nep-env New Economics Papers
on Environmental Economics
Issue of 2014‒11‒01
fifty-one papers chosen by
Francisco S. Ramos
Universidade Federal de Pernambuco

  1. Strengthening Carbon Financing for Grassland Management in the People's Republic of China: Mitigation Options in Grassland-Based Animal Husbandry By Asian Development Bank (ADB); ; ;
  2. EU Biofuel Policies in Practice – A Carbon Map for the Brazilian Cerrado By Mareike Lange
  3. Making Grasslands Sustainable in Mongolia: Assessment of Key Elements in Nationally Appropriate Mitigation Actions for Grassland and Livestock Management By Asian Development Bank (ADB); ; ;
  4. Impacts of Changes in Federal Crop Insurance Programs on Land Use and Environmental Quality By Langpap, Christian; Wu, JunJie
  5. Optimal Timing of CCS Policies under Decreasing Returns to Scale By Amigues, Jean-Pierre; Lafforgue, Gilles; Moreaux, Michel
  6. Doubling the Share of Renewable Energy in the Global Energy Mix By Gabriela Elizondo Azuela; Irina Bushueva
  7. Dynamic Mechanism Design for a Global Commons By Rodrigo Harrison; Roger Lagunoff
  8. Spielräume für uni- und multilateralen Klimaschutz By Wolfgang Buchholz; Wolfgang Peters; Aneta Ufert
  9. Le contrôleur de gestion au service de l’environnement naturel By Angèle RENAUD
  10. Climate Change, Heat Stress, and U.S. Dairy Production By Key, Nigel; Sneeringer, Stacy; Marquardt, David
  11. Cities and Green Growth: The Case of the Chicago Tri-State Metropolitan Area By OECD
  12. Reaping the Carbon Rent: Abatement and Overallocation Profits in the European Cement industry, Insights from an LMDI Decomposition Analysis By Frédéric Branger; Philippe Quirion
  13. Clean substitutes and the effectiveness of Carbon Footprint Labels vs. Pigovian Subsidies: Evidence from a Field Experiment By Bruno Lanz; Jules-Daniel Wurlod; Luca Panzone; Timothy Swanson
  14. Drought risk reduction in agriculture: A review of adaptive strategies in East Africa and the Indo-Gangetic plain of South Asia: By Cenacchi, Nicola
  15. Can Spatial Dependence Enhance Industry Sustainability? The Case of Pasture-Based Beef By Inocencio Rodriguez; Gerard D'Souza; Thomas Griggs
  16. EU ETS, Free Allocations and Activity Level Thresholds. The devil lies in the details By Frédéric Branger; Jean-Pierre Ponssard; Oliver Sartor; Misato Sato
  17. Environment and Regional Trade Agreements: Emerging Trends and Policy Drivers By Clive George
  18. Optimal Carbon Sequestration Policies in Leaky Reservoirs By Jean-Marie Alain; Michel Moreaux; Mabel Tidball
  19. Incentivizing interdependent resource management: watersheds, groundwater, and coastal ecology By Kimberly Burnett; James Roumasset; Sittidaj Pongkijvorasin; Christopher Wada
  20. EU ETS, free allocations and activity level thresholds, the devil lies in the details By Frédéric Branger,; Jean-Pierre Ponssard; Oliver Sartor; Misato Sato
  21. Going to the Source: Using an Upstream Point of Regulation for Energy in a National Chinese Emissions Trading System By Suzi Kerr; Vicki Duscha
  22. The Good, Bad, and Ugly of Watershed Management By Kimberly Burnett; James Roumasset; Christopher Wada
  23. Synopsis: 2014 Global Hunger Index: The challenge of hidden hunger By von Grebmer, Klaus; Saltzman, Amy; Birol, Ekin; Wiesman, Doris; Prasai, Nilam; Yin, Sandra; Yohannes, Yisehac; Menon, Purnima; Thompson, Jennifer; Sonntag, Andrea
  24. Le territoire entrepreneurial durable. Fondements théoriques et analyse économique Sustainable entrepreneurial territory. Theoretical bases and economic analysis By Sophie BOUTILLIER; Dimitri UZUNIDIS
  25. Hedonic value of Italian tourism supply: comparing environmental and cultural attractiveness By Valter di Giacinto; Giacinto Micucci
  27. Transition to Clean Technology By Douglas Hanley; Daron Acemoglu; Ufuk Akcigit; William Kerr
  28. Spatial dynamics of electricity usage in India By Ghani, Ejaz; Goswami, Arti Grover; Kerr, William R.
  29. Climate Trends and Farmers’ Perceptions of Climate Change in Zambia By Mulenga, Brian P.; Wineman, Ayala
  30. Can Negotiating a Uniform Carbon Price Help to Internalize the Global Warming Externality? By Weitzman, Martin L.
  31. Price and Market Behavior in Phase II of the EU ETS By Beat Hintermann; Sonja Peterson; Wilfried Rickels
  32. Green subsidies and the WTO By Charnovitz, Steve
  33. Insurance against Climate Change : Financial Disaster Risk Management and Insurance Options for Climate Change Adaptation in Bulgaria By World Bank Group
  34. The Effects of Experience on Preferences: Theory and Empirics for Environmental Public Goods By Mikolaj Czajkowski; Nick Hanley; Jacob LaRiviere
  35. Environmental and Related Social Costs of the Tax Treatment of Company Cars and Commuting Expenses By Rana Roy
  36. Small Might Be Beautiful, but Bigger Performs Better: Scale Economies in "Green" Refurbishments of Apartment Housing By Claus Michelsen; Sebastian Rosenschon; Christian Schulz
  37. Global Drivers of Agricultural Demand and Supply By Sands, Ronald; Jones, Carol; Marshall, Elizabeth
  38. Environmental migration and labor markets in Nepal By Jean-Francois Maystadt; Valerie Mueller; Ashwini Sebastian
  39. Economic Valuation for a better Conservation: A Case Study of Kaziranga National Park, India By Raju Mandal; Subrata Barman; M. P. Bezbaruah
  40. Inducing Private Finance for Renewable Energy Projects: Evidence from Micro-Data By Miguel Cárdenas Rodríguez; Ivan Haščič; Nick Johnstone; Jérôme Silva; Antoine Ferey
  41. Catching-up in waste management. Evidence from the EU By Giovanni Marin; Francesco Nicolli; Roberto Zoboli
  42. Performance of renewable energy auctions : experience in Brazil, China and India By Elizondo Azuela, Gabriela; Barroso, Luiz; Khanna, Ashish; Wang, Xiaodong; Wu, Yun; Cunha, Gabriel
  43. A Spatial Approach to Energy Economics By M. Scott Taylor; Juan Moreno Cruz
  44. Quasi-experimental evidence on the drivers of index-based livestock insurance demand in Southern Ethiopia By Takahashi, Kazushi; Ikegami, Munenobu; Sheahan, Megan; Barrett, Christopher B.
  45. Renewable and non-renewable intermittent energy sources: friends and foes? By Edmond Baranes; Julien Jacqmin; Jean-Christophe Poudou
  46. Forest Policy and Trade: The New Zealand experience Creation Date: 1991 By K. Jackson
  47. Ancillary Benefits of GHG Abatement Policies in Developing Countries: A literature Survey By Timothy Swanson; Chiara Ravetti; Mu Quan; Xuxuan Xie; Zhang Shiqiu
  48. Controlling for the effects of information in a public goods discrete choice model By Mikolaj Czajkowski; Nick Hanley; Jacob LaRiviere
  49. Green Luxury Goods? The Economics of Eco-Labels in the Japanese Housing Market By Fuerst, Franz; Shimizu, Chihiro
  51. Justice environnementale et approche par les capabilités By Jérôme Ballet; Damien Bazin; Jérôme Pelenc

  1. By: Asian Development Bank (ADB); (East Asia Department, ADB); ;
    Abstract: Climate change is a threat to Mongolia’s economic growth, sustainable development, and fragile environment. Well-designed actions to mitigate climate hange can provide multiple benefits, including socioeconomic development and resilience to climate variability and change. Nationally appropriate mitigation actions (NAMAs) can provide a framework for the identification and implementation of mitigation actions. This publication identifies and assesses technical, titutional, and policy elements needed to develop and implement a NAMA in the grassland and livestock sector. Technical elements include estimates of greenhouse gas (GHG) mitigation potential, economic costs and benefits, GHG measurement options, adaptation benefits, and barriers to adoption and identification of policies and measures.
