nep-env New Economics Papers
on Environmental Economics
Issue of 2014‒11‒28
63 papers chosen by
Francisco S. Ramos
Universidade Federal de Pernambuco

  1. Residential water demand, climate change and exogenous economic trends By Lott, Corey; Tchigriaeva, Elena; Rollins, Kimberly; Stoddard, Shawn
  2. Loaded DICE: Refining the Meta-analysis Approach to Calibrating Climate Damage Functions By Howard, Peter; Sterner, Thomas
  4. Economic Damages from Climate Change: A Review of Modeling Approaches By Anthony Bonen; Willi Semmler; Stephan Klasen
  6. Impact of U.S. Biofuel Policy in the Presence of Uncertain Climate Conditions By Hector, Nuñez; Andres, Trujillo-Barrera
  7. Bioeconomics of Climate Change Adaptation: Coffee Berry Borer and Shade-Grown By Atallah, Shady S.; Gómez, Miguel I.
  8. Irrigation Demand in a Changing Climate: Using disaggregate data to predict future groundwater use By Shaneyfelt, Calvin R.; Schoengold, Dr. Karina
  9. Experimental auctions to evaluate incentives for cost-effective agricultural phosphorus abatement in the Great Lakes By Harris, Leah M.; Swinton, Scott M.; Shupp, Robert S.
  10. Consumer Perceptions of Climate Changes and WTP for Mandatory Implementation of Low Carbon Labels: The Case of South Korea By Kim, Hyeyoung; House, Lisa; Kim, Tae-Kyun
  11. The Potential Costs of Invasive Pests: Nasutitermes Corniger in Florida By Alvarez, Sergio
  12. Climate cooperation with technology investments and border carbon adjustment By Carsten Helm; C. Schmidt
  13. Climate Policy and Border Measures: The Case of the US Aluminum Industry By Sheldon, Ian; McCorriston, Steve
  14. The Crucial Role of Policy Surveillance in International Climate Policy By Aldy, Joseph E.
  15. Climate Change and Labor Markets in Rural Mexico: Evidence from Annual Fluctuations in Weather By Jessoe, Katrina; Manning, Dale; Taylor, J. Edward
  16. Global land use impacts of U.S. ethanol: static vs. dynamic economic modeling By Golub, Alla; Hertel, Thomas; Rose, Steven
  17. Moving to Greener Societies: Moral Motivation and Green Behaviour By Lorenzo Cerda Planas
  18. Agricultural productivity and soil carbon dynamics: a bio-economic model By Berazneva, Julia; Conrad, Jon; Guerena, David
  19. Peer Effects and Farmer Heterogeneity in Tillage Choices By Konar, Avishek; Roe, Brian; Irwin, Elena G.
  20. Modeling effects of multiple conservation policy instruments and exogenous factors on urban residential water demand through household heterogeneity By Tchigriaeva, Elena; Lott, Corey; Kimberly, Rollins
  21. Future Property Damage from Flooding – Sensitivities to Economy and Climate Change By Liu, Jing; Hertel, Thomas; Delgado, Michael S.; Ashfaq, Moetasim; Diffenbaugh, Noah
  22. Reassessing the Effects of Weather on Agricultural Productivity By Beddow, Jason; Pardey, Philip; Hurley, Terrance
  23. Green Growth (for China): A Literature Review By Ho, Mun; Wang, Zhongmin
  24. Effects of Protected Areas on Forest Cover Change and Local Communities: Evidence from the Peruvian Amazon By Miranda, Juan Jose; Corral, Leonardo; Blackman, Allen; Asner, Gregory; Lima, Eirivelthon
  25. Dancing to whose tune? Farmers’ perspectives on agriculture’s role in By Duncan, Ronlyn
  26. Vulnerability of public rangelands to climate change in the Southwest United States By Hand, Michael S.; Eichman, Henry; Triepke, F. Jack; Warziniack, Travis
  27. Projecting the Economic Impact and Level of Groundwater Use in the Southern High Plains under Alternative Climate Change Forecasts Using a Coupled Economic and Hydrologic Model By Willis, David B.; Rainwater, Ken; Tewari, Rachna; Stovall, Jeff; Hayhoe, Katharine; Hernandez, Annette; Mauget, Steven A.; Leiker, Gary; Johnson, Jeff
  28. Adapting to Monsoon Variability in India: the Case for Irrigation By Zaveri, Esha; Fisher-Vanden, Karen; Wrenn, Douglas H.; Nicholas, Robert E.
  29. Mandates and the Incentives for Innovation By Clancy, Matthew; Moschini, GianCarlo
  30. Economic Implications of Winter-run Chinook Salmon Conservation through Water Management in the Southern Delta By Yoon, Haengku
  31. The role of short-termism and uncertainty in organizational inaction on climate change: multilevel framework By Natalie Slawinski; Jonatan Pinkse; Timo Busch; Subhabrata Bobby Banerjeed
  32. On the Interplay between Resource Extraction and Polluting Emissions in Oligopoly By L. Lambertini
  33. Evaluating the Effectiveness of Flood Mitigation Policies in the U.S. By Fan, Qin; Davlasheridze, Meri
  34. Innovation Premium of Water Quality Trading for Jordan Lake, NC By Motallebi, Marzieh; Hoag, Dana; O’Connell, Caela; Osmond, Deanna
  35. Market competition and abatement technology diffusion under environmental liability law By Li, Yi
  36. Spatial Interactions in Habitat Conservation: Evidence from Prairie Pothole Easements By Lawley, Chad; Yang, Wanhong
  37. Estimating Decadal Climate Variability Effects on Crop Yields: A Bayesian Hierarchical Approach By Huang, Pei; McCarl, Bruce A.
  38. Pricing RINs and Corn in a Competitive Storage Model By Zhou, Wei; Babcock, Bruce A.
  39. On the Dynamics of Price Discovery: Energy and Agricultural Markets with and without the Renewable Fuels Mandate By Shiva, Layla; Bessler, David A.; McCarl, Bruce A.
  40. Point-Nonpoint Heresy?! An Endogenous Risk Explanation for Point-Nonpoint Trading Ratios Less than One By Horan, Richard; Shortle, James
  41. Assessing Local Vulnerability to Climate Change in Agriculture for Tocantins, Brazil By Guerrero-Escobar, Santiago; Juarez-Torres, Miriam; Martinez Cruz, Adan
  42. Spatially-Referenced Choice Experiments: Tests of Individualized Geocoding in Stated Preference Questionnaires By Holland, Benedict M.; Johnston, Robert J.
  43. How Do Natural Gas Prices Affect Electricity Consumers and the Environment? By Linn, Joshua; Anna Muehlenbachs, Lucija; Wang, Yshuang
  44. The Effect of Spatial Interpolation on the Hedonic Model: a Case of Forest Pest Damages By Li, Xiaoshu; Boyle, Kevin J.; Preisser, Evan; Holmes, Thomas; Moeltner, Klaus; Orwig, David
  45. How Effective Are Energy-Efficiency Incentive Programs? Evidence from Italian Homeowners By Massimo Anna Alberini; Andrea Bigano
  46. Does Neighborhood Matter? A Micro-level Spatial Analysis of the Entry and Exit of Organic Farming Program in Southern Sweden By Liu, Xiangping; Smith, Henrik; Stjernman, Martin; Olsson, Ola; Sterner, Thomas
  47. Greener Skills and Jobs for a Low-Carbon Future By OECD
  48. Better Harnessing Talent and Knowledge to Boost Sustainable Medium-term Growth in Spain By David Haugh; Ben Westmore
  49. The effects of climate change adaptation strategies on food crop production efficiency in Southwestern Nigeria By Otitoju, Moradeyo Adebanjo
  50. Substitution Elasticities between GHG Polluting and Non-polluting Inputs in Agricultural Production: A Meta-Regression By Liu, Boying; Shumway, C. Richard
  51. The Effect of Price and Non-Price Conservation Programs on Residential Water Demand By Asci, Serhat; Borisova, Tatiana
  52. Biobased Chemicals and Bioplastics: Finding the Right Policy Balance By OECD
  53. Institutional and Economic Complications of River Basin Water Quality Management: The Case of Selenium in Colorado's Lower Arkansas River Valley By Sharp, Misti; Hoag, Dana
  54. Sustainable management and performance in SMEs: A French case study By Berger-Douce, Sandrine
  55. Fossil Fuels, Alternative Energy and Economic Growth By Raul Barreto
  56. Do Increasing Block Rate Water Budgets Reduce Residential Water Demand? A Case Study in Southern California By Baerenklau, Kenneth A.; Schwabe, Kurt; Dinar, Ariel
  57. Dynamic-Bayesian disease management under state uncertainty: learning and bovine tuberculosis control in New Zealand cattle By MacLachlan, Matthew; Springborn, Michael
  58. Do farmers treat rented land differently than the land they own? A fixed effects model of farmer’s decision to adopt conservation practices on owned and rented land By Nadella, Karthik; Deaton, Brady; Lawley, Chad; Weersink, Alfons
