nep-env New Economics Papers
on Environmental Economics
Issue of 2012‒05‒22
forty-one papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Indicators to Assess the Effectiveness of Climate Change Projects By Nancy McCarthy; Paul Winters; Ana María Linares; Timothy Essam
  2. The Carbon Dioxide Emissions of Firms: A Spatial Analysis By Matthew A. Cole; Robert J R Elliott; Toshihiro Okubo; Ying Zhou
  3. Toward low carbon mobility : Tackling road transport emissions By Rémi Russo; Virginie Boutueil
  4. Climate Change Policies in Poland: Minimising Abatement Costs By Balázs Égert
  5. The Political economy of environmental policy with overlapping generations By Karp, Larry; Rezai, Amon
  6. International Environmental Agreements with Mixed Strategies and Investment By Hong, Fuhsai; Karp, Larry
  7. Exiting the crisis in the right direction: A sustainable and shared prosperity plan for Europe By Spencer, Thomas; Lucas , Chancel; Emmanuel , Guerin
  8. Participation Games and international environmental agreements: a nonparametric model By Karp, Larry; Simon, Leo
  9. Domestic Pigouvian Taxation and Technological Spillovers under International Emissions Trading By Amanda Spisto
  10. "Guaranteed Green Jobs: Sustainable Full Employment" By Antoine Godin
  11. Designing and Constructing an Exemplar Zero Carbon Primary School in the City of Exeter, United Kingdom By Arthur Tatchell
  12. Do "green" state measures make import patterns "climate-friendly"? The case of the Asia-Pacific region By Martin Wermelinger
  13. Green Industrial Policy: Trade and Theory By Karp, Larry; Stevenson, Megan
  14. Narrowing the Gaps through Regional Cooperation Institutions and Governance Systems By Wyes, Heinrich-Wilhelm; Lewandowski, Michael
  15. Global Green Economy and Environmental Sustainability: a Coopetitive Model By David Carf\`i; Daniele Schilir\`o
  16. Is There a Pollution Haven Effect? Evidence from a Natural Experiment in China By Lu, Yi; Wu, Mingqin; Yu, Linhui
  17. Managing Excessive Predation in a Predator-Prey Setting: The Case of Piping Plovers By Melstrom, Richard T.; Horan, Richard D.
  18. Technological Change and Energy Demand in Europe By Kurt Kratena; Michael Wüger
  19. Non-Timber Forest Products and Rural Poverty Alleviation in Zambia By Mulenga, Brian P.; Richardson, Robert B.; Tembo, Gelson
  20. On the sources of risk preferences in rural Vietnam By Dang, Duc Anh
  21. Equilibrium management of fisheries with altruistic overlapping generations By Ekeland, Ivar; Karp, Larry; Sumaila, Rashid
  22. Investigating JEEM empirically: A story of co-authorship and collaboration By Schymura, Michael; Löschel, Andreas
  23. Independent Advisory Group on Sustainability: Final Report to the Inter-American Development Bank By Inter-American Development Bank (IDB)
  24. Fundamental questions on the economics of climate adaptation: Outlines of a new research programme By Heuson, Clemens; Gawel, Erik; Gebhardt, Oliver; Hansjürgens, Bernd; Lehmann, Paul; Meyer, Volker; Schwarze, Reimund
  25. Greenhouse Gas Emissions and Price Elasticities of Transport Fuel Demand in Belgium By Tom Schmitz
  26. Management Response to the Final Report of the Independent Advisory Group on Sustainability: From Managing Risks to Embracing New Opportunities By Inter-American Development Bank (IDB)
  27. Review and evaluation of existing vulnerability indicators for assessing climate related vulnerability in Africa By Jean-Baptiste, Nathalie; Kuhlicke, Christian; Kunath, Anna; Kabisch, Sigrun
  28. More than Mean Effects: Modeling the Effect of Climate on the Higher Order Moments of Crop Yields By Tack, Jesse B.; Harri, Ardian; Coble, Keith H.
  29. Non-Renewable but Inexhaustible – Resources in an Endogenous Growth Model By Martin Stürmer; Gregor Schwerhoff
  30. An Emissions Trading Scheme with Auctioning By Corina Haita
  31. Attribute attendance in choice experiments: Exploring issues of scale and attribute farming By Kragt, Marit Ellen
  32. Fiscal policy in Chile: Hindering sustainable development by favoring myopic growth By Ramón E. López; Eugenio Figueroa
  33. Macroeconomic Effects of the German Government’s Building Rehabilitation Program By Kronenberg, Tobias; Kuckshinrichs, Wilhelm; Hansen, Patrick
  34. Renewables in the energy transition: Evidence on solar home systems and lighting fuel choice in Kenya By Lay, Jann; Ondraczek, Janosch; Stöver, Jana
  35. Sharing a polluted river network By Dong, Baomin; Ni, Debing; Wang, Yuntong
  36. Do households export their recyclable waste? By de Jaeger, Simon; Eyckmans, Johan
  37. The Valuation of Clean Spread Options: Linking Electricity, Emissions and Fuels By Rene Carmona; Michael Coulon; Daniel Schwarz
  38. Natural and Industrial Disasters : Land Use and Insurance By Céline Grislain-Letrémy; Bertrand Villeneuve
  39. Waste demand in the context of waste price mimicking By de Jaeger, Simon; Eyckmans, Johan; Van Parys, Stefan; Verbeke, Tom
  40. Evaluating the efficiency of municipalities in collecting and processing municipal solid waste: A shared input DEA-model By Rogge, Nicky; de Jaeger, Simon
  41. Respuesta de la administración al informe final del grupo asesor independiente sobre sostenibilidad: De la gestión de riesgos al aprovechamiento de nuevas oportunidades By Banco Interamericano de Desarrollo (BID)

  1. By: Nancy McCarthy; Paul Winters; Ana María Linares; Timothy Essam
    Abstract: Determining reasonable indicators for climate change projects is complicated by the long-term horizon of both mitigation and adaptation project impacts as well as the uncertainty associated with climate change impacts. Actions taken now are often designed to have an impact in the uncertain and distant future and may not directly mitigate or adapt to climate change, but be taken as a step to prepare for future actions. Further complicating identification of indicators is the fact that there is a spectrum of projects, from the pure climate change-focused projects to those that provide climate change benefits as one part of an overall development program, and finally to those with only incidental indirect effects. The objective of this document is to discuss SMART (Specific, Measurable, Achievable, Realistic and Timely) indicators that can be used for assessing the impact of climate change projects, including those that seek to adapt to the expected impacts of climate change and those that promote low carbon emissions growth strategies to mitigate greenhouse gases.