    Keywords: China; People’s Republic of China; PRC, mitigation, climate policy, grassland management, livestock management, grassland carbon sequestration, carbon offset, carbon market, carbon trade, carbon dioxide, greenhouse gas, clean development mechanism, CDM, certified emission reduction, CER, GHG intensity, carbon credit, emissions trading, verified carbon standard, VCS, voluntary emission reduction, VER
    Date: 2014–01
  2. By: Mareike Lange
    Abstract: It is still difficult for biofuel producers to prove the contribution of their biofuels to reducing carbon emissions because the production of biofuel feedstocks can cause land use change (LUC), which in turn causes carbon emissions. A carbon map can serve as a basis to prove such contribution. I show how to calculate a carbon map according to the sustainability requirements for biofuel production adopted by the European Commission (EU-RED) for the Brazilian Cerrado. Based on the carbon map and the carbon balance of the production process I derive maps showing the possible emission savings that would be generated by biofuels based on soy and sugarcane if an area were to be converted to produce feedstock for this biofuel options. I evaluate these maps according to the criterion contained in the EU-RED of 35% minimum emission savings for each biofuel option compared to its fossil alternative. In addition, to avoid indirect LUC effects of the EU-RED that might offset any contribution of biofuels to reducing carbon emissions. I argue that all agricultural production should be subject to a carbon assessment. In this effort, the calculated carbon maps can be the basis for a climate friendly land use planning that is binding for all agricultural production in the Cerrado
    Keywords: biofuels, carbon emissions, Renewable Energy directive, carbon map, land use change, Brazil
    JEL: Q42 Q58 Q56 Q16
    Date: 2014–10
  3. By: Asian Development Bank (ADB); (East Asia Department, ADB); ;
    Abstract: Climate change is a threat to Mongolia’s economic growth, sustainable development, and fragile environment. Well-designed actions to mitigate climate change can provide multiple benefits, including socioeconomic development and resilience to climate variability and change. Nationally appropriate mitigation actions (NAMAs) can provide a framework for the identification and implementation of mitigation actions. This publication identifies and assesses technical, institutional, and policy elements needed to develop and implement a NAMA in the grassland and livestock sector. Technical elements include estimates of greenhouse gas (GHG) mitigation potential, economic costs and benefits, GHG measurement options, adaptation benefits, and barriers to adoption and identification of policies and measures.
    Keywords: Mongolia, climate change, mitigation, adaptation, greenhouse gas, GHG, carbon dioxide, methane, National Action Program on Climate Change, National Livestock Program, herders livelihoods, development, pasture rotation, pasture management livestock management, nationally appropriate mitigation action; NAMA, carbon finance, carbon market
    Date: 2014–03
  4. By: Langpap, Christian; Wu, JunJie
    Abstract: This paper integrates economic and physical models to assess how federal crop revenue insurance programs might affect land use, cropping systems, and environmental quality in the U.S. Corn Belt region. The empirical framework includes econometric models that predict land conversion, crop choices, and crop rotations at the parcel level based on expectation and variance of crop revenues, land quality, climate conditions, and physical characteristics at each site. The predictions are then combined with site-specific environmental production functions to determine the effect of revenue insurance on nitrate runoff and leaching, soil water and wind erosion, and carbon sequestration. Results suggest that crop insurance will have small impacts on conversions of non-cropland to cropland, but more significant impacts on crop choice. These changes in crop mix have moderate impacts on agricultural pollution.
    Keywords: Crop Insurance, Revenue Insurance, Crop Choice, Environmental Quality, Agricultural and Food Policy, Land Economics/Use, Risk and Uncertainty, Q18, Q28,
    Date: 2014–10
  5. By: Amigues, Jean-Pierre; Lafforgue, Gilles; Moreaux, Michel
    Abstract: Carbon capture and sequestration (CCS) can help to mitigate the climate change transition. Usually, in models where the atmospheric carbon stock is constrained by an institutional stabilization cap and under constant average CCS cost, the use of CCS must be delayed up to the time at which the constraint begins to be e@ective. In this paper, we show that, when abatement activity are submitted to decreasing returns to scale, abatement must start earlier, before the climate constraint becomes to bind, but they must also be stopped strictly before the climate constraints ceases to be active. Depending on the solar energy costs, either there is a return toward dirty energy or either a progressive rise of solar energy at the expense of abatement activities.
    Keywords: Energy resources; carbon stabilization cap; carbon capture and storage; decreasing returns to scale
    JEL: Q32 Q42 Q54 Q58
    Date: 2014–05
  6. By: Gabriela Elizondo Azuela; Irina Bushueva
    Keywords: Environment - Climate Change Mitigation and Green House Gases Energy - Energy Demand Energy - Energy Production and Transportation Environment - Environment and Energy Efficiency Energy - Energy and Environment
    Date: 2014–09
  7. By: Rodrigo Harrison (Instituto de Economia. Pontificia Universidad Católica de Chile.); Roger Lagunoff (Department of Economics, Georgetown University)
    Abstract: We model dynamic mechanisms for a global commons. Countries benefit from both consumption and aggregate conservation of an open access resource. A country's relative value of consumption-to-conservation is privately observed and evolves stochastically. An optimal quota maximizes world welfare subject to being implementable by Perfect Bayesian equilibria. With complete information, the optimal quota is first best; it allocates more of the resource each period to countries with high consumption value. Under incomplete information, the optimal quota is fully compressed - initially identical countries always receive the same quota even as environmental costs and resource needs differ later on.
    Keywords: Dynamic mechanism design, global commons, climate change, optimal quota, full compression, fish wars, Perfect Bayesian equilibria, international agency.
    JEL: C73 D82 F53 Q54 Q58
    Date: 2013–09–15
  8. By: Wolfgang Buchholz (Department of Economics, University of Regensburg); Wolfgang Peters (Faculty of Business Administration and Economics, European University Viadrina, Frankfurt (Oder)); Aneta Ufert (Faculty of Business Administration and Economics, European University Viadrina, Frankfurt (Oder))
    Abstract: The failure of previous climate policy leads us back to the public good characteristic of climate protection. The first aim of this paper is to identify by a simple graphical representation of 2x2 games, the ranges of constellations between country-specific environmental benefits and abatement costs which entail the four relevant games: prisoners’ dilemma, chicken game, stag hunt game and harmony game. Moreover, we examine how fairness preferences and especially reciprocity change these ranges. In contrast to the hypothesis that fairness motivations will foster cooperation we show that reciprocity reduces the scope for unilateral climate protection. In a third step, we consider reciprocal subsidies of abatement efforts, which definitely increase the scope for successful climate protection without requiring contractual mitigation obligations.
    Date: 2014–09
  9. By: Angèle RENAUD (IAE DIJON - Université de Bourgogne (CREGO))
    Abstract: (VF) Cet article s’interroge sur les rôles du contrôleur de gestion dans le domaine environnemental.Pour ce faire, une étude de cas longitudinale est menée sur une entreprise française avantgardiste en matière de contrôle de gestion environnemental (CGE). Les résultats révèlent 4 rôles du contrôleur de gestion (vérificateur de CO2, business partner, traducteur euro-carbone, acteur du changement) et ses caractéristiques dans ce nouveau domaine (image, pouvoir d’influence et territoire). Plusieurs enseignements d’ordre théorique, managérial et méthodologique sont tirés du cas. (VA) This paper explores the role of the management controller in environmental management control (EMC) by means of a longitudinal case study of a French company with a pioneering approach to EMC. The results show that the management controller has four key roles (carbon auditor, business partner, euro-carbon translator, and agent of change) and illustrate the characteristics of the controller in this new domain (image, power of influence, and territory). Several theoretical, managerial, and methodological lessons may be learned from this case study.