  59. Optimal Management of a Fishery with Bycatch By Melstrom, Richard T.
  60. Farmer Decision-Making on Enrollment in the Conservation Reserve Program By Wachenheim, Cheryl; Lesch, William; Fontaine, Cordell
  61. Spatial Competition and Economics of Biofuels from Corn Stover By Sesmero, Juan; Balagtas, Joseph Valdes; Pratt, Michelle
  62. Dynamic Factor Analysis for Short Panels: Estimating Performance Trajectories for Water Utilities By Zirogiannis, Nikolaos; Tripodis, Yorghos
  63. A DEA-PCA Sustainability Metric for Processing Vegetable Crops By Wille, Nicola; Mitchell, Paul; Dong, Fengxia; Knuteson, Deana; Wyman, Jeffery; Moore, Virginia

  1. By: Lott, Corey; Tchigriaeva, Elena; Rollins, Kimberly; Stoddard, Shawn
    Keywords: Water demand, disaggregated data, climate change, water policy, elasticity, outdoor residential water use, Demand and Price Analysis, Environmental Economics and Policy, Resource /Energy Economics and Policy, Q54, Q25, D12,
    Date: 2014
  2. By: Howard, Peter; Sterner, Thomas
    Keywords: integrated assessment model, DICE, climate change, meta-analysis, climate damage function, Environmental Economics and Policy, Research Methods/ Statistical Methods, Risk and Uncertainty,
    Date: 2014–05–27
  3. By: Ferris, Jeffrey; David, Newburn
    Keywords: Land Use, Forest Conservation, Ecosystem Services Accounting, Community/Rural/Urban Development, Environmental Economics and Policy, Land Economics/Use,
    Date: 2014
  4. By: Anthony Bonen; Willi Semmler; Stephan Klasen (Schwartz Center for Economic Policy Analysis (SCEPA))
    Abstract: This report elucidates one aspect of economic IAMs: the damage function. Damage functions map environmental changes (primarily mean temperature increases) to economic impacts. This crucial step in the determination of SCC appears in very different form in the leading economic IAMs. Through sections 3, 4, and 5 we review, in turn, the damage functions of the Dynamic Integrated Model of Climate and the Economy (DICE), the Framework for Uncertainty, Negotiation and Distribution (FUND) and the Policy Analysis of the Greenhouse Effect (PAGE). Section 6 discusses some empirical, programmatic and conceptual limitations of these three IAMs. Section 7 concludes. We begin, however, by providing a brief elaboration on integrated assessment modelling practices used by the IPCC. Readers familiar with IAMs and the IPCC's recent work may wish to skip this review.
    Keywords: Environmental Economics, Climate Change, Social Cost of Carbon, Integrated Assessment Models
    JEL: E1 E17 Q51 Q54 Q58
    Date: 2014–03
  5. By: Ferris, Jeffrey; David, Newburn
    Keywords: Land Use, Forest Conservation, Accounting of Ecosystem Services, Community/Rural/Urban Development, Environmental Economics and Policy, Land Economics/Use,
    Date: 2014
  6. By: Hector, Nuñez; Andres, Trujillo-Barrera
    Keywords: Agricultural and Food Policy, Environmental Economics and Policy,
    Date: 2014
  7. By: Atallah, Shady S.; Gómez, Miguel I.
    Abstract: Research on climate change in recent decades has disproportionately focused on predicting impacts while largely ignoring adaptation strategies. How agricultural systems can adapt to minimize the uncertainty caused by rising temperatures is one of the most important research issues today. We focus on the coffee berry borer, the most important coffee pest worldwide, which has recently expanded across the tropics as a result of rising temperatures, threatening coffee farms worldwide. Intercropping shade trees with coffee trees is being promoted as a promising climate change adaptation strategy that can protect coffee plantations from microclimate variability and reduce pest infestations. Little is known, however, on whether or not the benefits of the ecological services provided by shade trees justify the ensuing yield reduction associated with shade-grown coffee production systems. We develop a computational, bioeconomic model to analyze the ecological and economic sustainability of switching from a sun-grown to shade-grown coffee system as a climate change adaptation strategy. In particular, we model the spatial-dynamic pest diffusion at the plant level and evaluate alternative shading strategies based on farm expected net present values. Using parameters from Colombia, preliminary model findings suggest that the ecological benefits of shade-grown planting systems justify the forgone revenues from lower per acre yields only for high levels of shading. We solve for the threshold net price premium of shade-grown coffee that would make this climate change adaptation strategy cost-effective at moderate shading levels.
    Keywords: Bioeconomic Models, Cellular Automata, Computational Methods, Pest Control, Coffee Berry Borer, Crop Production/Industries, Environmental Economics and Policy, Resource /Energy Economics and Policy, C63, Q54, Q57,
    Date: 2014
  8. By: Shaneyfelt, Calvin R.; Schoengold, Dr. Karina
    Abstract: The paper estimates an irrigation water demand function using disaggregate climate and well data over a 32 year time period. Aggregating climate information over long periods, like a year, loses important details on temporal climatic variation, while aggregating climate information over space loses important details on spatial variation. This analysis uses disaggregate climate variation at a temporospatial level to determine the effects of climate on groundwater use. Results show that increased heat, measured in cooling degree-days, correlates with increased water use, while increased precipitation correlates with decreased water use. However, the effects are generally magnified for later summer months, and are generally lower earlier in the growing season, with a few notable exceptions. Other factors that significantly affect groundwater irrigation demand are soil type, the price of corn, pumping rate, and the number of certified irrigated acres.
    Keywords: groundwater, irrigation demand, climate change, Agricultural and Food Policy, Crop Production/Industries, Environmental Economics and Policy, Production Economics, Resource /Energy Economics and Policy,
    Date: 2014
  9. By: Harris, Leah M.; Swinton, Scott M.; Shupp, Robert S.
    Abstract: Research on payments for environmental services (PES) largely focuses on two contract types – cost-share and annual stewardship payments. But other types of transactions, such as tax credits, green insurance, and price premiums tied to environmental stewardship certification, can also promote conservation. Using experimental conservation procurement auctions we evaluate farmers’ willingness to adopt agricultural best management practices (BMPs) that reduce phosphorus runoff from farm land in the Maumee watershed to help abate damaging algal blooms in western Lake Erie. We determine how bids change depending on the type of transaction offered (e.g. payment, payment with green BMP insurance, tax credit, price premium tied to stewardship certification) to identify cost-effective incentive mechanisms that reduce the most phosphorus runoff per dollar of payment. Two kinds of transactions were found to be less cost-effective: a price premium for product certification and PES with green insurance to protect against yield loss from BMP adoption. The certification price premium cannot spatially target conservation practices to vulnerable locations, so average impact per dollar of payment (and hence cost-effectiveness) is reduced. Green insurance is perceived to have high transaction costs so it elicits demand for higher payments, reducing its cost-effectiveness.
    Keywords: Environmental Economics and Policy, Land Economics/Use, Q15, C93, Q57,
    Date: 2014
  10. By: Kim, Hyeyoung; House, Lisa; Kim, Tae-Kyun
    Abstract: Voluntarily implemented carbon labels have shown that there is a lack of motivation by companies to develop technology to reduce carbon emissions. This study examined consumer values for mandatory carbon labels in South Korea. Considering the altruistic nature of carbon labels, we asked about individuals’ perceptions about the impact of climate change on their personal lives to measure consumer preference for carbon labels. Significant preference for mandatory carbon labels reflected Koreans’ high level of concern about climate change. As an increasing number of consumers feel the impact of climate change, the gap of WTPs between low carbon labels and carbon measured labels is sufficient. The lower value of low-carbon labels as compared to GM labels indicates that consumers’ guilt is not an appropriate strategy with carbon labels.
