nep-env New Economics Papers
on Environmental Economics
Issue of 2015‒07‒18
forty papers chosen by
Francisco S. Ramos
Universidade Federal de Pernambuco

  1. Solar Geoengineering, Uncertainty, and the Price of Carbon By Garth Heutel; Juan Moreno Cruz; Soheil Shayegh
  2. Going Green for Esteem: An Extended Uzawa-Lucas Model with Status Driven Environmentalism By Zhou, Sophie Lian
  3. Has trade openness reduced pollution in China? By José de Sousa; Laura Hering; Sandra Poncet
  4. The Great Recession and the transition to a low-carbon economy By Andreas A. Papandreou
  5. Ecosystems and human health: towards a conceptual framework for assessing the co-benefits of climate change adaptation By Pablo Martinez-Juarez; Aline Chiabai; Sonia Quiroga Gómez; Tim Taylor
  6. Environmental Effects of a Vehicle Tax Reform: Empirical Evidence from Norway By Ciccone, Alice
  7. Europe's Mechanism for Countering the Risk of Carbon Leakage By Aleksandar Zaklan; Bente Bauer
  8. An analysis of the effects of policies; the case of coal By Massimo Di Matteo; Silvia Ferrini; Virna Talia
  9. Clean energy firms’ stock prices, technology, oil prices, and carbon price By Mara Madaleno; Alfredo Marvão Pereira
  10. Effects of fossil fuel prices on the transition to a low-carbon economy By Franco Ruzzenenti; Andreas A. Papandreou
  11. Modelling the impacts of a national carbon tax in a country with inhomogeneous regional development: an actor-based system-dynamic approach By Dmitry V. Kovalevsky; Klaus Hasselmann
  12. A New Carbon Tax in Portugal: A Missed Opportunity to Achieve the Triple Dividend? By Alfredo Marvão Pereira; Pedro G. Rodrigues
  13. Lobbying for carbon permits in Europe By Julien HANOTEAU
  14. Reducing CO2 from cars in the European Union: Emission standards or emission trading? By Paltsev, Sergey; Chen, Y.-H. Henry; Karplus, Valerie; Kishimoto, Paul; Reilly, John; Loeschel, Andreas; von Graevenitz, Kathrine; Koesler, Simon
  15. Agrarrelevante Extremwetterlagen und Möglichkeiten von Risikomanagementsystemen: Studie im Auftrag des Bundesministeriums für Ernährung und Landwirtschaft (BMEL) By Gömann, Horst; Bender, Andrea; Bolte, Andreas; Dirksmeyer, Walter; Englert, Hermann; Feil, Jan-Henning; Frühauf, Cathleen; Hauschild, Marlen; Krengel, Sandra; Lilienthal, Holger; Löpmeier, Franz-Josef; Müller, Jürgen; Mußhoff, Oliver; Natkhin, Marco; Offermann, Frank; Seidel, Petra; Schmidt, Matthias; Seintsch, Björn; Steidl, Jörg; Strohm, Kathrin
  16. Mining and Quasi-Option Value By Christopher Costello; Charles D. Kolstad
  17. Urban Agenda and Urban Sustainability Strategies. Taking Stock of Policy Implementation and Policy Discussion By Stephanie Barnebeck; Yannick Kalff
  18. The Dynamics of Linking Permit Markets By Holtsmark, Katinka; Midttømme, Kristoffer
  19. Nuclear and financial meltdowns; The impact of the Fukushima accident on the transition to a low-carbon economy By Alessandro Vercelli
  20. Bewertung kultureller Ökosystemleistungen von Berliner Stadtgrün entlang eines urbanen-periurbanen Gradienten By Riechers, Maraja; Barkmann, Jan; Tscharntke, Teja
  21. Ethics, equity and the economics of climate change paper 2: economics and politics By Nicholas Stern
  22. Fetal origins of mental health: evidence from Africa By Achyuta Adhvaryu; James Fenske; Namrata Kala; Anant Nyshadham
  23. A Panel Data Analysis of the Effects of Constitutional Environmental Rights Provisions on Access to Improved Sanitation Facilities and Water Sources By Christopher Jeffords
  24. Threatening Thresholds? The effect of disastrous regime shifts on the cooperative and non-cooperative use of environmental goods and services By Diekert, Florian K.
  25. Green packaging from a company’s perspective: Determining factors for packaging solutions in the German fruit juice industry By Ramme, Iris; Heimann, Ruth
  26. Macroéconomie du court terme et politique climatique : quelques leçons d'un modèle d'offre et demande globales By Jean-François FAGNART; Marc GERMAIN
  27. Minnesota Applied Economist 726, Summer 2015 By Runge, C. Ford; Johnson, Justin
  28. Do Energy Efficiency Investments Deliver? Evidence from the Weatherization Assistance Program By Meredith Fowlie; Michael Greenstone; Catherine Wolfram
  29. Heterogeneous preferences and the effects of incentives in promoting conservation agriculture in Malawi: By Ward, Patrick S.; Bell, Andrew R.; Parkhurst, Gregory M.; Droppelmann, Klaus; Mapemba, Lawrence
  30. The Pass-Through of RIN Prices to Wholesale and Retail Fuels under the Renewable Fuel Standard By Christopher R. Knittel; Ben S. Meiselman; James H. Stock
  31. Sustainable food consumption in China and India By von Meyer-Höfer, Marie; Juarez Tijerino, Andrea Maria; Spiller, Achim
  32. Agricultural intensification in Africa: A regional analysis: By Nin-Pratt, Alejandro
  33. Agricultural diversification and poverty in India: By Birthal, Pratap Singh; Roy, Devesh; Negi, Digvijay S.
  34. Demand for complementary financial and technological tools for managing drought risk: By Ward, Patrick S.; Spielman, David J.; Ortega, David L.; Kumar, Neha; Minocha, Sumedha
  35. Financialisation of the water sector in Poland By Piotr Lis
  36. Natural Resources and Sovereign Expropriation By Baldursson, Fridrik Mar; von der Fehr, Nils-Henrik
  37. The Long-Term Consequences of Vietnam-Era Conscription and Genotype on Smoking Behavior and Health By Lauren Schmitz; Dalton Conley
  38. Policies for inclusive and sustainable growth in Indonesia By Petar Vujanovic
  39. iMAP, an integrated Modelling Platform for Agro-economic Commodity and Policy Analysis By Robert M'barek; Jacques Delincé
  40. Resource Discovery and Conflict in Africa: What Do the Data Show? By Rabah Arezki; Sambit Bhattacharyya; Nemera Mamo

  1. By: Garth Heutel; Juan Moreno Cruz; Soheil Shayegh
    Abstract: We consider the socially optimal use of solar geoengineering to manage climate change. Solar geoengineering can reduce damages from atmospheric greenhouse gas concentrations, potentially more cheaply than reducing emissions. If so, optimal policy includes less abatement than recommended by models that ignore solar geoengineering, and the price of carbon is lower. Solar geoengineering reduces temperature but does not reduce atmospheric or ocean carbon concentrations, and that carbon may cause damages apart from temperature increases. Finally, uncertainty over climate change and solar geoengineering alters the optimal deployment of solar geoengineering. We explore these issues with an analytical model and a numerical simulation. The price of carbon is 30%-45% lower than the price recommended in a model without geoengineering, depending on the parameterizations of geoengineering costs and benefits. Carbon concentrations are higher but temperature is lower when allowing for solar geoengineering. The optimal amount of solar geoengineering is more sensitive to climate uncertainty than is the optimal amount of abatement.
