inventions in thirteen climate mitigation technologies since 1978 and their international diffusion on a global scale. Statistics suggest that innovation has mostly been driven by energy prices until 1990. Since then, environmental policies, and climate policies more recently, have accelerated the pace of innovation. Innovation is highly concentrated in three countries—Japan, Germany and the USA—which account for 60% of total innovations. Surprisingly, the innovation performance of emerging economies is far from being negligible as China and South Korea together represent about 15% of total inventions. However, they export much less inventions than industrialized countries, suggesting their inventions have less value. More generally, international transfers mostly occur between developed countries (73% of exported inventions). Exports from developed countries to emerging economies are still limited (22%) but are growing rapidly, especially to China. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-00488214_v1&r=env |
| By: | Giaccaria Sergio (University of Turin); Dalmazzone Silvana (University of Turin) |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:uto:dipeco:201003&r=env |
| By: | BRECHET, Thierry (UniversitŽ catholique de Louvain, CORE and Louvain School of Management, Chair Lhoist Berghemans in Environmental Economics and Management, B-1348 Louvain-la-Neuve, Belgium); CAMACHO, Carmen (UniversitŽ catholique de Louvain, Belgian National Foundation of Scientific Research and Economics Department, B-1348 Louvain- la-Neuve, Belgium); VELIOV, Vladimir (ORCOS, Institute of Mathematical Methods in Economics, Vienna University of Technology, A-1040 Vienna, Austria) |
| Abstract: | This study is motivated by the evidence of global warming, which is caused by human activity but affects the efficiency of the economy. We employ the integrated assessment Nordhaus DICE-2007 model [16]. Generally speaking, the framework is that of dynamic optimization of the discounted inter-temporal utility of consumption, taking into account the economic and the environmental dynamics. The main novelty is that several reasonable types of behavior (policy) of the economic agents, which may be non-optimal from the point of view of the global performance but are reasonable form an individual point of view and exist in reality, are strictly defined and analyzed. These include the concepts of Òbusiness as usualÓ, in which an economic agent ignores her impact on the climate change (although adapting to it), and of Òfree riding with a perfect foresightÓ, where some economic agents optimize in an adaptive way their individual performance expecting that the others would perform in a collectively optimal way. These policies are defined in a formal and unified way modifying ideas from the so-called Òmodel predictive controlÓ. The introduced concepts are relevant to many other problems of dynamic optimization, especially in the context of resource economics. However, the numerical analysis in this paper is devoted to the evolution of the world economy and the average temperature in the next 150 years, depending on different scenarios for the behavior of the economic agents. In particular, the results show that the Òbusiness as usualÓ, although adaptive to the change of the atmospheric temperature, may lead within 150 years to increase of temperature by 2¡C more than the collectively optimal policy. |
| Keywords: | environmental economics, dynamic optimization, optimal control, global warming, model predictive control, integrated assessment |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2010016&r=env |
| By: | Mónica Meireles (Faculdade de Economia, Universidade do Porto, ISCTE-IUL, Portugal); Isabel Soares (CEF.UP, Faculdade de Economia, Universidade do Porto, Portugal); Óscar Afonso (CEF.UP, OBEGEF and Faculdade de Economia, Universidade do Porto, Portugal) |
| Abstract: | Seminal works on growth theory had mainly focused on exogenous technological change, where a certain given path of technological change was considered. At the end of the 1980s, a new growth theory emerged allowing for the endogeneity of technological change, where economic agents can affect the pace of technological change and where technology is essentially interpreted as “knowledge”. The present paper aims to develop a simple endogenous growth model to study the effects of taxation on dirty intensive resources and the effects of subsidies on clean/ecological intensive resources. It also intends to analyse how exogenous environmental quality can affect the development of better quality (environmentally cleaner) inputs to production. For that, a dynamic general equilibrium growth model is considered based on the endogenous skill-biased technological change literature. It is shown that final-good sector bias is caused by the technological-knowledge bias, which is promoted by government intervention. |
| Keywords: | economic growth, technological change, environment |
| JEL: | C61 O13 Q55 Q58 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:378&r=env |
| By: | Luthfi Fatah (Faculty of Agriculture Lambung Mangkurat University); Udiansyah (Faculty of Agriculture Lambung Mangkurat University) |
