nep-env New Economics Papers
on Environmental Economics
Issue of 2014‒02‒08
24 papers chosen by
Francisco S.Ramos
Federal University of Pernambuco

  1. Do Environmental Policies Hurt Trade Performance? By Jean-Louis Combes; Pascale Combes Motel; Somlanare Romuald KINDA
  2. What time to adapt? The role of discretionary time in sustaining the climate change value-action gap By Chai, Andreas; Bradley, Graham; Lo, Alex Y.; Reser, Joseph
  3. The Principal-Agent Model with Multilateral Externalities: An Application to Climate Agreements By Carsten Helm; Franz Wirl
  4. CARBON TARIFFS REVISITED By Christoph Böhringer; André Müller; Jan Schneider
  5. International Environmental Agreements: An Emission Choice Model with Abatement Technology By Eftichios Sartzetakis; Stefania Strantza
  6. Spatial environmental efficiency indicators in regional waste generation: A nonparametric approach By Halkos, George; Papageorgiou, George
  7. Carbon prices and CCS investment: comparative study between the European Union and China By Marie Renner
  8. Citizens’ perceptions of justice in international climate policy – An empirical analysis By Joachim Schleich; Elisabeth Dütschke; Claudia Schwirplies; Andreas Ziegler
  9. Imperfect resource substitution and optimal transition to clean technologies By VARDAR, N. Baris
  10. Payments for Ecosystem Services: Can we kill two birds with one stone? Insights from a Natural Field Experiment in Madagascar By Sophie Clot; Fano Andriamahefazafy; Gilles Grolleau; Lisette Ibanez; Philippe Méral
  11. Dynamics of CO2 price drivers By Rita Sousa; Luís Aguiar-Conraria
  12. Economic Status, Air Quality, and Child Health: Evidence from Inversion Episodes By Jans, Jenny; Johansson, Per; Nilsson, Peter
  13. What explains the short-term dynamics of the prices of CO2 emissions? By Shawkat Hammoudeh; Duc Khuong Nguyen; Ricardo M. Sousa
  14. Integrated technological-economic modeling platform for energy and climate policy analysis By Patrícia Fortes; Alfredo Marvão Pereira; Rui M. Pereira; Júlia Seixas
  15. Energy prices and CO2 emission allowance prices: A quantile regression approach By Shawkat Hammoudeh; Amine Lahiani; Duc Khuong Nguyen; Ricardo M. Sousa
  16. Connecting strategy, environmental and social indicators: a study of oil and gas producers By Evgeny Varfolomeev; Oleg Marin; Dmitry Bykov; Oleg Karasev; Natalia Velikanova; Elena Vetchinkina; Anastasia Edelkina; Thomas Thurner
  17. Asymmetric and nonlinear pass-through of energy prices to CO2 emission allowance prices By Shawkat Hammoudeh; Amine Lahiani; Duc Khuong Nguyen; Ricardo M. Sousa
  18. The advantages of demographic change after the wave: fewer and older, but healthier, greener, and more productive? By Fanny A. Kluge; Emilio Zagheni; Elke Loichinger; Tobias Vogt
  19. Present Bias in Payments for Ecosystem Services: Insights from a Behavioural Experiment in Uganda By Sophie Clot; Charlotte Stanton
  20. Optimal Altruism in Public Good Provision By Robert Hahn; Robert Ritz
  21. Deforestation and Seigniorage in Developing Countries: A Tradeoff? By Jean-Louis Combes; Pascale Combes Motel; Alexandru Minea; Patrick Villieu
  22. Valuation of Cultural and Natural Resources in North Cascades National Park: Results from a Tournament-Style Contingent Choice Survey By Turner, Robert; Willmarth, Blake
  23. The value of the greenbelt in Vienna: a spatial hedonic analysis By Johanna Choumert; Shanaka HERATH; Gunther MAIER
  24. Carbon Financial Markets: a time-frequency analysis of CO2 price drivers By Rita Sousa; Luís Aguiar-Conraria; Maria Joana Soares

  1. By: Jean-Louis Combes (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Pascale Combes Motel (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Somlanare Romuald KINDA (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I)
    Abstract: This paper contributes to the controversial literature on the relationship between environmental policies and international trade. It provides new evidence about the effect of a gap in environmental policies between trading partners on trade flow on a sample of developed and developing countries over the 1980-2010 period. The paper innovates on two aspects. First, while previous studies have used partial measures of environmental regulations (input-oriented or output-oriented indicators), an index of a country's environmental policy is computed. This index is calculated as the difference between observed pollution levels and "structural" pollution i.e. pollution predicted by determinants of environmental degradation as identified and modelled in the literature. This index is therefore a measure of "revealed" efforts made by countries aiming at downsizing environmental degradation. Second, the effect of these revealed environmental policies is assessed on bilateral trade flows in a gravity model. A particular attention is paid to similarities in environmental policies. Our results show that a gap in domestic efforts towards environmental protection between trading partners has no effect on exports. Moreover, the results do not appear to be conditional on the level of development of the countries trading nor on the characteristics of exported goods (manufactured goods and primary commodities).