    JEL: C61 H23 Q54 Q58
    Date: 2015–07
  2. By: Zhou, Sophie Lian
    Abstract: Conspicuous conservation is a newly emerged phenomenon of status driven environmentalism, where individuals undertake publicly visible conservation activities for the purpose of gaining social esteem. This paper studies the role of conspicuous conservation as an additional means of regulating environmental issues in an extended Uzawa-Lucas model with leisure choice, environmental externality and social status. Particular attention is paid to the long-term impact of conspicuous conservation on environmental quality, production culture, and the overall welfare along the balanced growth path (BGP) in a decentralized economy. Conspicuous conservation is found to aid pollution taxation and always increase environmental quality by providing additional incentives for pollution abatement. It however also increases the dirtiness of the aggregate technology, and encourages the use of the polluting factor. The overall welfare impact is positive when pollution control is absent or weak, but eventually turns negative as pollution taxation becomes increasingly stringent. The numerical example further suggests that strong status comparison is generally undesirable except at zero or extremely low pollution control.
    Keywords: Conspicuous conservation, social status, pollution, economic growth, Environmental Economics and Policy, Institutional and Behavioral Economics, Resource /Energy Economics and Policy, Q50, D62, D91, O41, O44,
    Date: 2015–06–30
  3. By: José de Sousa; Laura Hering; Sandra Poncet
    Abstract: We use recent detailed Chinese data on trade and pollution emissions to assess the environmental consequences of China’s integration into the world economy. We rely on a panel dataset covering 235 Chinese cities over the 2003-2012 period and examine whether environmental repercussions from trade openness depends on whether it emanates from processing or ordinary activities. In line with our theoretical predictions, we find a negative and significant effect of trade on emissions that is magnified for processing trade and activities undertaken by foreign firms: much lower environmental gains result from either ordinary trade activities or domestic firms, even though these are today the main drivers of China’s export and import growth. This result invites caution about the prospects for pollution in a context of decline role of processing trade.
    Keywords: Trade openness;Pollution;SO2 emissions;China
    JEL: F10 F14 O14
    Date: 2015–07
  4. By: Andreas A. Papandreou (National and Kapodistrian University of Athens)
    Abstract: The objective of this paper is to consider the potential implications of the recent financial and economic crisis on the transition to a low carbon economy. This is unavoidably an exercise in tenuous conjectures given both our proximity to the still unfolding crisis, and the inherent complexity, confusing and highly contested nature of global scale crisis. It is also difficult because our understanding of major energy transitions are still very much in thier infancy, not to mention the unprecedented nature of a transition to a sustainable energy system. The paper begins with a breif review of the Great Recession, considers what lessions can be drawn from past energy transitions and the potential ways that crises, socio-economic transitions and sustainability might be linked. The historical relationship between past recessions and C)2 emissions is presented along with where we stand with respect to meeting mitigation targets. The Great Recession coincided with a relative peak in climate action and the rise of a Green Growth narrative that provides some hope of a joint attack on climate change and economic malaise. This paper will briefly review the idea of Green Growth and Green Keynesianism and look at the evidence on the extent and effectiveness of green demand stimulus following the Great Recession. The paper will argue that despite some early hope and some worthy global developments on the renewables front, public and political priorities shifted dramatically so that on balance the Great Recession can be associated with a 'policy peak' and a lost opportunity to propel the low carbon transition. Moreover, it raises concerns that the continued fragility of the economic recovery will further delay the needed transition.
    Keywords: Financial crisis, Great Recession, climate change policy, carbon prices, Green Growth, Green New Deal, socio-economic transitions, low carbon economy.
    JEL: E62 G01 O13 Q38 Q43 Q48 Q54 Q58
    Date: 2015–01–01
  5. By: Pablo Martinez-Juarez; Aline Chiabai; Sonia Quiroga Gómez; Tim Taylor
    Abstract: This paper focuses on the impact that changes in natural ecosystems can have on human health. Green and blue areas promoted as adaptation measures may provide a wide range of co-benefits which should be taken into account when designing adaptation options. Otherwise sub-optimal policy may result. Here we first present an overview of some key adaptation measures, their possible impacts on the natural environment and associated health implications. Second, we discuss the benefits associated with the exposure to green and blue areas and build a theoretical framework for analysing co-benefits of adaptation to climate change, where such adaptation affects the natural environment. Third, we present an overview of the key literature addressing the relationship between health and exposure to natural environment, while classifying the studies according to the methodological approaches, and discussing main results and key issues. Results in the literature show a positive correlation between health and green areas, while blue areas have attracted less attention. The wide range of differentiated approaches in the literature highlights the need for an integrated conceptual framework to assess the health co-benefits of adaptation that interrelates with the natural environment. We provide the basis for such a conceptual framework that allows identifying the different aspects of this interaction.
    Keywords: Ecosystems and human health, green and blue areas, co-benefits, climate change adaptation
    Date: 2015–04
  6. By: Ciccone, Alice (Dept. of Economics, University of Oslo)
    Abstract: In 2007, the Norwegian government reformed the vehicle registration tax in order to reduce the carbon intensity of the new car fleet by incentivizing the purchase of more fuel efficient cars. This paper identifies the impact of the new tax structure on three main dimensions: (i) the average CO2 emissions intensity of new registered vehicles, (ii) the relative change in sales between low and high polluting cars and (iii) the market share of diesel cars. A Difference in Difference approach is employed to estimate the short run effects on each outcome variable of interest. The results show that the average CO2 intensity of new vehicles was reduced in the year of the implementation of the reform by about 7.5 g of CO2/km. This reduction is the result of a 12 percentage points drop in the share of highly polluting cars and of an increase of about 20 percentage points in the market share of diesel cars.
    Keywords: CO2 emissions intensity; New vehicles; Vehicle registration tax; Tax reform; Norway; Diesel
    JEL: H25 L62 Q51 Q53 Q54 R48
    Date: 2015–02–11
  7. By: Aleksandar Zaklan; Bente Bauer
    Abstract: The EU’s Emissions Trading System (EU ETS) is a regional cap-and-trade program in a world with no binding international climate agreement. This climate regulation may induce a relocation of production away from Europe, with potentially negative consequences for the European economy. This relocation could lead to carbon leakage, i.e. a shift of greenhouse gas emissions from Europe into regions with less stringent climate policy. In response, installations in sectors deemed to be vulnerable receive compensatory free emissions allowances. The European Commission compiles a carbon leakage list of vulnerable sectors. The current mechanism distinguishes two levels of leakage risk. The criteria used lead to the majority of European industry regulated under the EU ETS benefiting from the additional compensation. Whereas industry representatives argue that the current level of compensation should be maintained if not increased, the evidence suggests that under the current framework overcompensation may occur. We describe the mechanism currently used to address the risk of carbon leakage in Europe, and for comparison outline the more differentiated system of assessing leakage risk used in the Californian cap-and-trade system. Applying such a more differentiated mechanism in the European context would lead to a re-distribution of compensation from sectors with an intermediate level of leakage risk to highrisk sectors.
    Date: 2015
  8. By: Massimo Di Matteo (Department of Political Science and International studies, University of Siena.); Silvia Ferrini (Department of Political Science and International studies, University of Siena.); Virna Talia (Department of Political Science and International studies, University of Siena.)
    Abstract: The shift to more sustainable energy regimes requires the implementation of the right mix of policy options to internalize fossil fuel externalities. In this paper the attention is dedicated to the coal. Coal is the main fossil fuel for energy production and also the key driver of emerging economies (China, India). On the other end, the coal has been the driver of developed economies (EU, US) and a systematic review of policy options can offer several insights on the path to sustainability. Whereas coal combustion externalities (mainly CO2) are well regulated, policies for coal mining externalities are mainly neglected. Policy options present several characteristics and a formal discussion of the nexus externality and efficiency is provided. The result of a systematic web search for the coal mining externalities is presented. The strength of this search is to review several national and international reports/papers on coal mining effects. Policies for environmental and societal externalities are reviewed. Results show that the command and control is still the most popular instrument. However, mature economies (e.g. US) have successfully shifted towards voluntary agreements. These instruments promote efficiency and minimize distributional effects. It also emerges that landscape and biodiversity lost are not well regulated.
