nep-env New Economics Papers
on Environmental Economics
Issue of 2017‒01‒08
fifty-two papers chosen by
Francisco S. Ramos
Universidade Federal de Pernambuco

  1. Innovation Processes and Environmental Safety By BIMONTE, Giovanna; SENATORE, Luigi
  2. Voluntary Individual Carbon Trading By Spash, Clive L.; Theine, Hendrik
  3. Decarbonization Pathways in Southeast Asia: New Results for Indonesia, Malaysia, Philippines, Thailand and Viet Nam By Bosello, Francesco; Orecchia, Carlo; Raitzer, David A.
  4. The land use change time-accounting failure By Marion Dupoux
  5. Financing Climate Policies Through Climate Bonds By Michael Flaherty; Arkady Gevorkyan; Siavash Radpour; Willi Semmler
  6. Projections and Uncertainties About Climate Change in an Era of Minimal Climate Policies By William D. Nordhaus
  7. Tree canopies, urban green amenities and the residential real estate market: Remote sensing and spatial hedonic applications to Lisbon, Portugal By Jacob Macdonald; Sofia Franco
  8. Intergenerational altruism: A solution to the climate problem?* By Nesje, Frikk; Asheim, Geir
  9. Policy- v. Individual Heterogeneity in the Benefits of Climate Change Mitigation: Evidence from a Stated-Preference Survey By Alberini, Anna; Ščasný, Milan; Bigano, Andrea
  10. The importance of the Water-Energy-Food Nexus in the implementation of The Sustainable Development Goals (SDGs) By Rabi Mohtar
  11. The Cost of Climate Stabilization in Southeast Asia, a Joint Assessment with Dynamic Optimization and CGE Models By Bosello, Francesco; Marangoni, Giacomo; Orecchia, Carlo; Raitzer, David A.; Tavoni, Massimo
  12. Financing energy innovation: The role of financing constraints for directed technical change from fossil-fuel to renewable innovation By Noailly, Joëlle; Smeets, Roger
  13. Spatial issues revisited: A note on the role of shared transportation modes By Marion Drut
  14. Interaction between CO2 emissions trading and renewable energy subsidies under uncertainty: feed-in tariffs as a safety net against over-allocation By Oskar Lecuyer; Philippe Quirion
  15. Economic Valuation of Sand and Gravel in Davao del Norte, Philippines By Tamayo, Adrian; Tagalo, Romulo
  16. Cumulative Emissions, Unburnable Fossil Fuel and the Optimal Carbon Tax By Rezai, Armon; Van der Ploeg, Frederick
  17. The Paris Agreement to Ignore Reality By Spash, Clive L.
  18. The power of active choice: Field experimental evidence on repeated contribution decisions to a carbon offsetting program By Kesternich, Martin; Römer, Daniel; Flues, Florens
  19. An Integrated Approach to Climate Change, Income Distribution, Employment, and Economic Growth* By Taylor, Lance; Rezai, Armon; Foley, Duncan K.
  20. Climate change related risks, opportunities and adaptation actions in European cities ? Insights from responses to the CDP cities program By Markus Groth; Maria Brück; Teresa Oberascher
  21. The Economics and Ethics of Human Induced Climate Change By Spash, Clive L.; Gattringer, Clemens
  22. The Role of Development Finance in Climate Action Post-2015 By Tara Shine; Gisela Campillo
  23. Reducing the Energy Burden of the Poor and Greenhouse Gas Emissions: Can We Kill Two Birds with One Stone? By Dorothée Charlier; Anna Risch; Claire Salmon
  24. Priorities and preferences in the implementation of the European Water Framework Directive - A case study of the river Alsterån By Ek, Kristina; Persson, Lars
  25. An Economic Assessment of Low-Carbon Investment Flows in the U.S. Power Sector By Wang, Lu; Favero, Alice; Brown, Marilyn
  26. The role of trade openness and investment in examining the energy-growth-pollution nexus: Empirical evidence for China and India By Nguyen, Duc Khuong; Sévi, Benoît; Sjö, Bo; Salah Uddin, Gazi
  27. Foreign direct investment and environmental degradation: Further evidence from Brazil and Singapore. By Kostakis, Ioannis; Lolos, Sarantis; Sardianou, Eleni
  28. Valuation of coral reefs using site choice model By Katsuhito Nohara; Azusa Okagawa; Akira Hibiki; Hiroya Yamano
  29. Energy consumption and CO2 emissions in the northern cities (case of Yakutia) By Tuyara Gavrilyeva
  30. Modeling Growth, Distribution, and the Environment in a Stock-Flow Consistent Framework By Naqvi, Syed Ali Asjad
  31. An evaluation of French municipal solid waste pricing system By Houévoh Amandine R. Gnonlonfin
  32. Carbon footprint decomposition in MRIO models: identifying EU supply-chain hot spots and their structural changes over time By Wieland, Hanspeter; Giljum, Stefan
  33. La transition énergétique est-elle favorable aux branches à fort contenu en emploi ? Une approche input-output pour la France By Quentin Perrier; Philippe Quirion
  34. Self Image and Environmental Attitude and Behavior By FIORILLO, Damiano; SENATORE, Luigi
  35. The Political Economy of Weak Treaties By Marco Battaglini; Bård Harstad
  36. An updated bibliography and database on forest ecosystem service valuation studies in Austria, Germany and Switzerland By Elsasser, Peter; Meyerhoff, Jürgen; Weller, Priska
  37. Farm-level Adaptation to Climate Change in Western Bangladesh: An Analysis of Adaptation Dynamics, Profitability and Risks By Md. Jahangir Kabir; Mohammad Alauddin; Steven Crimp
  38. Work-sharing for a sustainable economy By Zwickl, Klara; Disslbacher, Franziska; Stagl, Sigrid
  39. A general equilibrium cost-bene t rule for green certi ficates By Kriström, Bengt