    Keywords: Carbon-labels, Willingness-to-pay, South Korea, Agricultural and Food Policy,
    Date: 2014
  11. By: Alvarez, Sergio
    Keywords: Invasive species, Environmental Economics and Policy, Resource /Energy Economics and Policy,
    Date: 2014
  12. By: Carsten Helm; C. Schmidt (Humboldt University, Berlin)
    Abstract: A central question in climate policy is whether early investments in low-carbon technologies are a useful first step towards a more effective climate agreement in the future. We introduce a climate cooperation model with endogenous R&D investments where countries protect their international competitiveness via border<br>carbon adjustments (BCA). BCA raises the scope for cooperation and leads to a non-trivial relation between countries' prior R&D investments and participation in the coalition. We find that early investments in R&D render free-riding more attractive. Therefore, with delayed cooperation on emission abatement and ex-ante<br>R&D investments, the outcome is often characterized by high participation but inefficiently low technology investments and abatement.
    Keywords: climate treaty, border carbon adjustment, border tax adjustment, coalitions, R&D
    JEL: D62 F53 H23 Q55
    Date: 2014–11
  13. By: Sheldon, Ian; McCorriston, Steve
    Abstract: In this paper, analysis is presented relating to the impact of border measures for climate policy on the problem of carbon leakage, and the related issue of competitiveness in the US aluminum industry, which can be characterized as oligopolistic. Specifically, it is shown that an appropriate border measure depends on the nature of competition in aluminum production, as well as the basis for assessing the trade neutrality of any border measure. If trade neutrality is defined in terms of market volume, even though carbon leakage is reduced, US aluminum producer competitiveness cannot be maintained. This compares to defining trade neutrality in terms of market share, which results in US aluminum producer competitiveness being maintained and global carbon emissions being reduced. In either case, US users of aluminum incur deadweight losses.
    Keywords: climate policy, carbon leakage, border measures, aluminum, Environmental Economics and Policy, Industrial Organization, H87, Q38,
    Date: 2014–05
  14. By: Aldy, Joseph E. (Resources for the Future)
    Abstract: An extensive literature shows that information-creating mechanisms enhance the transparency of and can support participation and compliance in international agreements. This paper draws from game theory, international relations, and legal scholarship to make the case for how transparency through policy surveillance can facilitate more effective international climate change policy architecture. I draw lessons from policy surveillance in multilateral economic, environmental, and national security contexts to inform a critical evaluation of the historic practice of monitoring and reporting under the global climate regime. This assessment focuses on how surveillance produces evidence to inform policy design, enables comparisons of mitigation effort, and illustrates the adequacy of the global effort in climate agreements. I also describe how the institution of policy surveillance can facilitate a variety of climate policy architectures. This evaluation of policy surveillance suggests that transparency is necessary for global climate policy architecture.
    Keywords: policy surveillance, climate agreements, monitoring, reporting, compliance
    Date: 2014–09–05
  15. By: Jessoe, Katrina; Manning, Dale; Taylor, J. Edward
    Abstract: This paper evaluates the effects of annual fluctuations in temperature and precipitation on labor allocation in rural Mexico. We use a 28-year panel of individuals to investigate how people adjust their sector and location of work in response to year-to-year variation in weather. Controlling for state-year and individual fixed effects, we find that individuals are less likely to work locally in years with a high occurrence of extreme heat. This reduction in labor occurs for both agricultural and non-agricultural jobs, with larger reductions among wage workers. Extreme heat early in the year or for individuals located close to the U.S. border increases the likelihood that individuals respond by migrating to the United States. Under two medium-emissions climate change scenarios, our results imply that increased temperatures will lead to a 1.2-3% decrease in local employment and a 1-2% increase in domestic migration from rural to urban areas. These results provide an important example of how climate change could impact rural labor markets in developing countries.
    Keywords: climate change, weather, rural employment, migration, Mexico, Environmental Economics and Policy, Labor and Human Capital,
    Date: 2014
  16. By: Golub, Alla; Hertel, Thomas; Rose, Steven
    Keywords: ethanol, land use, dynamic model, CGE, Environmental Economics and Policy, Land Economics/Use, Resource /Energy Economics and Policy,
    Date: 2014
  17. By: Lorenzo Cerda Planas (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne)
    Abstract: This paper intends to provide an alternative explanation of why societies behave differently from an environmental point of view. To do so, I use a Kantian moral approach at a microeconomic level. Under this premise, I show that two identical societies (according to income and political system) might follow different paths with respect to their "green" behaviour. Additionally, I identify tipping points that could nudge a society from a polluting behaviour to a green one. I find that environmental perception as well as how governments are elected can be important factors in this shift.
    Keywords: Environmental motivation; Kantian morale; green behaviour; tipping points
    Date: 2014–01
  18. By: Berazneva, Julia; Conrad, Jon; Guerena, David
    Abstract: The strong link between poverty, natural resources and the environment is apparent in smallholder agriculture: farmers are making repeated land use and management decisions while facing diverse resource endowments and significant environmental constraints on production. To investigate the likely effects of changes in agricultural practices on the natural resource base and on farmer welfare, we develop a bio-economic dynamic model of agricultural households in the western Kenya highlands. Our modeling framework extends economic farm household models to incorporate the dynamic nature of natural resource management and its implications for household welfare, and to permit a meaningful interface with biophysical processes through soil carbon management. Using an eight-year panel data set, the model combines econometrically estimated production and soil carbon flow equations in a dynamic programming framework. We use the model to determine the optimal management of the farming system over time in terms of the quantity of mineral fertilizer and crop residues to apply, taking into consideration initial resource endowments and prices. Understanding how soil resources respond to the combined applications of mineral and organic resources is important for improved resource allocation at the farm level and for national agricultural policy decisions.
    Keywords: natural resource management, agricultural productivity, bio-economic model, soil carbon dynamics, western Kenya, Environmental Economics and Policy, Food Security and Poverty, International Development, Production Economics,
    Date: 2014
  19. By: Konar, Avishek; Roe, Brian; Irwin, Elena G.
    Keywords: Crop Production/Industries, Environmental Economics and Policy,
    Date: 2014
  20. By: Tchigriaeva, Elena; Lott, Corey; Kimberly, Rollins
    Keywords: Water demand, disaggregated data, landscaping, water policy, elasticity, outdoor residential water use, Demand and Price Analysis, Environmental Economics and Policy, Resource /Energy Economics and Policy, Q25, Q28, D12,
    Date: 2014
  21. By: Liu, Jing; Hertel, Thomas; Delgado, Michael S.; Ashfaq, Moetasim; Diffenbaugh, Noah
    Abstract: Using a unique dataset for Indiana counties during the period 1995-2012, we estimate the effects of flood hazard, asset exposure, and social vulnerability on property damage. This relationship then is combined with the expected level of future flood risks to project property damage from flooding in 2030 under various scenarios. We compare these scenario projections to identify which risk management strategy offers the greatest potential to mitigate flooding loss. Results show that by 2030, county level flooding hazard measured by extreme flow volume and frequency will increase by an average of 16.2% and 7.4%, respectively. The total increase in property damages projected under different model specifications range from 13.3% to 20.8%. Across models future damages consistently exhibit the highest sensitivity to future increases in asset exposure, reinforcing the importance of non-structural measures in managing floodplain development.
    Keywords: flooding damage, extreme weather, flooding risks, Environmental Economics and Policy, Q54, Q56,
    Date: 2014
  22. By: Beddow, Jason; Pardey, Philip; Hurley, Terrance
    Keywords: Environmental Economics and Policy, Production Economics, Productivity Analysis,
    Date: 2014–06
  23. By: Ho, Mun (Resources for the Future); Wang, Zhongmin (Resources for the Future)
    Abstract: This paper has two purposes. The first is to review the emerging literature on green growth, with a focus on the origin and meaning of the concept, as well as the justifications for and criticisms of the concept. The general idea of taking into account the impact of economic growth policies on the environment is not very controversial, but the possibility of simultaneously achieving conventional GDP growth and environmental protection is debated. The second purpose is to consider how China might move on to a green growth path. We summarize a sizable literature that traces China’s rapid economic growth and the associated environmental problems to its unique and fundamental institutions, and discuss the implications of this on how China might grow more sustainably.
    Keywords: green growth, economic development, environmental protection, China
    Date: 2014–08–07
  24. By: Miranda, Juan Jose; Corral, Leonardo; Blackman, Allen (Resources for the Future); Asner, Gregory; Lima, Eirivelthon
    Abstract: Protected areas are a cornerstone of forest conservation in developing countries. Yet we know little about their effects on forest cover change or the socioeconomic status of local communities, and even less about the relationship between these effects. This paper assesses whether “win-win” scenarios are possible—that is, whether protected areas can both stem forest cover change and alleviate poverty. We examine protected areas in the Peruvian Amazon using high-resolution satellite images and household-level survey data for the early 2000s. To control for protected areas’ nonrandom siting, we rely on quasi-experimental (matching) methods. We find that the average protected area reduces forest cover change. We do not find a robust negative effect on local communities. Protected areas that allow sustainable extractive activities are more effective in reducing forest cover change but less effective in delivering win-win outcomes.