    Keywords: Contrôleur de gestion;Contrôle de gestion environnemental (CGE);Bilan carbone;Budget carbone ; Management Controller;Environmental Management Control (EMC);Environmental Management Controller;Carbon Footprint;Carbon Budget
    JEL: M41 M14
    Date: 2014–04
  10. By: Key, Nigel; Sneeringer, Stacy; Marquardt, David
    Abstract: In the United States, climate change is likely to increase average daily temperatures and the frequency of heat waves, which can reduce meat and milk production in animals. Methods that livestock producers use to mitigate thermal stress—including modifications to animal management or housing—tend to increase production costs and capital expenditures. Dairy cows are particularly sensitive to heat stress, and the dairy sector has been estimated to bear over half of the costs of current heat stress to the livestock industry. In this report, we use operation-level economic data coupled with finely scaled climate data to estimate how the local thermal environment affects U.S. dairies’ effectiveness at producing outputs with a given level of inputs. We use this information to estimate the potential decline in milk production in 2030 resulting from climate change-induced heat stress. For four climate model scenarios, the results indicate modest heat stress-related production declines over the next 20 years, with the largest declines occurring in the South.
    Keywords: Climate change, dairy, heat stress, productivity, stochastic frontier, technical efficiency, Environmental Economics and Policy, Livestock Production/Industries,
    Date: 2014–09
  11. By: OECD
    Abstract: This working paper assesses opportunities and policies for green growth in the Chicago Tri-State Metropolitan Area. It first examines the Chicago metro-region's economic and environmental performance and potential constraints to regional growth, and identifies emerging regional specialisations in green products and services. This is followed by a review of sector-specific policies that can contribute to green jobs, green firms and urban attractiveness, with particular attention to energy-efficient buildings, the wind energy industry, public transportation, and the water and waste sectors. Finally, the working paper considers the role of workforce, innovation and governance policies, focusing on skill shortages and skill mismatches in the regional labour market, ways to make the most of the region's innovation assets, and opportunities for regional institutional co-ordination.
    Keywords: sustainable development, innovation, transport, renewable energy, climate change, energy efficiency, green technologies, green growth, green economy, urban sustainability, cities, multi-level governance, metro-region, Chicago, Indiana, Illinois, green cities, Milwaukee, urban development, regional clusters, attractiveness, Wisconsin
    JEL: O18 O44 Q01 Q55 Q58 R11 R58
    Date: 2013–05–03
  12. By: Frédéric Branger (CIRED et AgroParisTech ENGREF); Philippe Quirion (CNRS et CIRED)
    Abstract: We analyse variations of carbon emissions in the European cement industry from 1990 to 2011, at the European level(EU 27), and at the national level for six major producers (Germany, France, Spain, United Kingdom, Italy and Poland). We apply a Log-Mean Divisia Index (LMDI) method, crossing data from three databases: the Getting the Numbers Right (GNR) database developed by the Cement Sustainability Initiative, the European Union Transaction Log (EUTL), and the Eurostat International Trade database. Our decomposition method allows disentangling seven channels of emissions change: activity, clinker trade, clinker share, alternative fuels, thermal and electric energy efficiency, and electricity decarbonisation. We find that, apart from a slow trend of emissions reductions coming from technological improvements(first from a decrease in the clinker share, then from an increase in alternative fuels), most of the emissions changes can be attributed to the activity effect. Using counterfactual scenarios, we estimate that the introduction of the EU ETS brought small but positive technological abatement (2.0% ± 1.1% between 2005 and 2011). Moreover, we find that the European cement industry have gained 3.5 billion euros of “overallocation profits”, mostly due to the slowdown of production. Based on these findings, we advocate for output-based allocations, based on a stringent hybrid clinker and cement benchmarking.
    Keywords: Cement Industry, LMDI, EU ETS, Abatement, Overallocation, Windfall Profits, Overallocation Profits, Carbon Emissions, Energy Efficiency.
    JEL: Q58 Q54
    Date: 2014–09
  13. By: Bruno Lanz; Jules-Daniel Wurlod (Centre for International Environmental Studies, The Graduate Institute); Luca Panzone; Timothy Swanson
    Abstract: We study how substitutability between clean and dirty alternatives affects the effectiveness of environmental regulation in a field experiment that controls for the choice set of respondents. We consider four product categories with clean and dirty alternatives: (i) cola products in plastic bottles vs. in aluminum cans; (ii) skimmed vs. whole milk; (iii) chicken meat vs. beef meat; and (iv) margarine vs. butter. We employ two neutrally framed treatments to quantify the willingness to substitute between clean and dirty alternatives in each product market, namely a change in relative prices and the removal of the dirty alternative, leaving respondents the option of buying one of the remaining clean alternatives or nothing. We then compare the impact of a carbon footprint label and a Pigovian subsidy to the clean alternatives. While both instruments increase the market share of the clean products, their impact is higher when clean and dirty alternatives are close substitutes. We also find evidence that motivation crowding is present and increases with substitutability. Our results highlight the importance of product markets in the design of consumer-orientated policies.
    Keywords: Field experiments; Environmental policy; Market-based instruments; Information provision; Clean substitutes; Motivation crowding; Carbon footprint.
    JEL: C25 C91 D12 D64 L15 L50 Q58
    Date: 2014–10–01
  14. By: Cenacchi, Nicola
    Abstract: This report is a component of the Research Program on Climate Change, Agriculture, and Food Security (CCAFS)–-funded project “Impacts of Climate Extremes on Future Water and Food Security in South Asia and East Africa.†The goal of the project was to characterize extreme drought events, to improve on a methodology to assess the probability of these events in the future under climate change, to illustrate their impacts, and to provide suggestions on coping strategies. The present report sets the stage for the overall project by undertaking a review of the causes of vulnerability to drought in East Africa and the western Indo-Gangetic Plain (IGP) of South Asia, and discussing the options to increase resilience to drought in the agricultural sector. Agriculture is a high-risk endeavor in both regions, due to a combination of recurrent droughts—which may intensify due to climate change—poor soil fertility, and a host of constraints faced by farmers, especially low access to input and output markets. These factors, combined with farmers’ high aversion to risk, stifle investments in agriculture, resulting in continuous underachieving production, low income, and persisting poverty.
    Keywords: Climate change, Droughts, Risk, Water availability, Agricultural development, climate adaptation, vulnerability, shocks, environmental shocks,
    Date: 2014
  15. By: Inocencio Rodriguez (Division of Resource Management, West Virginia University); Gerard D'Souza (Division of Resource Management, West Virginia University); Thomas Griggs (Division of Plant & Soil Sciences, West Virginia University)
    Abstract: Can sustainability be enhanced by maximizing the sum of private and social benefits from an industry? This might take place, for example, by identifying production options that increase profitability side-by-side with societal goals such as renewable energy production and carbon sequestration, healthier communities, environmental quality, and economic development. We explore this issue for pasture based beef (PBB), a nascent industry where industry profitability, community development, and quality of life can be enhanced by explicitly linking the PBB supply chain spatially and intertemporally, thereby increasing the sum of private and social benefits. We develop a framework based on optimal control theory that integrates a spatial component in which the production of PBB and alternative energy production as well as greenhouse gas emission reduction enhances private as well as social wealth. This model provides a basic foundation for developing agglomeration economies in a spatially dependent industry in which other locations are able to supply resources to given locations as a way of improving regional economic and environmental conditions. The framework is subsequently employed to identify possible industry conditions and configurations that demonstrate how profits, economic development, and environmental improvement can be created through increased pasture-beef production in a region where economic activities across locations play a crucial role across the spatial domain. Of course, the intensification of benefits derived from the agglomeration economies require coordination and cooperation among the key players within the impacted region.
    Keywords: spatial optimal control, pasture-based beef, on-farm energy, sustainability
    JEL: C21 Q4 Q5 Q56
    Date: 2013–04
  16. By: Frédéric Branger (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, AgroParisTech - AgroParisTech); Jean-Pierre Ponssard (Department of Economics, Ecole Polytechnique - CNRS : UMR7176 - Polytechnique - X); Oliver Sartor (IDDRI - Institut du Développement Durable et des Relations Internationales - Institut d'Études Politiques [IEP] - Paris); Misato Sato (London School of Economics - [-])
    Abstract: This paper investigates incentives for firms to increase output above the activity level thresholds (ALTs) in order to obtain more free allowances in the EU Emissions Trading Scheme. While ALTs were introduced in order to reduce excess free allocation to low-activity installations, for installations operating below the threshold, the financial gain from increasing output to reach the threshold may outweigh the costs. Using installation level data for 246 clinker plants, we estimate the effect of ALTs on output decisions. The ALTs induced 5.8Mt of excess clinker production in 2012 (4% of total EU output), which corresponds to 5.2Mt of excess CO2 emissions (over 5% of total sector emissions). As intended, ALTs do reduce overallocation (by 6.6million allowances) relative to a scenario without ALTs, but an alternative output based allocation would further reduce overallocation by 39.5million allowances (29% of total cement sector free allocation). Firms responded disproportionately to ALTs in countries with low demand, especially in Spain and Greece. The excess clinker output lead to increased EU clinker and cement exports, production shifting between plants and also an increase in clinker content of cement thus reducing the carbon efficiency of cement production.