  40. Atmospheric Pollution and Child Health in Late Nineteenth Century Britain By Bailey, Roy E.; Hatton, Timothy J.; Inwood, Kris
  41. Spillover effects of blacklisting policy in the Brazilian Amazon By Luiza Andrade; André Luis Squarize Chagas
  42. Ecological Macreconomics: Introduction and Review By Rezai, Armon; Stagl, Sigrid
  43. Modello Baumol–Oates in tempo discreto e tempo continuo: analisi deterministica e stocastica By Loreno Cecconi
  44. Ice Age Climate, Somatic Capital, and the Timing of the Neolithic Transition By Lothar Grall
  45. Swedish no-take zones for fishing from an economic perspective – an empirical analysis By Bostedt, Göran; Brännlund, Runar; Carlén, Ola; Gisselman, Fredrik; Persson, Lars
  46. Transition Towards a Green Economy in Europe: Innovation and Knowledge Integration in the Renewable Energy Sector By Conti, Chiara; Mancusi, Maria Luisa; Francesca, Sanna-Randaccio; Roberta, Sestini; Elena, Verdolini
  47. Natural capital accounts and public policy decisions: Findings from a survey By Mathilde Jeantil; Laura Recuero Virto; Jean-Louis Weber
  48. How to Take Rights Seriously: A New Approach to the Intertemporal Evaluation of Social Alternatives By Ngo Van Long; Vincent Martinet
  49. Measuring the temperature and diversity of the U.S. regulatory ecosystem By Michael J Bommarito II; Daniel Martin Katz
  50. Ecological territory and ecocity as result of smart, sustainable, integrated planning policies By Stefano Aragona
  51. Long-Run Welfare Effect of Energy Conservation Regulation By Matsumura, Toshihiro; Yamagishi, Atsushi
  52. The impacts of the EU ETS on efficiency: An empirical analyses for German manufacturing firms By Löschel, Andreas; Lutz, Benjamin Johannes; Managi, Shunsuke

  1. By: BIMONTE, Giovanna (CELPE - Centre of Labour Economics and Economic Policy, University of Salerno - Italy); SENATORE, Luigi (CELPE - Centre of Labour Economics and Economic Policy, University of Salerno - Italy)
    Abstract: In this paper, we propose a new index that is able to point out the important relationship between environmental protection and investments in innovation processes. We identify the index with the acronym EICI (Environmental Innovation Comparative Index). This new empirical tool can help to explain how the level of innovation can determine different levels of air pollution in the world. We use OLS models to investigate how this new index impacts the variations in greenhouse gas emissions, and we underline some fundamental policy implications. Considering the levels of the EICI and the empirical analysis of the role of this index then we conclude that enforcing new environmental agreements with some fundamental rules, as the incentive to reduce the technological gaps among the countries, is crucial to protect the environment and at same time stimulate the investment for innovation in all countries of the world.
    Keywords: Kyoto Agreement; Environmental Index; OLS model; Environmental Policy;
    JEL: O33 Q50 Q52 Q55 Q58
    Date: 2016–12–30
  2. By: Spash, Clive L.; Theine, Hendrik
    Abstract: In recent years, the search for regulatory regimes in order to effectively address human induced climate change have become a prominent political and academic issue. Emission trading schemes have risen in popularity and are widely believed to be an effective, as well as economically efficient, measure and have become a favoured government strategy. On the individual level, many individuals in the industrialised nations now undertake actions to offset their personal direct greenhouse gas (GHG) emissions by voluntarily purchasing carbon credits, normally in association with product or service purchase. While this is a fast growing market, advertised as creating a carbon neutral consumer society, the voluntary carbon credit sector raises fundamental problems with respect to verification and credibility of the claimed offsets and associated projects. Lack of regulation and legal oversight leads to the impossibility of actually obtaining or verifying information on the consequences of voluntary credit purchases. Providers of offset credits who are driven by greed and easy profits will underfunded emissions abatement projects and pay little attention to quality standards. Corporate "green washing" is also likely through voluntary offsets marketed as going carbon neutral. This paper connects voluntary offsets to psychological and behavioural impacts on the individual. We identify three specific issues: the psychology of marketing and purchasing of voluntary offsets, commodification and crowding out of intrinsic motivations and the implicit ethics with its own psychological implications. We also discuss the political economy of voluntary carbon markets and their geo-political implications in terms of the global North- South divide and ethical responsibility for action on human induced climate change. This raises serious concerns over the individualisation of a collective problem, what can and should be expected of individuals as ethical consumers and how markets operate in practice. Such aspects place individual behaviour within a broader social and institutional context that questions the trend in market environmentalism and its impacts on the capability of humans to relate to nature. (authors' abstract)