    Keywords: Environment & Natural Resources :: Biodiversity & Natural Resources Management, Environment & Natural Resources :: Climate Change, impact evaluation guidelines
    JEL: H43 Q54 Q56
    Date: 2012–04
  2. By: Matthew A. Cole (Department of Economics, University of Birmingham); Robert J R Elliott (University of Birmingham); Toshihiro Okubo (Keio University, Japan); Ying Zhou (Aston University, UK)
    Abstract: In order to gain a greater understanding of firms' 'environmental behaviour' this paper explores the factors that influence firms' emissions intensities and provides the first analysis of the determinants of firm level carbon dioxide (CO2) emissions. Focussing on Japan, the paper also examines whether firms' CO2 emissions are influenced by the emissions of neighbouring firms and other possible sources of spatial correlation. Results suggest that size, the capital-labour ratio, R&D expenditure, the extent of exports and concern for public profile are the key determinants of CO2 emissions. Local lobbying pressure, as captured by regional community characteristics, does not appear to play a role, however emissions are found to be spatially correlated. This raises implications for the manner in which the environmental performance of firms is modelled in future.
    Date: 2012–05
  3. By: Rémi Russo (Chaire économie du climat - Chaire économie du climat); Virginie Boutueil (LVMT - Laboratoire Ville, Mobilité, Transport - Université Paris Est Marne-la-Vallée - Ecole des Ponts ParisTech - IFSTTAR UMR-T9404)
    Abstract: The ever-increasing trend to greater mobility has brought about a situation in which considerations of sustainable development might call for restrictions on the continued growth of the global mobility of people and goods. The transport sector is not the biggest contributor to greenhouse gas emissions, but accounts for a constant part in them and heavily depends on non-renewable fossil fuel. The prevalence of road transport in the sector's emissions makes it a priority in this necessary effort to move away from a carbon-intensive mobility. This study gives an overview of the options for progressing towards a low-carbon road transport. The solutions include necessary technological advances, and behavioural and organizational changes without which the benefits from these advances would be reduced. Economic instruments and public policies are needed to provide a vital support to this transition. In this regard, although emission abatements in the sector are generally considered to be costly, setting a price to CO2 emissions can prove an efficient way of adjusting relative prices according to comparative environmental benefits, thus favouring lower-carbon solutions. The options already experimented and the most credible ways forward give a glimpse of mobility's future, and food for thought to make it even better.
    Keywords: low-carbon mobility; CO2 emissions; carbon pricing; economic incentives; carbon tax; road transport; electric vehicle
    Date: 2011–09–01
  4. By: Balázs Égert
    Abstract: Poland is on track to meet its international greenhouse-gas emissions commitments. However, it will need to cut emissions significantly in the future, if the European Commission’s proposal on the Low Carbon Roadmap is adopted. Policies should ensure that the country’s substantial reduction potential, mainly linked to the energy sector’s high emissions intensity, and implying overall abatement costs above the EU-average, is realised in a least-cost fashion by imposing an economy-wide single carbon price. This stands in contrast with current explicit and implicit carbon prices, which vary widely across different sectors of the economy. Crucial to least-cost abatement is also a high responsiveness to the EU-ETS carbon price signal. While Poland has made good progress in complying with EU regulations related to the energy sector, the large share of public ownership and the lack of effective separation between electricity producers and distributors may blur the price signal for investment decisions in generation capacity. The isolation of the Polish electricity market implies a need for more investment in low-emission technologies in Poland to achieve a given emissions-reduction target, whereas a deeper integration with neighbouring electricity markets would spread the burden more efficiently across countries. The cost-efficiency advantage of uniform support to renewables via green certificates should be retained to minimise abatement costs. Government policies aimed at a higher share of nuclear power and natural gas from shale formations need to take fully into account tail risks and the short- and long-term environmental costs of the use of the former and fully consider environmental risks related to extraction of the latter. Energy efficiency policies can help to address market failure but should not be allowed to distort relative carbon prices. This Working Paper relates to the 2012 OECD Economic Review of Poland (<P>Politiques liées au changement climatique en Pologne : minimiser les coûts de réduction des émissions<BR>La Pologne est en voie de tenir ses engagements internationaux en matière d’émissions de gaz à effet de serre. Elle devra toutefois réduire sensiblement ses émissions à l’avenir si la proposition de la Commission européenne concernant la Feuille de route pour une économie sobre en carbone est adoptée. Les politiques mises en oeuvre devraient s’attacher à exploiter au moindre coût l’important potentiel de réduction des émissions du pays, principalement lié à la forte intensité d’émissions du secteur de l’énergie et qui implique des coûts globaux de réduction supérieurs à la moyenne de l’UE, en imposant un prix unique du carbone pour toute l’économie. Cet objectif contraste avec les prix explicites et implicites actuels du carbone, qui sont très variables selon les secteurs. Une forte sensibilité aux signaux de prix du carbone fournis par le SCEQE est également essentielle à la réduction des émissions au moindre coût. En dépit des progrès significatifs accomplis par la Pologne pour se conformer aux réglementations de l’UE dans le secteur énergétique, l’importance de l’actionnariat public et l’absence de séparation effective entre les producteurs et les distributeurs d’électricité peuvent brouiller le signal de prix pour les décisions d’investissement dans les capacités de production. L’isolement du marché polonais de l’électricité implique qu’il faudra procéder à de plus lourds investissements dans les technologies sobres en émissions pour atteindre un objectif donné de réduction des émissions, alors qu’une intégration plus poussée avec les marchés de l’électricité des pays voisins permettrait un partage plus efficient des coûts entre les différents pays. Il faudrait maintenir l’avantage coût-efficacité du système de soutien uniforme aux énergies renouvelables sous forme de certificats verts en vue de minimiser les coûts de réduction des émissions. Les politiques publiques destinées à accroître la part de l’énergie nucléaire et du gaz naturel à partir des gisements de schiste doivent tenir pleinement compte des risques d’événements extrêmes et des coûts environnementaux à court et long termes de l’utilisation du nucléaire, et intégrer pleinement les risques environnementaux potentiels induits par l’extraction des schistes bitumineux. Les politiques axées sur l’efficacité énergétique peuvent contribuer à remédier aux défaillances du marché, mais elles ne devraient pas aller jusqu’à fausser les prix relatifs du carbone. Ce Document de travail se rapporte à l’Étude économique de l’OCDE de la Pologne 2012 (
    Keywords: global warming, GHG emissions, environmental policies, carbon price, abatement cost, renewables, nuclear power, negative externalities, énergie renouvelable, réchauffement climatique, politiques environnementales, émissions de GES, coût d'abattement, énergies nucléaire, externalités négatives
    JEL: H23 Q41 Q42 Q48 Q52 Q53 Q54 Q58
    Date: 2012–04–24
  5. By: Karp, Larry; Rezai, Amon
    Abstract: A two-sector OLG model illuminates previously unexamined intergenerationaleffects of a tax that protects an environmental stock. A traded asset capitalizes the economic returns to future tax-induced environmental improvements, benefiting the current asset owners, the old generation. Absent a transfer, the tax harms the young generation by decreasing their real wage. Future generations benefit fromthe tax-induced improvement in environmental stock. The principalintergenerational conflict arising from public policy is between generationsalive at the time society imposes the policy, not between generations alive at different times. A Pareto-improving policy can be implemented under various political economy settings.