    Keywords: Externalities, Redistributive Effects, Valuation of Environmental Effects, Valuation of Environmental Policies Correlation Index
    JEL: Q51 Q58 H23 Q48
    Date: 2015–01–01
  9. By: Mara Madaleno (Department of Economics, Management and Industrial Engineering, University of Aveiro Aveiro, Portugal); Alfredo Marvão Pereira (Department of Economics, The College of William and Mary)
    Abstract: Production costs of alternative energies are still high, but increased demand for oil, future oil supply shortage concerns and climate change concerns, have led to the fast development of renewable energy firms. The sector accomplished has accomplished remarkable progress and attracted attention to clean energy, both at the industry level and at the academic side. With this work we attempt to determine whether or not the placement of a price on carbon emissions encourages investments in clean energy firms. Unlike previous literature we focus on the German case and we address the issue at the individual company level. We were able to verify this link but only for the case of companies whose weight over the amount of total energy produced is relevant, which is the case of solar in Germany.
    Keywords: Clean Energy; Firm Stock Prices; Oil Prices; Carbon Prices; Technology.
    Date: 2015–07–05
  10. By: Franco Ruzzenenti (University of Siena); Andreas A. Papandreou (National and Kapodistrian University of Athens)
    Abstract: The purpose of this paper is to shed light on the role that fossil fuel prices have in bringing about a transition to a low carbon economy. This is a very broad, complex and potentially ambiguous question. It requires a good understanding of the factors that can shape long run fossil fuel price trends as well as an understanding of how energy transitions take place, and more specifically how an unprecedented policy-driven global energy transition can be orchestrated. The paper starts with the theory and historical evidence of resource and energy prices with a key message that over the very long run prices of energy services have shown a steady decline. The paper explains why a focus on oil is warranted, discusses the key determinants of oil prices and presents a brief history of recent oil price patterns. It also considers the connection of oil prices with recessions, what the future might bring for fossil fuel prices, and the potential implications of an end to cheap oil for the transition to a low-carbon economy. Finally, it looks into some facets of the interaction between fossil fuel prices and climate policy with a special focus on the role of carbon prices and how these must ultimately be part of a much broader strategy for an effective transition to a low carbon economy that is robust to alternative oil price trajectories.
    Keywords: oil prices, energy prices, energy policy, climate change policy, carbon prices, green paradox, socio-economic transitions, low-carbon economy
    JEL: L98 O13 Q32 Q38 Q41 Q43 Q47 Q48 Q54
    Date: 2015–01–01
  11. By: Dmitry V. Kovalevsky; Klaus Hasselmann
    Abstract: Different countries of the world are affected differently by the adverse impacts of anthropogenic climate change. For a large country consisting of several regions with different geographical conditions, the direct geographical impacts of climate change may differ significantly. Given the inhomogeneous regional economic development typical for many large countries already for the present climate, this suggests that regional economic disparities may increase even further as global warming develops. It is thus important that the impacts of climate mitigation policies are assessed not only on global and national levels, but also on the regional level. The key tool for assessing the efficiency of climate mitigation policies and their impacts are Integrated Assessment models (IAMs), i.e. dynamic models of the coupled climate?socioeconomic system. The family of IAMs described in the present paper represent extensions and modifications of a set of actor-based system-dynamics models reported earlier in Hasselmann K. (2013), Detecting and responding to climate change, Tellus B 65, 20088, (open access). The models focus on the strategies of key decision-making aggregate economic actors (often pursuing conflicting goals) that jointly govern the dynamic evolution of the socio-economic system. We start from a global IAM in which both fossil-fuel-based capital and renewable-energy-based capital determine the production function. We compare a business-as-usual scenario (no mitigation policy) with various mitigation scenarios with different global carbon tax rates. The revenues from the carbon tax in the mitigation scenarios are recirculated into the economy in the form of investments in renewable-energy-based capital. We explore both the case of constant productivity of renewable-energy-based capital and the case with endogenous improvement of renewable-energy productivity through learning-by-doing effects. The model simulations demonstrate that efficient mitigation policies are feasible with readily affordable costs. From this we develop a regionalized IAM along the same methodological lines. We consider a large country composed of two regions characterized by different climates and levels of economic development. This is coupled to large residual "country" representing the "rest of the world". It is assumed that a harmonized carbon tax is imposed in both regions of the country and also in the rest of the world. We explore to which extent the transfer of money from carbon tax revenues between the two regions undertaken by a national government can moderate regional disparities in economic development and climate change impacts. The research leading to these results has received funding from the European Community's Seventh Framework Programme under Grant Agreement No. 308601 (COMPLEX).
    Keywords: actor-based modelling; system dynamics; climate change; mitigation; carbon tax; multi-region models; inhomogeneous regional development; codes Q54; O44; R11
    Date: 2014–11
  12. By: Alfredo Marvão Pereira (Department of Economics, The College of William and Mary); Pedro G. Rodrigues (aCAPP, Center for Administration and Public Policies, Universidade de Lisboa, Portugal)
    Abstract: a carbon-tax proposal designed to achieve three dividends: to help Portugal meet the European Union’s target for emissions reductions by 2030, to boost long-term employment and GDP above their pre-carbon tax levels, and to strengthen public finances by lowering public indebtedness. A key feature of this proposal was a judicious set of mixed strategies to recycle all carbon-tax revenues back into the economy. In this note, we show how the carbon tax that the Portuguese Parliament eventually approved deviated from such guidelines, and ultimately failed to achieve the triple dividend. We argue that authorities need to quickly amend the existing legislation to avoid this misguided attempt turning into a missed opportunity to improve environmental, macroeconomic, and fiscal outcomes.
    Keywords: Carbon Tax; Triple Dividend; Economic Growth; Fiscal Consolidation; Dynamic General Equilibrium; Portugal.
    JEL: D58 H63 O44
    Date: 2015–07–05
  13. By: Julien HANOTEAU (KEDGE Business School and Université d’Aix-Marseille, GREQAM)
    Abstract: Using cross-sector and cross-country data, this paper evidences that rent seeking influenced the allocation of CO2 emission permits in the two first phases of the European emissions trading scheme. Industry lobbies effectively used the ‘job loss’ and ‘competitiveness’ arguments, as unemployment proxy variables significantly impacted the allocation in both phases, and carbon intensity influenced it in the second phase. The countries that adopted a partial auction scheme also gave relatively more permits and in particular to the politically more powerful sectors. This suggests a compensation mechanism and supports the assumption of a political tradeoff between the quantity of permits issued and the decision between free grant and auction. It also confirms that the initial allocation is not neutral in the presence of special interest lobbying.
    Keywords: Lobbying, Emission trading, Permits allocation
    JEL: D72 Q58 C10
    Date: 2014–03–01
  14. By: Paltsev, Sergey; Chen, Y.-H. Henry; Karplus, Valerie; Kishimoto, Paul; Reilly, John; Loeschel, Andreas; von Graevenitz, Kathrine; Koesler, Simon
    Abstract: CO2 emissions mandates for new light-duty passenger vehicles have recently been adopted in the European Union (EU), which require steady reductions to 95 g CO2/km in 2021. Using a computable general equilibrium (CGE) model, we analyze the impact of the mandates on oil demand, CO2 emissions, and economic welfare, and compare the results to an emission trading scenario that achieves identical emissions reductions. We find that vehicle emission standards reduce CO2 emissions from transportation by about 50 MtCO2 and lower the oil expenditures by about €6 billion, but at a net added cost of €12 billion in 2020. Tightening CO2 standards further after 2021 would cost the EU economy an additional €24-63 billion in 2025 compared with an emission trading system achieving the same economy-wide CO2 reduction. We offer a discussion of the design features for incorporating transport into the emission trading system.
