nep-env New Economics Papers
on Environmental Economics
Issue of 2014‒01‒24
twenty-two papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Environmental Tax Reforms in Switzerland A Computable General Equilibrium Impact Analysis By Christoph Böhringer; André Müller
  2. Marginal abatement cost curves and the optimal timing of mitigation measures By Adrien Vogt-Schilb; Stéphane Hallegatte
  3. The Short-Term Population Health Effects of Weather and Pollution: Implications of Climate Change By Ziebarth, Nicolas R.; Schmitt, Maike; Karlsson, Martin
  4. The Strategic Value of Carbon Tariffs By Christoph Böhringer; Jared C. Carbone; Thomas F. Rutherford
  5. On the stationarity of per capita carbon dioxide emissions over a century By Maria Christisou; Theodore Panagiotidis; Abhijit Sharma
  6. Sharing the burden for climate change mitigation in the Canadian federation By Christoph Böhringer; Nicholas Rivers; Tom F. Rutherford; Randall Wigle
  7. Linkage of Greenhouse Gas Emissions Trading Systems: Learning from Experience By Matthew Ranson; Robert Stavins
  8. To Sell Or Not To Sell: The Impacts of Pollution on Home Transactions By Dennis Guignet
  9. Environmental taxation, health and the life-cycle By Nathalie Mathieu-Bolh; Xavier Pautrel
  10. Determinants of the price-premium for Green Energy: Evidence from an OECD cross-section By Kiran Krishnamurthy, Chandra; Kriström, Bengt
  11. CAPRI long-term climate change scenario analysis: The AgMIP approach By Heinz-Peter Witzke; Pavel Ciaian; Jacques Delince
  12. Demand-side management and European environmental and energy goals: an optimal complementary approach By Claire Bergaentzlé; Cédric Clastres; Haikel Khalfallah
  13. Towards a diagnostic approach to climate adaptation for fisheries. By Leith, Peat; Ogier, Emily; Pecl, Gretta; Hoshino, Eriko; Davidson, Julie; Haward, Marcus
  14. A study of CO2 emissions, output, energy consumption, and trade By Sahbi Farhani; Anissa Chaibi; Christophe Rault
  15. Exploring Public Perception of Solar Radiation Management By Christine Merk; Gert Pönitzsch; Carola Kniebes; Katrin Rehdanz; Ulrich Schmidt
  16. The Legal Framework of Vietnam’s Water Sector: Update 2013 By Nguyen, Thi Phuong Loan
  17. ICT and the demand for energy: Evidence from OECD countries By Rexhaeuser, Sascha; Schulte, Patrick; Welsch, Heinz
  18. Household Decision-Making and Valuation of Environmental Health Risks to Parents and their Children By Wiktor Adamowicz; Mark Dickie; Shelby Gerking; Marcella Veronesi; David Zinner
  19. A Tourism Conditions Index By Chia-Lin Chang; Hui-Kuang Hsu; Michael McAleer
  20. Special Interests and the Media: Theory and an Application to Climate Change By Jesse M. Shapiro
  21. In search of appropriate institutions for forest management By Keijiro Otsuka; Ridish Pokharel
  22. Bioeconomics of a Marine Disease By Jon M. Conrad; Daniel Rondeau

  1. By: Christoph Böhringer (University of Oldenburg, Department of Economics); André Müller (Ecoplan, Bern, Switzerland)
    Abstract: The Swiss energy strategy until 2050 envisages ambitious CO2 emission reduction targets along with substantial cutbacks in electricity consumption to establish a low-carbon economy without nuclear energy. Our computable general equilibrium analysis find that compliance with stringent CO2 constraints requires high CO2 taxes on economic activities which are not eligible for international emissions trading; likewise, electricity consumers are burdened with substantial electricity taxes. Environmental tax reforms are not likely to generate welfare gains without accounting for the benefits of improved environmental quality . However, economic adjustment costs to a low carbon economy without nuclear energy remain modest and can be markedly reduced through revenue-neutral cuts of initial distortionary taxes. On the other hand, alternative recycling strategies pose a trade-off between efficiency anddistributional justice which has to be resolved on normative grounds.