| Abstract: | Uncontrolled forest fires are one of the key causes of habitat destruction in Indonesia. The haze they produce causes significant pollution problems for people in the country and in surrounding nations. This study has highlighted the root causes of the fires and assessed a range of potential new policy options to improve the situation. The study finds that the weak enforcement of forest conservation rules and regulations is a key problem and that this is caused by wide range of resource and institutional failures. |
| Keywords: | forest fire, Indonesia |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:eep:pbrief:pb2010041&r=env |
| By: | Ronald J. Shadbegian; Wayne B. Gray |
| Abstract: | We examine the determinants of environmental regulatory activity (inspections and enforcement actions) for 1616 U.S. manufacturing plants in four large U.S. cities – Los Angeles, Boston, Columbus, and Houston – using data for 2000-2002. The main focus of our study is to examine whether or not regulators treat different segments of the population differently, by directing more regulatory activity at plants in rich, white neighborhoods and less in poor, minority neighborhoods, controlling for characteristics of the plant (size, age, and industry), and the plant’s past environmental performance. To date, tests of “Environmental Justice” hypotheses tend to focus on whether or not polluters are disproportionately likely to locate in neighborhoods with relatively high poor/minority populations, or on whether polluters located in those neighborhoods emit disproportionately high levels of pollution. Focusing instead on the allocation of enforcement activity across neighborhoods within each city allows us to shed light on a key mechanism through which discrepancies in pollution exposure across neighborhoods could arise and persist. Our results show relatively little statistically significant evidence that regulatory activity is less intense near disadvantaged demographic groups. We do find some suggestive coefficients - plants located in minority neighborhoods face less regulatory activity - but this effect is generally insignificant, and plants located in poor neighborhoods face (insignificantly) more regulatory activity. In contrast, we do find significant effects for plant characteristics and political variables, with plants that are larger and more energy-intensive, owned by single-plant firms, and located near politically active and liberal populations, facing more regulatory activity. |
| Keywords: | environmental justice, regulatory activity, enforcement, political, poor, minority |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp200902&r=env |
| By: | Ronald J. Shadbegian; Ann Wolverton |
| Abstract: | Economists have long been interested in explaining the spatial distribution of economic activity, focusing on what factors motivate profit-maximizing firms when they choose to open a new plant or expand an existing facility. We begin our paper with a general discussion of the theory of plant location, including the role of taxes and agglomeration economies. However, our paper focuses on the theory, evidence, and implications of the role of environmental regulations in plant location decisions. On its face, environmental regulation would not necessarily be expected to alter location decisions, since we would expect Federal regulation to affect all locations in the United States essentially equally. It turns out, however, that this is not always the case as some geographic areas are subject to greater stringency. Another source of variation is differences across states in the way they implement and enforce compliance with Federal regulation. In light of these spatial differences in the costs of complying with environmental regulations, we discuss three main questions in this survey: Do environmental regulations affect the location decisions of polluting plants? Do states compete for polluting plants through differences in environmental regulation? And, do firms locate polluting plants disproportionately near poor and minority neighborhoods? |
| Keywords: | plant location decisions, environmental policy, inter-jurisdictional competition, environmental justice |
| JEL: | D21 H77 Q52 Q56 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp201005&r=env |
| By: | He, Haoran (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | To reduce plastic bag litter, China introduced a nationwide regulation requiring all retailers to charge for plastic shopping bags on June 1, 2008. By using the policy implementation as a natural experiment and collecting individual-level data before and after the implementation, we investigate the impacts of the regulation on consumers’ bag use. We find that the regulation implementation caused a 49% reduction in the use of new bags. Besides regulation enforcement, consumers’ attitude toward the regulation and some consumers’ socioeconomic characteristics also affected bag consumption. However, the regulation effects differ largely among consumer groups and among regions and shopping occasions.<p> |
| Keywords: | China; litter; market-based policy; natural experiment; plastic bag |
| JEL: | Q53 Q58 |