    Date: 2016–10
  3. By: Bosello, Francesco; Orecchia, Carlo; Raitzer, David A.
    Abstract: Southeast Asia is one of the most vulnerable regions of the world to the impacts of climate change. At the same time, the region is also following a trajectory that could make it a major contributor to greenhouse gas emissions in the future. Understanding the economic implications of policy options for low carbon growth is essential to formulate instruments that achieve the greatest emissions reductions at lowest cost. This study focuses on five developing countries of Southeast Asia that collectively account for 90% of regional emissions in recent years—Indonesia, Malaysia, the Philippines, Thailand, and Viet Nam. The analyses are based on the CGE economy-energy-environment model ICES under an array of scenarios reflecting business as usual, fragmented climate policies, an approximately 2.4°C post 2020 global climate stabilization target, termed 650 parts per million (ppm) carbon dioxide (CO2) equivalent (eq), and an approximately 2°C global target (termed 500 ppm CO2 eq). Averted deforestation through reducing emissions from forest degradation and deforestation (REDD) is included in some scenarios. The study shows that global and coordinated action is found to be critical to the cost effectiveness of emissions stabilization policies. A 650ppm stabilization scenario (below 3°C in 2100) has a similar cost to the region to current fragmented targets, but achieves much higher levels of emissions reductions. However, only some of the countries have short-term emissions targets that are consistent with a stabilization scenario at 650ppm: these are Indonesia, Philippines and Viet Nam. None of the countries’ mid-term targets are coherent with more ambitious stabilization scenario at 500ppm.
    Keywords: Climate Change Mitigation, Asian Economies, Computable General Equilibrium Models, Environmental Economics and Policy, Q54, Q58, C68,
    Date: 2016–12–15
  4. By: Marion Dupoux (University Paris Ouest Nanterre La Défense, EconomiX)
    Abstract: Land use change (LUC) is the second human-induced source of greenhouse gases (GHG). This paper warns about the LUC time-accounting failure in internalizing GHG impacts in economic appraisal (within policies). This emerges from (i) relative carbon prices commonly following the Hotelling rule as if climate change were regarded as an exhaustible resource problem and (ii) a uniform annualization (i.e. constant flows over time) of LUC impacts supported by most energy policies. First, carbon prices time evolution should account for the climate change framework specificities (natural carbon absorption, uncertainty), which makes a departure from the Hotelling rule necessary. Second, there is a carbon dynamic after land conversion: GHG impact flows are strictly decreasing over time. With a theoretical framework, I show that the employment of the uniform annualization, within a benefit-cost analysis, enhances both the discounting overwhelming effect and the carbon price increase, whatever the type of impact (emissions or sequestrations). It results in skewed values of LUC-related projects as long as relative carbon prices deviate from the Hotelling rule. I apply this framework to global warming impacts of bioethanol in France and quantify this bias. In particular, carbon profitability payback periods under the uniform approach do not reflect the LUC effective carbon investment. This potentially modifies the conclusions regarding a project’s achievement of imposed environmental criteria.
    Keywords: benefit-cost analysis, land use change, relative carbon price, discounting, global warming
    JEL: D61 H43 Q15 Q48 Q54
    Date: 2016–09
  5. By: Michael Flaherty; Arkady Gevorkyan; Siavash Radpour; Willi Semmler (Schwartz Center for Economic Policy Analysis (SCEPA))
    Abstract: The funding of climate mitigation and adaptation policies has become an essential issue in climate negotiations. Emissions trading schemes (ETS) and carbon tax policies are widely disccussed as viable mitigation strategies, the revenue from which might then be used for adaptation efforts. In most current models, the burden of enacting mitigation and adaptation policies falls on current generations. This paper expands on a recent article by Sachs (2014) that proposes intertemporal burden sharing, suggesting that implementation of climate policies would represent a Pareto improving strategy for both current and future generations. In particular, this paper proposes that green bonds (also referred to as climate bonds) represent an immediately implementable opportunity to initiate Sachs' plan; the issuance of green bonds could fund immediate investment in climate mitigation such that the debt might be repaid by future generations, those who benefit most from reduced environmental damages. The Sachs model is a discrete time overlapping generations model which we generalize and turn into a continuous time version exhibiting three major stages. We solve this three phase model by using a new numerical procedure called NPMC that allows for finite horizon solutions and phase changes. We show that the issued bonds can be repaid and the debt is sustainable within a finite time horizon. We also study econometrically whether the current macroeconomic environment is conducive to successfully phasing in such climate bonds.
    Keywords: Cimate Bonds, Finance, NMPC
    JEL: Q54 F37
    Date: 2016–03
  6. By: William D. Nordhaus
    Abstract: Climate change remains one of the major international environmental challenges facing nations. Yet nations have to date taken minimal policies to slow climate change. Moreover, there has been no major improvement in emissions trends as of the latest data. The current study uses the updated DICE model to present new projections and the impacts of alternative climate policies. It also presents a new set of estimates of the uncertainties about future climate change and compares the results will those of other integrated assessment models. The study confirms past estimates of likely rapid climate change over the next century if there are not major climate-change policies. It suggests that it will be extremely difficult to achieve the 2°C target of international agreements even if ambitious policies are introduced in the near term. The required carbon price needed to achieve current targets has risen over time as policies have been delayed.