    Keywords: Trade;Environmental policies;Gravity Model
    Date: 2014–01–30
  2. By: Chai, Andreas; Bradley, Graham; Lo, Alex Y.; Reser, Joseph
    Abstract: We investigate the role discretionary (non-working) time plays in sustaining the gap between individuals’ concern about climate change and their propensity to act on this concern by adopting sustainable consumption practices. Using recent Australian survey data on climate change adaptation, we find that while discretionary time is unrelated to concern about climate change, it is positively correlated with the propensity to adopt mitigating behavior. Moreover, we find that increasing discretionary time is associated with significant reductions in the gap between the concern that individuals express about climate change and their reporting of engagement in sustainable consumption practices.
    Keywords: discretionary time; environmental concern; sustainable consumption ; climate change ; Australia
    JEL: D12 D83 Q50
    Date: 2014–02–06
  3. By: Carsten Helm (University of Oldenburg - Public Economics & ZenTra); Franz Wirl (University of Vienna, Center of Business Studies)
    Abstract: We consider contracting of a principal with an agent if multilateral externalities are present. The motivating example is that of an interna- tional climate agreement given private information about the willingness- to-pay (WTP) for emissions abatement. Due to multilateral externalities the principal uses her own emissions besides subsidies to incentivize the agent and to assure his participation. Optimal contracts equalize marginal abatement costs and, thus, can be implemented by a system of competitive permit trading. Moreover, optimal contracts can include a boundary part (i.e., the endogenous, type dependent participation constraint is binding), which is not a copy of the outside option of no contract. Compared to this outside option, a contract can increase emissions of the principal for types with a low WTP, and reduce her payo§ for high types. Subsidies can be constant or even decreasing in emission reductions, and turn negative so that the agent reduces emissions and pays the principal.
    Keywords: private information, multilateral externalities, mecha- nism design, environmental agreements, type-dependent outside options
    JEL: D82 Q54 H87
    Date: 2014–01
  4. By: Christoph Böhringer (University of Oldenburg, Department of Economics); André Müller (Ecoplan, Bern, Switzerland); Jan Schneider (University of Oldenburg, Department of Economics)
    Abstract: Concerns about adverse impacts on domestic energy-intensive and trade-exposed (EITE) industries are at the fore of the political debate about unilateral climate policies. Tariffs on the carbon embodied in imported goods from countries without emission pricing appeal as a measure to reduce carbon leakage and protect domestic EITE industries. We show that the introduction of carbon tariffs can do more harm than good to domestic EITE industries. Two determinants drive the sign and magnitude of EITE impacts. Firstly, the composition of embodied emissions in goods: if a large share of embodied carbon is imported in intermediate inputs, industries might suffer from carbon tariffs. Secondly, the share of domestic output that is supplied to the export market: while carbon tariffs level the playing field on domestic markets, they increase the cost-disadvantage vis-à-vis competitors from abroad in foreign markets.
    Keywords: carbon tariffs, unilateral climate policy, multi-region input-output analysis, CGE
    JEL: Q58 D57 D58
    Date: 2014–01
  5. By: Eftichios Sartzetakis (Department of Economics, University of Macedonia); Stefania Strantza (Department of Economics, Concordia University)
    Abstract: The present paper examines the size of stable IEAs concerning transboundary environmental problems. A coalition is considered stable when no signatories wish to withdraw while no more countries wish to participate. We assume that the coalition behaves as a leader maximizing its members' aggregate welfare while the countries outside the coalition maximize their own welfare independently, taking the choice of the coalition as given. We further assume a benefit function that is concave in the country's own emissions, an environmental damage function that is convex in aggregate net emissions and an abatement cost function that is convex in the country's abatement effort. Each country chooses both its emission and abatement levels. Within this framework we find that the size of the stable coalition depends on the model's parameters but it is always larger than in the case in which countries are allowed to choose either emission or abatement level. Our results complement Barrett's (1994) suggestion that the size of the stable coalition depends on the model's parameters, even though we are imposing the constraint that the net emission flow is positive.