    Date: 2015
  15. By: Gömann, Horst; Bender, Andrea; Bolte, Andreas; Dirksmeyer, Walter; Englert, Hermann; Feil, Jan-Henning; Frühauf, Cathleen; Hauschild, Marlen; Krengel, Sandra; Lilienthal, Holger; Löpmeier, Franz-Josef; Müller, Jürgen; Mußhoff, Oliver; Natkhin, Marco; Offermann, Frank; Seidel, Petra; Schmidt, Matthias; Seintsch, Björn; Steidl, Jörg; Strohm, Kathrin
    Abstract: Das Verbundforschungsvorhaben untersuchte regional differenzierte Änderungen agrarrelevanter Extremwetterlagen in Deutschland und deren Auswirkungen auf die Landwirtschaft einschließlich Sonderkulturen und Forstwirtschaft. Auswertungen der Stationsdaten von 1961 bis 2013 des Deutschen Wetterdienstes sowie Daten aus 21 Klimamodellläufen bis zum Jahr 2100 zeigten unter anderem einen Anstieg extremer Hitzetage, die auch in Zukunft häufiger werden sollen. Ferner wurde in den letzten 20 Jahren eine Zunahme der Tage ohne Niederschlag im März und April sowie eine Zunahme extrem trockener Tage im Sommer beobachtet, wobei letztere zukünftig weiter zunehmen sollen. Zunehmende Hitze und Trockenheit beeinträchtigen vor allem die Ertragsbildung bei einigen Ackerkulturen, wie z.B. beim Weizen. Im Wald ist die Verjüngungsfähigkeit vor allem unter Fichte und Kiefer gefährdet. Bei einigen Extremwetterlagen, die insbesondere im Acker- und Sonderkulturanbau hohe Schäden verursachen, wie z. B. Hagel, Starkniederschläge und Spätfröste, besteht wegen fehlender Beobachtungsdaten bzw. nicht eindeutiger Wechselwirkungen weiterer Forschungsbedarf. Nach den Ergebnissen besteht angesichts vielfältiger Anpassungsoptionen in der Land- und Forstwirtschaft keine unmittelbare Notwendigkeit, Risikomanagementsysteme staatlich verstärkt zu unterstützen.
    Abstract: The collaborative project analysed regional differentiated changes of extreme weather events in Germany and their impacts on agriculture including specialised crops and forestry. Analyses of weather station data from 1961 to 2013 of the German Weather Service as well as results of 21 climate model runs until 2100 show i. a. an increase of days with extreme heat which are expected to become more frequent in the future. Furthermore, an increase of days without precipitation in March and April as well as an increase of days with extreme drought in summer were observed. The latter are expected to increase in the future. Increasing heat and drought adversely affect in particular growth and crop harvest of arable cultures e. g. winter wheat. Extreme drought impairs especially the regeneration capacity in spruce and pine forests. For some extreme weather events that cause severe damages in particular in arable and specialised crops such as hail, extreme precipitation and late frosts further research need was identified due to missing observation data or unclear interactions between weather and vegetation. According to the results and in the light of various adaptation options there is currently no further necessity for governmental support of risk management systems.
    Keywords: Extremwetterlagen,Klimaanpassung,Risikomanagement,GAP,extreme weather events,climate adaptation,risk management,CAP
    JEL: O13 Q12 Q15 Q18 Q54
    Date: 2015
  16. By: Christopher Costello; Charles D. Kolstad
    Abstract: We study the timing-of-extraction problem facing a decentralized mine owner when extraction entails environmental damage. As expected, when the environmental damage from mining is known, the socially optimal timing will depend on the magnitude of the damage relative to these costs in the rest of the world. But when environmental damage is uncertain, and these costs are revealed over time, a quasi-option value arises. We show that even if expected environmental costs are identical to those in the rest of the world, any uncertainty over these costs will cause the social planner to optimally delay mining until better information arrives. We show conditions under which it is optimal to postpone the mining decision indefinitely, and conditions when it is optimal to postpone only for a finite duration. The analysis leverages a crucial observation that distinguishes the non-renewable resource problem from the traditional quasi-option value framework. In the traditional framework, the presence of an irreversible investment and uncertainty can help nudge the decision maker to preserve an option, but it by no means implies the decision maker should always preserve the option. In contrast, for a non-renewable resource model, the arbitrage condition underpinning the Hotelling rule suggests that in the absence of uncertainty, the marginal mine owner is completely indifferent between mining immediately and at any point in the future. Thus, for our problem, any uncertainty will convince her to defer the mining decision.
    JEL: Q31 Q32 Q38 Q52
    Date: 2015–07
  17. By: Stephanie Barnebeck; Yannick Kalff
    Abstract: Socio-ecological transitions are a main project, current EU policies, national environmental poli-tics, and regional as well as local action address. Manifold approaches exist and the European Union is anxious to coordinate and facilitate the process of a consolidated transition. Therefore, a policy paper is being developed, the European Urban Agenda, which operates on all govern-mental levels to allow cities more capability in realising said socio-ecological transition accord-ing to their own structural, spatial, social, economic, and environmental predispositions. In a broad study of 40 cities in Europe, we gathered a vast amount of empirical data that indi-cates the individual approaches towards a transition as well as their relations to European and national policies. This paper presents an extension of this research results. We depart from the results of the ROCSET study that is centred on the possibilities of self-organisation and ask about local sustainability strategies with concrete aims and goals. Further, the results of a con-sultation process on this European Urban Agenda are interpreted as an indicator on how the general perception of EU urban policies differs from actor to actor. Such an Agenda can con-tribute to unify individual approaches towards sustainability and consolidate strategies while maintaining the individuality of the local approaches. This paper starts with an outline of the research of the ROCSET study. In the second chapter, the actual urban sustainability strategies are reconstructed to take stock of the current situation in our forty researched cities. The third chapter analyses the consultation process on the Euro-pean Urban Agenda that then can be taken as an indicator on what the expectations for such an agenda are, and how they might reflect currently existing urban strategies.
    Keywords: Academic research, Beyond GDP, Demographic change, Ecological innovation, European economic policy, European governance, Good governance, Holistic and interdisciplinary approach, Research, Social innovation, Socio-ecological transition, Sustainable growth
    JEL: C01 O18 Q01 Q28 Q42 Q48 Q53 Q57 Q58 R1
    Date: 2015–06
  18. By: Holtsmark, Katinka (Dept. of Economics, University of Oslo); Midttømme, Kristoffer (Dept. of Economics, University of Oslo)
    Abstract: We present a novel benefit of linking emission permit markets. We consider a dynamic setting, and let the countries issue permits non-cooperatively. With exogenous technology levels, there are only gains from permit trade if countries are different. With endogenous technology, however, we show that there are gains from trade even if countries are identical. In this case, linking the permit markets of different countries will turn permit issuance into intertemporal strategic complements: If one country issues fewer permits today, other countries will respond by issuing fewer permits in the future. This happens because issuing fewer permits today increases current investments in green energy capacity in all permit market countries, and countries with a higher green energy capacity will respond by issuing fewer permits in the future. Hence, each country faces incentives to withhold emission permits. Even though countries cannot commit to reducing their own emission, or punish other countries that do not, the outcome is reduced emissions, higher investments, and increased welfare, compared to a benchmark with only domestic permit trade. The more frequently participating countries reset their caps, the higher the gain from linking permit markers.