    Keywords: Activity level thresholds, EU ETS, carbon trading, free allowance allocations, cement
    Date: 2014–10–08
  17. By: Clive George
    Abstract: This report examines trends in the use of environmental provisions in Regional Trade Agreements and identifies factors which may explain the presence or absence of these provisions. The report builds on work of the OECD Joint Working Party on Trade and Environment (JWPTE) and includes results of an informal survey of delegates. Analysis of the environmental provisions in RTAs reveals an encouraging upward trend. While basic provisions remain the most common types found in RTAs, the incidence of more substantive provisions has increased significantly in recent years. Among these, environmental co-operation has been the most common type. Several factors may have contributed to this evolution. These include countries extending their political mandates for RTAs, for example to include provisions for compliance with multilateral environmental agreements (MEAs), as well as a general accumulation of experience with the use of environmental provisions.
    Keywords: trade policy, trade and environment, free trade agreements, environmental provisions, regional trade agreements
    JEL: F13 F18 N50 Q56
    Date: 2014–07–25
  18. By: Jean-Marie Alain (INRIA and UMR LIRMM); Michel Moreaux (Toulouse School of Economics, IDEI and LERNA); Mabel Tidball (INRA and UMR LAMETA)
    Abstract: We study in this report a model of optimal Carbon Capture and Storage in which the reservoir of sequestered carbon is leaky, and pollution eventually is released into the atmosphere. We formulate the social planner problem as an optimal control program and we describe the optimal consumption paths as a function of the initial conditions, the physical constants and the economic parameters. In particular, we show that the presence of leaks may lead to situations which do not occur otherwise, including that of non-monotonous price paths for the energy.
    Keywords: carbon sequestration and storage, optimal control.
    JEL: Q32 C61
    Date: 2014–09
  19. By: Kimberly Burnett (UHERO, University of Hawai‘i at Manoa); James Roumasset (University of Hawai‘i at Manoa, UHERO); Sittidaj Pongkijvorasin; Christopher Wada (UHERO, University of Hawai‘i at Manoa)
    Abstract: Managing water resources independently may result in substantial economic losses when those resources are interdependent with each other and with other environmental resources. We first develop general principles for using resources with spillovers, including corrective taxes (subsidies) for incentivizing private resource users. We then analyze specific cases of managing water resources, in particular the interaction of groundwater with upstream or downstream resource systems.
    Date: 2014–06
  20. By: Frédéric Branger,; Jean-Pierre Ponssard; Oliver Sartor; Misato Sato
    Abstract: This paper investigates incentives for firms to increase output above the activity level thresholds (ALTs) in order to obtain more free allowances in the EU Emissions Trading Scheme. While ALTs were introduced in order to reduce excess free allocation to low-activity installations, for installations operating below the threshold, the financial gain from increasing output to reach the threshold may outweigh the costs. Using installation level data for 246 clinker plants, we estimate the effect of ALTs on output decisions. The ALTs induced 5.8Mt of excess clinker production in 2012 (4% of total EU output), which corresponds to 5.2Mt of excess CO2 emissions (over 5% of total sector emissions). As intended, ALTs do reduce overallocation (by 6.6million allowances) relative to a scenario without ALTs, but an alternative output based allocation would further reduce overallocation by 39.5million allowances (29% of total cement sector free allocation). Firms responded disproportionately to ALTs in countries with low demand, especially in Spain and Greece. The excess clinker output lead to increased EU clinker and cement exports, production shifting between plants and also an increase in clinker content of cement thus reducing the carbon efficiency of cement production.
    Date: 2014–10
  21. By: Suzi Kerr (Motu Economic and Public Policy Research); Vicki Duscha (Fraunhofer Institute for Systems and Innovation Research)
    Abstract: There are many choices within the design of an emissions trading system. In this paper we focus on one specific aspect – the point of regulation for the energy sector. This choice affects transaction costs; comprehensiveness, and hence the amount of emissions covered and the extent to which the potential cost-effectiveness gains are realised; and credibility of the system. We discuss how an “upstream” energy sector emissions trading system works and present arguments for going upstream (in particular, simplicity of administration) while also discussing arguments for other points of regulation in light of the Chinese circumstances. We present experiences with the New Zealand system, the only system that is entirely upstream for energy, showing ways to address issues that may arise with an upstream system. Ultimately the success of emissions trading depends on markets that operate in a relatively free and competitive way. Simply copying others’ systems to the context of a largely controlled economy such as the Chinese one is likely to be ineffective; each system must be uniquely tailored to local circumstances, possibly in China more than ever before.
    Keywords: Emissions trading scheme, point of regulation, upstream, energy sector, China, New Zealand
    JEL: Q54 Q56 Q58 Q48 H23
    Date: 2014–09
  22. By: Kimberly Burnett (UHERO, University of Hawai‘i at Manoa); James Roumasset (University of Hawai‘i at Manoa, UHERO); Christopher Wada (UHERO, University of Hawai‘i at Manoa)
    Abstract: Efficient management of groundwater resource systems requires careful consideration of relationships — both positive and negative — with the surrounding environment. The removal of and protection against “bad” and "ugly" natural capital such as invasive plants and feral animals and the enhancement of “good” capital (e.g. protective fencing) are often viewed as distinct management problems. Yet environmental linkages to a common groundwater resource suggest that watershed management decisions should be informed by an integrated framework. We develop such a framework and derive principles that govern optimal investment in the management of two types of natural capital — those that increase recharge and those that decrease recharge — as well as groundwater extraction itself. Depending on the initial conditions of the system and the characteristics of each type of natural capital, it may make sense to remove bad capital exclusively, enhance good capital exclusively, or invest in both activities simultaneously until their marginal benefits are equal.
    Keywords: Watershed management, natural capital, invasive species, groundwater economics
    JEL: Q24 Q25
    Date: 2014–05
  23. By: von Grebmer, Klaus; Saltzman, Amy; Birol, Ekin; Wiesman, Doris; Prasai, Nilam; Yin, Sandra; Yohannes, Yisehac; Menon, Purnima; Thompson, Jennifer; Sonntag, Andrea
    Abstract: The 2014 Global Hunger Index (GHI) report the ninth in an annual series presents a multidimensional measure of national, regional, and global hunger. It shows that the world has made progress in reducing hunger since 1990, but still has far to go, with levels of hunger remaining alarming or extremely alarming in 16 countries. This years report focuses on a critical aspect of hunger that is often overlooked: hidden hunger. Also known as micronutrient deficiency, hidden hunger affects more than an estimated 2 billion people globally. The repercussions of these vitamin and mineral deficiencies are both serious and long lasting. Where hidden hunger has taken root, it not only prevents people from surviving and thriving as productive members of society, it also holds countries back in a cycle of poor nutrition, poor health, lost productivity, persistent poverty, and reduced economic growth.