    Keywords: Environmental Agreements.
    JEL: D6 Q5 C7
    Date: 2013–12
  6. By: Halkos, George; Papageorgiou, George
    Abstract: This paper computes and analyses for the first time environmental efficiencies in waste generation of 160 European regions in NUTS 2 level in seven European countries. For this reason different Data Envelopment Analysis (DEA) model formulations are used modeling the pollutant in the form of waste generation as a regular output and as a regular input. In the latter case we also use the notion of eco-efficiency. The empirical findings reveal environmental inefficiencies among the regions indicating the lack of a uniform regional environmental policy among the European countries. This finding is observed not only between countries but also between regions in the same country, implying the need for implementation of appropriate municipal environmental policies in waste management.
    Keywords: Environmental efficiency; Waste generation; European regions; Data Envelopment Analysis
    JEL: C6 O13 O52 Q50 Q53 Q56 R11
    Date: 2014–02–03
  7. By: Marie Renner
    Abstract: As policy makers assess strategies to reduce greenhouse gas emissions (GHG), they need to know the available technical options and the conditions under which these options become economically attractive. Carbon Capture and Storage (CCS) techniques are widely considered as a key option for climate change mitigation. But integrating CCS techniques in a commercial scale power plant adds significant costs to the capital expenditure at the start of the project and to the operating expenditure throughout its lifetime. Its additional costs can be offset by a sufficient CO2 price but most markets have failed to put a high enough price on CO2 emissions: currently, the weak Emission Unit Allowances price threatens CCS demonstration and deployment in the European Union (EU). A different dynamic is rising in China: a carbon regulation seems to appear and CCS techniques seem to encounter a rising interest as suggest their inclusion in the 12th Five-Year Plan and the rising number of CCS projects identifies/planned. However, there are very few in-depth techno-economic studies on CCS costs. This study investigates two related questions: how much is the extra-cost of a CCS plant in the EU in comparison with China? And then, what is the CO2 price beyond which CCS power plants become more profitable/economically attractive than classic power plants, in the EU and in China? To answer these questions, I first review, analyze and compare public studies on CCS techniques in order to draw an objective techno-economic panorama in the EU and China. Then, I develop a net present value (NPV) model for coal and gas plants, with and without CCS, in order to assess the CO2 price beyond which CCS plants become the most profitable power plant type. This CO2 value is called CO2 switching price. I also run some sensitivity analyses to assess the impact of different parameter variations on this CO2 switching price. I show that CCS power plants become the most profitable baseload power plant type with a CO2 price higher than 70 €/t in the EU against 30 €/t in China, without transport and storage costs. When the CO2 price is high enough, CCS gas plants are the most profitable power plant type in the EU whereas these are CCS coal plants in China. Through this study, I advise investors on the optimal power plant type choice depending on the CO2 market price, and suggest an optimal timing for CCS investment in the EU and China.
    Date: 2014
  8. By: Joachim Schleich (Fraunhofer Institute for Systems and Innovation Research); Elisabeth Dütschke (Fraunhofer Institute for Systems and Innovation Research); Claudia Schwirplies (University of Kassel); Andreas Ziegler (University of Kassel)
    Abstract: Relying on a recent survey of more than 3300 participants from China, Germany and the US, this paper empirically analyzes citizens’ perceptions of climate change and climate policy, focusing on key guiding principles for sharing mitigation costs across countries. The ranking of the main principles for burden-sharing is identical in China, Germany and the US: accountability followed by capability, egalitarianism, and sover-eignty. Thus, on a general level, citizens across these countries seem to have a com-mon understanding of fairness. We therefore find no evidence that citizens’ (stated) fairness preferences are detrimental to future burden-sharing agreements. While there is heterogeneity in citizens’ perceptions of climate change and climate policy within and across countries, a substantial portion of citizens in all countries perceive a lack of transparency, fairness, and trust in international climate agreements.