    JEL: C15 F6 Q5 Q54
    Date: 2016–12
  7. By: Jacob Macdonald; Sofia Franco
    Abstract: This paper explores the use of remote sensing techniques and hedonic pricing methods for the valuation of urban green amenities and in particular street trees. The classification and study of these amenities in an urban area is challenged by the high level of spatially detailed data required. While tree canopies are important not only for their aesthetics and ecological benefits, it is difficult to obtain such data to be used for informed policy discussions. A classification algorithm is tested and applied to high resolution aerial photographs of Lisbon to assess the usage of remote sensing techniques for the detection of tree canopies in the city. Results indicate a high accuracy rate of approximately 90%. We further explore how the heterogeneity of urban green amenities influence the residential real estate market under the hedonic valuation framework with a spatial error specification, focusing on the impact of parks, urban forests, cemeteries, playgrounds, the Tagus River and Monsanto Forest Park. Results indicate that different types of green spaces are valued differently and further that there is varying effects in how the real estate market values different types of street trees. Residential real estate capitalizes these trees based on their heterogeneous characteristics such as location and relative age, with results showing that trees have significant positive amenity values in mitigating flood risk in the urban area. This highlights the importance in considering how different trees are contextualized in an urban environment. Remote sensing techniques of tree canopies are thus worthwhile in providing additional dimensions from which urban green amenities can be valued via the hedonic framework. In this way, our findings contribute to the broader debate on applying remote sensing and hedonic pricing to the valuation of ecosystem and environmental services and to assess strategies to increase the level of greenness within urban areas.
    Keywords: Environmental amenities; tree canopy; spatial hedonic; remote sensing
    JEL: Q51 R21
    Date: 2016–12
  8. By: Nesje, Frikk (Dept. of Economics, University of Oslo); Asheim, Geir (Dept. of Economics, University of Oslo)
    Abstract: The future effects of climate change may induce increased intergenerational altruism. But will increased intergenerational altruism reduce the threat of climate change? In this chapter we investigate this question. In a second-best setting with insufficient control of greenhouse gas emissions in the atmosphere, increased transfers to future generations through accumulation of capital might result in additional accumulation of greenhouse gases, and thereby aggravate the climate problem. In contrast, transfers to the future through control of greenhouse gas emissions will alleviate the climate problem. Whether increased intergenerational altruism is a means for achieving accumulation of consumption potential (through accumulation of capital) without increasing the climate threat depends on how it affects factors motivating the accumulation of capital and the control of emissions of greenhouse gases. An argument is provided for why increased intergenerational altruism in fact will aggravate the climate problem. We use the models of Jouvet et al. (2000), Karp (forthcoming) and Asheim and Nesje (forthcoming) to facilitate the discussion.
    Keywords: Intergenerational altruism; climate change
    JEL: D63 D64 Q01 Q54
    Date: 2016–09–11
  9. By: Alberini, Anna; Ščasný, Milan; Bigano, Andrea
    Abstract: The implementation of decarbonization policies depends crucially on the public’s willingness to pay for them. We use stated preference methods to investigate the public’s preferences for such policies. We ask three research questions. First, does the willingness to pay (WTP) for each ton of CO2 emissions reductions depend on the policies and on individual characteristics of the respondents? Second, how extensive is the variation associated with these factors? Third, what factors affect support for or opposition to a carbon tax? Based on the responses to discrete choice experiments from a sample of Italians, we find that the WTP per ton of CO2 ranges between € 6 and 130, depending on whether the public program is based on taxes, incentives, information-based approaches or standards. Further allowing for individual characteristics of the respondents, such as gender or education, and knowledge of climate change, results in a 300% change in WTP, holding the policy instrument the same. We conclude that the variation associated with the policy instrument is approximately of the same order of magnitude as that associated with individual characteristics of the respondents.
    Keywords: Climate Change Mitigation, WTP per ton of CO2 Emissions Reduced, Choice Experiments, Environmental Economics and Policy, Q41, Q48, Q54, Q51,
    Date: 2016–12–23
  10. By: Rabi Mohtar
    Abstract: In September 2015, Heads of State met at the United Nations General Assembly to announce the end of the term of “Millennium Development Goals” (MDGs) and commit to a new set of Sustainable Development Goals (SDGs). The 17 SDGs were written by disciplinary teams, and as they are formulated now, they recognize the interlinkages between well-being, economic prosperity and a healthy environment. The SDGs include a wide spectrum of topics and issues: food security, poverty, gender inequality, economic development, climate change, and health, among others. Under each of the Goals is a list of quantifiable targets to be achieved in the coming 10-15 years. Progress toward 12 of these SDGs is directly related to the sustainable use of resources such as land, food, water, energy and materials. The commitment of the Nations to adopt and achieve the SDGs, eradicate poverty, and achieve sustained development that will impact more and more populations, represents an unprecedented opportunity to enter a new era of policy making and resource management. One that can make the integration of social, economic and environmental issues a reality.
    Date: 2016–12
  11. By: Bosello, Francesco; Marangoni, Giacomo; Orecchia, Carlo; Raitzer, David A.; Tavoni, Massimo
    Abstract: Southeast Asia is at a time one of the most vulnerable region to the impacts of a changing climate, with millions of its inhabitants still trapped in extreme poverty without access to energy and employed in climate-sensitive sectors, and, potentially, one of the world’s biggest contributors to global warming in the future. Fortunately, major Southeast Asian countries are also implementing policies to improve their energy and carbon efficiency and are discussing if and how to extend these further. The present study aims to assess the implications for energy consumption, energy intensity and carbon intensity in the Southeast Asia region of a set of short-term and long-term de-carbonization policies characterized by different degrees of ambition and international cooperation. The analysis applies two energy-climate-economic models. The first, the fully dynamic Integrated Assessment model WITCH, is more aggregated in the sectoral and country representation, but provides a detailed technological description of the energy sector. The second, the ICES Computable General Equilibrium model, offers a richer sectoral breakdown of the economy and of international trade patterns, but is less refined in the representation of technology. The joint application of these two complementary models allows the capture of distinct and key aspects of low- carbon development paths in Southeast Asia.