    Keywords: Natural Resources and Conservation, Economics, open-access resource, two-sector overlapping generations, resource tax, generational conflict, environmental policy, dynamic bargaining
    Date: 2012–05–07
  6. By: Hong, Fuhsai; Karp, Larry
    Abstract: We modify a canonical participation game used to study International Environmental Agreements (IEA), considering both mixed and pure strategies at the participation stage, and including a prior cost-reducing investment stage. The use of mixed strategies at the participation stage reverses a familiar result and alsoreverses the policy implication of that result: with mixed strategies, equilibriumparticipation and welfare is higher in equilibria that involve higher investment.
    Keywords: Natural Resources and Conservation, Social Sciences, International Environmental Agreement, climate agreement, participation games, investment, mixed strategy
    Date: 2012–05–08
  7. By: Spencer, Thomas; Lucas , Chancel; Emmanuel , Guerin
    Abstract: This paper investigates the synergies between the policy response to the European crisis and the green economy. We begin by examining the causes of the European crisis, including the potential role played by resource constraints, in particular the rise in oil prices 2004-2008. Then we develop a matrix to assess the synergies between the crisis response and the green economy. We survey the literature on three green economy instruments, namely environmental fiscal reform, green investment and environmental innovation. We then assess their coherence with and potential contribution to the current crisis response.
    Keywords: European crisis; green economy; european climate policy; environmental fiscal reform; green stimulus
    JEL: H54 Q56 H23 Q43
    Date: 2012–05–14
  8. By: Karp, Larry; Simon, Leo
    Abstract: We examine the size of stable coalitions in a participation game that has been used to model international environmental agreements, cartel formation, R&D spillovers, and monetary policy. The literature to date has relied on parametric examples; based onthese examples, a consensus has emerged that in this kind of game, the equilibrium coalition size is small, except possibly when the potential benefits of cooperation are also small. In this paper, we develop a non-parametric approach to the problem, and demonstrate that the conventional wisdom is not robust. In a general setting, we identify conditions under which the equilibrium coalition size can be large even when potential gains are large. Contrary to previously examined leading special cases, we show that reductions in marginal abatementcosts in an international environmental game can increase equilibrium membership, and we provide a measure of the smallest reduction in costs needed to support a coalition of arbitrary size.
    Keywords: Natural Resources and Conservation, Social Sciences, stable coalitions, participation games, International Environmental Agreement, climate agreement, trans-boundary pollution, investment spillovers
    Date: 2012–02–13
  9. By: Amanda Spisto (Faculty of Economics, University of Rome "Tor Vergata")
    Abstract: I model an economy featuring two representative firms in two countries, one in each country, where one firm innovates and generates technological unilateral spillovers. I analyze a partial equilibrium model in two different scenarios: in the first one, the innovating firm is under a domestic emissions taxation, while the other country does not implement any environmental policy. Government of the innovating firm introduces a tax credit aimed at incentivizing investment in cleaner abatement technologies. Finally, in the second scenario, the two countries take part to an international ETS. Comparisons among results from di¤erent scenarios are shown in the analytical part of the study. I conclude that, under specific assumpitons, overlapping regulations might be welfare improving.
    Keywords: Pigouvian Taxation, International ETS, policy mix, trans- boundary pollution, international technological spillover.
    JEL: Q58 H23
    Date: 2012–05–08
  10. By: Antoine Godin
    Abstract: In most economies, the potential of saving energy via insulation and more efficient uses of electricity is important. In order to reach the Kyoto Protocol objectives, it is urgent to develop policies that reduce the production of carbon dioxide in all sectors of the economy. This paper proposes an analysis of a green-jobs employer-of-last-resort (ELR) program based on a stock-flow consistent (SFC) model with three productive sectors (consumption, capital goods, and energy) and two household sectors (wage earners and capitalists). By increasing the energy efficiency of dwellings and public buildings, the green-jobs ELR sector implies a shift in consumption patterns from energy consumption toward consumption of goods. This could spur the private sector and thus increase employment. Lastly, the jobs guarantee program removes all involuntary unemployment and decreases poverty while lowering carbon dioxide emissions. The environmental policy proposed in this paper is macroeconomic and offers a structural change of the economy instead of the usual micro solutions.
    Keywords: Full Employment; Green Jobs; Stock-flow Consistent
    JEL: E24 J08 Q48
    Date: 2012–05
  11. By: Arthur Tatchell
    Abstract: Montgomery Primary School is the UK's first "zero carbon" in use and "climate-change-ready" exemplar school built to the Passivhaus standard. Its design and solar generating electrical power plant enable its electricity bill to be zero each year.