    Keywords: Climate change policies; climate change; burden sharing; equity; justice; distributive justice
    Date: 2014
  9. By: VARDAR, N. Baris (Paris School of Economics)
    Abstract: Non-renewable and renewable resources are imperfect substitutes due to technical and geographical constraints. What is the role of imperfect substitution on the optimal transition path to the clean technologies? We address this question by characterizing the optimal growth path and resource use of an economy. We show that the economy initially starts with using the non-renewable and renewable resources simultaneously and gradually increases the share of renewable. The outcome can be either (i) the economy switches to a backstop at a certain date or (ii) the initial regime lasts forever. The results show that the economy converges to a steady state even if the backstop is too costly and a green, zero-carbon economy is the optimal final state in any case. We also present some simulation results to illustrate the shapes of the optimal paths. This analysis allows us to discuss the policy implications and question the existence of the Green Paradox.
    Keywords: imperfect substitution, optimal transition, non-renewable resource, renewable resource, backstop, simultaneous use, switching, Green Paradox
    JEL: Q43 Q42 Q30 Q20
    Date: 2014–01–13
  10. By: Sophie Clot; Fano Andriamahefazafy; Gilles Grolleau; Lisette Ibanez; Philippe Méral
    Abstract: The explicit assumption underlying Payments for Ecosystem Services (PES) is that offering payments that are at least equal to individual’s opportunity cost will establish individuals’ participation. At the same time, that payment should act as a substitution within landowners’ global income, making environmental conservation compatible with economic development goals, and suitable for win-win policy. This partially acts under the more general hypothesis of money fungibility built-in neoclassical economic premise. Meanwhile, behavioural economics demonstrate that individuals track their financial activities using a set of cognitive labels depending to the context in which it was obtained, each of which being associated with a different marginal propensity to consume. Based on a ‘Humans’ vs. ‘Econs’ approach, we test the effect of income’s origin (‘Low effort’ based money vs. ‘High effort’ based money) on spending decisions (Necessity vs. Superior goods) and pro social preferences (Contribution to a public good) within Madagascar rural areas that are potential beneficiaries of PES programs, using a natural field experiment. Our findings support that human’s behavioural responses matter and could, under some circumstances, alter environmental conservation policies.
    Date: 2014–01
  11. By: Rita Sousa (CENSE, Universidade Nova de Lisboa e Universidade do Minho); Luís Aguiar-Conraria (Universidade do Minho - NIPE)
    Abstract: Using data from Phase II-III of the European Union Emission Trading Scheme, we characterize CO2 prices interrelation with energy prices (gas, electricity and coal), carbon allowances substitute prices and with economic activity index. We estimate a vector autoregressive model and the responses of CO2 prices to impulses in other variables, observing duration and direction of the impact. Our main findings include significant positive impact of returns in CO2 of peak electricity, gas, and economy index, and CO2 returns itself. The impact is visible during ten days in case of an electricity innovation, and during one day in case of gas. A shock in economy index prices has 2 days impact, and finally a substitute good for carbon licences in the European market does not have a significant impact.
    Keywords: Carbon price; Emission allowances and trading; VAR model
    Date: 2014
  12. By: Jans, Jenny (Uppsala University); Johansson, Per (IFAU); Nilsson, Peter (IIES, Stockholm University)
    Abstract: On normal days, the temperature decreases with altitude, allowing air pollutants to rise and disperse. During inversion episodes, a warmer air layer at higher altitude traps pollutants close to the ground. We show how readily available NASA satellite data on vertical temperature profiles can be used to measure inversion episodes on a global scale with high spatial and temporal resolution. Then, we link inversion episode data to ground level pollution monitors and to daily in- and outpatient records for the universe of children in Sweden during a six-year period to provide instrumental variable estimates of the effects of air quality on children's health. The IV estimates show that the respiratory illness health care visit rate increases by 8 percent for each 10 μm/m³ increase in PM10; an estimate four times higher than conventional estimates. Importantly, by linking the health care data to detailed records of parental background characteristics, we show that children from low-income households suffer significantly more from air pollution than children from high income households. Finally, we provide evidence on the importance of several mechanisms that could contribute to the difference in the impact of air pollution across children in rich and poor households.