    Keywords: conservation, deforestation, protected areas, poverty, land use, land conservation
    JEL: Q56 Q23 Q24 R14 R52
    Date: 2014–06–11
  25. By: Duncan, Ronlyn
    Keywords: Agribusiness, Environmental Economics and Policy, Research and Development/Tech Change/Emerging Technologies,
    Date: 2014
  26. By: Hand, Michael S.; Eichman, Henry; Triepke, F. Jack; Warziniack, Travis
    Keywords: public rangelands, grazing, climate change, Southwest United States, Farm Management, Land Economics/Use,
    Date: 2014–05–28
  27. By: Willis, David B.; Rainwater, Ken; Tewari, Rachna; Stovall, Jeff; Hayhoe, Katharine; Hernandez, Annette; Mauget, Steven A.; Leiker, Gary; Johnson, Jeff
    Abstract: This research estimates the impact that eight alternative climate change scenarios are likely to have on agricultural returns and the useful life of the Ogallala aquifer in the Southern High Plains (SHP) over a 90-year planning horizon, relative to the situation where climate conditions are maintained at the historical average condition for 1960 to 2009. The empirical analysis is accomplished with the aid of an integrated water policy model that couples a dynamic economic optimization model to a detailed aquifer model of the Southern Ogallala Aquifer. The integrated model controls for the effects of spatial heterogeneity in land use practices and aquifer characteristics. For each climate scenario, changes in annual economic returns, irrigated acres, water use, and aquifer storage levels are measured relative to respective estimates derived from the historic no change climate scenario. The annual 90-year time path of economic returns, water use, and cropping patterns under the eight climate change scenarios significantly varies from the baseline forecast. Moreover, relative to a baseline condition that estimates significant annual decreases in economic returns due to continued groundwater mining, the climate change scenarios generally suggest climate change will mitigate the cost of increasing groundwater scarcity due to a complimentary effect between crop yields and the various climate change scenarios.
    Keywords: Resource /Energy Economics and Policy,
    Date: 2014
  28. By: Zaveri, Esha; Fisher-Vanden, Karen; Wrenn, Douglas H.; Nicholas, Robert E.
    Abstract: How will future changes in precipitation affect irrigation demand and supply in India? This paper provides econometric evidence for the demand side of the analysis by examining the relationship between monsoon changes and irrigation variability for one of the world’s most water stressed countries, India. Using detailed crop-wise agriculture and weather data spanning 35 years, the econometric model isolates the historical impact of the distribution and total supply of monsoon precipitation on irrigation demand via the use of irrigated area for crops grown in the dry(Rabi) and wet(Kharif) seasons. We find differential impacts of the monsoon by crop, by season and by source of irrigation. In general, for crops grown in the wet season, irrigation is sensitive to both distribution and total monsoon rainfall but not to ground or surface water availability. For crops grown in the dry season, total monsoon rainfall matters most, and its effect is sensitive to groundwater availability. Over the historic period of analysis, the effect of the monsoon on irrigation has remained relatively stable. The econometric analysis, when combined with a process based hydrology model that accounts for the supply side response of water availability, can help quantify the (un)sustainable water use trajectory that different regions within India will face.
    Keywords: climate change, adaptation, agriculture, irrigation, monsoon, India, Environmental Economics and Policy, O13, Q15, Q54, Q56,
    Date: 2014
  29. By: Clancy, Matthew; Moschini, GianCarlo
    Abstract: One prominent feature of the US biofuels sector is its reliance on mandates to enforce use. The performance of this policy tool has been mixed, with corn-based ethanol production successfully meeting targets but cellulosic ethanol falling well short of them. A crucial difference in this setting is that corn-based ethanol relies on a mature technology whereas the prospect of meeting cellulosic ethanol mandates was always predicated on the development of new technologies. Is it reasonable to expect that mandates would work well as an incentive for innovation? To address this question, we develop a partial equilibrium model with endogenous innovation to examine the incentives for innovation in production under a mandate and compare this policy to two benchmark situations: laissez-faire and a carbon tax. We find that a mandate creates relatively strong incentives for investment in R&D in low-quality innovations, but relatively weak incentives to invest in high-quality innovations. Moreover, mandates are likely to underperform carbon taxes in welfare terms.
    Keywords: biofuels, innovation, mandates, carbon tax, technology policy, Agricultural and Food Policy, Environmental Economics and Policy, Research and Development/Tech Change/Emerging Technologies, Resource /Energy Economics and Policy, Risk and Uncertainty,
    Date: 2014
  30. By: Yoon, Haengku
    Abstract: Recent legal restrictions on water exports in the Southern Delta to protect listed fish populations have brought public attention to the trade-off relationship between fish conservation and agricultural economy. The restrictions may result in losses of agricultural returns in the Central Valley. This paper aims to examine the economic costs of conserving the endangered Winter-run Chinook salmon for two water year assumptions: one without environmental correlations and the other with the environmental correlations. The combination of a modified statewide agricultural production model and a multistage Winter-run Chinook salmon model allows me to assess the economic costs per age 3 and 4 adult for two cases. The estimated costs range from $1,304 to $114,966 for the first case and from $864 to $721,120 for the second case. They generally increase at an increasing rate as the pumping cuts back from 10% to 100%. The consideration of environmental correlations does not change the order of cost estimates: critical, dry, wet, above normal, and below normal. The results provide policy-makers with economic data on the tradeoffs in water management for the Southern Delta. One important factor in determining the agricultural losses is a climatic condition and the corresponding dependency of the farms on water exports.
    Keywords: Statewide Agricultural Production Model, Multistage Winter-run Chinook Salmon Population Model, Water Export, Economic Cost, Ecological Benefit, Trade-off, Water Management, Environmental Economics and Policy, Resource /Energy Economics and Policy,
    Date: 2014
  31. By: Natalie Slawinski (Memorial University of Newfoundland - Memorial University of Newfoundland); Jonatan Pinkse (MTS - Management Technologique et Strategique - Grenoble École de Management (GEM)); Timo Busch (University of Hamburg - University of Hamburg); Subhabrata Bobby Banerjeed (Cass Business School - Cass Business School)
    Abstract: Despite increasing pressure to deal with climate change, firms have been slow to respond with effective action. This paper derives a multi-level framework for a better understanding of why many firms are failing to reduce their absolute greenhouse gas emissions that contribute to climate change. To explain the phenomenon of organizational inaction on climate change, we draw on the related concepts of short-termism and uncertainty avoidance from research in psychology, sociology and organization theory. We argue that antecedents related to short-termism and uncertainty avoidance reinforce each other at three levels - individual, organizational and institutional - and result in organizational inaction on climate change. We discuss the implications of our framework for research on corporate sustainability.
    Keywords: Climate change; corporate sustainability; short-termism; uncertainty avoidance; multi-level theory.
    Date: 2014
  32. By: L. Lambertini
    Abstract: This paper offers an overview of the literature discussing oligopoly games in which polluting emissions are generated by the supply of goods requiring a natural resource as an input. An analytical summary of the main features of the interplay between pollution and resource extraction is then given using a differential game based on the Cournot oligopoly model, in which (i) the bearings on resource preservation of Pigouvian tax rate tailored on emissions are singled out and (ii) the issue of the optimal number of firms in the commons is also addressed.
    JEL: C73 H23 L13 O31 Q52
    Date: 2014–11
  33. By: Fan, Qin; Davlasheridze, Meri
    Abstract: We employ a two-stage random utility model (RUM) to estimate people’ marginal willingness to pay (WTP) for enhancing community-level floodplain management activities reflected in the National flood insurance program (NFIP)’s Community Rating System (CRS) program. CRS is a voluntary program, which provides the participating communities with discounts on flood insurance premium in exchange for strengthened flood protection activities. Results show that people with different demographics react differently to flood risk and generally value flood protection activities. We find that among the CRS program activities, people place the highest value on activities concerning repetitive flood loss reduction, with the second highest being public information disclosure about flood risk. In addition, results suggest that people significantly value structural mitigation projects such as flood- and debris- control dams. Importantly, our results suggest that water body as an amenity measure is perceived positively in people’s location choices, nonetheless flood risk information disclosure diminishes the amenity value.