    Keywords: International agreements; permit markets; dynamic games; green technology investments
    JEL: F53 H87 Q54
    Date: 2015–01–30
  19. By: Alessandro Vercelli (DEPS University of Siena)
    Abstract: The paper is articulated in two parts. In the first part the consequences of the Fukushima incident are briefly described and analyzed offering a post-Fukushima reassessment of the advantages and disadvantages of nuclear power generation as compared to those of alternative energy sources. In the second part of the paper the intrinsic structural instability of the process of nuclear power generation is analyzed by comparing it with that of financial processes and showing that a thorough understanding of their critical dynamic nature puts serious constraints on their controllability. The Fukushima accident made evident, and further worsened, the shortcomings of the existing energy system based on fossil sources. A crucial consequence was that it reduced significantly the current and prospective contributions of nuclear energy to the global supply of energy aggravating for a foreseeable future a trend characterized by structural excess demand of energy. A persistent increase in the price of nuclear energy and, more in general, in the trend of energy prices may frustrate any attempt to resume a sustained rate of growth within the business-as-usual paradigm. This calls for a more rapid transition towards a low carbon economy.
    Keywords: Fukushima accident, nuclear power generation, critical systems, structural instability, financial crisis, climate change policy, carbon prices, low-carbon economy
    JEL: B41 G01 Q01 Q28 Q38 Q42 Q43 Q48 Q54
    Date: 2014–12–15
  20. By: Riechers, Maraja; Barkmann, Jan; Tscharntke, Teja
    Abstract: Stadtgrün steht unter hohem Nutzungsdruck. Gerade Erholungsfunktionen werden von An-wohner unterschiedlich wahrgenommen. Eine Möglichkeit, Bewertungen für Grünflächen zu erheben, sind kulturelle Ökosystemleistungen. In dieser Studie vereinen wir qualitative und quantitative Methoden, um Informationen zu kulturellen Ökosystemleistungen und Besuchs-verhalten zu Grünflächen in Berlin zu erhalten. Quaitative Bewertungen von kulturellen Ökosystemleistungen wurden durch semi-strukturierte Interviews mit Berliner Einwohnern (Problemzentrierte Interviews, n = 22) und Experten (Experteninterviews, n = 19) erhalten. Kategorien kultureller Ökosystemleistungen wurden an den urbanen Kontext Berlins angepasst, um detaillierte Informationen über die Bedeutung von Stadtgrün zu erhalten. Zusätzlich wurden quantitative Bewertungen durch direkte Umfragen, basierend auf proportionalem Klumpenauswahlverfahren erhalten. Daten (n = 558) wurden in zwei Runden in fier Ortsteilen Berlins erhoben. Unsere Ergebnisse zeigen, dass sich Nutzung und Bewertung von Stadtgrün je nach Popula-tionsdichte des Berliner Ortsteils unterscheidet. Außerdem werden kulturelle Ökosystemleis-tungen zwischen sozialen Gruppen - jüngere im urbanen Ballungsraum lebende Befragte und ältere in weniger eng besiedelten Gegenden - unterschiedlich bewertet. Unsere Resultate zeigen räumliche, zeitliche und soziale Faktoren auf, die der Bewertung von kulturellen Ökosystemleistungen unterliegen. Kulturelle Ökosystemleistungen haben einen heterogenen Charakter und das Verständnis dessen ist von großer Bedeutung für Grünflächenmanage-ment und Forschung im Bereich der Ökosystemleistung.
    Abstract: Urban green experiences high use-pressures. Especially recreation is perceived differently by inhabitants. One possibility to assess values for green spaces are cultural ecosystem services. In the paper at hand we combine qualitative and quantitative valuations to gain information on cultural ecosystem services and visiting behavior towards urban green spaces in Berlin. Qualitative values of cultural ecosystem services were assessed through semi-structured interviews with Berlin inhabitants (problem-centered interviews, n = 22) and experts (expert interviews, n = 19). Categories of cultural ecosystem services were uniquely adjusted to fit to the urban context and detailed information on the benefits of urban green for local inhabit-ants gained. Additionally, quantitative values were assessed using a face-to-face survey, based on proportioned stratified sampling. Data (n = 558) were collected in two sampling rounds in four districts of Berlin. Results show that green space utilization and valuation of cultural ecosystem services differs by population density of the sampled district of Berlin. Additionally, different social groups - in Berlin, younger urban dwellers versus older residents in less densely populated areas - perceive cultural ecosystem services differently. We uncovered spatial, temporal and social factors which underlie cultural ecosystem service valuation. Cultural ecosystem services have a heterogeneous character and their understanding is of great importance for green space management, spatial planning and ecosystem service research.
    Keywords: Urbane kulturelle Ökosystemdienstleistungen,Grüne Infrastruktur,Raumordnungsplanung,quantitative und qualitative Bewertungen,Management von Stadtgrün,urban cultural ecosystem services,green infrastructure,spatial planning,qualitative and quantitative valuation,green space management
    Date: 2015
  21. By: Nicholas Stern
    Abstract: Both intergenerational and intratemporal equity are central to the examination of policy towards climate change. However, many discussions of intergenerational issues have been marred by serious analytical errors, particularly in applying standard approaches to discounting; the errors arise, in part, from paying insufficient attention to the magnitude of potential damages, and is part from overlooking problems with market information. Some of the philosophical concepts and principles of Paper 1 are applied to the analytics and ethics of pure-time discounting and infinite-horizon models, providing helpful insights into orderings of welfare streams and obligations towards future generations. Such principles give little support for the idea of discrimination by date of birth. Intratemporal issues are central to problematic and slow-moving international discussions and are the second focus of this paper. A way forward is to cast the policy issues and analyses in a way that keeps equity issues central and embeds them in the challenge of fostering the dynamic transition to the low-carbon economy in both developed and developing countries. This avoids the trap of seeing issues primarily in terms of burden-sharing and zero-sum games – that leads to inaction and the most inequitable outcome of all.
    JEL: J1
    Date: 2014
  22. By: Achyuta Adhvaryu; James Fenske; Namrata Kala; Anant Nyshadham
    Abstract: Mental health disorders are a substantial portion of the global disease burden, yet their determinants are understudied, particularly in developing countries. We find that temperature shocks in utero increase depressive symptoms in adulthood in Africa. A ten percent increase in heat exposure increases our depression indices .05 to .07 standard deviations. We find no evidence that the effects of these shocks are smaller for more recent birth cohorts, nor do shocks predict greater treatment of depressive symptoms. Temperature fluctuations, increasingly frequent due to climate change, worsen the mental health disease burden and health care systems in Africa do not mitigate these impacts.
    Keywords: Fetal origins; in-utero; mental health; climate change; Africa
    JEL: I15 O12
    Date: 2015
  23. By: Christopher Jeffords (Indiana University of Pennsylvania)
    Abstract: Using novel panel data on constitutional environmental rights (CER) for 190 countries from 1990-2012, this paper questions if the presence/language of CER provisions provides increased access to improved sanitation facilities and drinking water sources. While implementing statutory laws/regulations derived from CER provisions is a dynamic process, the presence/language of CER provisions is temporally fixed. To capture these dynamics, the presence of a CER and a measure of its legal strength are interacted with its age as explanatory variables within a fixed effects framework yielding evidence of: (1) no association between the CER measures and access to improved sanitation facilities; (2) a positive statistically significant association between ageing CER provisions and access to improved water sources; and (3) a positive but weakly statistically significant association between the legal strength of ageing CER provisions and access to improved water sources, which is improved upon for countries with British vs. French legal origins.