    Keywords: Climate Change Mitigation, Asian Economies, Computable General Equilibrium Models, Environmental Economics and Policy, Q54, Q58, C68,
    Date: 2016–12–23
  12. By: Noailly, Joëlle; Smeets, Roger
    Abstract: Addressing both the challenge of climate change and the world's growing energy needs will only be possible by achieving a breakthrough in clean technologies in order to deliver safe, clean and sustainable energy for future generations. Such a large-scale technological transition will require massive investments in research and development (R&D) of clean energy production. Within the sector of electricity generation, renewable (REN) energy technologies, such as solar, wind or geothermal energy, can provide a clean alternative to electricity produced from carbon-intensive fossil-fuels (FF). Nonetheless, private firms' investments in advancing innovation for renewable energy technologies face important challenges. [...]
    Date: 2016
  13. By: Marion Drut
    Abstract: Spatial and environmental issues related to mobility are exacerbated in urban areas. Road congestion, rivalry of use for parking spaces and air pollution are major issues regularly at the heart of local transportation policies. They have been dealt with through various approaches. Mass transit have recently been fostered as a solution against road congestion and rivalry of use. These spatial issues relate to the space consumed by transportation modes. Private cars are assumed to consume larger quantities of space than mass transit, while offering similar services, namely origin-to-destination trips. Similarly, cars are the most polluting mode and transportation policies fostering bicycles have thrived in order to reduce air pollution, in particular CO2, and NOX emissions and PM. However, private cars remain the leading transportation mode for commuting trips (except in some large cities, such as Paris where mass transit is the leading mode). On the contrary, shared modes such as taxis, car-sharing and self-service cars or bicycles are often overlooked in transportation policies. In this article, I focus on shared modes, namely vehicle-sharing and self-service vehicles. The contribution is twofold. First, I explore the mechanisms through which shared modes help reduce road congestion and rivalry of use for parking spaces, as well as air pollution, compared to private modes. Second, I highlight the fact that transportation modes do not provide similar services to users. Therefore, gross comparisons in terms of time-space consumptions between modes (Marchand, 1993) are oversimplifying. I suggest to put these gross estimations into perspective accounting for additional services provided by transportation modes. Refined measures of time-space consumptions are presented. When the service provided is accounted for, the gap between mass transit and private cars is reduced. More importantly, the results show that car-sharing and self-service cars constitute relevant alternatives to private cars in terms of time-space consumption per unit of service provided. The analysis provides guidelines for decision-makers since it clearly indicates orders of magnitude for time-space consumptions from various transportation modes. The study reveals that both types of shared modes help reduce spatial and environmental issues related to mobility in urban areas and as such constitute key components of a comprehensive and efficient transportation system. For instance, I demonstrate that shared low-carbon modes, such as self-service bicycles, have the potential to reduce simultaneously both spatial (congestion and rivalry of use) and environmental (air pollution) issues in medium-sized city. Furthermore, I mention the limits of the present organization for shared modes. More precisely, the need for institutionalizing is highlighted for car-sharing, and network expansion required for self-service vehicles.
    Keywords: mobility; shared modes; spatial issues; time-space consumption
    JEL: D6 D61 Q28 Q30
    Date: 2016–12
  14. By: Oskar Lecuyer (OCCR,University of Bern); Philippe Quirion (CNRS, CIRED)
    Abstract: We study the interactions between a CO2 emissions trading system (ETS) and renewable energy subsidies under uncertainty over electricity demand and energy costs. We first provide evidence that uncertainty has generated over-allocation (defined as an emissions cap above business-as-usual emissions) during at least part of the history of most ETSs in the world. We then develop an analytical model and a numerical model applied to the European Union electricity market in which renewable energy subsidies are justified only by CO2 abatement. We show that in this context, when uncertainty is small, renewable energy subsidies are not justified, but when it is big enough, these subsidies increase expected welfare because they provide CO2 abatement even in the case of over-allocation. The source of uncertainty is important when comparing the various types of renewable energy subsidies. Under uncertainty over electricity demand, renewable energy costs or gas prices, a feed-in tariff brings higher expected welfare than a feed-in premium because it provides a higher subsidy when it is actually needed i.e. when the electricity price is low. Under uncertainty over coal prices, the opposite result holds true. These results shed new light on the ongoing switch from feed-in tariffs to feed-in premiums in Europe.
    Keywords: Willingness to pay, Social capital, Environmental protection, Ordered logistic regression, Sweden
    JEL: Q28 Q48 Q58
    Date: 2016–04
  15. By: Tamayo, Adrian; Tagalo, Romulo
    Abstract: The study aims to quantify the economic value of the sand and gravel which is deemed as a non-renewable resource. A survey was conducted to extract the consumer surplus of the households, also construct the demand equation for the resource. With the demand equation for sand and gravel at , the consumer surplus was estimated at P8271. Using the economic valuation technique, the economic value of sand and gravel was estimated at P729,568,368. Thus, a very high value imputed on the environmental resource. The survey showed that 82% of the population in Davao del Norte is amenable for a policy to regulate sand and gravel extraction. With the new valuation measure of the sand and gravel, a new price may be introduced at price range between P125-P225 per cubic meter. The new price is set to be used as payment for environmental services and compensation projects at the quarry sites. Also, the cost structures of permitees in Davao del Norte are too low compared to the operators in Compostela Valley, Davao Oriental and Davao City. The cost of operation in Davao del Norte is approximately 18% of the cost in Davao Oriental and 20% of the cost of Compostela Valley. The cost differences are largely due to the permit cost which is cheaper in Panabo and Tagum than in other areas. This is suggestive that the permitees may likely absorb the cost rather than transfer operation given their high producer surplus value.