| Date: | 2010–06–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0453&r=env |
| By: | Antoine Dechezleprêtre (CERNA - Centre d'économie industrielle - Mines ParisTech, Grantham Research Institute on Climate Change and the Environment - London School of Economics and Political Science); Matthieu Glachant (CERNA - Centre d'économie industrielle - Mines ParisTech); Yann Ménière (CERNA - Centre d'économie industrielle - Mines ParisTech) |
| Abstract: | Using patent data from 66 countries for the period 1990–2003, we characterize the factors which promote or hinder the international diffusion of climate-friendly technologies on a global scale. Regression results show that technology-specific capabilities of the recipient countries are determinant factors. In contrast, the general level of education is less important. We also show that restrictions to international trade—e.g., high tariff rates—and to a lesser extent lax intellectual property regimes negatively influence the international diffusion of patented knowledge. A counter-intuitive result is that barriers to foreign direct investments can promote transfers. We discuss different possible interpretations. |
| Keywords: | Climate change, technology diffusion, technology transfer |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-00488268_v1&r=env |
| By: | Robert Shelburne (United Nations Economic Commission for Europe); Claudia Trentini (United Nations Economic Commission for Europe) |
| Abstract: | The Pan-European Region made significant progress from 1995 to 2007 in improving the economic, social, environmental and health indicators incorporated into the Millennium Development Goals (MDGs). However, given the huge set-backs associated with the transition recession in the early 1990s and the more recent economic declines from the global financial crisis, achievement of some of the MDGs in a significant number of countries by 2015 is now problematic. The degree to which the actual targets can be achieved by 2015 will depend critically on: (i) the speed of recovery from the current crisis and the policy responses to it; (ii) the commitment by national governments to focus resources on the MDG objectives and their willingness to implement new policy initiatives, and (iii) the level of foreign assistance and regional cooperation that can be obtained. The EU new Member States (NMS) are most likely to meet the MDGs, while the prospects for the other European emerging economies are more mixed, especially for MDGs related to poverty and health. All of the Pan-European economies are falling short in terms of achieving environmental sustainability and gender equality. |
| Keywords: | millennium development goals, economic development, Europe, financial crisis, transition economies, CIS, Russia, caucasus, central Asia, health, education, environmental sustainability, gender, HIV, AIDS, Tuberculosis, trade, |
| JEL: | O10 O52 P20 P27 P36 I10 I20 I30 F02 J40 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:ece:dispap:2010_1&r=env |
| By: | Patrick Walsh; J. Walter Milon; David Scrogin |
| Abstract: | Federal efforts are increasingly targeting surface water quality in urban watersheds throughout the U.S., as demonstrated by recent litigation between the EPA and the State of Florida. While the cost of achieving federal standards is ultimately borne by taxpayers, pollution abatement may generate diverse and wide-reaching taxable benefits. This study investigates the effects of enhanced water quality on property prices in urban housing markets. Hybrid specifications of hedonic price models employed in water quality and proximity valuation studies are estimated, and several hypotheses about the implicit value of water quality are tested. Findings indicate i) the value of increased water quality depends upon surface water size and declines rapidly as proximity to the waterfront diminishes, though the mean effect remains significant at several hundred meters; and ii) when housing density is considered, the aggregate benefits derived in the broader housing market may dominate those realized by waterfront homeowners. New version posted 3-18-2010 |
| Keywords: | hedonic pricing, water quality, pollution abatement, proximity, amenity value |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp201002&r=env |
| By: | Luca Salvati (Sapienza University of Rome and National Council for Research in Agriculture) |
| Abstract: | This paper reviews the role of market, population growth, social issues, developmental policies, and other (minor) economic variables contributing to Mediterranean desertification. These variables were classified as describing the micro-economic and macro-economic factors suitable to assure a better comprehension of the environmental-economic nexus. Micro-economic factors like the higher prices and lower wages in the primary sector, as well as the reduction of off-farm employment reflect some potential causes of LD. It was also argued how technical change, agricultural input prices, and household income may affect land vulnerability but their contribution to this ecological problem is poorly known. On the contrary, the role of macroeconomic factors such as population density, poverty, and environmental policies, although more extensively studied on a qualitative base, was regarded as important but still relatively ambiguous, and needs further quantitative studies. Territorial disparities in land distribution, as well as increasing rural poverty and unsustainable management of soil and water were described as a consequence of the process triggering Mediterranean desertification. The effectiveness of policies aimed at mitigating LD and thus reducing desertification risk was finally discussed. |