    Keywords: instrumental variable, environmental policy, inversions, health, air pollution, nonparametric regression, socio-economic gradient in health
    JEL: Q53 I1 I3 J24
    Date: 2014–01
  13. By: Shawkat Hammoudeh (Drexel University, LeBow College of Business); Duc Khuong Nguyen (IPAG Business School); Ricardo M. Sousa (Universidade do Minho - NIPE)
    Abstract: Using the vector auto-regression (VAR) and the vector error-correction Models (VECM), this paper analyzes the short-term dynamics of the prices of CO2 emissions in response to changes in the prices of oil, coal, natural gas, electricity and carbon emission allowances. The results show that: (i) a positive shock to the crude oil prices has a negative effect on the CO2 allowance prices; (ii) an unexpected increase in the natural gas prices raises the price of CO2 emissions; (iii) a positive shock to the prices of the fuel of choice, coal, has virtually no significant impact on the CO2 prices; (iv) there is a clear positive effect of the coal prices on the CO2 allowance prices when the electricity prices are excluded from the VAR system; and (v) a positive shock to the electricity prices reduces the price of the CO2 allowances. We also find that the energy price shocks have a persistent impact on the CO2 allowance prices, with the largest effect occurring six months after a shock strikes. The effect is particularly strong in the case of the natural gas price shocks. Additionally, we estimate that it takes between 7.3 and 9.6 months to halve the gap between the actual and the equilibrium prices of the CO2 allowances, i.e., to erase any price over- or undervaluations after a shock strikes. Finally, the empirical findings suggest an important degree of substitution between the three primary sources of energy (i.e., crude oil, natural gas and coal), particularly, when electricity prices are excluded from the VAR system.
    Keywords: CO2 allowance prices, crude oil, natural gas, coal, electricity.
    JEL: Q47
    Date: 2014
  14. By: Patrícia Fortes (CENSE, Departamento de Ciências e Engenharia do Ambiente, Faculdade de Ciências e Tecnologia, Universidade Nova de Lisboa); Alfredo Marvão Pereira (Department of Economics, The College of William and Mary); Rui M. Pereira (Department of Economics, The College of William and Mary); Júlia Seixas (CENSE, Departamento de Ciências e Engenharia do Ambiente, Faculdade de Ciências e Tecnologia, Universidade Nova de Lisboa)
    Abstract: Computable general equilibrium (CGE) and bottom-up models each have unique strengths and weakness in evaluating energy and climate policies. This paper describes the development of an integrated technological, economic modelling platform (HYBTEP), built through the soft-link between the bottomup TIMES and the CGE GEM-E3 models. HYBTEP combines cost minimizing energy technology choices with macroeconomic responses, which is essential for energy-climate policy assessment. HYBTEP advances on other hybrid tools by assuming ‘full-form’ models, integrating detailed and extensive technology data with disaggregated economic structure, and ‘full-link’, i.e., covering all economic sectors. Using Portugal as a case study, we examine three scenarios: i) the current energyclimate policy, ii) a CO2 tax, and iii) renewable energy subsidy, with the objective of assessing the advantages of HYBTEP vis-à-vis bottom-up approach. Results show that the economic framework in HYBTEP partially offsets the increase or decrease in energy costs from the policy scenarios, while TIMES sets a wide range of results, dependent of energy services-price elasticities. HYBTEP allows the computation of the economic impacts of policies while considers technological detail. Moreover, the hybrid platform increases the transparency of policy analysis by making explicit the mechanisms through which energy demand evolves, resulting in high confidence for decision-making.
    Keywords: bottom-up, top-down, hybrid modeling, energy-climate policy
    Date: 2014–01–25
  15. By: Shawkat Hammoudeh (Drexel University, LeBow College of Business); Amine Lahiani (University of Orléans and ESC Rennes Business School); Duc Khuong Nguyen (IPAG Business School); Ricardo M. Sousa (Universidade do Minho - NIPE)
    Abstract: We use a quantile regression framework to investigate the impact of changes in crude oil prices, natural gas prices, coal prices, and electricity prices on the distribution of the CO2 emission allowance prices in the United States. We find that: (i) an increase in the crude oil price generates a substantial drop in the carbon prices when the latter is very high; (ii) changes in the natural gas prices have a negative effect on the carbon prices when they are very low but have a positive effect when they are quite high; (iii) the impact of the changes in the electricity prices on the carbon prices can be positive in the right tail of the distribution; and (iv) the coal prices exert a negative effect on the carbon prices.
    Keywords: CO2 allowance price, energy prices, quantile regression.