    Keywords: Non-renewable natural resource, willingness to pay
    JEL: Q3 Q31 Q5 Q51
    Date: 2016–10–20
  16. By: Rezai, Armon; Van der Ploeg, Frederick
    Abstract: A new IAM is used to calculate the optimal tradeoff between, on the one hand,locking up fossil fuel and curbing global warming, and, on the other hand,sacrificing consumption now and in the near future. This IAM uses the Oxford carbon cycle, which differs from DICE, FUND and PAGE in that cumulative emissions are the key driving force of changes in temperature. We highlight how time impatience, intergenerational inequality aversion and expected trend growth affect the time paths of the optimal global carbon tax and the optimal amount of fossil fuel reserves to leave untapped. We also compare these with the adverse and deleterious global warming trajectories that occur if no policy actions are taken. (authors' abstract)
    Keywords: unburnable fossil fuel; cumulative emissions; optimal carbon tax; Oxford carbon cycle; trend growth; intergenerational inequality aversion; time impatience
    Date: 2016
  17. By: Spash, Clive L.
    Abstract: At the 21st session of the Conference of the Parties to the United Nations Framework Convention on Climate Change held in Paris, France, 30 November to 11 December 2015, an Agreement was reached by the international community including 195 countries. The Agreement has been hailed, by participants and the media, as a major turning point for policy in the struggle to address human induced climate change. The following is a short critical commentary in which I briefly explain why the Paris Agreement changes nothing. I highlight how the Agreement has been reached by removing almost all substantive issues concerning the causes of human induced climate change and offers no firm plans of action. Instead of substantive cuts in greenhouse gas emissions, as soon as possible, the intentions of the parties promise escalation of damages and treat worst case scenarios as an acceptable 50:50 chance. The Paris Agreement signifies commitment to sustained industrial growth, risk management over disaster prevention, and future inventions and technology as saviour. The primary commitment of the international community is to maintain the current social and economic system. The result is denial that tackling greenhouse gas emissions is incompatible with sustained economic growth. The reality is that Nation States and international corporations are engaged in an unremitting and ongoing expansion of fossil fuel energy exploration, extraction and combustion, and the construction of related infrastructure for production and consumption. The targets and promises of the Paris Agreement bear no relationship to biophysical or social and economic reality. (author's abstract)
    Date: 2016–01–26
  18. By: Kesternich, Martin; Römer, Daniel; Flues, Florens
    Abstract: We study the effect of a subtle change in the choice architecture on offsetting behavior. In a large-scale field experiment, we examine repeated voluntary contributions to a carbon offsetting program during the online purchase of long-distance bus tickets. In the control group, travelers had the option to offset their carbon emissions resulting from their bus trip, but they could also simply ignore the offer. In the treatment group, travelers were forced to actively choose whether to offset their carbon emissions or not. This "active choice" requirement immediately increased participation in the offsetting program by almost 50%. Investigating returning customers, we find that this treatment remains effective over time. We report evidence that some customers tend to keep avoiding active contribution decisions in subsequent booking decisions.
    Keywords: voluntary carbon offsets,randomized field experiment,default setting,choice architecture
    JEL: H41 C93 D03 L92
    Date: 2016
  19. By: Taylor, Lance; Rezai, Armon; Foley, Duncan K.
    Abstract: A demand-driven growth model involving capital accumulation and the dynamics of greenhouse gas (GHG) concentration is set up to examine macroeconomic issues raised by global warming, e.g. effects on output and employment of rising levels of GHG; offsets by mitigation; relationships among energy use and labor productivity, income distribution, and growth; the economic significance of the Jevons and other paradoxes; sustainable consumption and possible reductions in employment; and sources of instability and cyclicality implicit in the twodimensional dynamical system. The emphasis is on the combination of biophysical limits and Post- Keynesian growth theory and the qualitative patterns of system adjustment and the dynamics that emerge.
    Keywords: Demand-driven growth; climate change; demand and distribution; energy use; energy productivity; labor productivity; employment
    Date: 2015–03
  20. By: Markus Groth; Maria Brück; Teresa Oberascher
    Abstract: Cities, home to more than half of the world?s population and important economic hubs, are vulnerable to impacts of climate change and worthy to protect. To address these challenges, implementing climate change adaptation measures is inevitable. The paper provides insights into climate change related risks, opportunities and adaptation actions based on responses by 40 European cities to the 2014 CDP Cities Information Request. The analysis shows that 92.5% of the responding European cities report that they face physical risks arising from climate change and that they identify more intense rainfall as the most relevant physical risk. Furthermore, more than half of the participants indicate that they are facing social risks due to climate change with increased risk to already vulnerable populations being the most important one. However, 72.5% of the cities report that they see economic opportunities arising from climate change. Already, 55% of the observed European cities indicate that they have implemented adaptation action plans and 82.5% of all cities are putting adaptation action into practice. The results point out that city governments show great awareness, interest and knowledge in addressing climate change issues, but however there is still demand for information and guidance. Moreover, the variety of answers shows that there is no ?one-size fits all solution? for cities to adapt to climate change. Thus, the findings can also serve as an innovative starting point for further research as well as the design and practical implementation of adaptation measures.