    Keywords: environmental tax reforms, computable general equilibrium
    JEL: H21 D58 Q48
    Date: 2014–01
  2. By: Adrien Vogt-Schilb (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Centre de coopération internationale en recherche agronomique pour le développement [CIRAD] : UMR56 - CNRS : UMR8568 - École des Hautes Études en Sciences Sociales (EHESS) - École des Ponts ParisTech (ENPC) - AgroParisTech); Stéphane Hallegatte (SDN - Sustainable Development Network - The World Bank)
    Abstract: Decision makers facing abatement targets need to decide which abatement measures to implement, and in which order. Measure-explicit marginal abatement cost curves depict the cost and abating potential of available mitigation options. Using a simple intertemporal optimization model, we demonstrate why this information is not sufficient to design emission reduction strategies. Because the measures required to achieve ambitious emission reductions cannot be implemented overnight, the optimal strategy to reach a short-term target depends on longer-term targets. For instance, the best strategy to achieve European's -20% by 2020 target may be to implement some expensive, high-potential, and long-to-implement options required to meet the -75% by 2050 target. Using just the cheapest abatement options to reach the 2020 target can create a carbon-intensive lock-in and make the 2050 target too expensive to reach. Designing mitigation policies requires information on the speed at which various measures to curb greenhouse gas emissions can be implemented, in addition to the information on the costs and potential of such measures provided by marginal abatement cost curves.
    Keywords: climate change mitigation; dynamic efficiency; sectoral policies
    Date: 2014–01–14
  3. By: Ziebarth, Nicolas R. (Cornell University); Schmitt, Maike (Darmstadt University of Technology); Karlsson, Martin (University of Duisburg-Essen)
    Abstract: This study comprehensively assesses the immediate effects of extreme weather conditions and high concentrations of ambient air pollution on population health. For Germany and the years 1999 to 2008, we link the universe of all 170 million hospital admissions, along with all 8 million deaths, with weather and pollution data reported at the day-county level. Extreme heat significantly increases hospitalizations and deaths. Extreme cold has a negligible effect on population health. High ambient PM10, O3 and NO2 concentrations are associated with increased hospitalizations and deaths, particularly when ignoring simultaneous weather and pollution conditions. We find strong evidence for "harvesting", and that the instantaneous heat-health relationship is only present in the short-term. We calculate that one "Hot Day" with a temperature higher than 30 °C (86 °F) triggers short-term adverse health effects valued between $0.10 and $0.68 per resident.
    Keywords: register data, hospital admissions, mortality, weather and pollution, climate change
    JEL: I12 I18 Q51 Q53 Q54 Q58
    Date: 2013–12
  4. By: Christoph Böhringer (University of Oldenburg, Department of Economics); Jared C. Carbone (Department of Economics, University Drive NW, Calgary, Canada,); Thomas F. Rutherford (University of Wisconsin, Madison, USA)
    Abstract: Unilateral carbon policies are inefficient due to the fact that they generally involve emission reductions in countries with high marginal abatement costs and because they are subject to carbon leakage. In this paper, we ask whether the use of carbon tariffs—tariffs on the carbon embodied in imported goods—might lower the cost of achieving a given reduction in world emissions. Specifically, we explore the role tariffs might play as an inducement to unregulated countries adopting emission controls of their own. We use an applied general equilibrium model to generate the payoffs of a policy game. In the game, a coalition of countries regulates its own emissions and chooses whether or not to employ carbon tariffs against unregulated countries. Unregulated countries may respond by adopting emission regulations of their own, retaliating against the carbon tariffs by engaging in a trade war, or by pursuing no policy at all. In the unique Nash equilibrium produced by this game, the use of carbon tariffs by coalition countries is credible. China and Russia respond by adopting binding abatement targets to avoid being subjected to them. Other unregulated countries retaliate. Cooperation by China and Russia lowers the global welfare cost of achieving a 10% reduction in global emissions by half relative to the case where coalition countries undertake all of this abatement on their own.