    Keywords: Africa South of Sahara; Caribbean; CIS; Commonwealth of Independent States; South Asia; Southeast Asia; Latin America; Developing countries; Middle East; North Africa; OECD countries; India; East Africa; East Asia; Eastern Europe; Food availability; food crises; food crisis; food prices; food security; Global Hunger Index; GHI; Gross income; indicators; Children; Land; Land degradation; Nutrition; Malnutrition; Undernutrition; Hunger; Micronutrients; Mortality; Natural resources; Climate change; Data; Policies; Poverty; property rights; smallholders; Stress; Sustainable development; sustainable livelihoods; transition economies; Underweight; Water; resilience; natural disasters; disaster relief; environmental disasters; emergencies; environmental shocks; environmental risks; nutritive value; vitamin deficiencies; mineral deficiencies; nutrition security
    Date: 2014
  24. By: Sophie BOUTILLIER (Lab.RII, ULCO/Clersé-UMR8019, Université Lille Nord de France, RRI); Dimitri UZUNIDIS (Lab.RII, ULCO/Clersé-UMR8019, Université Lille Nord de France, RRI)
    Abstract: Qu’est-ce qu’un territoire entrepreneurial durable ? Pour analyser la dynamique de l’innovation dans les territoires industriels dont la reconversion passe par les activités de l’environnement et du développement durable, le chercheur doit répondre à plusieurs questions capitales : Comment définir l’entrepreneuriat innovant ? Comment favoriser l’entrepreneuriat éco-innovant ? Quels rôles et fonctions des institutions et de l'initiative individuelle ? Quelles opportunités et atouts pour l’entrepreneur éco-innovant ? Un territoire entrepreneurial durable peut être défini comme un ensemble territorialisé qui s’efforce de mobiliser des ressources sur le plan social, politique, économique, culturel et environnemental à l’intérieur d’un cadre institutionnel cohérent au service d’une stratégie clairement définie de développement économique et social respectueux de la préservation des ressources naturelles. Un de ses objectifs est la promotion de la création d’éco-entreprises pour réussir un programme de réorientation de sa trajectoire de développement. What is a sustainable entrepreneurial territory? To analyze the dynamics of innovation in industrial areas where conversion ensues from the development of activities related to environment and sustainable development, the researcher has to answer to several crucial questions: How to define innovative entrepreneurship? How to promote eco-innovative entrepreneurship? What are the respective roles and functions of institutions and of individual initiative? What are the opportunities and advantages for the eco-innovative entrepreneur? A sustainable entrepreneurial territory can be defined as a territorialized area that seeks to mobilize social, political, economic, cultural and environmental resources within a coherent institutional framework to serve a clearly defined economic and social development strategy respecting the conservation of natural resources. One of its objectives is to promote the creation of green businesses to successfully complete a reorientation of its development path.
    Keywords: territoire entrepreneurial durable, entrepreneuriat, développement durable, développement territorial
    JEL: L26 O18 Q01
    Date: 2014–06
  25. By: Valter di Giacinto (Bank of Italy); Giacinto Micucci (Bank of Italy)
    Abstract: This paper provides an empirical evaluation of the main determinants of hotel prices in the Italian tourism industry. We pool information from two datasets: i) a database on hotel prices and attributes based on the Touring Club Italia Guide and providing information on about 1,100 hotels located in almost 300 towns in the entire Italian coastal region; and ii) a set of neighbourhood characteristics indicators that assess local environmental quality and artistic and cultural attractiveness. On the basis of the results of a hedonic analysis of hotel price differentials, we show that tourists place a high value on both marine environmental quality and local access to artistic and cultural amenities. The contribution to consumer utility is sizeable in both cases, but that of artistic and cultural amenities appears to be more stable across seasons. On the whole, our results suggest that the widespread availability of an extraordinarily rich artistic and cultural endowment, as is the case of Italy, may strongly complement environmental attributes in supporting the non-price competitiveness of the coastal tourism industry.
    Keywords: tourism; environment; artistic and cultural attractiveness
    JEL: L83 Q53 R11 Z11
    Date: 2014–09
  26. By: Caroline Burr (Bournemouth University, UK)
    Abstract: Customers, through their purchases, play a central role in sustainable development. As public concern for the environment increases, opportunities emerge for marketers to produce the green products that consumers desire. However, there is growing skepticism about green claims, and despite many consumers being pro-environmental, most do not translate this into purchases. These factors pose problems for organisations, therefore in order to take advantage of the available opportunities, companies need to understand green consumer behavior in more depth. This paper will critically analyse the conventional literature on green consumption, but will also synthesise the recent research which covers exclusion, conspicuous consumption and cheating. Green purchasing might be different from other types of consumer behaviour due to the underlying motivations, and as such we are beginning to discover more about the experiential and symbolic benefits of green products. Buying green products can be considered as a new form of conspicuous consumption, which denotes the consumer as caring, informed and well- off . In addition, certain green consumption patterns may be used to reinforce symbolic boundaries. For instance, simultaneously including the consumer as green, but also excluding the consumer from the non-green consumption patterns which are said to have contributed to global warming etc. These findings appear to contradict the previous literature which has consistently indicated that values such as universalism and benevolence are positively related to environmentally friendly behaviours, and others such as power, achievement and hedonism are negatively related. It also seems that the ‘greener’ people are, counter-intuitively, the more likely they are to lie and cheat. The “halo of green consumerism” appears to be a licensing effect which allows people to behave less well in other areas of life. This literature review will consider the implications for green marketing, particularly focusing on exclusion, conspicuous consumption and cheating.
    Date: 2013–09
  27. By: Douglas Hanley; Daron Acemoglu; Ufuk Akcigit; William Kerr
    Abstract: We develop a microeconomic model of endogenous growth where clean and dirty technologies compete in production and innovation-in the sense that research can be directed to either clean or dirty technologies. If dirty technologies are more advanced to start with, the potential transition to clean technology can be difficult both because clean research must climb several steps to catch up with dirty technology and because this gap discourages research effort directed towards clean technologies. Carbon taxes and research subsidies may nonetheless encourage production and innovation in clean technologies, though the transition will typically be slow. We characterize certain general properties of the transition path from dirty to clean technology. We then estimate the model using a combination of regression analysis on the relationship between R&D and patents, and simulated method of moments using microdata on employment, production, R&D, firm growth, entry and exit from the US energy sector. The model`s quantitative implications match a range of moments not targeted in the estimation quite well. We then characterize the optimal policy path implied by the model and our estimates. Optimal policy heavily relies on research subsidies as well as carbon taxes. We use the model to evaluate the welfare consequences of a range of alternative policy structures. For example, just relying on carbon taxes or delaying intervention both have significant welfare costs--though their implications for medium run temperature increases are quite different.
    Keywords: carbon cycle, directed technological change, environment, innovation, optimal policy
    JEL: O30 O31 O33 C65
    Date: 2014–01
  28. By: Ghani, Ejaz; Goswami, Arti Grover; Kerr, William R.
    Abstract: India's manufacturing sector has undergone many spatial adjustments since 1989, including, for example, the organized sector's migration to rural locations, the powerful rise of informal manufacturing within cities, and the development of intermediate cities for manufacturing. This paper investigates the impact of these spatial adjustments for electricity usage in India’s manufacturing sector. Striking spatial differences in energy usage exist, and whether spatial adjustments exacerbate or alleviate energy consumption strains is important for issues ranging from reducing India's power blackouts to stemming rising pollution levels. Using detailed surveys for the organized and unorganized sectors, the analysis finds that electricity usage per unit of output in urban plants declined steadily during 1989-2010. In the rural areas, by contrast, electricity consumption per unit of output for organized sector plants peaked in 2000 and thereafter declined. Decomposing the observed trends in aggregate electricity usage from 2000 onwards, the paper finds that most reductions in electricity usage per unit of output came from reductions in existing sites of activity (defined through state-industry-urban/rural cells). The second biggest factor leading to reduced usage was lower usage in fast-growing sectors. By contrast, spatial movements of manufacturing activity across India did not significantly change usage levels and may have even increased them. This appears to have been in part because of the split nature of the mobility, with organized and unorganized sectors migrating in opposite directions.
    Keywords: Energy Production and Transportation,Climate Change Mitigation and Green House Gases,Environment and Energy Efficiency,Energy and Environment,Energy Demand
    Date: 2014–10–01
  29. By: Mulenga, Brian P.; Wineman, Ayala
    Abstract: In Zambia like in many other developing countries, the agricultural sector is highly dependent on rain-fed production and therefore vulnerable to weather shocks. Maize is the primary staple crop in Zambia, and is widely grown by smallholder farmers throughout the country, with a dual cassava-maize regime found only in the northern region. Among the smallholder farmers almost all production is rain-fed with very few farmers using mechanized irrigation. Climate change therefore has the potential to significantly reduce agricultural production and exacerbate poverty and food insecurity.
    Keywords: Climate trends, Zambia, Agricultural and Food Policy, Food Security and Poverty,
    Date: 2014–09
  30. By: Weitzman, Martin L.
    Abstract: It is difficult to resolve the global warming free-rider externality problem by negotiating n different quantity targets. By contrast, negotiating a single internationally binding minimum carbon price (the proceeds from which are domestically retained) counters self-interest by incentivizing agents to internalize the externality. The model of this article indicates an exact sense in which each agent’s extra cost from a higher emissions price is counterbalanced by that agent’s extra benefit from inducing all other agents to simultaneously lower their emissions in response to the higher price. Some implications are discussed. While the study is centered on a formal model, the tone of the policy discussion resembles more an exploratory think piece.