    Keywords: adaptation actions; adaptation planning; CDP; cities; climate change; climate change adaptation; climate change opportunities; climate change risks
    JEL: H11 H41 Q54 Q58 R50
    Date: 2016–12
  21. By: Spash, Clive L.; Gattringer, Clemens
    Abstract: Human induced climate change poses a series of ethical challenges to the current political economy, although it has often be regarded by economists as only an ethical issue for those concerned about future generations. The central debate in economics has then concerned the rate at which future costs and benefits should be discounted. Indeed the full range of ethical aspects of climate change are rarely even discussed. Despite recent high profile and lengthy academic papers on the topic the ethical remains at best superficial within climate change economics. Recognising the necessary role of ethical judgment poses a problem for economists who conduct exercises in cost-benefit analysis and deductive climate modelling under the presumption of an objectivity that excludes values. Priority is frequently given to orthodox economic methodology, but that this entails a consequentialist utilitarian philosophy is forgotten while the terms of the debate and understanding is simultaneously restricted. We set out to raise the relevance of a broader range of ethical issues including: intergenerational ethics as the basis for the discount rate, interregional distribution of harm, equity and justice issues concerning the allocation of carbon budgets, incommensurability in the context of compensation, and the relationship of climate ethics to economic growth. We argue that the pervasiveness of strong uncertainty in climate science, incommensurability of values and nonutilitarian ethics are inherent features of the climate policy debate. That mainstream economics is ill-equipped to address these issues relegates it to the category of misplaced concreteness and its policy prescriptions are then highly misleading misrepresentations of what constitutes ethical action. (authors' abstract)
    Keywords: Climate change; economics; ethics; carbon budgets; discounting; compensation; harm; intergenerational equity; intragenerational distribution; justice; consequentialism; utilitarianism; incommensurability; risk; uncertainty; cost-benefit analysis; growth economy
    Date: 2016–06
  22. By: Tara Shine (OECD); Gisela Campillo (OECD)
    Abstract: This working paper reflects on the outcomes of the 2015 agreements on development and environment including the Sendai Framework, the Addis Ababa Action Agenda, the 2030 Agenda and the Sustainable Development Goals, and the Paris Agreement. It identifies common themes emerging from the international agreements and their implications for development co-operation providers and their partners. The paper outlines existing synergies between climate and development finance and proposes factors to improve coherence for sustainable development with a particular focus on the role of development co-operation providers in the post-2015 context. The paper contributes to the discussion about how the international community can successfully deliver on the commitments to sustainable development and climate action made in 2015.
    Keywords: climate change, climate finance, development co-operation, development finance, sustainable development
    JEL: N5 O19 P48 Q56
    Date: 2016–12–22
  23. By: Dorothée Charlier (University of Montpellier); Anna Risch (IAE Savoie Mont-Blanc, IREGE); Claire Salmon (IAE Savoie Mont-Blanc, IREGE)
    Abstract: In this article, we assess current public policies, designed to reduce greenhouse gas (GHG) emissions, lower energy consumption, and fight the “energy burden” in the long term, so that it might offer relevant policy recommendations. We develop an existing partial equilibrium model to take into consideration key determinants of excessive energy burden. This analysis reveals that public policies are not sufficient to reach the ambitious objectives for reducing energy consumption and GHG emissions in France. Moreover, the decreases that might occur disguise significant social disparities across households. The joint implementation of multiple instruments leads to interactions that diminish overall policy outcomes. Overall, current public policies produce estimated free-riding rates of 75%. Energy efficiency measures are thus insufficient; governments need to focus more on monetary poverty as a cause of low renovation rates and consider subsidies of renovation costs as a potential solution.
    Keywords: energy burden; public policies; bottom-up simulation; energy consumption; GHG emissions
    JEL: Q41 Q48 Q58 C21 C61
    Date: 2016–02
  24. By: Ek, Kristina (Luleå University of Technology, Economics unit); Persson, Lars (CERE and the Department of Economics, Umeå University)
    Abstract: This paper elicits local and semi-local citizens’ preferences for water quality attributes explicitly related to the water framework directive. A river basin in southeast of Sweden is used as a case study. The sample consists of 502 respondents living in the municipalities through which the river passes, or neighboring municipalities. By the use of a choice experiment tailored to the specific case study area, the paper analyzes public attitudes and willingness to pay for selected attributes related to water quality management. The attributes and their corresponding levels are based on real criteria for ecological water status, used in the implementation of the WFD in the river basin. Although participants live in or close to the catchment area, the results reveal a general lack of knowledge and interest in matters related to the environmental quality of the river. All attributes included in the choice experiment proved to have a statistically significant impact on the choice probabilities. There was however no significant evidence that the preferences differ between respondents with regard to self reported previous experience or knowledge about the water body, nor with regard to differences in recreational habits in the area. The results can potentially be used as inputs in practical policy making with its inevitable trade offs and priorities.
    Keywords: choice experiment; Water framework directive; water quality; willingness to pay
    JEL: Q25 Q50 Q53 Q57
    Date: 2016–12–12
  25. By: Wang, Lu; Favero, Alice; Brown, Marilyn
    Abstract: This study used the GT NEMS model to analyze how the proposed federal regulation on carbon emissions will impact investments in the U.S. electricity generating capacity at the federal and Census Division level for 2016-2030. Results show that in order to reduce emissions by 32% by 2030, cumulative investments will increase from 399 to 414 billion USD by 2030. Under the scenario which addresses carbon leakage - covering new and existing power plants - cumulative investment will reach 475 billion USD by 2030. Addressing carbon leakage will affect not only the size of the investments but also the direction: when only existing power plants are covered investments in natural gas remains almost unchanged (123 billion USD) relative to the Reference case; while under the scenario that covers all power plants, investment in natural gas will be 24% lower and the investments in renewable will be 64% higher than the Reference. Carbon regulation will produce not only losers and winners among energy sources but also among U.S. states. While the South and Midwest states will experience much higher increase in cumulative investments with respect to the national average; Northeast and West states will reduce their overall investments by 2030 under the policy scenarios.