    Date: 2014–01
  5. By: Maria Christisou (Department of Economics, University of Macedonia); Theodore Panagiotidis (Department of Economics, University of Macedonia); Abhijit Sharma (Bradford University School of Management)
    Abstract: This paper examines the stationarity of carbon dioxide (CO2) emissions per capita for a set of 36 countries covering the period 1870-2006. We employ recently developed unit root and stationarity tests that allow for the mean reverting process to be nonlinear and take into account cross sectional dependence. By grouping countries according to their geographical proximity the importance of cross sectional dependence in panel unit root and stationarity tests is revealed. Using a recently developed nonlinear panel unit root test, we nd strong evidence that the per capita carbon dioxide emissions over the last one hundred and fty years are stationary. Our nonlinear specication captures the dynamics of the emissions time series data more eectively and we obtain evidence supporting stationarity for all country groups under study.
    Keywords: convergence, nonlinear unit roots, panel unit roots, heterogeneous panels, cross-section dependence.
    JEL: C32 C33 Q28 Q54
    Date: 2013–12
  6. By: Christoph Böhringer (University of Oldenburg, Department of Economics); Nicholas Rivers (Graduate School of Public and International Affairs and Institute of Environment, University of Ottawa); Tom F. Rutherford (University of Wisconsin, Madison, USA); Randall Wigle (Balsillie School of International Affairs and School of Business and Economics, Wilfrid Laurier University)
    Abstract: Dividing the burden for greenhouse gas abatement amongst the provinces has proven challenging in Canada, and is a major factor contributing to Canada's poor historic performance on greenhouse gas abatement. As the country aims to achieve substantial cuts to emissions over the next decade and by mid-century, such burden sharing considerations are likely to be elevated in importance. This paper uses a calibrated multi-region multi-sector computable general equilibrium model to compare a number of archetypal rules for sharing the burden of a joint commitment amongst members for the case of greenhouse gas reductions in Canada. Because of the substantial heterogeneity amongst Canadian provinces, these different burden sharing rules imply signifcantly different relative abatement effort amongst provinces, and also signifcantly different welfare implications. When emission permits are allocated on an equal per capita basis, welfare is increased in Ontario, British Columbia, Quebec, and Manitoba, and signifcantly reduced in Alberta and Saskatchewan. In contrast, when emission permits are allocated based on historic emissions, Alberta and Saskatchewan are made better off, and Ontario, British Columbia, Quebec, and Manitoba are made worse off. We compare these archetypal burden sharing rules to existing provincial emission reduction commitments, and find that none of the standard burden sharing rules comes close to existing commitments. We argue that the debate on burden sharing of greenhouse gas abatement in Canada could be objectified if informed by coherent quantitative analysis such as the one presented here.
    Keywords: climate, burden sharing, computable general equilibrium analysis
    JEL: C68 Q50
    Date: 2014–01
  7. By: Matthew Ranson; Robert Stavins
    Abstract: The last ten years have seen the growth of linkages between many of the world’s cap-and-trade systems for greenhouse gases (GHGs), both directly between systems, and indirectly via connections to credit systems such as the Clean Development Mechanism. If nations have tried to act in their own self-interest, this proliferation of linkages implies that for many nations, the expected benefits of linkage outweighed expected costs. In this paper, we draw on the past decade of experience with carbon markets to test a series of hypotheses about why systems have demonstrated this revealed preference for linking. Linkage is a multi-faceted policy decision that can be used by political jurisdictions to achieve a variety of objectives, and we find evidence that many economic, political, and strategic factors – ranging from geographic proximity to integrity of emissions reductions – influence the decision to link. We also identify some potentially important effects of linkage, such as loss of control over domestic carbon policies, which do not appear to have deterred real-world decisions to link. These findings have implications for the future role that decentralized linkages may play in international climate policy architecture. The Kyoto Protocol has entered what is probably its final commitment period, covering only a small fraction of global GHG emissions. Under the Durban Platform for Enhanced Action, negotiators may now gravitate toward a hybrid system, combining top-down elements for establishing targets with bottom-up elements of pledge-and-review tied to national policies and actions. The incentives for linking these national policies are likely to continue to produce direct connections among regional, national, and sub-national cap-and-trade systems. The growing network of decentralized, direct linkages among these systems may turn out to be a key part of a future hybrid climate policy architecture.