    Keywords: climate change, zero carbon, sustainable, passive design, energy demand
    Date: 2012–04
  12. By: Martin Wermelinger
    Abstract: This paper estimates to what extent "green" crisis-era measures have an impact on the "climate-friendliness" of imports in the Asia-Pacific region. Testable predictions and the empirical strategy are derived from the seminal paper of Eaton and Kortum (2002). The empirical results show that at the intensive margin implemented "green" measures are associated with an increase of sourcing from more rather than less energy intensive countries. One reason for this surprising result may be that governments have presented the state interventions as being "green" although the main purpose was not the environment. At the extensive margin, results are slightly more promising. The implementation of "green" measures seems to decrease the likelihood that imports are sourced from a relatively more energy intensive origin. However, the results are not very strong as to statistical and economic significance. In sum, only limited evidence for environmental benefits of "green" crisis-era interventions through the import channel exist. The implementation of such measures may in fact be associated with an environmental degradation of imports. Moreover, supplier countries being "close" competitors to the interventionist country (in terms of technology levels) relatively loose import share if discriminatory "green" measures are implemented. Stated differently, the alleged "green" measures protect domestic against foreign suppliers with similar technology levels.
    Keywords: international trade, trade policy, green growth
    JEL: F13 F18
    Date: 2012–05
  13. By: Karp, Larry; Stevenson, Megan
    Abstract: This paper studies the reality and the potential for green industrial policy. We provide a summary of the green industrial policies, broadly understood, for five countries. We then consider the relation between green industrial policies and trade disputes, emphasizing theBrazil-US dispute involving ethanol and the broader US-China dispute. The theory of public policy provides many lessons for green industrial policy. We select four of these lessons, involving the Green Paradox, the choice of quantities versus prices with endogenous investment, the coordination issues arising from emissions control, and theability of green industrial policies to promote cooperation in reducing a global public bad like carbon emissions.
    Keywords: Natural Resources and Conservation, Economics, green industrial policy, trade conflicts, green paradox, asymmetric information, coordination games, participation games
    Date: 2012–01–27
  14. By: Wyes, Heinrich-Wilhelm (Asian Development Bank Institute); Lewandowski, Michael (Asian Development Bank Institute)
    Abstract: Regional governance systems and national frameworks to address climate change and accelerate green growth in Asia are reviewed and tools to address climate change are outlined. Options for regional level political institutions and financial architecture needed to fulfill voluntary pledges and programs are suggested and potentials, options, and challenges regarding monitoring, reporting, and verification systems are analyzed. In conclusion, policy measures for adaption and mitigation to climate change are provided.
    Keywords: climate change; green growth; asia
    JEL: H87
    Date: 2012–05–08
  15. By: David Carf\`i; Daniele Schilir\`o
    Abstract: This paper provides a coopetitive model for a global green economy, taking into account the environmental sustainability. In particular, we propose a differentiable coopetitive game G (in the sense recently introduced by D. Carf`{\i}) to represent a global green economy interaction, among a country c and the rest of the world w. Our game G is a linear parametric (Euclidean) perturbation of the classic Cournot duopoly. In the paper we offer the complete study of the proposed model and in particular a deep examination of its possible coopetitive solutions.
    Date: 2012–05
  16. By: Lu, Yi; Wu, Mingqin; Yu, Linhui
    Abstract: In this paper, we investigate whether there is a pollution haven effect, specifically, the effect of environmental regulations on firm location. Our identification uses the Two Control Zones (TCZ) policy implemented by the Chinese government in 1998. The difference-in-differences (DID) estimation shows that cities with tougher environmental regulations attract less foreign direct investment (FDI). Specifically, being listed as a TCZ city causes the amount of FDI to drop by 41%. Our results are robust to various robustness checks on the validity of the DID estimation and other estimation concerns.
    Keywords: Pollution haven effect; Difference-in-differences estimation; Two control zones; Natural experiment
    JEL: D21 L25 R11
    Date: 2012–05
  17. By: Melstrom, Richard T.; Horan, Richard D.
    Abstract: Ecosystems involve interspecies interactions that can be influenced by human interventions. Prior work shows interventions that ignore these interactions cause efficiency-reducing ecosystem externalities. We show inefficiencies may also be attributable to nature, via interspecies interactions generating excessive competition or predation. Ecosystem management therefore may involve correcting both ecological and economic inefficiencies. We explore ecosystem management to correct ecological inefficiencies from predation. The inefficiencies are shown to be akin to anthropogenic externalities arising when humans harvest resources under open access conditions, and so the solution is to “regulate” predators. Viewing the ecological inefficiencies in this manner facilitates the choice of controls. We examine predator removal and predator exclosures that shelter prey from predation. Using a numerical example of the Great Lakes Piping Plover, an endangered bird, and Merlins, a falcon that predates on plovers, we find using predator exclosures can yield a win-win outcome that increases both prey and predator populations.
    Keywords: bioeconomics, wildlife management, endangered species, open access, predator control, predator removal, exclosures, Piping Plovers, Merlins, Environmental Economics and Policy,
    Date: 2012
  18. By: Kurt Kratena (WIFO); Michael Wüger (WIFO)
    Abstract: The aim of this paper is the econometric analysis of embodied and induced technological change that reduces energy input and CO2 emissions in production. For this purpose, a model of unit costs and factor demand for 35 industries in 23 EU countries has been set up, based on the World Input-Output Database (WIOD). The deterministic trend usually applied for describing the factor bias for energy is replaced by a mixed term of energy efficiency of physical production capacity and a trend in three energy intensive industries. This new variable for energy saving technological change is linked to the vintage structure of installed capital. By this link technological change becomes induced, if capital and energy are substitutes. If energy and capital are complements, this technological change can only be enforced by measures that accelerate the path of renovating the capital stock. Within the three energy intensive industries we identify one, where induced technological change is energy saving, but energy and capital are complements (pulp and paper), one where energy and capital are very weak substitutes, but technological change is energy using (non-metallic minerals) and one, where energy and capital are substitutes and technological change is energy saving (basic metals). Only in this latter case, price induced technological change can contribute significantly to fossil energy and emission reduction.