    JEL: Q47
    Date: 2014
  16. By: Evgeny Varfolomeev (Science Research Institute of Economics and Management in Gas Industry); Oleg Marin (Science Research Institute of Economics and Management in Gas Industry); Dmitry Bykov (Science Research Institute of Economics and Management in Gas Industry); Oleg Karasev (National Research University Higher School of Economics); Natalia Velikanova (National Research University Higher School of Economics); Elena Vetchinkina (Lomonosov Moscow State University); Anastasia Edelkina (National Research University Higher School of Economics); Thomas Thurner (National Research University Higher School of Economics)
    Abstract: This paper studies the integration of social and environmental objectives into strategy through performance indicators based on a sample of multinational world-leading oil- and gas producers. Also, we inquire if the companies under study, which identify certain areas as strategic objectives, do better than their peers. We show that top management of the companies did indeed identify different areas of interest, had different strategic foci, and used different performance indicators. This is often explicable through a company’s own history and past experiences. When comparing a sample of greenhouse gas emissions, safety measures, and energy efficiency indicators between the different companies, we could not identify a consistent development over time trends. In fact, some did worse over time and collective improvements were largely absent. We suggest further research into the link between strategic objectives and a company’s relative position in industry.
    Keywords: indicator, environmental protection, oil- and gas producers, energy efficiency, resource availability
    JEL: M14 M40 N50
    Date: 2014
  17. By: Shawkat Hammoudeh (Drexel University, LeBow College of Business); Amine Lahiani (University of Orléans and ESC Rennes Business School); Duc Khuong Nguyen (IPAG Business School); Ricardo M. Sousa (Universidade do Minho - NIPE)
    Abstract: We use the recently developed nonlinear autoregressive distributed lags (NARDL) model to examine the pass-through of changes in crude oil prices, natural gas prices, coal prices and electricity prices to the CO2 emission allowance prices. This approach allows one to simultaneously test the short- and long-run nonlinearities through the positive and negative partial sum decompositions of the predetermined explanatory variables. It also offers the possibility to quantify the respective responses of the CO2 emission prices to positive and negative shocks to the prices of their determinants from the asymmetric dynamic multipliers. We find that: (i) the crude oil prices have a long-run negative and asymmetric effect on the CO2 allowance prices; (ii) the falls in the coal prices have a stronger impact on the carbon prices in the short-run than the increases; (iii) the natural gas prices and electricity prices have a symmetric effect on the carbon prices, but this effect is negative for the former and positive for the latter. Policy implications are provided.
    Keywords: CO2 allowance price, energy prices, NARDL model, asymmetric passthrough
    JEL: Q47
    Date: 2014
  18. By: Fanny A. Kluge (Max Planck Institute for Demographic Research, Rostock, Germany); Emilio Zagheni (Max Planck Institute for Demographic Research, Rostock, Germany); Elke Loichinger (Max Planck Institute for Demographic Research, Rostock, Germany); Tobias Vogt (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: Population aging is an inevitable global demographic process. Most of the literature on the consequences of demographic change focuses on the economic and societal challenges that we will face as people live longer and have fewer children. In this paper, we (a) describe key trends and projections of the magnitude and speed of population aging; (b) discuss the economic, social, and environmental consequences of population aging; and (c) investigate some of the opportunities that aging societies create. We use Germany as a case study. However, the general insights that we obtain can be generalized to other developed countries. We argue that there may be positive unintended side effects of population aging that can be leveraged to address pressing environmental problems and issues of gender inequality and intergenerational ties.
    Keywords: Germany, ageing
    JEL: J1 Z0
    Date: 2014–01
  19. By: Sophie Clot; Charlotte Stanton
    Abstract: Farmers are necessary agents in global efforts to conserve the environment now that croplands and pastures together constitute the largest terrestrial system on Earth – covering some 48% of (ice-free) land surface. Whereas standard economic models predict that farmers will participate in conservation programs so long as they are profitable, empirical findings from behavioral economics point to a number of normally unobservable preferences that may influence the decision-making process. This study tests whether heterogeneity in behavioral preferences correlates with decisions to participate in Payments for Environmental Services (PES) programs. We elicit individual trust and time preferences using incentivized choice experiments and link resulting measures to PES enrollment and household survey data in Uganda. We find that farmers who exhibit present-biased preferences – those who show a particular desire for proximate gains – are 44.1% more likely to self-select into PES than those who show time-consistent or future-biased preferences.