    Keywords: Flood Insurance, Community Rating System, Tiebout Sorting, Locational Equilibrium, Environmental Economics and Policy, Risk and Uncertainty, Q51, Q54 and Q58,
    Date: 2014
  34. By: Motallebi, Marzieh; Hoag, Dana; O’Connell, Caela; Osmond, Deanna
    Abstract: In this paper, the amount of farmers’ trading cost in Jordan Lake will be estimated based on farmers’ willingness to accept (WTA) for participating in water quality trading (WQT) program and then the amount of innovative premium will be interpreted based on the trading cost. In order to achieve this goal, a survey was done by person in Jordan Lake watershed from 90 farmers.
    Keywords: Environmental Economics and Policy, Institutional and Behavioral Economics, Resource /Energy Economics and Policy,
    Date: 2014
  35. By: Li, Yi
    Abstract: One challenge in environmental liability law is to apportion the liability appropriately among multiple parties, when these multiple parties generate a single and non-separable damage. This paper provides a method of designing efficient apportionment rule in the presence of product market competition. In particular, I examine the role of apportionment rule in inducing abatement technology diffusion between competing firms. I show that such diffusion can be induced by an efficient apportionment rule. And this apportionment rule allocates a relatively large (more than 1/2) portion of the liability to the firm which originally owns the abatement technology. Furthermore, allocating the liability equally between the firms cannot induce diffusion.
    Keywords: Environmental liability law, Apportionment rule, Diffusion, Competition, Environmental Economics and Policy, Industrial Organization,
    Date: 2014
  36. By: Lawley, Chad; Yang, Wanhong
    Abstract: We examine the role of spatial interactions in conservation easements placed on prairie pothole habitat in western Canada. One of the goals of the conservation easement program we study is to protect contiguous habitat. We identify endogenous spatial interactions among conservation easements and government protected land, independent of spatially correlated landscape features and local economic shocks that influence easement enrollment. We present evidence that easements increase the likelihood of subsequent easements on neighboring land. Government-protected land appears to have little effect on the location of conservation easements. These results imply that conservation agencies have leveraged past conservation effort to enroll more contiguous habitat in permanent easements through a combination of targeting and positive social interactions among neighboring landowners.
    Keywords: Conservation easements, Prairie potholes, Land conservation, Conservation planning, Social interactions, Contiguous habitat, Spatial spillovers, Environmental Economics and Policy, Land Economics/Use, Resource /Energy Economics and Policy,
    Date: 2014
  37. By: Huang, Pei; McCarl, Bruce A.
    Keywords: Crop Production/Industries, Productivity Analysis,
    Date: 2014
  38. By: Zhou, Wei; Babcock, Bruce A.
    Abstract: A rational expectations competitive storage model for U.S. corn and RIN (Renewable Identification Numbers) markets is built to study the impacts of different ethanol policy scenarios. The model considers corn use for ethanol, storage and all other uses in each period, accounting for two random variables: oil prices and corn yields. Borrowing and banking provisions of the Renewable Fuels Standard (RFS) mandate are also integrated into the model. We use the model to provide estimates of the impact on corn prices, corn plantings and ethanol production under two ethanol mandate scenarios for six marketing years from 2014/15. The first scenario is one in which corn ethanol mandates stay the same as required in the RFS and additional E85 stations are introduced that allow for compliance with higher mandates. The second scenario is one in which no investment occurs and the Environmental Protection Agency reduces the mandate to 13 billion gallons. We find that corn prices drop about 6 percent from reduced mandates or about 26 cents per bushel, while RIN prices drop from around 54 cents to nearly zero. The results suggest that meeting the more broad policy objectives of energy policy and not the price of corn or RINs should determine the level of ethanol mandates.
    Keywords: Resource /Energy Economics and Policy,
    Date: 2014
  39. By: Shiva, Layla; Bessler, David A.; McCarl, Bruce A.
    Abstract: We model the energy–agriculture linkage through structural vector autoregression (VAR) model. This model quantifies the relative importance of various contributing factors in driving prices in both markets. The LiNGAM algorithm from the machine learning literature is used to help identify structural parameters in contemporaneous time. We perform conditional forecasting, taking into account the renewable fuel standards policies, and compare the forecasted path of prices with and without the renewable fuels mandates.
    Keywords: ethanol, vector autoregression, renewable fuel standard, graph theory, Agricultural and Food Policy, Environmental Economics and Policy, Resource /Energy Economics and Policy,
    Date: 2014
  40. By: Horan, Richard; Shortle, James
    Abstract: Extant point-nonpoint trading programs involve trades of relatively certain point source emissions reductions for highly uncertain estimates of nonpoint reductions. Trade ratios, or uncertainty ratios, define the rate at which these imperfect substitute commodities are traded. Economic research on optimal trade ratio design provides support for ratios greater than or less than one, depending on how nonpoint source emissions uncertainties respond to trading. While this implies optimal trade ratio magnitudes are an empirical issue, guidelines for extant programs universally call for ratios that exceed one. Such guidelines are implicitly based on a priori assumptions about risk that are akin to treating risk as a fixed, exogenous measure rather than as an endogenous one that responds to policy-induced behavioral changes. Perhaps this should not be surprising, as prior analyses do not clearly illustrate out-of-equilibrium tradeoffs involving abatement costs and environmental risks, obscuring the endogenous nature of risk. We develop a new approach that illustrates these tradeoffs explicitly. Unlike prior studies that only illustrate the unique, optimal equilibrium ratio, our approach allows us to examine economic tradeoffs and abatement outcomes associated with different trade ratios. Our results show that an optimally designed trading program reallocates abatement to nonpoint sources to reduce abatement costs or to reduce environmental risks from nonpoint sources, but not both. This outcome is in direct contrast to the stated goals of the EPA’s national trading rules. Our methodology is also useful for examining second-best program design. Here, we find theoretical support that smaller ratios may be optimal.
    Keywords: point-nonpoint trading, water quality, permit markets, emissions, uncertainty ratios, Environmental Economics and Policy, Risk and Uncertainty, Q53,
    Date: 2014
  41. By: Guerrero-Escobar, Santiago; Juarez-Torres, Miriam; Martinez Cruz, Adan
    Abstract: We propose a reliable indicator of vulnerability to climate change in agriculture that allows assessing within the system the main components of vulnerability at a local level: stressors exposure (SE), stressors sensitivity (SS), and adaptive capacity (AC). Also, this indicator will allow identifying main vulnerability drivers and planning policies to increase system resiliency as well as designing climate change adaptation policies at the local level.
    Keywords: local vulnerability to Climate change in agriculture Brazil Tocantins, Research Methods/ Statistical Methods,
    Date: 2014
  42. By: Holland, Benedict M.; Johnston, Robert J.
    Abstract: Maps in stated preference surveys rarely identify the location of respondents’ homes. This standard approach is grounded in the assumption that respondents are aware of their exact household locations relative to mapped policy effects, and hence possess sufficient understanding of spatial relationships to support well-informed preference elicitation. The validity this assumption is rarely if ever tested. This paper evaluates this nearly universal practice of generic policy-area mapping in choice experiments. This is compared to a more information-intensive alternative in which individualized maps pinpoint the location of each respondent’s household relative to policy effects. The latter approach requires a unique map to be generated for each respondent. Methods and results are illustrated using an application to riparian land restoration in south coastal Maine. Comparison of the results from these two approaches illustrates the implications of stated preference survey design that provides additional cartographic detail, and suggests the potential limitations of generic policy area maps.
    Keywords: Willingness to Pay, Individualized Survey, Stated Preference, Ecosystem Service, Valuation, Environmental Economics and Policy,
    Date: 2014
  43. By: Linn, Joshua (Resources for the Future); Anna Muehlenbachs, Lucija (Resources for the Future); Wang, Yshuang
    Abstract: Between 2008 and 2012, the delivered price of natural gas to the U.S. power sector fell 60 percent. This paper addresses, in theory and in practice, the effects of this negative price shock on electricity consumers and the environment. We demonstrate with a simple model that the larger the effects of gas prices on consumer welfare, the smaller the effects on pollution emissions and the smaller the increase in profits of existing natural gas–fired generators. Using detailed data on electricity prices, fuel consumption, and fuel prices from 2001 to 2012, we confirm this hypothesis. Regions that experience greater reductions in pollution emissions experience smaller reductions in electricity prices and consumer welfare.
    Keywords: Electricity Demand, Natural Gas, Coal, Shale Gas, Pollution
    JEL: Q41 Q53
    Date: 2014–07–18
  44. By: Li, Xiaoshu; Boyle, Kevin J.; Preisser, Evan; Holmes, Thomas; Moeltner, Klaus; Orwig, David
    Abstract: In the hedonic model, when an investigator wishes to merge property sale data with spatial data on an environmental amenity, one problem encountered in the matching process is that the environmental data are usually limited. A challenging task is how to scale site and time specific environmental data to all property sales within a defined geographical area. Inverse distance weighting, Kriging and splines are three commonly used geo-statistical methodologies to make spatial interpolation. In this study, we investigate the effect of these spatial interpolation methods on the estimation of a hedonic model in the context of an invasive forest pest, the hemlock wooly adelgid. Our results indicate a statistically significant relationship between hemlock health and residential property values at the 0.1 km level. Comparing through different interpolation methodologies, Kriging provides the most reliable interpolation results which provides us a useful tool to scale up our analysis from specific sample sites to broad geographical area.