    Keywords: embodied and induced technological change, vintage models, emission mitigation policies
    Date: 2012–05–08
  19. By: Mulenga, Brian P.; Richardson, Robert B.; Tembo, Gelson
    Abstract: Forests support rural livelihoods and food security in many developing countries by providing critical sources of food, medicine, shelter, building materials, fuels, and cash income. The increasing demand for forest products has enhanced rural livelihoods and enabled the expansion of domestic markets, particularly in urban areas where woodfuel and other forest resources are scarce. Therefore, non-timber forest products may offer sources of income and opportunities for poverty alleviation in both rural and urban areas. In Zambia, most rural households residing near forests extract a range of forest products for both direct consumption and trade (including food products and wood for cooking fuel and charcoal production), and forest products are among the top sources of household income in some rural areas. Households engage in trade of non-timber forest products (NTFPs) because of low capital requirements and relatively easy entry to markets. NTFPs help bridge seasonal gaps in income for many farmers, and they provide a safety net for many rural households during years with low crop yields.
    Keywords: Food security, resource economics, non-timber forest products, poverty, Zambia, Community/Rural/Urban Development, Environmental Economics and Policy, Food Security and Poverty, Resource /Energy Economics and Policy,
    Date: 2012–04
  20. By: Dang, Duc Anh
    Abstract: In this paper, I provide a new empirical evidence that natural environment can shape individual risk preferences. By combining historical data on climate variation and contemporary survey questions on risk aversion, I find that risk aversion is significantly different for people who live in areas that have suffered high frequency of natural disasters. In particular, individuals highly affected by climate volatility show a long term risk aversion. The finding also supports the hypothesis that when people used to live in risky environment, an incremental increase in risk affects their risk preferences less.
    Keywords: Climate variation, risk aversion, Vietnam
    JEL: D03 O53 Q54
    Date: 2012–04
  21. By: Ekeland, Ivar; Karp, Larry; Sumaila, Rashid
    Abstract: We imbed a classic fishery model, where the optimal policy follows a Most Rapid Approach Path to a steady state, into an overlapping generations setting. The current generation discounts future generations’ utility flows at a rate possibly different from the pure rate of time preference used to discount their own utility flows. The resulting model has non-constant discount rates, leading totime inconsistency. The unique Markov Perfect equilibrium to this model hasa striking feature: provided that the current generation has some concern forthe not-yet born, the equilibrium policy does not depend on the degree of thatconcern.
    Keywords: Agriculture, Agriculture Operations, and Related Sciences, Natural Resources and Conservation, fisheries management, sustainable development, renewable resources, time inconsistency, hyperbolic discounting
    Date: 2011–12–10
  22. By: Schymura, Michael; Löschel, Andreas
    Abstract: We examine the incidence and extent of co-authorship and intellectual collaboration in the leading journal of environmental and resource economics: the Journal of Environmental Economics and Management. Previous studies of general economic journals have offered empirical evidence for the fact that intellectual collaboration is most prevalent in the field of environmental and resource economics. However, no previous study has examined this finding more carefully. This is a gap in the literature we hope to fill. Accordingly, we investigate all 1436 papers published in JEEM from 1974 until 2010 with respect to potential drivers of co-authorship. We start with a simple descriptive analysis in order to depict the most important trends in the past 36 years. We then employ empirical methods to test several hypotheses that are commonly used to analyze the structure of co-authorship. However, we do not stick to the commonly used hypotheses but investigate also other potentially relevant drivers of co-authorship as e.g. the acknowledgment of external funding, the gender of the authors or the geographical location. We find empirical support for the rising incidence of co-authorship with increasing complexity of the field of economics and the competition for external funding. As research has become more demanding in terms of both disciplinary and - especially in the field of environmental and resource economics - interdisciplinary skills, the likelihood of collaborative research and jointly written publications increased. --
    Keywords: environmental and resource economics,co-authorship,production of knowledge
    JEL: Q0 Q50
    Date: 2012
  23. By: Inter-American Development Bank (IDB)
    Abstract: The Independent Advisory Group on Sustainability (IAG) is pleased to submit this final report to the Board of Executive Directors and Management of the Inter-American Development Bank (IDB). In keeping with our mandate, the Advisory Group undertook a strategic review of the Bank's capacity to address critical environmental and social issues effecting sustainable development in Latin America and the Caribbean through its Environment and Safeguards Compliance Policy (OP703). Our findings and recommendations are rooted in a deep appreciation of the Bank's commitment to fostering environmentally sustainable growth, social equity, and the reduction of poverty in Latin America and the Caribbean and of the historic role the Bank has played as a leading development partner to its member countries.