| Keywords: | Land degradation, desertification, economic system, micro-economic causes, macro-economic factors, Mediterranean basin |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:des:wpaper:20&r=env |
| By: | Charles Griffiths; Nathalie B. Simon; Tracey J. Woodruff |
| Abstract: | In this study, we examine the effects of chronic exposure to air pollution on asthma exacerbation through a cross-sectional analysis of asthma prescriptions for quick-relief medications at the 5 digit zip code level in California. Using information on the use of maintenance therapies by each patient, we are able to stratify our data by asthma severity as well as by age. In general, we find a positive relationship between asthma and both PM10 and ozone levels. We find that prescriptions for quick-acting inhalers for children increases with PM10, and this relationship generally does not level off effect except for mild intermittent asthmatics. Ozone also generally increases the number of prescriptions for ages 5 through 17, as well as for severe asthmatics and some moderate asthmatics at younger ages. However, prescriptions and ozone show the opposite relationship for the adults and the very young (ages 0-4). |
| Keywords: | asthma, air pollution |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp200906&r=env |
| By: | Kelly B. Maguire; Robin R. Jenkins |
| Abstract: | There is substantial evidence that hazardous and solid waste facilities are located disproportionately in communities of color. While there are many potential explanations, one contributing factor might be that policy makers treat waste facilities differently, depending on the racial makeup of the facilities’ host communities. On a larger scale, policies targeted at waste facilities might also vary according to the racial make-up of entire constituencies (not just of host communities). This paper examines hazardous and solid waste taxes set by state governments and how those taxes vary according to the racial consistency of the entire state as well as within communities located inside a 3 kilometer radius of waste facilities. We also pose a set of alternative explanations for the variability in state waste taxes, including the extent of negative externalities, inter-jurisdictional competition, revenue-seeking behavior and the interplay between state and local governments. We find no evidence that policy makers consider the racial makeup of the community immediately surrounding the waste facilities when setting taxes. We do, however, find that the percent of the population in the state that is Black varies negatively with the tax rates even after controlling for income levels and voting behavior. Other important determinants of waste taxes are the percent of the state that votes, other state taxes, and inter-jurisdictional competition |
| Keywords: | hazardous waste, municipal solid waste, state waste taxes, environmental justice |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp200901&r=env |
| By: | Linda Fernandez; Glenn Sheriff |
| Abstract: | This paper analyzes border protection policies for managing risk of unintended imports of invasive species. Previous work typically assumes invasive species risk to be exogenous and commonly known. Here, we examine cases in which endogenous actions (exporter abatement) affect risk and allow for unobservable differences in exporter abatement cost. We show how the optimal inspection/penalty regime differs in such cases from that derived for homogeneous exporters. The information asymmetry also makes it optimal for the regulator to provide technical assistance grants even if it would be otherwise inefficient to do so. Further, we show that the fungibility of technical assistance with inputs in other sectors of the exporting economy significantly affects the qualitative nature of the optimal policy. If it has no outside value in the exporter's country, the optimal policy is characterized by a menu of contracts trading off higher tariffs with lower penalties for being caught with an invasive. If technical assistance can be used in other sectors of the exporter's economy, it introduces countervailing incentives that make it optimal for the regulator to use a uniform tariff/penalty combination for all exporters. |
| Keywords: | asymmetric information, inspection, international trade , invasive species |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp201003&r=env |
| By: | David Simpson |