    Keywords: hemlock woolly adelgid, forest damage, spatial interpolation, hedonic model, Environmental Economics and Policy, Research Methods/ Statistical Methods,
    Date: 2014
  45. By: Massimo Anna Alberini (University of Maryland,USA); Andrea Bigano (CIP - Climate Impacts and Policy Division)
    Abstract: We evaluate incentives for residential energy upgrades in Italy using data from an original survey of Italian homeowners. In this paper, attention is restricted to heating system replacements, and to the effect of monetary and non-monetary incentives on the propensity to replace the heating equipment with a more efficient one. To get around adverse selection and free riding issues, we ask stated preference questions to those who weren’t planning energy efficiency upgrades any time soon. We argue that these persons are not affected by these behaviors. We use their responses to fit an energy-efficiency renovations curve that predicts the share of the population that will undertake these improvements for any given incentive level. This curve is used to estimate the CO2 emissions saved and their cost-effectiveness. Respondents are more likely to agree to a replacement when the savings on the energy bills are larger and experienced over a longer horizon, and when rebates are offered to them. Reminding about CO2 (our non-monetary incentive) had little effect. Even under optimistic assumptions, the cost-effectiveness of incentives of size comparable to that in the Italian tax credit program is generally not favorable.
    Keywords: Energy-efficiency incentives; Free riding; Adverse selection; Stated Preferences; CO2 emissions reductions; CO2 emissions reductions supply curves; residential energy consumption.
    JEL: Q41 Q48 Q54 Q51
    Date: 2014–11
  46. By: Liu, Xiangping; Smith, Henrik; Stjernman, Martin; Olsson, Ola; Sterner, Thomas
    Abstract: We investigate farmers’ decision to engage in organic production. Our objective is to identify the key factors that promote or hinder the update of organic farming. In particular, we focus on neighborhood factors and the spatial allocation of organic land parcels. A rich spatial panel data of all agricultural parcels is compiled and the information on land use, soil quality, biodiversity, local landscapes, and neighborhood characteristics are extracted using ArcGIS techniques. We carry out both cross-sectional analyses and panel data models. In the cross –sectional analysis, we focus on the duration that a parcel stays in organic production: to temporarily enroll into organic farming program for subsidy or to convert to organic production permanently. In the panel data model, we analyze whether a parcel stays in organic production in a period by assuming there is or there is no temporary correlation. We find that neighborhood characteristics do have significant effects on farmers’ decision. Such effects manifest in the following four areas: 1) a farm with a higher share of organic land in its adjacent neighborhood is more likely to be organic temporarily or permanently; 2) a neighborhood with a higher share of ley and grass land, hence, a higher potential for biological control, can promote conversion to organic production; 3) a parcel with a larger shared border per unit area with other parcels are less likely to be engaged in organic production; and 4), a neighborhood with abundant floral species and more floral spices that are suitable to traditional agricultural production has more parcels being converted to organic production. We also find that highly productive land is less likely to be enrolled into organic farming programs, which confirms the finding from literature that profits is an important factor that affects farmers’ decision. Farmers tend to convert parcels that are far away from their houses to organic while keep the parcels close by in conventional production. Small farms and farms that are more diversified are more likely to be shifted to organic production. Our findings are hence in favor of the policy suggestions on agglomeration payments in biodiversity conservation.
    Keywords: Organic farming, Neighborhood effect, Neighboring effect, Edge effect, Biodiversity, Agribusiness, Agricultural and Food Policy, Environmental Economics and Policy, Q01, Q18, Q24, Q38, Q57, Q58,
    Date: 2014
  47. By: OECD
    Abstract: Green skills, that is, skills needed in a low-carbon economy, will be required in all sectors and at all levels in the workforce as emerging economic activities create new (or renewed) occupations. Structural changes will realign sectors that are likely to decline as a result of the greening of the economy and workers will need to be retrained accordingly. The successful transition to a low-carbon economy will only be possible if workers can flexibly adapt and transfer from areas of decreasing employment to new industries. This paper suggests that the role of skills and education and training policies should be an important component of the ecological transformation process.
    Date: 2013–12–03
  48. By: David Haugh; Ben Westmore
    Abstract: Structural transformation towards a more knowledge-based economy will strengthen Spain’s medium-term growth prospects. To deal with long standing impediments to higher growth the government has a substantial structural reform programme touching on education, the labour market and the business environment. Areas of particular weakness to be tackled include the high number of poorly qualified long-term unemployed, skills mismatches and a high school drop-out rate, and insufficient innovation. Spain has done well in reducing the carbon emissions intensity of GDP growth but will need to do more to meet future targets and manage its scarce water resources. The resolution of acute banking and fiscal problems, and the cyclical upswing, provide a more solid platform for sustained growth. Raising trend growth will boost job creation, which is the most effective antidote to the strong rise in poverty and inequality that accompanied the sharp deterioration in the labour market during the crisis.<P>Mieux maîtriser les talents et les connaissances pour stimuler une croissance à moyen terme durable en Espagne<BR>La transformation structurelle en faveur d’une économie davantage fondée sur le savoir renforcera les perspectives de croissance à moyen terme de l’Espagne. Pour remédier aux obstacles qui entravent de longue date une croissance plus soutenue, les autorités ont mis en place un important programme de réformes structurelles, concernant l’éducation, le marché du travail et l’environnement des entreprises. Parmi les déficiences particulières que ce programme vise à surmonter figurent le grand nombre de chômeurs de longue durée peu qualifiés, les inadéquations de compétences et le taux élevé d’abandon scolaire ainsi que l’insuffisance de l’innovation. L’Espagne a obtenu de bons résultats pour ce qui est de la réduction de l’intensité en émissions de carbone de la croissance du PIB, mais elle devra faire davantage pour atteindre les objectifs futurs et gérer ses rares ressources en eau. La résolution des graves problèmes bancaires et budgétaires et le redressement conjoncturel de l’activité créent des conditions plus propices à une croissance soutenue. L’accélération de la croissance tendancielle dopera la création d’emplois, qui est le meilleur antidote à la forte progression de la pauvreté et de l’inégalité qui a accompagné la profonde dégradation du marché du travail durant la crise.
    Keywords: education, productivity, environment, innovation, Spain, R&D, employment protection, climate change, active labour market policies, training, family policy, fertility, wage bargaining, skills, long-term unemployment, youth unemployment, female labour force participation, labour participation, trend growth, green innovation, skills mismatch, water scarcity, universities, growth simulations, carbon pricing, compétences, simulations de croissance, fertilité, participation de la main-d'oeuvre féminine., tarification du carbone, rareté de l'eau, inadéquation des compétences, chômage des jeunes, politiques actives du marché du travail, croissance tendancielle, universités, innovation verte, politiques familiales, chômage de longue durée, R-D, négociation salariale, formation, protection de l'emploi, changement climatique, Espagne, innovation, éducation, environnement, productivité
    JEL: E17 E24 I23 I28 J13 J21 J52 J61 J65 O31 O38 O40 Q52 Q58
    Date: 2014–11–13
  49. By: Otitoju, Moradeyo Adebanjo
    Keywords: Agricultural and Food Policy, Crop Production/Industries, Production Economics, Productivity Analysis,
    Date: 2013–11
  50. By: Liu, Boying; Shumway, C. Richard
    Abstract: This paper reports meta-regressions of substitution elasticities between greenhouse-gas (GHG) polluting and nonpolluting inputs in agricultural production. We treat energy, fertilizer, and manure collectively as the “polluting input” and labor, land, and capital as nonpolluting inputs. We estimate meta-regressions for samples of Morishima substitution elasticities for labor, land, and capital vs. the polluting input. Much of the heterogeneity of Morishima elasticities can be explained by type of primal or dual function, functional form, type and observational level of data, input categories, the number of outputs, type of output, time period, and country categories. Each estimated long-run elasticity for the reference case, which is most relevant for assessing GHG emissions through life-cycle analysis, is greater than 1.0 and significantly different from zero. Most predicted elasticities remain significantly different from zero at the data means in the long run. These findings imply that life-cycle analysis based on fixed proportions production functions could provide grossly inaccurate measures of GHG of biofuel.