    Keywords: Environment & Natural Resources, Private Sector :: CSR, Institutional Policy Background Paper
    Date: 2011–02
  24. By: Heuson, Clemens; Gawel, Erik; Gebhardt, Oliver; Hansjürgens, Bernd; Lehmann, Paul; Meyer, Volker; Schwarze, Reimund
    Abstract: In view of the failure of international negotiations on climate protection and the improbability of a trend reversal in the climate changes that have already occurred, the option of climate change adaptation is becoming more and more important in climate change policy. A large number of countries have already initiated a process of adaptation by drafting strategies or catalogues of measures. Hence there is an urgent need to support this process at the scientific level. The discipline of economics has a key role to play in this context, especially with regard to the design, evaluation and selection of adaptation measures and instruments. The still relatively young field of research into the economics of adaptation is growing at a considerable pace and already exhibits a wide range of methodological approaches and research questions. Against this background, the present report aims to undertake a systematic structuring and synthesis of the individual research studies in order to provide political actors with an overview of the scientific recommendations and findings they must consider when making decisions. Another aim of the report is to identify open research questions and, based on this, to outline key pointers for the future direction of the research into the economics of climate adaptation. --
    Keywords: climate change,climate policy,adaptation,barriers,governance,instruments,literature overview,economic research,goal setting
    Date: 2012
  25. By: Tom Schmitz
    Abstract: Since 1990, Belgium has managed to bring down greenhouse gas emissions in most domains of economic activity. Road transport, as in many other countries, is a notable exception to this pattern: emissions have steadily increased, driven by an ever higher consumption of petrol and diesel. Even though the current overall performance will probably be sufficient to reach the reduction objectives of the Kyoto protocol, transport emissions thus need to be targeted in the future. One possible measure aimed at reducing them, an increase in fuel taxes, is examined in detail in this paper. The success of such a policy depends on the price elasticity of fuel demand, and therefore, the latter is estimated for Belgium and other European countries. The elasticities obtained are relatively small: in Belgium, for instance, a 10% increase in prices would cause consumption to fall by around 1.8% in the short-run and 2.3% in the medium run. Tax increases alone will thus certainly be insufficient for cutting emissions at this time horizon. Nevertheless, as a supporting measure in a more general reduction strategy, they could still yield substantial advantages. This Working Paper relates to the 2011 OECD Economic Review of Belgium (<P>Émissions de gaz à effet de serre et élasticités-prix de la demande de carburants en Belgique<BR>Depuis 1990, la Belgique a réussi à réduire ses émissions de gaz à effet de serre (GES) dans la plupart des domaines d'activité économique. Comme dans de nombreux autres pays, le transport routier constitue à cet égard une exception notable : ses émissions ont régulièrement augmenté, sous l'effet d'une consommation toujours croissante d'essence et de gazole. Même si les performances globales actuelles seront sans doute suffisantes pour atteindre les objectifs de réduction des émissions de GES du Protocole de Kyoto, un objectif doit donc être défini pour les futures émissions des transports. Une des mesures envisageables pour les faire diminuer, une hausse des taxes sur les carburants, est examinée de manière approfondie dans ce document. La réussite d'une telle mesure dépend de l'élasticité-prix de la demande de carburants, ce qui nous amène à estimer celle-ci pour la Belgique et d'autres pays européens. Les élasticités obtenues sont relativement modestes : en Belgique, par exemple, une hausse des prix de 10 % entraînerait un recul de la consommation de l'ordre de 1.8 % à court terme, et de 2.3 % à moyen terme. De simples augmentations des taxes seront donc certainement insuffisantes pour réduire les émissions à cet horizon. Néanmoins, en tant que mesures d'accompagnement s'inscrivant dans le cadre d'une stratégie plus générale de réduction des émissions de GES, elles pourraient avoir des retombées positives substantielles. Ce Document de travail se rapporte à l’Étude économique de l’OCDE de la Belgique 2011 (
    Keywords: Belgium, road transport, greenhouse gas emissions, elasticity of fuel demand, fuel taxes, Belgique, transport routier, émissions de gaz à effet de serre, élasticité de la demande de carburants, taxes sur les carburants
    JEL: Q42 Q48 Q58
    Date: 2012–04–26
  26. By: Inter-American Development Bank (IDB)
    Abstract: The IAG presented its Final Report to the Committee of the Whole and to the Management in February 2011. The report concluded that the environmental and social safeguards provided for in the Environment and Safeguard Compliance Policy were adequate. However the report recommended a number of additional measures in order to strengthen the Bank's capacity to meet the commitments of IDB-9 and maintain a leadership role in the region. These recommendations mainly seek to mainstream sustainability considerations in the Bank's work and ensure better effectiveness in the implementation of the safeguards. In response to the recommendations included in the report, Management created an internal working group to determine, with the benefit of independent expertise, the best way to incorporate appropriate activities for this purpose. This document presents the working group's response to the recommendations of the report. Following a summary of the IAG Sustainability report, this document describes the mandate and work of the IDB Working Group on Sustainability and presents the action plan and implementation strategy developed by the Working Group.
    Keywords: Environment & Natural Resources, Private Sector :: CSR, Institutional Policy Background Paper
    Date: 2011–12
  27. By: Jean-Baptiste, Nathalie; Kuhlicke, Christian; Kunath, Anna; Kabisch, Sigrun
    Abstract: The report provides a first theoretical setting on the concept of vulnerability, vulnerability assessment and indicators in order to identify and evaluate relevant assessment measures for the CLUVA project. It describes a set of identified indicators which serves as a starting point for selecting appropriate indicators for assessing climate related vulnerability. This is a contribution to the process of evolution of vulnerability assessment measures and to ensure a more robust and sustainable results in CLUVA. This report should therefore be seen as an initial conceptual proposition which needs to be tested empirically, peer-reviewed and discussed among experts, PhD candidates and practitioners working in the field of risk and vulnerability assessment. Only then can it be refined and fed back for further conceptual development. --
    Date: 2011
  28. By: Tack, Jesse B.; Harri, Ardian; Coble, Keith H.
    Abstract: The objective of this article is to propose the use of moment functions and maximum entropy techniques as a flexible way to estimate conditional crop yield distributions. We present a moment based model that extends previous approaches in several dimensions, and can be easily estimated using standard econometric estimators. Upon identification of the yield moments under a variety of climate and irrigation regimes, we utilize maximum entropy techniques to analyze the distributional impacts from switching regimes. We consider the case of Arkansas, Mississippi, and Texas upland cotton to demonstrate how climate and irrigation affect the shape of the yield distribution, and compare our findings to other moment based approaches. We empirically illustrate several advantages of our moment based maximum entropy approach, including flexibility of the distributional tails across alternative irrigation and climate regimes.
    Keywords: risk, climate change, moments, entropy, yield, cotton, Crop Production/Industries, Production Economics, Research Methods/ Statistical Methods, Risk and Uncertainty,
    Date: 2012
  29. By: Martin Stürmer (Institute for International Economic Policy (IIW), University of Bonn); Gregor Schwerhoff (Max Planck Institute for Research on Collective Goods, Bonn)
    Abstract: This paper proposes an endogenous growth model with an essential non-renewable resource, where economic growth enables firms to invest in innovation in the extraction technology and to allocate more capital to resource extraction. Innovation in the extraction technology offsets the deterioration of ore qualities and keeps the production costs of the non-renewable resource constant. Aggregate output as well as production and use of the non-renewable resource increase exponentially. Our model explains the long-run trends of non-renewable resource prices and world production over more than 200 years. If historical trends in technological progress and in the deterioration of ore qualities continue, it is in the realm of possibility that non-renewable resources are de facto inexhaustible. Our results suggest that the industrialization in China and other emerging economies contributes to keeping non-renewable resource prices constant in the long run.