    Date: 2014
  31. By: Beat Hintermann; Sonja Peterson; Wilfried Rickels
    Abstract: Since 2005, the EU ETS has provided a market-based price signal for European carbon emissions, accompanied by increasing economic research related to this policy instrument. In this paper, we carry out a review of the empirical literature examining allowance price formation. A consensus has emerged that allowance prices are significantly related to fuel prices and to variables affecting the expected amount of necessary abatement, such as economic activity or changes in the cap. However, the relationship is not robust, probably because the relevant abatement technologies change with the economic conditions they operate in. There is evidence that models explicitly accounting for uncertainty about future demand and supply of abatement are better at explaining allowance price variation during certain periods. Yet, our understanding of the level of the allowance price remains poor. We cannot say with any degree of confidence whether the price is “right,” in the sense that it reflects marginal abatement costs, or whether there is a price wedge caused by transaction costs, price manipulation, or other sources of inefficiency. Nevertheless, the market has matured compared to Phase I, and the banking provision has induced it to incorporate future scarcity of allowances and to smooth the effect of transient shocks as intended
    Keywords: EU Emission trading, allowance Prices, market efficiency
    JEL: Q56 Q58
    Date: 2014–09
  32. By: Charnovitz, Steve
    Abstract: This paper provides a detailed explanation how the law of the World Trade Organization regulates environmental subsidies with a focus on renewable energy subsidies. The paper begins by discussing the economic justifications for such subsidies and the criticisms of them and then gives examples of categories of subsidies. The paper provides an overview of the relevant World Trade Organization rules and case law, including the recent Canada-Renewable Energy case. The paper also makes specific recommendations for how World Trade Organization law can be improved and discusses the literature on reform proposals. The study finds that because of a lack of clarity in World Trade Organizaion rules, for some clean energy subsidies, a government will not know in advance whether the subsidy is World Trade Organization-legal.
    Keywords: Environmental Economics&Policies,Economic Theory&Research,Taxation&Subsidies,Emerging Markets,Trade Law
    Date: 2014–10–01
  33. By: World Bank Group
    Keywords: Insurance and Risk Mitigation Macroeconomics and Economic Growth - Climate Change Economics Finance and Financial Sector Development - Debt Markets Urban Development - Hazard Risk Management Law and Development - Insurance Law
    Date: 2014
  34. By: Mikolaj Czajkowski (Faculty of Economic Sciences, University of Warsaw, Poland); Nick Hanley (School of Geography and Sustainable Development, University of St. Andrews); Jacob LaRiviere (Department of Economics, University of Tennessee)
    Abstract: This paper develops a choice model for environmental public goods which allows for consumers to learn about their preferences through consumption experiences. We develop a theoretical model of Bayesian updating, perform comparative statics over the model, and show how the theoretical model can be consistently incorporated into a reduced form econometric model. Our main findings are that in a Random Utility Model (RUM) discrete choice model, a subject’s scale should increase and the variability of scale should decrease with experience if subjects are Bayesians. We then estimate the model using field data regarding preferences for one particular public good, water quality. We find strong evidence that additional experience increases scale, thereby makes consumer preferences more predictable from the econometrician’s perspective. We find supportive but less convincing evidence that experience decreases the variability of scale across subjects.
    Keywords: Bayesian updating,choice experiment,learning,scale, scale variance
    JEL: C51 D83 Q51 H43
    Date: 2014–09
  35. By: Rana Roy
    Abstract: This paper builds upon a recent OECD paper on the personal tax treatment of company cars and commuting expenses in OECD member-countries and aims to arrive at a better understanding of the environmental and related social costs of the tax treatment described therein. The paper begins with an analysis of the larger transport market, which is the primary storehouse of evidence on the nature and extent of the environmental impacts of the various transport modes, the relative importance of the proximate and underlying determinants of these impacts, and the elasticities and functional relationships at work. Non-linearities in the relevant elasticities and functional relationships mean that the tax treatment of company cars may have a greater or lesser impact than is suggested by the size of the company car market. And distortions in relative prices between competing modes in the larger transport market mean that subsidies can have very different impacts depending on the mode in question. The further analysis of the interaction of the current tax treatment of company cars and commuting expenses with the transport market yields several findings. The current under-taxation of company cars is likely to result in a disproportionately large increase in total distance driven, composed of both an increase in the number of cars in use and an increase in distance driven per car. In turn, this is likely to result in disproportionately large impacts on most relevant environmental and related social costs. And a favourable tax treatment of commuting expenses generally, and of employer-paid parking in particular, is likely to impact on the choice of transport mode in favour of the car relative to public transport and non-motorised modes. In turn, this is likely to impact on most relevant environmental and related social costs. An Annex to this paper provides, for the OECD group of countries as a whole, some indicative estimates of the main relevant impacts of the under-taxation of company cars as well as an indicative estimate of its overall social cost. The largest quantified cost elements are additional congestion costs; additional local air pollution costs; and additional traffic accident costs. The overall social cost attributable to the current under-taxation of company cars is estimated at circa EUR 116 billion per year. Ce document fait fond sur une récente étude de l’OCDE sur le traitement des voitures de société et des frais de déplacement domicile-travail dans le cadre de l’impôt sur le revenu des personnes physiques dans les pays membres de l’OCDE. Il vise à mieux cerner les coûts environnementaux et les coûts sociaux connexes de ce traitement. Le document s’ouvre sur une analyse du marché des transports en général, qui offre le principal gisement d’informations sur la nature et l’ampleur des incidences environnementales des différents modes de transport, sur l’importance relative des déterminants immédiats et sous-jacents de ces incidences, ainsi que sur les élasticités et les relations fonctionnelles qui entrent en jeu. Si ces élasticités et relations ne sont pas linéaires, l’impact du traitement fiscal des voitures de société peut être plus fort ou plus faible que ne le laisse penser la taille du marché de ces voitures. En outre, en présence de distorsions affectant les prix relatifs des modes concurrents sur le marché des transports en général, les subventions peuvent avoir des répercussions très différentes selon le mode considéré. Une analyse plus poussée de l’interaction du traitement fiscal actuel des voitures de société et des frais de déplacement domicile-travail avec le marché des transports permet de faire plusieurs constatations. La situation actuelle de sous-imposition de ces voitures est de nature à déboucher sur une hausse disproportionnée de la distance totale qu’elles parcourent, sous l’effet aussi bien de la multiplication des voitures de société en circulation que de l’augmentation de la distance parcourue par chacune. Cette évolution risque elle-même de se répercuter de façon disproportionnée sur la plupart des coûts environnementaux et coûts sociaux connexes. Par ailleurs, un traitement fiscal favorable des frais de déplacement domicile-travail en général, et de la mise à disposition d’une place de stationnement gratuite par l’employeur en particulier, est susceptible de faire pencher le choix du mode de transport en faveur de la voiture plutôt que vers les transports publics et les modes non motorisés, avec là encore des répercussions sur la plupart des coûts environnementaux et coûts sociaux connexes. L’annexe du document présente, pour les pays de l’OCDE pris dans leur ensemble, des estimations indicatives des plus importantes incidences de la sous-imposition des voitures de société, ainsi que des estimations indicatives de son coût social global. Les principaux éléments quantifiés sont les coûts du surcroît de congestion, du surcroît de pollution atmosphérique locale et du surcroît d’accidents de la circulation. Le coût social global attribuable à la sous-imposition des voitures de société est estimé à environ 116 milliards EUR par an.
    Keywords: tax benefit, tax induced behaviour, environmental effects, vehicles, company cars, voitures de société, avantage fiscal, coûts environnementaux, comportement induit par la fiscalité
    JEL: H20 H30 Q51 R41
    Date: 2014–09–30
  36. By: Claus Michelsen; Sebastian Rosenschon; Christian Schulz
    Abstract: The energy efficiency of the residential housing stock plays a key role in strategies to mitigate climate change and global warming. In this context, it is frequently argued that private investment and the quality of thermal upgrades is too low in the light of the challenges faced and the potential energy cost savings. While many authors address the potential barriers for investors to increase energy efficiency, studies on the capabilities different investors have to reduce energy requirements of their property are scarce. This study investigates potential advantages of housing company's size, i.e. economies of scale, economies of scope and institutional learning in thermal upgrades of residential housing. Based on unique data on energy consumption in 102,307 apartment houses in Germany, we present new evidence for advantages and disadvantages of housing company's size in "green" retrofitting projects. Our estimations show, that large housing companies outperform private landlords by far in high effort refurbishment projects. In contrast, private landlords appear to have advantages in low effort, incremental refurbishment activities. The results offer new options for policy makers to refine the support schemes towards a low carbon housing stock.