    Keywords: Constitutional Law, Environmental Rights, Sanitation, Water, Legal Origins, Panel Data, Fixed Effects
    JEL: K10 K32 O13 Q50 Q56
    Date: 2015–06
  24. By: Diekert, Florian K. (Centre for Ecological and Evolutionary Synthesis, University of Oslo,)
    Abstract: This paper presents an analytically tractable dynamic game in which players jointly use a resource. The resource replenishes fully but collapses should total use exceed a threshold in any one period. The initial level of use is known to be safe. If it is at all optimal to increase resource use, the consumption frontier is pushed once. Moreover, it is shown that the degree of experimentation is decreasing in the safe value of resource use. Non-cooperative agents can take advantage of this feature and coordinate on a “cautious" equilibrium. If the status quo is sufficiently valuable, the threat of the regime shift induces the first-best. If the status-quo is not sufficiently valuable, experimentation will be inefficiently risky. But given that the threshold has not been crossed, the updated consumption frontier will, ex post, be socially optimal. However, there is also a pareto-inferior, “aggressive" equilibrium in which the resource is depleted immediately. Under some conditions, immediate depletion is a self-fulfilling prophecy, although the social optimum is to sustain the resource indefinitely. Closed-form solutions are provided for a specific example and it is shown that the pareto-superior, “cautious" equilibrium is risk-dominant up to a high probability that the opponents play an aggressive strategy. The result that the threat of a disastrous regime shift allows the agents to coordinate on a pareto-superior equilibrium, because it only pays to search for the location of the threshold once, is robust to extensions that account for more general resource dynamics
    Keywords: Dynamic Games; Thresholds and Natural Disasters; Learning
    JEL: C73
    Date: 2015–06–11
  25. By: Ramme, Iris; Heimann, Ruth
    Abstract: In Germany, extensive legislation aims at getting companies to engage in eco-friendly packaging. A common packaging challenge centers on fruit juice products the packaging of which ranges from carton container, to glass or plastic bottles. This study examined the prevalence of Green Packaging in the Baden-Württemberg fruit juice industry. Expert interviews reveal that these companies make packaging decisions based on bottling volume and financial resources and not on Green Packaging concerns. Concerns about product quality, packaging functionality and convenience prevail because the market values these factors above all. This means Green Packaging will be implemented only when eco-friendly packaging becomes a ‘must-have’ product feature. The study also revealed that the retail channels used by these companies push back against returnable bottles because of their handling costs. Interviewees also expressed their opinion that consumers’ demand for Green Packaging does not suffice to drive change in existing practices. Our recommendation is that smaller companies focus their packaging decisions on existing returnable glass bottles thereby both minimizing change over costs and maximizing green marketing potential. For larger companies it is possible to take on a pioneer role in the field of Green Packaging.
    Keywords: green packaging; environmentally-friendly packaging; fruit juice; product policy; marketing; expert interviews; Germany;
    JEL: M31 M38 Q50
    Date: 2015–07–14
  26. By: Jean-François FAGNART (Université Saint-Louis Bruxelles, CEREC); Marc GERMAIN (Université de Lille 3, Equippe)
    Abstract: Nous introduisons le concept d’empreinte carbone dans un modèle d’offre globale et demande globale avec formation imparfaitement concurrentielle des prix et des salaires et en examinons les propriétés de l’équilibre en présence d’une politique climatique. Nous étudions deux instruments possibles de cette politique, une taxe carbone ou un quota de permis de pollution. Nous montrons qu’à court terme, la politique climatique (ou son durcissement) constitue à la fois un choc d’offre globale négatif et, ceteris paribus, un choc de demande globale positif. Elle provoque donc des effets inflationnistes mais a un impact ambigu sur l’activité économique, l’emploi, le chômage. Ce n’est que dans une économie avec des rigidités nominales suffisantes que la politique climatique stimulera – sous certaines conditions – l’activité à court terme. Dans tous les cas de figure, elle pèsera négativement sur les salaires réels. Nous étudierons encore les interactions entre la politique climatique et les politiques macroéconomiques traditionnelles de demande (stimulus budgétaire ou monétaire) et d’offre (baisse des cotisations sociales). Les effets multiplicateurs de ces politiques sont influencés par l’existence d’une d’une politique climatique et diffèrent selon l’instrument choisi (Taxe ou permis).
    Keywords: Offre et demande globale, Politique climatique, Taxe carbone, permis de pollution
    JEL: E10 E60 Q58
    Date: 2014–03–01
  27. By: Runge, C. Ford; Johnson, Justin
    Abstract: In This Issue: From the Department Head; Food and Carbon to 2050; Outstanding alumni award: Dick Todd; Faculty Spotlight: Pamela J. Smith; Student Spotlight: Blake & Blaine Nelson; Student Spotlight: Nel Pilgrim-Rukavina; A Tribute to Delane Welsch; Why we give: Dorothy Peterson
    Keywords: Resource /Energy Economics and Policy, Teaching/Communication/Extension/Profession,
    Date: 2015–07
  28. By: Meredith Fowlie; Michael Greenstone; Catherine Wolfram
    Abstract: Conventional wisdom suggests that energy efficiency (EE) policies are beneficial because they induce investments that pay for themselves and lead to emissions reductions. However, this belief is primarily based on projections from engineering models. This paper reports on the results of an experimental evaluation of the nation’s largest residential EE program conducted on a sample of more than 30,000 households. The findings suggest that the upfront investment costs are about twice the actual energy savings. Further, the model-projected savings are roughly 2.5 times the actual savings. While this might be attributed to the “rebound” effect – when demand for energy end uses increases as a result of greater efficiency – the paper fails to find evidence of significantly higher indoor temperatures at weatherized homes. Even when accounting for the broader societal benefits of energy efficiency investments, the costs still substantially outweigh the benefits; the average rate of return is approximately -9.5% annually.
    JEL: Q4 Q48 Q5
    Date: 2015–07
  29. By: Ward, Patrick S.; Bell, Andrew R.; Parkhurst, Gregory M.; Droppelmann, Klaus; Mapemba, Lawrence
    Abstract: Malawi faces significant challenges in meeting its future food security needs because there is little scope for increasing production by simply expanding the area under cultivation. One potential alternative for sustainably intensifying agricultural production is by means of conservation agriculture (CA), which improves soil quality through a suite of farming practices that reduce soil disturbance, increase soil cover via retained crop residues, and increase crop diversification. We use discrete choice experiments to study farmers’ preferences for these different CA practices and assess willingness to adopt CA. Our results indicate that, despite many benefits, some farmers are not willing to adopt CA without receiving subsidies, and current farm-level practices significantly influence willingness to adopt the full CA package. Providing subsidies, however, can create perverse incentives. Subsidies may increase the adoption of intercropping and residue mulching, but adoption of these practices may crowd out adoption of zero tillage, leading to partial compliance. Further, exposure to various risks such as flooding and insect infestations often constrains adoption. Rather than designing subsidies or voucher programs to increase CA adoption, it may be important to tailor insurance policies to address the new risks brought about by CA adoption.