    Keywords: Non-Renewable Resources, Endogenous Growth, Extraction Technology
    JEL: O44 Q32 Q33
    Date: 2012–05
  30. By: Corina Haita
    Abstract: I propose an emissions trading scheme which mimics the upcoming third phase design of the European Union Emissions Trading Scheme, with auction as initial allocation method. Risk-averse polluters and speculators, participating in the scheme, respond idiosyncratically to an economy-wide shock. I find that a polluter’s willingness to pay for permits in the auction increases in her risk aversion and in the shock volatility if aggregated and individual sensitivities to this shock satisfy certain conditions. For a particular region, of low sensitivity and high emissions rate, the polluter’s willingness to pay for permits decreases in the expected secondary market price. Numerical simulations show that if all polluters emit at the same rate, the secondary market facilitates a wealth transfer from the most sensitive to the least sensitive polluters. The risk aversion exacerbates polluters’ sensitivity to the shock when forming their valuations: for the same sensitivity level, the risk aversion decreases their valuations. The model predicts that, in a scheme with polluters only and homogeneous responses to the shock, the secondary market trading volume decreases in the uncertainty faced by the economy.
    Date: 2012–05–07
  31. By: Kragt, Marit Ellen
    Abstract: An increasing number of choice experiment studies has shown that not all respondents consider all attributes when choosing their preferred alternative in the presented choice sets. Not accounting for this so-called ‘attribute non-attendance’ will lead to bias parameter estimates, and can hence increase or reduce estimates of willingness to pay. In this study, three aspects of attribute non-attendance are investigated. First, scale heterogeneity models are specified to test whether attribute attendance affects the variance of the error term. Second, the concordance between stated non-attendance and inferred non-attendance is assessed by comparing answers to supplementary questions with results from equality constrained latent class models. Finally the impacts of varying attribute descriptions or attribute levels on attendance is analysed. Results show that model fit is significantly improved when attribute non-attendance is taken into account, that but welfare estimates are not significantly different. The scale heterogeneity models reveal significant individual heterogeneity in scale, which decreases when incorporating ANA in the model specification. There is little overlap between stated and inferred non-attendance. Finally, describing a rare species attribute in terms of “number of species lost” attracts more attention to that attribute compared to “number of species present”, and that using a higher price vector may reduce attendance to the cost attribute.
    Keywords: Attribute Attendance, Choice Experiments, Framing Effects, Mixed Logit Models, Latent Class Models, Scale Heterogeneity, Environmental Economics and Policy, Institutional and Behavioral Economics, Q51, Q57,
    Date: 2012–05–02
  32. By: Ramón E. López; Eugenio Figueroa
    Abstract: We show that the tax system in Chile is insufficient, inefficient and inequitable. Insufficient because it does not yield enough revenues for the state to promote human capital development and to face poverty in a more comprehensive way; inefficient because it is highly unbalanced causing most of the tax burden to be concentrated in very few taxes while neglecting the use of the least distortion-prone tax mechanisms available; inequitable because it forces the middle and low income groups to shoulder most of the tax burden while allowing the super rich to get away paying one of the lowest tax rates among middle income and advanced countries. The consequence of the combined effect of the two sides of this fiscal policy - taxation and public expenditures - is to artificially increase the capital intensity of the economy, to deepen its dependency on natural resource based and environmentally dirty industries, to handicap the creation of human capital and to delay the evolution towards a knowledge-based economy. Fiscal policy has thus negatively affected the long run growth potential of the economy and has contributed to perpetuate a highly unequal distribution of wealth and to exacerbate environmental and natural resource degradation.
    Date: 2011–11
  33. By: Kronenberg, Tobias; Kuckshinrichs, Wilhelm; Hansen, Patrick
    Abstract: The German government maintains programs providing financial support for the rehabilitation of buildings with the aim of reducing energy consumption and greenhouse gas emissions in the building sector. Lately, these programs have received additional attention for three reasons: First, the government’s new Energy Concept from 2010 incorporates a substantial expansion of building rehabilitation activities. Second, the programs have been used as a tool for macroeconomic stabilization in the wake of the 2008/2009 financial crisis. Third, the government is concerned about the public deficit and all kinds of public expenditure are coming under increasing scrutiny. The aim of our paper is to contribute to a fact-based discussion of the costs and benefits of the building rehabilitation program. We develop an extended input-output model (STEIN) to estimate the macroeconomic effects of the rehabilitation measures that received funding and how they affect the public deficit, focusing on the revenue from income taxes and social security contributions (SSC) as well as taxes on products and production. Our findings indicate that the programs induce substantial public revenue mainly through income taxes and SSC which have to be weighed against the program cost. We also estimate the distribution of public cost and public revenue between different levels of government (national level, federal state level and municipality level). If the rehabilitation measures do not crowd out other investment projects, the net effect on the public deficit turns out to be positive.
    Keywords: Energy efficiency; CO2 emissions; building rehabilitation; economic stimulus
    JEL: E62 C67 Q4
    Date: 2012–05–15
  34. By: Lay, Jann; Ondraczek, Janosch; Stöver, Jana
    Abstract: We study the determinants of households' choices of lighting fuels in Kenya including the option of using solar home systems (SHS). Our goal is to add new evidence on the factors that influence the introduction and adoption of decentralized and less carbon-intensive energy sources in developing countries, and, more generally, to the empirical debate on the energy ladder. We capitalize on a unique representative survey on energy use and sources from Kenya, one of the few relatively well-established SHS markets in the world. Our results reveal some very interesting patterns of the fuel transition in the context of lighting fuel choices. While we find clear evidence for a cross-sectional energy ladder, the income threshold for modern fuel use - including solar energy use - to move beyond traditional and transitional fuels is very high. Income and education turn out to be key determinants of SHS adoption, but we also find a very pronounced effect of SHS clustering, i.e. the prevalence of SHS systems in the proximity of a potential user increases the likelihood of adoption. In addition, we do not find a negative correlation between grid access and SHS use. --
    Keywords: renewable energy,household fuel choice,lighting fuel choice,solar power use,solar home systems,Kenya,energy ladder,KIHBS
    JEL: D12 O12 Q42
    Date: 2012
  35. By: Dong, Baomin; Ni, Debing; Wang, Yuntong
    Abstract: A polluted river network is populated with agents (e.g., firms, villages, municipalities, or countries) located upstream and downstream. This river network must be cleaned, the costs of which must be shared among the agents. We model this problem as a cost sharing problem on a tree network. Based on the two theories in international disputes, namely the Absolute Territorial Sovereignty (ATS) and the Unlimitted Territorial Integrity (UTI), we propose three different cost sharing methods for the problem. They are the Local Responsibility Sharing (LRS), the Upstream Equal Sharing (UES), and the Downstream Equal Sharing (DES), respectively. The LRS and the UES generalize Ni and Wang ("Sharing a polluted river", Games Econ. Behav., 60 (2007), 176-186) but the DES is new. The DES is based on a new interpretation of the UTI. We provide axiomatic characterizations for the three methods. We also show that they coincide with the Shapley values of the three different games that can be defined for the problem. Moreover, we show that they are in the cores of the three games, respectively. Our methods can shed light on pollution abatement of a river network with multiple sovereignties.