    JEL: Q28
    Date: 2014–01
  8. By: Dennis Guignet
    Abstract: Numerous nonmarket valuation studies have examined the impacts of environmental commodities on house prices, but little attention has been given to how shifts in these commodities affect the occurrence of home transactions, and the resulting welfare implications. Using a novel theoretical framework and an empirical analysis of homes impacted by petroleum releases from underground storage tanks, this paper demonstrates that changes in environmental quality can significantly impact a household’s decision to sell their home, and that this change in behavior has important implications towards theoretical welfare measures and empirical estimates. A discrete time duration model is estimated using a panel of single-family homes from 2000 to 2007. The dependent variable is the annual occurrence of a sale at each individual home. I find that contamination and cleanup activities in close proximity significantly impact the probability that a home is sold. Most striking is that this probability is reduced by about 50% during ongoing cleanup. This finding is most pronounced among lower quality homes and where an exposure pathway is present.
    Keywords: housing market, property transactions, discrete time duration model , hedonic analysis, leaking underground storage tanks, groundwater contamination
    JEL: D62 I18 Q51 Q53 R20
    Date: 2014–01
  9. By: Nathalie Mathieu-Bolh (University of Vermont - University of Vermont); Xavier Pautrel (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)
    Abstract: We build a model that takes into consideration the evolution of health over the life cycle and its consequences on individual optimal choices. In this framework, the effect of environmental taxation are not limited to the traditional negative crowding-out and positive productivity effects. We show that environmental taxation generates new general equilibrium effects ignored by previous contributions. Indeed, as the environmental tax improves the health profile over the life-cycle, it influences saving, labor supply, retirement and investment in health. We also show that whether those general equilibrium effects are positive or negative for the economy crucially depends on the degree of substitutability between young and old labor. We complete our theoretical analysis with numerical examples. Within the range of our parameters, it appears that ignoring those general equilibrium effects results in significantly understating the negative of environmental tax- ation on output per capita and welfare.
    Keywords: Health; environmental policy; economic growth
    Date: 2014–01–14
  10. By: Kiran Krishnamurthy, Chandra (CERE, Umeå University); Kriström, Bengt (CERE, Swedish University of Agricultural Sciences)
    Abstract: Using data from a large, multi-country survey, this paper investigates the determinants of preferences for a completely green residential electricity system. Three important questions are addressed: (i) How much are households willing to pay to use only renewable energy? (ii) Does willingness-to-pay (wtp) vary significantly across household groups and countries? and (iii) What drives the decision to enter the (hypothetical) market for green energy and, given entry, what drives the level of wtp? The analysis here differs from previous ones in the literature in two distinct ways: first, data and analyses are comparable across countries and second, a comprehensive attempt to address censoring and heterogeneity is carried out. The survey data indicate, in common with prior analyses and market experience, a low wtp, about 9􀀀10%. This study addressed a key aspect: how important is income for understanding wtp, relative to more âattitudinalâ determinants? Surprisingly, income exerts almost no effect on wtp, at the margin; this result is robust to controlling for censoring and heterogeneity. Key determinants of the wtp decision appear to be environmental attitudes, particularly membership in an environmental organization.
    Keywords: green electricity; willingness-to-pay; censoring; quantile regression; renewable energy
    JEL: C21 C24 Q42 Q51
    Date: 2013–10–27
  11. By: Heinz-Peter Witzke (Bonn University); Pavel Ciaian (European Commission (DG Joint Research Center)); Jacques Delince (European Commission (DG Joint Research Center))
    Abstract: The current paper investigates the long-term global effects of crops productivity changes under different climate scenarios and the impact of biofuels expansion using the Common Agricultural Policy Regionalised Impact (CAPRI) model. These analyses are conducted in the framework of the AgMIP project (Agricultural Model Intercomparison and Improvement Project). The results indicate that globally there will be both winners and losers, with some regions benefitting from agricultural production adjustment as a result of climate change whilst most regions suffering losses in production and consumption. Biofuel expansion leads to land relocation away from crop agricultural commodity production to new energy crops which is reflected in lower production levels of agricultural commodities and higher agricultural prices.