    Keywords: zero tillage, food security, food production, sustainability, technology adoption, subsidies, discrete choice experiments, conservation agriculture,
    Date: 2015
  30. By: Christopher R. Knittel; Ben S. Meiselman; James H. Stock
    Abstract: The U.S. Renewable Fuel Standard (RFS) requires blending increasing quantities of biofuels into the U.S. surface vehicle fuel supply. In 2013, the fraction of ethanol in the gasoline pool effectively reached 10%, the ethanol capacity of the dominant U.S. gasoline blend (the “E10 blend wall”). During 2013-2015, the price of RINs—tradeable electronic certificates for complying with the RFS—fluctuated through a wide range, largely because of changes in actual and expected policy combined with learning about the implications of the E10 blend wall. RINs are sold by biofuels producers and purchased by obligated parties (refiners and importers), who must retire RINs in proportion to the petroleum they sell for surface transportation. As a result, RINs in effect serve as a charge on obligated fuels and a corrective subsidy for lower-carbon renewable fuels, and are neutral for fuels outside the RFS. In theory, RIN prices provide incentives to consumers to use fuels with a high renewable content and to biofuels producers to produce those fuels, and as such are a key mechanism of the RFS. This paper examines the extent to which RIN prices are passed through to the price of obligated fuels, and provides econometric results that complement the graphical analysis in Burkholder (2015). We analyze daily data on RINs and fuel prices from January 1, 2013 through March 10, 2015. When we examine wholesale prices on comparable obligated and non-obligated fuels, for example the spread between diesel and jet fuel in the U.S. Gulf, we find that that roughly one-half to three-fourths of a change in RIN prices is passed through to obligated fuels in the same day as the RIN price movement, and this fraction rises over the subsequent few business days. Using six different wholesale spreads between obligated and non-obligated fuels, we estimate a pooled long-run pass-through coefficient of 1.01 with a standard error of 0.12. We also examine the transmission of RIN prices to retail fuel prices. The net RIN obligation on E10 is essentially zero over this period, and indeed we find no statistical evidence linking changes in RIN prices to changes in E10 prices. We also examine the price of E85 which, with an estimated average of 74% ethanol, generates more RINs than it obligates and thus in principle receives a large RIN subsidy. In contrast to the foregoing results, which are consistent with theory, the pass-through of RIN prices to the E85-E10 spread is precisely estimated to be zero if one adjusts for seasonality (as we argue should be done), or if not, is at most 30%. Over this period, on average high RIN prices did not translate into discounted prices for E85.
    JEL: C32 Q42
    Date: 2015–07
  31. By: von Meyer-Höfer, Marie; Juarez Tijerino, Andrea Maria; Spiller, Achim
    Abstract: This study examines sustainable food consumption in China and India, based on online consumer survey data. It explores which factors influence sustainable food consumption in these countries, based upon a model related to the Theory of Planned Behaviour. Structural equation modelling is used for the analysis and comparison of both countries. Among the similarities found are the significant influence of subjective norms on intention towards sustainable food consumption and the influence of perceived consumer effectiveness on sustainable food consumption behaviour. Price is identified as a barrier to sustainable food consumption. Based on these findings policy and marketing implications are given.
    Keywords: sustainable food consumption, consumer behaviour, partial least squares, China, India, Food Consumption/Nutrition/Food Safety, Institutional and Behavioral Economics, Marketing, Q 13, Q18, Q19,
    Date: 2015–02
  32. By: Nin-Pratt, Alejandro
    Abstract: This study assesses the patterns of agricultural intensification in 40 African countries looking at the role fertilizer plays in the process. We propose a set of indicators that uses information on available agricultural land and land suitability to measure intensity of land use in agricultural production. Results show that half of the countries in our sample, those with low population density, have followed a land-abundant intensification path with growth driven by new land incorporated to crop production and increased cropping intensity through the reduction of fallow periods and increased double cropping.
    Keywords: Agricultural growth, Agricultural development, Green Revolution, Land use, farm inputs, Intensification, Intensive farming, Fertilizers,
    Date: 2015
  33. By: Birthal, Pratap Singh; Roy, Devesh; Negi, Digvijay S.
    Abstract: As stress on Indian agriculture increases because of several reasons, such as continuous fragmentation of landholdings and climate change, there is a serious threat to livelihood based on farming. This is particularly true for small farmers. Growing rural populations and constrained employment opportunities in the nonfarm sector have caused subdivision of landholdings in India to the extent that these cannot provide an adequate livelihood to a majority of farm households. With this view, this study was undertaken to explore options for improving the outcomes of the farmers. In this context, crop diversification into high-value crops (HVCs) can be a possible strategy to improve livelihood. Using data from a nationally representative survey, we establish that households diversifying toward HVCs are less likely to be poor, the biggest impact being for smallholders. Furthermore, using continuous treatment matching, we establish the relationship between degree of diversification (share of area dedicated to HVC) and economic well-being of the farmers. Growers of HVCs need to allocate at least 50 percent of their area to these crops to escape poverty. Although the diversification effect on poverty is in general positive, it seems to wither after a threshold probably because of some operational constraints, such as capital on smaller farms and labor on larger ones.
    Keywords: poverty, livelihoods, smallholders, land ownership, off farm employment, high value agriculture, high-value products, continuous treatment, binary treatment, unobserved factors,
    Date: 2015
  34. By: Ward, Patrick S.; Spielman, David J.; Ortega, David L.; Kumar, Neha; Minocha, Sumedha
    Abstract: Weather-related production risks remain one of the most serious constraints to agricultural production in much of the developing world. Financial and technological innovations that mitigate these risks have the potential to greatly benefit farmers in areas prone to such risks. In this study we examine farmers’ preferences for two distinct tools that allow them to manage drought risk: weather index insurance and a recently released drought-tolerant rice variety. We illustrate how these tools can independently address drought risk and demonstrate the potential for these tools to be combined in a complementary risk management product. Using a discrete choice experiment, we assess farmers’ preferences for these two tools independently and in a bundled package. Findings indicate that farmers are generally unwilling to pay for drought-tolerant rice independent of insurance, largely due to the yield penalty under normal conditions. When bundled with insurance, however, farmers’ valuation of the rice increases. Farmers value insurance on its own, but even more so when bundled with the drought-tolerant rice variety. The results provide evidence that farmers value the complementarities inherent in a well-calibrated bundle of risk management tools.
    Keywords: Insurance, Risk, finance, rice, Drought tolerance, Risk management, Weather, Farmers, discrete choice experiments,
    Date: 2015
  35. By: Piotr Lis (Department of Economic and Local Government Policy, Poznan University of Economics, Poland)
    Abstract: Over the last decade there has been dynamic development of technical infrastructure connected with the water economy in Poland. In the years 2000-2013, the water system network expended three times. Such development was possible thanks to the subsidies granted for the realisation of infrastructural investments under the European Union pre-accession (ISPA) as well as post-accession programmes (Structural Funds, Cohesion Funds) supported by state institutions responsible for environmental protection (the Ministry of Environment, the National Fund of Environmental Protection and Water Management). The financial means obtained from bank loans constituted an insignificant part of infrastructural investments. Responsibility for the water system, including the collective supply of water and collective discharge of sewage, is held by gminas1 and it is their own task under the municipal economy. Gminas, the number of which is 2479 in Poland, commission water and sewage service enterprises to perform these tasks. Such enterprises, characterised by a very fragmented structure, play a monopolistic role in a given gmina or a collection of gminas. That is why, the process of financialisation of this sector seems to be rather slow. Political conditions in local communities constitute additional limitations to abrupt ownership transformations in the water sector. Of key importance in water sector is the process of establishing tariffs for collective water supply and collective sewage discharge. The manner of validating the tariffs by gminas is, however, rather questionable. The total price of water supply in Poland varies to a large degree, compared to the prices of electricity or gas supply. It comes as a result of geographical and geological conditions in particular gminas as well as a large scale of proecological investments. Furthermore, the prices of water constitute a crucial political factor used in the fight for votes in the local government elections. The agreement from the gmina’s authorities to increase water prices may contribute to their political defeat and a loss of influence. The sector of water and sewage services is not supervised by a central regulatory authority. The functioning of water and sewage service enterprises is supervised by individual gminas. Thus, a conflict of interests occurs, i.e. gminas establish water and sewage service enterprises which they subsequently supervise. That is why, there has been a discussion in Poland over the creation of a central regulatory authority and the consolidation of the sector. These activities could lead to an intensive privatisation of this area of the economy and a significant growth in the level of financialisation of this sector.