| Abstract: | There has been great interest in recent decades in “ecosystem services”. One of the services most often mentioned is the retention of nutrients. I construct a simple model of agricultural land use under a regulatory requirement that nutrient loading cannot exceed a fixed ceiling develop three propositions. First, when the regulatory constraint is relatively weak there will be a corner solution in which no land is set aside to provide the service of nutrient retention. Second, for any given regulatory constraint there is in general a minimum amount of land that would be set aside to provide ecosystem services, regardless of the efficiency with which preserved land provides the nutrient retention function. Third, there is sort of paradox of value: the more valuable it is to set some land aside for nutrient retention, the less land in total would optimally be preserved for this purpose. I illustrate the implications of this model with an application to the Chesapeake Bay watershed. Estimates reported in the literature suggest that land retained in natural cover could prove very effective in retaining reactive nitrogen and other nutrients. If so, there is a sort of “good news/bad news” scenario for conservation advocates touting the importance of ecosystem services. The good news is that the ecosystem service of nitrogen retention is, in fact, likely to be very valuable. The bad news is that “a little may go a long way”: setting aside small areas of land may be sufficient. |
| Keywords: | Reactive nitrogen, diamonds and water paradox, Ecosystem services, constrained optimization, Land use regulation, corner solution |
| JEL: | Q24 Q53 Q58 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp201004&r=env |
| By: | BRECHET, Thierry (UniversitŽ catholique de Louvain, CORE and Louvain School of Management, Chair Lhoist Berghemans in Environmental Economics and Management, B-1348 Louvain-la-Neuve, Belgium); TSACHEV, Tsvetomir (Institute of Mathematics and Informatics, Bulgarian Academy of Sciences, 1113 Sofia, Bulgaria); VELIOV, Vladimir (ORCOS, Institute of Mathematical Methods in Economics, Vienna University of Technology, A-1040 Vienna, Austria) |
| Abstract: | In this paper we develop a vintage capital model for a firm involved in a market for tradable emission permits. We analyze both the firmÕs optimal investment plans and the market equilibrium. This allows us to scrutinize how firms use permits free endowment, and to highlight the implications of non-optimal uses both at the firm and at the market level. We provide a new rationale for the market of tradable permits not to be cost-efficient. The novel technical points in this context are the use a distributed (vintage) optimal control model of the firm, the use of optimality conditions for non-smooth problems, and the involvement of a nonlinear Fredholm integral equation of the first kind for the description of the equilibrium price of permits, and its practical meaning for market regularization. |
| Date: | 2010–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2010017&r=env |
| By: | Trond Bjørndal; Daniel Gordon; Mintewab Bezabih |
| Abstract: | The paper assesses the possibilities for rent generation in the North Sea herring fishery. A bioeconomic model combining fish population dynamics with the economic structure of the fishery is used in rent calculations. The model combines biological data with vessel-level economic data for UK pelagic trawlers, as well as preexisting parameters from the literature, in measuring for potential rent under optimal management conditions. The results are evaluated under various assumptions with regard to price, costs and discount rate. With negative estimated current rents for the herring fishery, substantial economic gains could be realized with optimal management of the fishery. |
| JEL: | Q22 Q28 |
| Date: | 2010–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:clg:wpaper:2010-14&r=env |
| By: | John Foster (School of Economics, The University of Queensland) |
| Abstract: | It is argued that the fact that economic systems are dissipative structures must be taken fully into account in economics if we are to understand the nature of the economic-ecological interface and how to deal with emergent environmental problems, such as global warming. Such problems are a product of economic growth, which is widely accepted to be the outcome of the acquisition and application of knowledge. Drawing upon disparate literatures within and outside economics, it is argued that economic growth should be more properly viewed as the outcome of a co-evolutionary process that involves the autocatalytic interaction of new knowledge and access of increasing amounts of free energy to do increasingly specialized forms of work. The conventional view is that energy is just a factor of production used increasingly as new knowledge is employed. The possibility of reverse causation is considered here. Specifically, the relevance of the ‘energy hypothesis,’ associated with Eric Schneider and his collaborators, is assessed. This hypothesis states that all dissipative structures have, as their primary objective, the reduction of accessible free energy gradients. It is concluded that such a hypothesis cannot be rejected in the context of economic behaviour and that this opens up an important research agenda for economists. It is argued that such research has to be interdisciplinary because our economic behaviour is driven by aspirational goals which are