    Keywords: Climate Change, Lung-run modelling, Agriculture, Productivity, Biofuels
    JEL: Q02 Q11 Q54
    Date: 2014–01
  12. By: Claire Bergaentzlé (PACTE - Politiques publiques, ACtion politique, TErritoires - Institut d'Études Politiques [IEP] - Grenoble - CNRS : UMR5194 - Université Pierre-Mendès-France - Grenoble II - Université Joseph Fourier - Grenoble I); Cédric Clastres (PACTE - Politiques publiques, ACtion politique, TErritoires - Institut d'Études Politiques [IEP] - Grenoble - CNRS : UMR5194 - Université Pierre-Mendès-France - Grenoble II - Université Joseph Fourier - Grenoble I); Haikel Khalfallah (PACTE - Politiques publiques, ACtion politique, TErritoires - Institut d'Études Politiques [IEP] - Grenoble - CNRS : UMR5194 - Université Pierre-Mendès-France - Grenoble II - Université Joseph Fourier - Grenoble I)
    Abstract: Demand side management (DSM) in electricity markets could improve energy efficiency and achieve environmental targets through controlled consumption. For the past 10 years or so DSM programmes have registered significant results. However, detailed analysis of its real impact as observed by a large number of pilot studies suggests that such programmes need to be fine-tuned to suit clearly identified conditions. This study aims to provide recommendations for the instruments to be used to prompt demand response with a view to maximizing energy and environmental efficiencies of various countries. The present study suggests that different DSM models should be deployed depending on the specific generation mix in any given country. Beside the natural benefits from cross-borders infrastructures, DSM improves the flexibility and reliability of the energy system, absorbing some shock on generation mix. We show efficiency increases with demand response but at a decreasing rate. So, according to rebound and report effects, simple DSM tools could be preferred.
    Keywords: EU energy policy ; Demand side management ; Energy efficiency
    Date: 2014
  13. By: Leith, Peat (Adaptation Research Network for Marine Biodiversity and Resources, University of Tasmania); Ogier, Emily (IMAS Fisheries, Aquaculture & Coasts Centre (FACC), University of Tasmania); Pecl, Gretta (IMAS Fisheries, Aquaculture & Coasts Centre (FACC), University of Tasmania); Hoshino, Eriko (School of Economics and Finance, University of Tasmania); Davidson, Julie (School of Geography and Environmental Studies, University of Tasmania); Haward, Marcus (IMAS Marine & Antarctic Futures Centre (MAFC), University of Tasmania)
    Abstract: A diagnostic approach to climate change adaptation for fisheries is proposed to define potential climate adaptation pathways in well-managed fisheries. Traditional climate vulnerability and risk assessments tend to focus on biophysical threats and opportunities and thereby what needs to be done to adapt to climate change. Our diagnostic approach moves from such analysis to focus on how the processes of adaptation and development of adaptive capacity can be structured to achieve desired outcomes. Using a well-grounded framework, the diagnostic approach moves fi•om system description to characterization of challenges and opportunities, through two stages of analysis and validation, to the definition and embedding of adaptation options and pathways. The framework can include all contextually relevant variables and accommodate evaluation of adaptation outcomes and comparisons across scales and contexts. Such an approach can serve as a basis for enabling stakeholders to identify challenges and opportunities, and to explore and prioritize options for development and implementation of legitimate adaptation pathways.
    Keywords: collaborative management, adaptation, climate change, fisheries, diagnostic approach, governance Note:
    Date: 2013–11–01
  14. By: Sahbi Farhani; Anissa Chaibi; Christophe Rault
    Abstract: This article contributes to the literature by investigating the dynamic relationship between Carbone dioxide (CO2) emissions, output (GDP), energy consumption, and trade using the bounds testing approach to cointegration and the ARDL methodology for Tunisia over the period 1971-2008. The empirical results reveal the existence of two causal long-run relationships between the variables. In the short-run, there are three unidirectional Granger causality relationships, which run from GDP, squared GDP and energy consumption to CO2 emissions. To check the stability in the parameter of the selected model, CUSUM and CUSUMSQ were used. The results also provide important policy implications.