    Keywords: River network; Water pollution; Cost sharing; the Shapley value
    JEL: D62 C71 D61
    Date: 2012–04–01
  36. By: de Jaeger, Simon (Hogeschool-Universiteit Brussel (HUB), KULeuven); Eyckmans, Johan (Hogeschool-Universiteit Brussel (HUB), KULeuven)
    Abstract: Local policy makers in Flanders often claim that an important fraction of waste presented at their municipal recycling centres originates from nearby municipalities. If neighbouring municipalities charge significantly different prices at their recycling centres, residents indeed have an incentive to present their waste at the cheapest location. As the prices often do not reflect the true processing costs for the municipalities, waste imports are perceived as problematic by the local policy makers. In this paper we present a simple theoretical model of consumers’ demand for waste disposal facilities and test the predictions from the model using a set of spatial econometric tools. Our estimation results indicate that bulky household refuse quantities depend on the prices charged in neighbouring municipalities. For other waste fractions like demolition waste, garden waste, scrap metal and wood waste we find no proof of waste export. This is not surprising as we argue some waste fractions are more sensitive to spatial differences in prices than others.
    Keywords: waste tourism, municipal solid waste, recycling centre
    Date: 2012–03
  37. By: Rene Carmona; Michael Coulon; Daniel Schwarz
    Abstract: The purpose of the paper is to present a new pricing method for clean spread options, and to illustrate its main features on a set of numerical examples produced by a dedicated computer code. The novelty of the approach is embedded in the use of structural models as opposed to reduced-form models which fail to capture properly the fundamental dependencies between the economic factors entering the production process.
    Date: 2012–05
  38. By: Céline Grislain-Letrémy (CREST); Bertrand Villeneuve (CREST, Université Paris-Dauphine)
    Keywords: natural disasters, industrial disasters, insurance, land use regulation, hazard maps
    JEL: H23 G22 R52 Q54
    Date: 2011–12
  39. By: de Jaeger, Simon (Hogeschool-Universiteit Brussel (HUB), KULeuven); Eyckmans, Johan (Hogeschool-Universiteit Brussel (HUB), KULeuven); Van Parys, Stefan (Nationale Bank Van België, UGent); Verbeke, Tom (Hogeschool-Universiteit Brussel (HUB), UGent)
    Abstract: In this paper we set up a two-stage theoretical model of consumers’ demand and municipalities’ pricing policy for residual municipal solid waste collection and processing. Local policy makers set the local residual municipal solid waste price in order to maximize welfare in the municipality net of waste disposal costs, potential perks and political costs associated with high waste tax rates. As consumers might use prices in neighboring municipalities as a yardstick when judging the local politicians performance, our theoretical model includes the possibility for municipalities to take account of other municipalities’ waste prices. Using spatial econometric estimation methods to test the predictions of our model on Flemish data shows that local jurisdictions do indeed interact strategically with each other when deciding on waste prices. As expected this interaction is stronger when municipalities are members of the same municipal waste joint venture
    Date: 2012–03
  40. By: Rogge, Nicky (Hogeschool-Universiteit Brussel (HUB), KULeuven); de Jaeger, Simon (Hogeschool-Universiteit Brussel (HUB), KULeuven)
    Abstract: This paper proposed an adjusted “shared-input” version of the popular efficiency measurement technique Data Envelopment Analysis (DEA) that enables evaluating municipality waste collection and processing performances in settings in which one input (waste costs) is shared among treatment efforts of multiple municipal solid waste fractions. The main advantage of this version of DEA is that it not only provides an estimate of the municipalities overall efficiency but also estimates of the municipalities’ efficiency in the treatment of the different fractions of municipal solid waste (MSW). To illustrate the practical usefulness of the shared input DEA-model, we apply the model to data on 293 municipalities in Flanders, Belgium, for the year 2008.
    Keywords: Municipal solid waste, Cost efficiency, Data Envelopment Analysis
    Date: 2012–03
  41. By: Banco Interamericano de Desarrollo (BID)
    Abstract: En febrero de 2011, el GAI presentó a la Comisión General y la Administración su Informe Final, en el que se llegó a la conclusión de que las salvaguardias ambientales y sociales previstas en la Política de Medio Ambiente y Cumplimiento de Salvaguardias eran adecuadas, pero se recomendaron no obstante medidas adicionales para fortalecer la capacidad del Banco de cumplir los compromisos del Noveno Aumento y mantener una función de liderazgo en la región. A través de esas recomendaciones se procura principalmente integrar las consideraciones sobre sostenibilidad en la labor del Banco e implementar más eficazmente las salvaguardias. Como respuesta a las recomendaciones incluidas en el informe la Administración creó un grupo de trabajo interno para determinar, con el aporte de conocimientos especializados de carácter independiente, la mejor manera de incorporar actividades adecuadas para esos fines. En este documento se presenta la respuesta del grupo de trabajo a las recomendaciones del informe. Tras un resumen del informe del GAI sobre sostenibilidad, en el presente documento se exponen el mandato y la labor del Grupo de Trabajo del BID sobre Sostenibilidad, así como el plan de acción y la estrategia de ejecución elaborados por dicho grupo de trabajo.
    Keywords: Medio ambiente y recursos naturales, Sector privado :: Responsabilidad social empresarial, Institutional Policy Background Paper
    Date: 2011–12

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