    Keywords: greenhouse gas polluting inputs, input substitution, life-cycle analysis, meta-regression, Morishima elasticity, production function., Environmental Economics and Policy, Production Economics, greenhouse gas polluting inputs, input substitution, life-cycle analysis, meta-regression, Morishima elasticity, production function.,
    Date: 2014
  51. By: Asci, Serhat; Borisova, Tatiana
    Abstract: The study examines effectiveness of price- and non-price residential water demand management programs. Household-level water use data for Alachua County, Florida, were analyzed using three methods: IV, 2SLS, and 3SLS. Residential water demand is examined separately for households with combined water meters, as well as separate indoor and outdoor irrigation water meters. Preliminary results show that the price-base program (i.e., inclining block rate pricing) and non-price programs (i.e., residential irrigation restrictions with an enforcement component) have a significant effect on monthly household water use.
    Keywords: Residential Water Demand, Price and Non-Price Conservation Programs, irrigation restrictions., Consumer/Household Economics, Demand and Price Analysis, Environmental Economics and Policy,
    Date: 2014–07
  52. By: OECD
    Abstract: As OECD countries emerge from the global financial crisis, several countries have published their plans for the development of a future bioeconomy, an economy in which bio-based materials and production techniques will contribute significantly to economic and environmental sustainability. Such plans typically involve building a bio-based production industry in which fuels, energy and materials such as chemicals and plastics, almost always generated from fossil resources such as oil and natural gas, are incrementally replaced by equivalent or novel products generated from renewable resources. The realisation of this vision will require sustainably harnessing the vast biomass resource. <P> The highest policy priorities at present are on several levels: allowing bio-based materials to compete for biomass on price with bioelectricity and biofuels; rectifying the highly distorting fossil fuel subsidies, heading off future competition for crude oil demand; and correcting for any excessive regulatory impacts. If governments wish to realise a successful bioeconomy in the future, the case for support for bio-based chemicals and plastics warrants serious attention.
    Date: 2014–09–29
  53. By: Sharp, Misti; Hoag, Dana
    Abstract: For over a decade, engineers and scientists have been studying water flow and quality in Colorado’s Lower Arkansas River Valley (LARV). Key findings indicate that dissolved selenium (Se) in the water system exceeds the chronic standard, which can endanger aquatic life and livestock. The presence of this naturally occurring element is exacerbated by excess irrigation water and nitrogen seeping into the groundwater and interacting with shale formations, producing harmful levels of Se. Nonpoint source pollution such as Se can be mitigated by Best Management Practices (BMPs) that would reduce the amount of Se that reaches the river. Four BMPs are under consideration: improved irrigation technology, sealing and/or lining of the irrigation canals, lease fallowing and reduced fertilizer loading. These solutions are a mixture of private and public efforts in order to integrate the underlying incentive structure and modeling capabilities. The objective of this study is to map the trade-off between costs of BMP implementation and Se reduction in a traditional Pareto frontier, but with the added innovation to account for institutional constraints (e.g. water law) that affect the slope, continuity and concavity of the tradeoff curve. The purpose is to examine how policies and economic incentives of farmers and mutual canal companies influence the efficiency of tradeoffs that are technically, but not necessarily institutionally, attainable. For example, the legal environment is in place for land owners to lease water rights to the municipalities; however, the relationships that would be necessary to make this a possible solution may not be present. These institutional constraints are examined to determine the impact they have on the ability to trade off reduced Se for farm profits. A companion study in engineering utilizes regional-scale groundwater flow and reactive transport models to simulate Se loading to the river for 3 implementation levels of the 4 considered BMPs as well as a few targeted combinations of the BMPs in the river basin. Enterprise budgets are utilized to identify costs of the BMPs under various farm characteristics. Using the outputs from the numerical hydro-chemical models and the enterprise budgets, a traditional Pareto trade-off curve is mapped showing the technical feasibility of trading off BMP costs for reduced Se. Finally, institutional limitations are added, and the curves adjusted, to determine the opportunity costs of institutional constraints. Institutional constraints and incentive structures do impact the costs associated with the BMPs as well as the relative impact the BMPs can have on Se reduction. Moreover, they introduce discontinuities and non-concavities in the trade-off curve and impact society’s ability to benefit as a result of the policy due to the complex interaction of private incentives that are influenced by the institutional setting. This method provides an attractive platform from which to demonstrate gains that could be made by addressing constraints.
    Keywords: Non-point source pollution, BMPs, selenium, watershed management, public versus private solutions, Environmental Economics and Policy, Institutional and Behavioral Economics, Production Economics,
    Date: 2014
  54. By: Berger-Douce, Sandrine
    Abstract: Nowadays, sustainable management seems more likely to be a guarantee of competitiveness for companies, regardless of their size. Besides offering those strategic opportunities, sustainable management practices also play a significant role in gaining acceptance and legitimacy in the marketplace. Moreover, SMEs are continually researching ways to improve their performance. The relationship between sustainability and company performance has interested researchers for twenty years, even if the academic results are mostly focused on bigger companies. The purpose of this paper is to provide an understanding of how sustainable management practices help in achieving global performance for small and medium-sized enterprises (SMEs). The analysis of this case study shows how the transition from risk management to sustainable management allows an improvement in global company performance. Global performance considers social, environmental and societal issues in addition to economic performance. The first part of the paper looks at the relationship between sustainability and performance in the context of SMEs. The second part uses a French case study to illustrate how an industrial SME can implement sustainable management and translate this into improved performance. To resume, this paper illustrates that sustainable management can be a catalyst for innovation in industrial SMEs.
    Keywords: case study,(global) performance,sustainability,small and medium-sized enterprises (SMEs)
    JEL: M10 M14
    Date: 2014
  55. By: Raul Barreto (School of Economics, University of Adelaide)
    Abstract: We present a theoretical framework that incorporates energy within an endogenous growth model. The model explicitly allows for the interaction and substitution between fossil fuels, defined as a non-renewable resource derived from some fixed initial stock, and alternative energy, defined as renewable resource whose production requires capital input. The dynamics of the model depict a unique balance growth to a saddle point. The consumption path temporarily peaks, when fossil fuels are plentiful and cheap, followed by a fall, as fossil fuel become more scarce and alternative energy production has yet to take over, until finally the steady state is reached where alternative energy production fuels the entire economy. The model depicts a sort of energy heyday when fossil fuels are still plentiful and cheap. As oil stocks fall, alternative energy sources become ever more viable until the day in the future when alternative energy has almost completed replaced oil. Whether or not the peak oil type picture of consumption the model depicts actually represents a sort of energy rich heyday depends analytically on the productivity differential between alternative energy and fossil fuels now and in the future.
    Keywords: Endogenous growth, non-renewable resources, renewable resources, energy, oil, fossil fuels, alternative energy, peak oil
    JEL: O41 Q21 Q31
    Date: 2013–04
  56. By: Baerenklau, Kenneth A.; Schwabe, Kurt; Dinar, Ariel
    Abstract: This study investigates the effect of introducing a fiscally neutral increasing block-rate water budget price structure on residential water demand. We estimate that demand was reduced by at least 18 percent, although the reduction was achieved gradually over more than three years. As intermediate steps the study derives estimates of price and income elasticities that rely only on longitudinal variability. We investigate how different subpopulations responded to the pricing change and find evidence that marginal, rather than average, prices may be driving consumption. Additionally, we derive alternative rate structures that might have been implemented, and assess the estimated demand effects of those rate structures.