    Keywords: CO2 emissions, Energy consumption, ARDL bounds testing approach
    JEL: Q56 Q43 C51
    Date: 2014–01–06
  15. By: Christine Merk; Gert Pönitzsch; Carola Kniebes; Katrin Rehdanz; Ulrich Schmidt
    Abstract: Solar radiation management (SRM) could quickly offset global warming caused by anthropogenic greenhouse gas emissions. Because SRM would have global side effects, it raises not only technological but also political and social concerns. Therefore, SRM research should be accompanied by a global debate that incorporates public perception and concerns into the development and governance of the technology. Our paper provides insight into public perception and explores its underlying patterns using a survey conducted in Germany. The data reveal a differentiated picture. Laboratory research on SRM is broadly approved, whereas field research is much less approved. Immediate deployment is largely rejected. The acceptance of the technology is associated with the belief that climate change is a severe problem and that humans will eventually be able to control nature. It is also determined by the levels of trust in scientists and firms. Among the strongest objections against the technology is the belief that humans should not manipulate nature in the way SRM would. The actual public perception of SRM will, however, evolve along with the ongoing debate between the public, experts, and policymakers
    Keywords: Climate Engineering, Geoengineering, Solar Radiation Management, Climate Change, Public Opinion, Survey
    JEL: Q54 D19 H43
    Date: 2014–01
  16. By: Nguyen, Thi Phuong Loan
    Abstract: In order to deal with problems related to both water quality and quantity as well as to strengthen the sustainable and integrative management of the nation’s water resources, the Vietnamese Government has adopted a wide spectrum of laws and regulations. In recent years, more than 300 water related regulations on the guidance and implementation of the Law on Water Resources have been issued and often amended to meet the requirements of the country’s development and its increasing international integration. In spite of this, the current legal framework for water resources management in Vietnam remains ineffective and does not correspond with the reality on the ground. Furthermore, law enforcement is deficient and often national regulations are ignored by local authorities, who priorities rapid growth of their communities over sustainability. Under these circumstances, the legal framework cannot properly guide sustainable use of water resources in order to achieve a degree of environmentally sustainable and, in particular, to protect the livelihoods of marginalized groups in society, such as landless fishermen, small-holders or poor people in periurban areas. Despite the gaps in this legal framework, water-related policies and programs in Vietnam consistently refer back to it while, at the same time, policy advisors typically call for reform. Understanding the legal framework is therefore important for both researchers and practitioners. In this view, a previous study was carried out by the author, entitled ‘Legal Framework of the Water Sector in Vietnam’ (Nguyen 2010), which aimed at presenting the key dimensions and the structure of that framework. Both the Vietnamese and the English version of the book were widely disseminated. This update became necessary because the government of Vietnam recently issued a new law on water resources as well as supplementary legislation. So far, no official English version of any of these new documents exists. Therefore, a detailed presentation of the contents of the laws is particularly timely. In addition to presenting the laws, this paper aims at shedding light on some of the critical aspects of the current legislation and illustrates how the law making process proceeded.
    Keywords: Environmental impact assessment (EIA), regulatory impact assessment (RIA), integrated water resource management(IWRM), law on water resources, law making process, Mekong Delta,Vietnam, water quality management, water resources management
    JEL: K23 K4 L5 L52 Q53 Q54 Q56 Q58
    Date: 2013–08
  17. By: Rexhaeuser, Sascha; Schulte, Patrick; Welsch, Heinz
    Abstract: This paper analyzes the relationship between information and communication technology (ICT) and energy demand. We construct a comprehensive cross-country cross-industry panel data set covering 13 years, 10 OECD countries, and 27 industries. Using up to 2889 country-industry observations, we find that: (1) ICT capital is associated with a significant reduction in energy demand. (2) This relationship differs with regard to different types of energy. ICT use is not significantly correlated with electricity demand, but is significantly related to a reduction in non-electric energy demand. That is, ICT use comes with a reduction in total energy demand and an increase in the relative demand for electric over non-electric energy. --
    Keywords: technical change,ICT,energy demand,energy efficiency,energy mix,Green IT,cross-country cross-industry data,environmental policy
    JEL: O33 O44 Q41 Q43
    Date: 2013
  18. By: Wiktor Adamowicz; Mark Dickie; Shelby Gerking; Marcella Veronesi; David Zinner
    Abstract: This paper empirically discriminates between alternative household decisionmaking models for estimating parents’ willingness to pay for health risk reductions for their children as well as for themselves. Models are tested using data pertaining to heart disease from a stated preference survey involving 432 matched pairs of parents married to one another. Analysis is based on a collective model of parental resource allocation that incorporates household production of perceived health risks and allows for differences in preferences and risk perceptions between parents. Results are consistent with Pareto efficiency within the household, which implies that (1) for a given proportionate reduction in health risk, parents are willing to pay the same amount of money at the margin to protect themselves and the child; and (2) parents’ choices about proportionate health risk reductions for their children are based on household valuations, rather than their own individual valuations. Results also suggest that the marginal willingness to pay of mothers and fathers for health risk protection is sensitive to a shift in intra-household decision-making power between parents.