    Keywords: "green" real estate, energy efficiency, refurbishment, economies of scale, economies of scope
    JEL: R31 R32 Q48
    Date: 2014
  37. By: Sands, Ronald; Jones, Carol; Marshall, Elizabeth
    Abstract: Recent volatility in agricultural commodity prices and projections of world population growth raise concerns about the ability of global agricultural production to meet future demand. This report explores the potential for future agricultural production to 2050, using a model-based analysis that incorporates the key drivers of agricultural production, along with the responses of producers and consumers to changes to those drivers. Model results show that for a percentage change in population, global production and consumption of major field crops respond at nearly the same rate. In response to a change in per capita income, the percentage change in crop consumption is much lower, about one-third the percentage change in income. The model also suggests that the global economy absorbs changes in agricultural productivity growth through compensating responses in yield, cropland area, crop prices, and international trade.
    Keywords: Agricultural productivity, food demand, population growth, income growth, land use, Crop Production/Industries, Demand and Price Analysis, Environmental Economics and Policy, Land Economics/Use,
    Date: 2014–09
  38. By: Jean-Francois Maystadt; Valerie Mueller; Ashwini Sebastian
    Abstract: While an emerging literature cites weather shocks as migration determinants, scant evidence exists on how such migration impacts the markets of receiving communities in developing countries. We address this knowledge gap by investigating the impact of weather-driven internal migration on labor markets in Nepal. An increase of 1 percentage point in net migration reduces wages in the formal sector by 4.8 percentage points. The absence of wage effects in the informal sector is consistent with the exit of low-skilled native workers from the labor market. Understanding entrepreneurial constraints and drivers of labor market exits will inform pathways to resilience.
    Keywords: Environmental migration, weather, conflict, labor markets, Nepal
    JEL: J21 J61 O15
    Date: 2014
  39. By: Raju Mandal (Department of Economics, Assam University); Subrata Barman (Department of Economics, Nalbari College); M. P. Bezbaruah (Department of Economics, Gauhati University)
    Abstract: This paper makes an attempt to estimate the public and non-public good component values of Kaziranga National Park (KNP), a World Heritage Site in the northeast part of India, using contingent valuation method and individual travel cost method respectively. Such a decomposition of total value of an environmental amenity into public good and non-public good components can have significant implications for conservation policies. The results of our analysis led us to conclude that the conservation efforts in terms of resource allocation for KNP are by no means excessive as it amounted to only 3.52 % of total willingness to pay that was estimated in a very conservative way. The estimated consumers’ surplus, a proxy for use values of the park, turned out to be 8.86 % of estimated total economic values, and we suggest a same share of conservation outlay be recovered from the users. A relatively smaller proportion of current user charges in total conservation expenditure (5.87 %) provide a justification for an upward revision of the user charges for a better and more effective conservation in view of the ongoing deterioration of the heritage site from various sources.
    Date: 2014–09
  40. By: Miguel Cárdenas Rodríguez; Ivan Haščič; Nick Johnstone; Jérôme Silva; Antoine Ferey
    Abstract: This paper analyses the effects of government policies on flows of private finance for investment in renewable energy (inducement effect). It also examines whether direct provision of public finance for a project increases the volume of private finance raised (“crowding in” effect). A unique dataset of financial transactions for renewable energy projects with worldwide coverage is constructed using the Bloomberg New Energy Finance database. The analysis covers 87 countries, six renewable energy sectors (wind, solar, biomass, small hydropower, marine and geothermal) and the 2000-2011 time-span. Main findings are that, in contrast to quota-based schemes, price-based support schemes are positively correlated with investors’ ability to raise private finance. The paper suggests that, rather than the type of instrument (price vs. quota), it is the specific design of such schemes that is key to providing a predictable signal and an effective incentive to attract private investors. It is also found that public finance supports precisely those projects that have had difficulty raising private finance (co-financed projects), where neither quota-based measures nor price-based support schemes have a significant effect on private finance flows. This raises the concern that in the absence of well-designed policies which incentivise private finance investment, governments wishing to secure project completion have no other choice than to support projects directly through the use of public finance. Ce document porte sur l’analyse des effets des politiques publiques sur les flux financiers privés affectés à l'investissement dans les énergies renouvelables (effet d'induction). Il examine également si l’apport direct de fonds publics à un projet renforce la probabilité d'obtention de financements privés (effet d'attraction). Cette analyse est fondée sur une base de données sans équivalent sur les financements d'actifs (c'est-à-dire sur les opérations d'investissement réalisées dans des projets d'énergie renouvelable) construite à partir de la base de données Bloomberg sur le financement des énergies nouvelles (BNEF, Bloomberg New Energy Finance), couvrant tous les pays. Les principaux résultats indiquent que contrairement aux systèmes fondés sur des quotas, les dispositifs de soutien fondés sur les prix sont corrélés positivement avec la capacité des investisseurs à obtenir des financements privés. Notre analyse suggère que, davantage que le type de dispositif utilisé (instrument fondé sur les prix ou système de quotas), c'est la conception spécifique de ces dispositifs qui est déterminante pour donner des signaux prévisibles et des incitations efficaces attirant les investisseurs privés. L’analyse conclue également que les financements publics sont précisément affectés aux projets qui ont eu des difficultés à attirer des fonds privés (projets cofinancés), très probablement parce qu'ils ne sont pas économiquement viables en l'absence d'un tel soutien. Cela laisse à penser qu'en l'absence de politiques publiques judicieusement conçues, permettant d'attirer des investissements financiers privés, les gouvernements souhaitant garantir l'achèvement d'un projet n'aient pas d'autre choix que de soutenir directement ledit projet à travers des financements publics.
    Keywords: renewable energy, technology deployment, investment, finance, policy instrument choice, choix des instruments d'action, innovation induite, financement d'actifs, investissement, énergie renouvelable
    JEL: G3 H23 L94 O3 Q42 Q48 Q54 Q55 Q58
    Date: 2014–10–16
  41. By: Giovanni Marin (CERIS-CNR, Italy.); Francesco Nicolli (CERIS-CNR, Italy.); Roberto Zoboli (CERIS-CNR, Italy; Catholic University of Sacred Heart, Milano, Italy.)
    Abstract: In this work we test for the presence of convergence in the main municipal solid waste-related indicators across EU countries over the years 1995-2009. We analyse in particular both sides of the waste sector: generation, considering waste collected per capita, and the main disposal choices, i.e. landfilling, recycling and incineration. We believe this is a relevant exercise, considering that in the last two decades the waste sector has experienced a profound transformation at European level. Landfill is losing its primary role as the main disposal technology, and other activities, like recycling and incineration, are becoming increasingly important. In this context, beta and sigma tests of convergence can tell us more about the distribution of the three different rival choices of waste disposal, as well as about waste generation, by assessing the presence of convergence and its main drivers. With convergence we mean here testing, on the one hand, if countries which are lagging behind are actually catching up more virtuous countries (in term of use of preferred waste management technologies, like recycling and incineration) and, on the other hand, testing if the disparities between countries are decreasing over time. We believe in particular that several factors may have influenced this trend, like consumption per capita, the presence of environmental policy and the level of a country innovative activities measure by a coherent stock of patent applications in waste related sectors.
    Keywords: Waste management, Beta-convergence, Sigma-convergence
    JEL: Q53 Q58 O47
    Date: 2014–10
  42. By: Elizondo Azuela, Gabriela; Barroso, Luiz; Khanna, Ashish; Wang, Xiaodong; Wu, Yun; Cunha, Gabriel
    Abstract: This paper considers the design and performance of auction mechanisms used to deploy renewable energy in three emerging economies: Brazil, China, and India. The analysis focuses on the countries'experience in various dimensions, including price reductions, bidding dynamics, coordination with transmission planning, risk allocation strategies, and the issue of domestic content. Several countries have turned to public competitive bidding as a mechanism for developing the renewable generation sector in recent years, with the number of countries implementing some sort of auction procedure rising from nine in 2009 to 36 by the end of 2011 and about 43 in 2013. In general, the use of auctions makes sense when the contracting authority expects a large volume of potentially suitable bids, so that the gains from competition can offset the costs of implementation. A study of the successes and failures of the particular auction design schemes described in this paper can be instrumental in informing future policy making.