    Date: 2014–01
  20. By: Robert Hahn; Robert Ritz
    Abstract: We present a model of altruistically-minded-yet rational-players contributing to a public good. A key feature is the tension between altruism and "crowding-out" effects (players' efforts are strategic substitutes). We find that more altruistic behaviour can raise or reduce welfare, depending on the fine details of the environment. It is almost always optimal for a player to act more selfishly than her true preference. We discuss applications to a range of public good problems, including global climate policy. Our results highlight that it may be difficult to infer social preferences from observed behaviour.
    Keywords: Altruism, climate policy, crowding out, public goods
    JEL: D03 H23 H41 Q58
    Date: 2014–01–29
  21. By: Jean-Louis Combes (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Pascale Combes Motel (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Alexandru Minea (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Patrick Villieu (Université d'Orléans - Université d'Orléans - Université d'Orléans)
    Abstract: Most of countries covered by natural forests are developing countries, with limited ability to levy taxes and restrained access to international credit markets; consequently, they are amenable to draw heavily on two sources of government financing, namely seigniorage and deforestation revenues. First, we develop a theoretical model emphasizing a substitution effect between seigniorage and deforestation revenues. Second, a panel-data econometric analysis over the 1990-2010 period confirms our findings. Consequently, a tighter monetary policy hastens deforestation. Third, we extend the theoretical model and show that international transfers dedicated to forest protection can upturn the positive link between tighter monetary policies and deforestation, and then discuss the relevance of this finding with respect to recent institutional arrangements.
    Keywords: deforestation;seigniorage;inflation;developing countries;Panel Data Analysis
    Date: 2014–01–30
  22. By: Turner, Robert (Department of Economics, Colgate University); Willmarth, Blake (Department of Economics, Colgate University)
    Abstract: We present the results of a new, tournament-style design of a contingent choice survey about management options at North Cascades National Park (NCNP). In our tournament-style survey, each respondent explicitly ranks several sets of scenarios and in addition several other rankings are implicit. Including the implicit rankings does not change our findings much, suggesting that the tournament-style format can add usefully to the data collected by a survey. We find strong evidence of nonuse values for both cultural and natural resource protection; indeed, nonuse values seem to dominate preferences even for those who have visited NCNP. We further find that respondents in general seem to value the protection of natural resources more than the protection of cultural resources, though both are valuable.
    Keywords: contingent choice, tournament, cultural protection, wilderness protection, national park, nonuse values
    JEL: C9 Q3 Q5
    Date: 2014–01–01
  23. By: Johanna Choumert (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Shanaka HERATH (University of New South Wales - University of New South Wales - University of New South Wales); Gunther MAIER (Vienna University of Economics and Business - Vienna University of Economics and Business - Vienna University of Economics and Business)
    Abstract: This paper employs the hedonic price method (HPM) to examine whether the implicit value of the greenbelt is capitalized into apartment prices in the city of Vienna, Austria. We improve the traditional model using spatial econometric techniques and compare estimates from different spatial models, namely the spatial lag model (SAR), the spatial error model (SEM) and the spatial Durbin model (SDM). While our use of spatial models addresses the common problem of omitted variable bias, the SDM specifically allows for controlling possible nearby proximity effects (i.e., small-scale neighbourhood) that are rarely included in this type of analyses. Findings indicate that distance from the greenbelt is important in explaining apartment prices in Vienna: while the CBD exerts a centripetal force, the greenbelt, on the contrary, exerts a centrifugal force. The SDM is found to be the best performing model indicating existence of small-scale neighbourhood effects and presenting a solid case for consideration of this model in valuation of green amenities.
    Keywords: Greenbelt;open space;urban amenities;hedonic price valuation;Spatial econometrics;spatial Durbin model
    Date: 2014–01–30
  24. By: Rita Sousa (CENSE, Universidade Nova de Lisboa e Universidade do Minho); Luís Aguiar-Conraria (Universidade do Minho - NIPE); Maria Joana Soares (Universidade do Minho - NIPE)
    Abstract: We characterize the interrelation of CO2 prices with energy prices (gas and electricity), and with economic activity. Previous studies have relied on time-domain techniques, such as Vector Auto-Regressions. In this study, we use multivariate wavelet analysis, which operates in the time-frequency domain. Wavelet analysis provides convenient tools to distinguish relations at particular frequencies and at particular time horizons. Our empirical approach has the potential to identify relations getting stronger and then disappearing over specific time intervals and frequencies. We are able to examine the coherency of these variables and lead-lag relations at different frequencies for the time periods in focus.
    Keywords: Carbon prices; Financial Markets; Multivariate wavelet analysis.
    Date: 2014

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