    Keywords: household decision-making, collective household model, non-cooperative household model, unitary household model, Pareto efficiency, environmental health risks to parents and children, willingness to pay, matched sample of mothers and fathers
    JEL: D13 D61 I12 I38 J13 Q51
    Date: 2013–12
  19. By: Chia-Lin Chang; Hui-Kuang Hsu; Michael McAleer (University of Canterbury)
    Abstract: This paper uses monthly data from April 2005 to August 2013 for Taiwan to propose a novel tourism indicator, namely the Tourism Conditions Index (TCI). TCI accounts for the spillover weights based on the Granger causality test and estimates of the multivariate BEKK model for four TCI indicators to predict specific tourism and economic environmental indicators for Taiwan. The foundation of the TCI is the Financial Conditions Index (FCI), which is derived from the Monetary Conditions Index (MCI). The empirical findings show that TCI weighted by spillovers reveal greater significance in forecasting the Composite Index (CI), an economic environmental indicator, than the Tourism Industry Index (TII), which is an existing indicator for the tourism industry that is listed on the Taiwan Stock Exchange (TWSE). Moreover, previous values of the alternative TCI and TII are shown to contain useful information in predicting both tourism and economic environmental factors. Overall, the new Tourism Conditions Index is straightforward to use and also provides useful insights in predicting tourism arrivals and the current economic environment.
    Keywords: Monetary Conditions Index (MCI), Financial Conditions Index (FCI), Tourism Conditions Index (TCI), BEKK, Spillovers, Granger causality
    JEL: B41 E44 E47 G32
    Date: 2014–01–10
  20. By: Jesse M. Shapiro
    Abstract: I present a model in which competing special interests seek policy influence through the news media. In the model a journalist reports on expert opinion to a voter. Two competing interested parties can invest to acquire credentialed advocates to represent their positions in the press. Because advocates are easier to obtain when expert opinion is divided, the activities of special interests can reveal useful information to the voter. However, competition among special interests can also reduce the amount of information communicated to the voter, especially on issues with large economic stakes and a high likelihood of a scientific consensus. The model provides an account of persistent voter ignorance on climate change and other high-stakes scientific topics.
    JEL: D72 D83 Q54
    Date: 2014–01
  21. By: Keijiro Otsuka (National Graduate Institute for Policy Studies); Ridish Pokharel (Institute of Forestry, Tribhuvan University, Pokhara, Nepal)
    Abstract: There is a variety of forest management institutions ranging from state management to community and private management. This article attempts to identify the conditions under which one institution outperforms the others in the efficiency of forest management based on a review of the literature, empirical evidence on the dominant forest management institutions, and theoretical arguments. In conclusion, we argue that the community management system performs best for non-timber forests, whereas a mixed management system, in which forest protection is carried out communally and tree management is carried out individually, is likely to work best for timber forests.
    Date: 2014–01
  22. By: Jon M. Conrad; Daniel Rondeau
    Abstract: We study the economic impact of the viral disease AVG, its stochastic transmission across abalone reefs in southern Australia, and the optimal management response as AVG approaches an uninfected reef. Using conservative estimates of the virulence and mortality rates associated with the disease, we find it optimal to maintain the pre-AVG steady-state biomass on reef j until AVG has reached reef j - 1. The size of the optimal harvest when AVG has reached reef j - 1 is significant, ranging from 85% of the pre-AVG steady-state stock plus its annual growth, to 100% when the mortality rate associated with the virus reaches 80%. Increases in the probability of transmission, P, also increase the size of the drawdown but to a lesser extent than the mortality rate. A regime shift in the intrinsic growth rate following infection also plays a central role in determining the level of pre-emptive harvesting.
    Keywords: fisheries, bioeconomics, marine pathogens, disease transmission, epidemiology, optimal management
    JEL: Q2 Q22
    Date: 2014–01

This nep-env issue is ©2014 by Francisco S.Ramos. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.