    Keywords: Energy Production and Transportation,Markets and Market Access,Climate Change Mitigation and Green House Gases,Debt Markets,Emerging Markets
    Date: 2014–10–01
  43. By: M. Scott Taylor (University of Calgary); Juan Moreno Cruz
    Date: 2014–09–29
  44. By: Takahashi, Kazushi; Ikegami, Munenobu; Sheahan, Megan; Barrett, Christopher B.
    Abstract: Microinsurance is widely considered an important tool for sustainable poverty reduction, especially in the face of increasing climate risk. Although index-based microinsurance, which should be free from the classical incentive problems, has attracted considerable attention, uptake rates have generally been weak in low-income rural communities. We explore the purchase patterns of index-based livestock insurance in southern Ethiopia, focusing in particular on the role of accurate product comprehension and price, including the prospective impact of temporary discount coupons on subsequent period demand due to price anchoring effects. We find that randomly distributed learning kits contribute to improving subjects' knowledge of the products; however, we do not find strong evidence that the improved knowledge per se induces greater uptake. We also find that reduced price due to randomly distributed discount coupons has an immediate, positive impact on uptake, without dampening subsequent period demand due to reference-dependence associated with price anchoring effects.
    Keywords: Ethiopia, Insurance, Livestock, Rural economy, Poverty, Climate, Index-Based Livestock Insurance, Quasi-Experiment, Uptake
    JEL: D12 G22 O12
    Date: 2014–09
  45. By: Edmond Baranes; Julien Jacqmin; Jean-Christophe Poudou
    Abstract: This paper studies the links between renewable and non-renewable intermittent energy sources in the production of electricity. More precisely, we argue that the relationship between the natural gas price and capacity investments in solar and wind power energy is far from univocal. We find that this relationship is not linear but is better represented by a bell-shaped curve. Hence, for relativelly low gas price, the two modes of production are substitutable. After a price threshhold is reached, the two are complementary. A theoretical model explains this as the trade-off resulting from two forces: the input price differential of these two modes of production and the risks related to the unpredictable nature of the intermittence of renewable energies. Using U.S. state level data from 1998 to 2012, we find that this relationship is robust to various empirical specifications.
    Date: 2014–10
  46. By: K. Jackson
  47. By: Timothy Swanson (Centre for International Environmental Studies, IHEID, The Graduate Institute of International and Development Studies, Geneva); Chiara Ravetti; Mu Quan; Xuxuan Xie; Zhang Shiqiu
    Abstract: In this subtask we survey the literature that estimates the ancillary benefits of greenhouse gas (GHG) abatement in developing countries, and the extent to which its findings can be transferred across countries. Specifically, we focus upon the health benefits from emission reduction in developing nations. In order to evaluate the spillovers and indirect benefits that a country could reap from GHG mitigation policies, it is crucial to account for the differences that exist among nations in the valuation of such benefits. In fact, the monetary loss attached to an illness and the value of a human life may vary across cultures, economies and over time, depending on income, demographics, socio-economic and political characteristics of a country. There is a rich literature on valuation techniques that spans much of the developed world, whereas there has been far less analysis of developing countries. The goal of this research is to examine the still relatively scarce literature on the developing world and its specific findings. Particular attention will be dedicated to case studies of China.
    Date: 2014–08–08
  48. By: Mikolaj Czajkowski (Faculty of Economic Sciences, University of Warsaw, Poland); Nick Hanley (School of Geography and Sustainable Development, University of St. Andrews); Jacob LaRiviere (Department of Economics, University of Tennessee)
    Abstract: This paper develops a reduced form method of controlling for differences in information sets of subjects in public good discrete choice models, using stated preference data. The main contribution of our method comes from accounting for the effect of information provided during a survey on the mean and the variance of individual-specific scale parameters. In this way we incorporate both scale heterogeneity as well as observed and unobserved preference heterogeneity to investigate differences across an d within information treatments. Our approach will also be useful to researchers who want to combine stated preference data sets while controlling for scale differences. We illustrate our approach using the data from a discrete choice experiment study of a biodiversity conservation program and find that the mean of individual -specific scale parameters and its variance in the sample is sensitive to the information set provided to the respondents.
    Keywords: information, uncertainty, choice modelling, information effects, scale, scale heterogeneity, G-MNL, combined datasets
    JEL: Q51 C51 D03 D83 D61
    Date: 2014–07
  49. By: Fuerst, Franz; Shimizu, Chihiro
    Abstract: This paper aims to extend the existing evidence on the investment value of green buildings to international markets, specifically the residential market in Japan. Using a unique transaction database of condominiums in the Tokyo metropolitan area and a hedonic analytical framework, we find that green buildings command a small but significant premium on both the asking and transaction prices. This finding is consistent with results from other countries. As far as we are aware, this is also the first study of green buildings’ economic value based on a hedonic model incorporating buyer characteristics. However, further analysis reveals that this premium is primarily driven by wealthy households that exhibit a higher willingness-to-pay for eco-labelled condominiums, both as a total amount and as a fraction of the total sales price. We therefore conclude that eco-labels are perceived as a luxury good in the Japanese housing market rather than a way to save money on lower utility bills.
    Keywords: Green building, green label, hedonic approach, offer price, bid price, market price function, omitted variable bias
    JEL: M14 D92
    Date: 2014–09
  50. By: Tom Duncanson (Millikin University, USA)
    Abstract: With one exception, the major coal companies in the U.S. have ignored growing demands for corporate social responsibility. Coal in the U.S. is a profoundly problematic industry with a history of labor violence, worker safety disasters, fatal health impacts on both those who produce and consume the product, the ruin of landscapes, myriad impacts on water and land resources, and commodity price volatility for those who would invest in it. Only the most sanguine coal backers see it as a key energy for the future; while people might fantasize automobiles without gasoline, practical thinkers have, for a generation, successfully pursued substitutes for coal. For many observers, to open a coal mine today is as absurd as founding a buggy factory. This paper is a case study of the attempt by Sunrise Coal of Terre Haute, Indiana to open a massive new underground coal mine spanning Champaign County and Vermilion County, Illinois, and the crucial step in the process of acquiring treated and untreated water, plus sewer services, from the Village of Homer, Illinois. In this controversy members of the Homer community first raised questions, then concerns, and finally arguments, about the coal mine; but at each step in the public deliberations Sunrise remained aloof from making answers, reassurances, and rebuttals. Sunrise negotiated legal obligations but did not acknowledge social responsibilities; in this negotiation process community voices became little more than background noises. Profoundly, the coal company chose not to explain its silence, and to cloak its position in as much secrecy as possible with “non-disclosure agreements” with the land owners who leased their mineral rights to Sunrise and disciplining their champion, the Mayor of Homer, when he went off script. Sunrise gave its critics’ complaints no credit, but it is likely it did not build enough trust to actually open and operate the mine.
    Date: 2013–09
  51. By: Jérôme Ballet (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - CNRS : UMR5113 - Université Montesquieu - Bordeaux IV); Damien Bazin (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis (UNS)); Jérôme Pelenc (CREDA - Centre de recherche et de documentation des Amériques - CNRS : UMR7227 - Université Paris III - Sorbonne nouvelle)
    Abstract: Nous montrons que l'approche par les capabilités offre de sérieuses pistes pour donner tout son sens à la justice environnementale abordée sous l'angle de la justice comparative. L'approche des capabilités permet de prendre en compte les trois enjeux que soulève la justice environnementale : la distribution des bénéfices et des nuisances liés à l'environnement, les enjeux de participation des populations dans l'élaboration des régulations environnementales, la reconnaissance des identités collectives. Cependant, cela suppose d'une part de donner une priorité à la liberté de processus sur la liberté d'opportunités, d'autre part l'introduction du concept de capabilité collective.
    Keywords: capabilités, justice comparative, justice environnementale, justice transcendantale.
    Date: 2013–09–03

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.