    Keywords: Block rate pricing, DCC model, residential water demand, water budgets, Demand and Price Analysis, Environmental Economics and Policy, Q21, Q25, Q28,
    Date: 2014
  57. By: MacLachlan, Matthew; Springborn, Michael
    Abstract: In the context of bovine tuberculosis (bTB) control in New Zealand cattle, we address the problem of management under uncertain disease prevalence by integrating a model of disease transmission and Bayesian learning from testing. We show the implications of accounting for the full dynamic value of information for setting levels of investment in, and targeting of, disease control measures. In the process, we provide a methodology to addressing problems in which learning occurs regarding an uncertain and endogenous state variable. bTB is an infectious and potentially fatal disease of both animals and humans that persists throughout much of the world. In addition to health impacts, trade may be restricted by potential importers that are averse to the possibility of direct transmission via live cattle movements and via animal products to consumers. Despite intensive and sustained control efforts in New Zealand, eradication has been encumbered by characteristics of the pathogen and environmental and anthropogenic factors: a long incubation period, a pervasive but elusive wild host (the common brushtail possum), imperfect testing methods, and the diffuse nature of production. These features have allowed bTB to remain endemic among New Zealand cattle and deer herds since the mid-to-late 20th century, and substantially increased the difficulty of determining prevalence. For an endemic disease such as this, there may be an especially high value to the central veterinary authority in understanding the prevalence of the disease, particularly at a regional scale. More specifically, test results may be used to better inform future testing choices. Modifications of existing bioeconomic models are necessary to capture the value of additional information regarding prevalence. Implicit in existing bioeconomic models of bTB control is the unrealistic assumption that the central veterinary authority knows perfectly the number of facilities that are latently infected without knowing specifically which facilities are infected. We address uncertainty over the true state of disease prevalence by specifying a belief distribution. We then obtain results by using Bayesian and dynamic programming methods to optimize a dynamical system of disease spread and control in which the central authority’s beliefs regarding prevalence is modeled as a partially observed Markov decision processes. The belief distribution is characterized by two parameters that replace the true but uncertain state variable in the dynamic programming problem. The dynamics are complicated by the fact that decision makers are learning about a moving target: an evolving and endogenous disease prevalence. In each period, the central veterinary authority must update its beliefs using the information gained from testing, and using its understanding of the changes in prevalence that result from infections and recoveries. These physical processes are determined in part by the number of facilities that receive testing and subsequent targeted treatment, making prevalence endogenous. This extension allows us to examine efficient testing and application of targeted controls while explicitly modeling uncertainty and learning about the unobserved state. Our model captures both the gains from targeting animal movement restrictions and culling efforts and from using additional information to inform future testing decisions.
    Keywords: Agricultural and Food Policy, Environmental Economics and Policy, Food Security and Poverty, Livestock Production/Industries, Production Economics, Resource /Energy Economics and Policy,
    Date: 2014
  58. By: Nadella, Karthik; Deaton, Brady; Lawley, Chad; Weersink, Alfons
    Abstract: Approximately 40% of farmland is rented in Canada (Statistics Canada, 2011). In our survey, approximately ninety-five percent of the farmers that rent land also farm on their own land. This provides a unique empirical opportunity to assess the influence of ownership on farmers’ decision to adopt conservation practices. This empirical assessment is important given the conflicting results in previous literature. One group of studies find that owner-operators are more likely to adopt conservation practices than tenants (Belknap and Saupe, 1988; Lynne et al., 1988). This finding is consistent with the idea that owner-operators have a longer planning horizon than tenants and are therefore in a better position to realize the long-term benefits of current investment in conservation practices. However, another set of studies (Rahm and Huffman, 1984; Norris and Batie, 1987) find no differences between owner-operators and tenants with respect to the adoption of conservation practices like conservation tillage. This conflict in literature can be potentially explained by the differences in the present value of expected returns across conservation practices. The adoption of cover crops, for example, involves a tradeoff between costs which occur in the short term and increases in the productivity of the land which occur in the longer term. In our theoretical model the expected returns of long-term investments are influenced by a tenure security measure. Farmers are expected to face a lower level of tenure security on the land they rent relative to the land that they own and are therefore hypothesized to be less likely to plant cover crops on rented land. On the other hand, the adoption of conservation tillage could be profitable in the short-term once the farmer has acquired the machinery and might not be necessarily influenced by tenure status. The empirical analysis (fixed effects) regresses the adoption of conservation practices against a number of explanatory variables. Our data set allows us to examine this decision for the same farmer and thereby eliminates differences that may be explained by characteristics of the farmer. The key explanatory variable of interest is land tenure, which is modeled by observations regarding whether the land is owned or rented. We examine the sensitivity of this to alternative specifications of the model by accounting for the length of time the farmer has rented the land. The data for this analysis comes from a survey of 425 farmers who operate on both owned and rented land in Ontario and Manitoba. The data was collected over a two-week period in April 2013. Farmers provided information about their production practices on both owned and rented properties. (We also gather information from farmers who farm only their own land. This expands the data set to 810 observations.) The key dependent variable is the adoption of conservation practices: i.e., cover crops and conservation tillage. For example, 26% of farmers adopt cover crops on their own land while 15 % adopt cover crops on rented land. The key explanatory variables are measures of land tenure: e.g., whether the land is owned or rented. Additional explanatory variables include measures, which account for variation in land characteristics and crop choice. The data also allows for exploration of a number of important issues, for example, we are able to gather data on characteristics of the farmland owner. For instance, approximately 40% of the landlords in Ontario can be characterized as Non-Farmer Investors while approximately 11% can be characterized as widows or widowers. In total we group landlords into seven categories. In the linear probability model with fixed effects, tenure status is not found to be a statistically significant factor on the probability of the adoption of conservation tillage. However, tenure status is found to be a statistically significant factor on the probability of the adoption of cover crops. These results confirm the hypotheses generated by our theoretical model, which suggests that the influence of tenure status varies on the adoption of conservation practices varies depending on the type of practice that is being considered. These results are also found to be robust under different model specifications.
    Keywords: tenure, conservation practice, rental contract, Agricultural and Food Policy, Environmental Economics and Policy, Land Economics/Use,
    Date: 2014
  59. By: Melstrom, Richard T.
    Keywords: Bioeconomics, fisheries, bycatch, multispecies fishery, nonselective harvests, Resource /Energy Economics and Policy, C61, Q22, Q26,
    Date: 2014
  60. By: Wachenheim, Cheryl; Lesch, William; Fontaine, Cordell
    Keywords: Conservation Reserve Program, environment, conservation, decision-making, Agricultural and Food Policy, Land Economics/Use,
    Date: 2014
  61. By: Sesmero, Juan; Balagtas, Joseph Valdes; Pratt, Michelle
    Abstract: This paper develops a model of spatial competition nesting the classical Zhang and Sexton (2001) duopsony and spatial monopsony in order to evaluate the effects of alternative stover market structures on stover prices, supply of biofuels, and firm profits. We show theoretically, as well as in an empirical implementation calibrated to reflect supply conditions in Indiana, that spatial competition may significantly increase feedstock cost, reduce profits of biofuels plants, and decrease a plant’s optimal scale of production and supply elasticity.
    Keywords: biofuels, spatial competition, corn stover, Nash equilibrium, Industrial Organization, Production Economics, Resource /Energy Economics and Policy,
    Date: 2014
  62. By: Zirogiannis, Nikolaos; Tripodis, Yorghos
    Abstract: We develop a dynamic factor model for panel data with a short time dimension (i.e. n<15). Unlike most of the work in the DFM literature where one common factor is estimated for a group of cross sectional units, our interest lies in the estimation of a latent variable for each cross sectional unit at every point in time. This difference increases the computational challenges of the estimation process. To facilitate estimation we develop the “Two-Cycle Conditional Expectation-Maximization” (2CCEM) algorithm which is a variant of the EM algorithm and it’s extensions (Dempster et al. 1977; Meng and Rubin 1993; Liu and Rubin 1994). Initially, the latent variable is estimated (first cycle) and then the dynamic component is incorporated into the estimation process (second cycle). The estimates of each cycle are updated with information from the estimates of the previous cycle until convergence is achieved. We provide simulation results demonstrating consistency of our 2CCEM estimator. One of the advantages of this work is that the estimation strategy can account for multiple cross sectional units with a short time dimension, and is flexible enough to be used in different types of applications. We apply our model to a dataset of 853 water and sanitation utilities from 45 countries and use the 2CCEM algorithm to estimate performance trajectories for each utility.
    Keywords: Dynamic Factor Models, EM algorithm, Panel Data, State-Space models, Water utilities, IBNET, Environmental Economics and Policy, Research Methods/ Statistical Methods,
    Date: 2014
  63. By: Wille, Nicola; Mitchell, Paul; Dong, Fengxia; Knuteson, Deana; Wyman, Jeffery; Moore, Virginia
    Abstract: Sustainable agriculture is garnering renewed interest as more customers and retailers from both the U.S. and the world markets demand more sustainably sourced products and ingredients. Processed vegetables (canned and frozen) such as sweet corn and green beans face this same growing demand. To respond to this growing demand for sustainability data and programs, the Midwest Food Processors Association and the Wisconsin Potato and Vegetable Growers Association chose the National Initiative for Sustainable Agriculture (http://wisa. approach. This approach develops a farmer self-assessment survey that documents grower adoption of multiple sustainable practices, and then analyzes the data using data envelope analysis with principal components to develop a “sustainability score” for both individual growers and the industry as a whole.
    Keywords: Sustainable Agriculture, Practice Adoption, Best Management Practices, Crop Production/Industries, Farm Management, Production Economics, Research Methods/ Statistical Methods,
    Date: 2014

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