aesthetic constructions in the mind and strongly connected to our emotions. In this regard, recent neuropsychological literature, arguing that certain emotional dispositions are necessary before we can employ our cognitive capabilities effectively, is important to digest. Thus, the possibility exists that it is in the emotional domain of the mind that the energy hypothesis is operative. Aesthetic constructions are, thus, connecting agents in the knowledge-energy co-evolutionary process. Some of the macroeconomic evidence concerning the relationship between free energy use and economic growth is considered and it is found that the energy hypothesis cannot be rejected in the economic domain. However, considerably more research needs to be undertaken before any firm conclusions can be drawn. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:404&r=env |
| By: | Gloria Helfand; Ann Wolverton |
| Abstract: | In modeling how the U.S. market responds to changes in national fuel economy standards, the question of how consumers evaluate trade-offs between the cost of consuming more fuel economy than they would otherwise choose and the expected fuel savings that result is potentially quite important. Consumer vehicle choice models are a means to predict the change in vehicle purchase patterns, as well as the effects of these changes on compliance costs and consumer surplus. This paper surveys the literature on consumer choice models and finds a wide range in methods and results. A large puzzle raised is whether automakers build into their vehicles as much fuel economy as consumers are willing to purchase. This paper examines possible reasons why there may be a gap between the amount consumers are willing to pay for fuel economy and the amount that automakers provide. |
| Keywords: | consumer behavior, vehicle purchase decision |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp200904&r=env |
| By: | Abidoye, Babatunde; Herriges, Joseph A.; Tobias, Justin |
| Abstract: | Random Utility Maximization (RUM) models of recreation demand are typically plagued by limited information on environmental and other attributes characterizing the available sites in the choice set. To the extent that these unobserved site attributes are correlated with the observed characteristics and/or the key travel cost variable, the resulting parameter estimates and subsequent welfare calculations are likely to be biased. In this paper we develop a Bayesian approach to estimating a RUM model that incorporates a full set of alternative specific constants, insulating the key travel cost parameter from the influence of the unobserved site attributes. In contrast to estimation procedures recently outlined in Murdock (2006), the posterior simulator we propose (combining data augmentation and Gibbs sampling techniques) can be used in the more general mixed logit framework in which some parameters of the conditional utility function are random. Following a series of generated data experiments to illustrate the performance of the simulator, we apply the estimation procedures to data from the Iowa Lakes Project. In contrast to an earlier study using the same data (Egan \textit{et al.} \cite{eganetal}), we find that, with the addition of a full set of alternative specific constants, water quality attributes no longer appear to influence the choice of where to recreate. |
| Keywords: | nonmarket valuation; water quality; discrete choice |
| JEL: | C25 Q25 Q51 |
| Date: | 2010–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:31559&r=env |
| By: | Fabrizio Carmignani; Abdur Chowdhury (School of Economics, The University of Queensland) |
| Abstract: | We study the nexus between natural resources and growth in Sub-Saharan Africa (SSA) and find that SSA is indeed special: resources dependence retards growth in SSA, but not elsewhere. The natural resources curse is thus specific to SSA. We then show that this specificity does not depend on the type of primary commodities on which SSA specializes. Instead, the SSA specificity appears to arise from the interaction between institutions and natural resources. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:406&r=env |
| By: | Jeffrey Zabel; Dennis Guignet |
| Abstract: | Petroleum from leaking underground storage tanks (LUSTs) can contaminate local soil, and surface and groundwater. In some cases this can pose health risks to the surrounding population. Focusing on single family home sales from 1996-2007 in three Maryland counties, we use a hedonic house price model to estimate the willingness to pay to live father away from LUST sites. Particular attention is given to how property values are affected by leak and cleanup activity at a LUST site, the severity of contamination, the presence of a primary exposure path (i.e., private groundwater wells), and publicity surrounding a LUST site. The results suggest that although the typical LUST site may not significantly affect nearby property values, more publicized (and more contaminated sites) can impact surrounding home values by more than 10%. |
| Keywords: | hedonic model, LUST, groundwater contamination, Remediation benefits |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp201001&r=env |