    Keywords: water, water sector, provision of water, collective water supply, water and sewage service enterprises, financialisation of the waters sector.
    JEL: Q56 Q59 H41 H42 G21
    Date: 2015–03–01
  36. By: Baldursson, Fridrik Mar (Reykjavik University, School of Business); von der Fehr, Nils-Henrik (Dept. of Economics, University of Oslo)
    Abstract: A government wants to exploit a renewable resource, yielding a timevarying flow of rent, by leasing it at a fixed rate. Leasing contracts can be expropriated before expiration, albeit at a cost. To minimise transactions costs and avoid the ‘resource curse’ the government would prefer to enter into an infinitely long contract (i.e. sell the resource), if it could commit not to expropriate. However, with finite costs of expropriation credible commitment is impossible: the government either enters into finite contracts, expropriates with positive probability or does both. The value of the resource to the government is increasing in the cost of expropriation, but decreasing in the variability of the resource rent.
    Keywords: Natural resources; sovereign expropriation; optimal contract length
    JEL: D86 Q02
    Date: 2015–02–15
  37. By: Lauren Schmitz; Dalton Conley
    Abstract: Research is needed to understand the extent to which environmental factors mediate links between genetic risk and the development of smoking behaviors. The Vietnam-era draft lottery offers a unique opportunity to investigate whether genetic susceptibility to smoking is influenced by risky environments in young adulthood. Access to free or reduced-price cigarettes coupled with the stress of military life meant conscripts were exposed to a large, exogenous shock to smoking behavior at a young age. Using data from the Health and Retirement Study (HRS), we interact a genetic risk score for smoking initiation with instrumented veteran status in an instrumental variables (IV) framework to test for genetic moderation (i.e. heterogeneous treatment effects) of veteran status on smoking behavior and smoking-related morbidities. We find evidence that veterans with a high genetic predisposition for smoking were more likely to become regular smokers, smoke heavily, and are at a higher risk of being diagnosed with cancer or hypertension at older ages. Smoking behavior was significantly attenuated for high-risk veterans who attended college after the war, indicating post-service schooling gains from veterans’ use of the GI Bill may have reduced tobacco consumption in adulthood.
    JEL: I1 I12 I14
    Date: 2015–07
  38. By: Petar Vujanovic
    Abstract: Indonesia has a very good record of poverty reduction, having halved its incidence over the past two decades. Nevertheless, almost 30 million people still live below the national poverty line, mostly in rural areas and in certain provinces. In order to make further progress in lifting these people out of poverty and economic vulnerability, policy needs to focus on generating strong, inclusive and sustainable growth. Pro-poor growth can assist in the process of economic convergence by facilitating the migration of workers out of the low-productivity agricultural sector into the industry and services sectors. By putting in place the right fundamentals, such as a well-designed and inclusive education system, efficient infrastructure and a stable macroeconomic environment, Indonesia will have decades of strong growth ahead by virtue of economic convergence with frontier countries. This has the potential to lift millions more out of poverty without exacerbating income inequality. Moreover, it will set Indonesia up for the next phase of innovation-driven growth that will propel it into the ranks of high income countries. While existing poverty reduction programmes have become increasingly effective, more resources are required, and efficiency could be further enhanced, especially through better targeting. The distribution of income has become markedly more unequal over the past decade and needs to be kept in mind when formulating growth policies. This Working Paper relates to the 2015 OECD Economic Survey of Indonesia (<P>Des politiques en faveur d'une croissance inclusive et durable en Indonésie<BR>L’Indonésie a obtenu de très bons résultats en matière de réduction de la pauvreté, dont l’incidence a été divisée par deux au cours des vingt dernières années. Néanmoins, presque 30 millions d’Indonésiens vivent toujours en dessous du seuil national de pauvreté, dont la majorité dans des zones rurales et dans certaines provinces. Pour qu’il soit possible de continuer à aider ces populations à sortir de la pauvreté et de la vulnérabilité économique, l’action publique doit viser en priorité à susciter une croissance forte, inclusive et durable. L’instauration d’une croissance favorable aux pauvres peut rendre plus aisé le processus de convergence économique en facilitant le redéploiement des travailleurs du secteur agricole, à faible productivité, vers l’industrie et les services. Pour autant qu’elle mette en place les fondamentaux adéquats, comme un système éducatif bien conçu et inclusif, des infrastructures efficientes et un environnement macroéconomique stable, l’Indonésie aura devant elle des décennies de forte croissance en vertu de la convergence économique avec les pays frontières. Une telle évolution a le potentiel d’aider des millions de personnes à sortir de la pauvreté sans accentuer les inégalités de revenus. De plus, l’Indonésie sera ainsi bien placée pour aborder la phase suivante, celle de la croissance tirée par l’innovation, lui permettant ainsi de se hisser aux rangs des pays à haut revenu. Par ailleurs, les programmes existants de réduction de la pauvreté sont devenus de plus en plus efficaces, mais des ressources supplémentaires sont nécessaires, et l’efficacité pourrait être encore améliorée, notamment grâce à un meilleur ciblage. La distribution des revenus est devenue sensiblement plus inégale au cours de la dernière décennie et il conviendra de ne pas perdre cet élément de vue lors de la formulation des politiques en faveur de la croissance.
    Keywords: productivity, education, convergence, sustainable growth, middle-income trap, income distribution, inclusive growth, inequality
    JEL: A20 D63 E25 H53 H54 H55 I20 I31 I38
    Date: 2015–07–09
  39. By: Robert M'barek (European Commission – JRC - IPTS); Jacques Delincé (European Commission – JRC - IPTS)
    Abstract: Building, maintaining and applying the integrated Modelling Platform for Agro-economic Commodity and Policy Analysis (iMAP) has been a long-term project (since 2005) at the Joint Research Centre Institute for Prospective Technological Studies (JRC-IPTS), whose aim is to deliver in-house policy support to the European Commission. iMAP is the result of collaboration with and contributions from many former and present IPTS colleagues, as well as from researchers outside IPTS. The present JRC Technical Report provides an update on published model-related policy impact analysis related to baselines, the Common Agricultural Policy, Resource and energy policies, the bioeconomy, Europe and its neighbours, and Europe’s agri-food sector in the global market.
    Keywords: models, PE, CGE, agriculture, trade, bioeconomy, iMAP, economics, modelling, data
    Date: 2015–07
  40. By: Rabah Arezki; Sambit Bhattacharyya; Nemera Mamo
    Abstract: The empirical relationship between natural resources and conflict in Africa is not very well understood. Using a novel geocoded dataset on resource discovery and conflict we are able to construct a quasi-natural experiment to explore the causal effect of (giant and major) oil and mineral discoveries on conflict in Africa at the grid level corresponding to a spatial resolution of 0.5 x 0.5 degree covering the period 1946 to 2008. Contrary to conventional wisdom, we find no evidence of natural resources triggering conflict in Africa after controlling for grid-specific fixed factors and time varying common shocks. Resource discovery appears to have improved local income measured by nightlights which could be reducing the conflict likelihood. We observe little or no heterogeneity in the relationship across resource type, size of discovery, pre and post conclusion of the cold war, and institutional quality. The relationship remains unchanged at the regional and national levels.
    Keywords: Resource discovery; Conflict onset; Conflict incidence; Conflict intensity
    JEL: D72 O11
    Date: 2015

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