    Keywords: Clean Power Plan, Climate Change Mitigation Policy, Investment, Electricity, United States, Environmental Economics and Policy, Q42, Q43, Q48, Q58,
    Date: 2016–12–23
  26. By: Nguyen, Duc Khuong; Sévi, Benoît; Sjö, Bo; Salah Uddin, Gazi
    Abstract: Most of the existing literature dealing with the relationship between carbon emissions, energy consumption and economic growth either suffers from ignoring relevant variables such as trade openness or investment, or suffers from using econometric methods that are unable to distinguish between short and long-term causality and are not robust to the degree of integration of time series used for the analysis. This paper suggests using the autoregressive distributed lag (ARDL) approach along with additional explanatory variables such as measures of trade and investment to shed a new light on the link between emissions, energy consumption and income in the two largest and energy-intensive developing economies: China and India. Our results, over the 1971-2009 period, provide evidence that investment plays a major role in shaping the relationship between carbon emissions, energy consumption and income in China while this is not the case in India. Furthermore, trade openness is found to play a key function in the short-term in China but does not contribute to the emissions-energy-growth scenario in India.
    Keywords: Energy; carbon emissions; income; ARDL approach; India; China.
    JEL: Q43 Q53 Q56
    Date: 2015–09
  27. By: Kostakis, Ioannis; Lolos, Sarantis; Sardianou, Eleni
    Abstract: This paper assesses empirically the role of foreign direct investment (FDI) inflows on environmental quality, measured by CO2 emissions. The cases of Brazil and Singapore are taken as examples for our empirical investigation, on the grounds of their specific similarities and differences. The empirical analysis is carried out in a multivariate setting, using a variety of models (ARDL, FMOLS, OLS) for the early 1970s to 2010. The results indicate that FDI inflows have lead to environmental degradation in Brazil but not in Singapore. Our findings point to the importance of the sectoral composition of FDI as a determinant of its impact on environmental quality. The analysis is supplemented with an environmental Kuznets curve (EKC), our results showing that the EKC hypothesis holds for the case of Singapore but its validity is marginal in Brazil.
    Keywords: foreign direct investment; environmental degradation; kuznets curve
    JEL: Q43 Q56
    Date: 2016–12–19
  28. By: Katsuhito Nohara; Azusa Okagawa; Akira Hibiki; Hiroya Yamano
    Abstract: The coral reef ecosystems provide many goods and services to coastal populations, such as tourism. Furthermore, they form a unique natural ecosystem, with an important biodiversity value as well as scientific and educational value. They also form a natural protection against wave erosion. However, they have been damaged due to red soil erosion and global warming. Therefore, the preservation of coral reefs has been an important policy issue. The cost benefit analysis of the policy is important to choose cost-effective policy. A few studies have evaluated the economic value of coral reefs in Okinawa prefecture, Japan, but most of them have applied contingent valuation method. The purpose of this study is to estimate the value of coral reefs which tourists to Okinawa prefecture obtain using discrete choice travel cost method. We implemented an on-site survey to tourists to Okinawa at Naha airport, Ishigaki airport, Miyako airport and Kumejima airport on November 8th to 11th in 2013 and collected 410 responses. A total of 163 responses were excluded from data analysis because they were not fully completed. We applied conditional logit model to tourist?s decision to select his/her destination and estimate the model using collected data. Based on the conditional logit model, the hypothesis of Independence from Irrelevant Alternatives (IIA) cannot be rejected. We also tried to apply mixed logit model to our data but there was no significant difference between random parameters and not random ones. The main findings are willingness to pay by a tourist for coral reefs is 4,754 yen/km2 per a day and16,544 yen/km2 per trip.
    Keywords: the value of coral reefs; discrete choice travel cost method; marginal willingness to pay
    Date: 2016–12
  29. By: Tuyara Gavrilyeva
    Abstract: The huge territory and long distances between settlements (up to 700 km) determine the complex structure of the energy system of Yakutia. The average duration of the heating season in the region is 8-9 months, and 12 months in the Arctic. Electricity generation is carried out mostly by low-capacity boilers using coal and diesel fuel. About 85% of fuel is imported from outside of Yakutia. The northern provision is seasonal, due to a complicated transport scheme. The time of fuel delivery reaches 18 - 30 months. As a result, the net cost of electricity generation in the Arctic is higher than in Central Yakutia in 7-40 times. There are considerable territorial disparities of net costs of heating generation too. The settlements of Yakutia are not compact, have a large area because of the specific agricultural specialization. Construction of new buildings of public services increases the number of low-capacity boilers. There are 1355 heating units operating in villages and cities of Yakutia. The share of houses with central heating varies greatly. In settlements with significant proportion of houses with stove heating there is a reduction in forest area within a radius of 20-40 km, which leads to an increase in environmental problems. Yakutia obtains a certain effect from programs of local energy optimization systems and implementation of energy saving measures, including gasification of settlements, but budget costs are still very significant. This is a common problem for all northern countries. At present the system of cross-subsidization of energy consumption changes. It meant that a part of the energy consumption costs of economic agents have been paid by other economic agents, including the state. Its main reason is population poverty. Actually Inhabitants compensate by own funds only 25.5% of the real cost of central heating, 78.2% - of electricity. It is considerably lower than in Russia in general. The transition to rates, based on real costs, will lead to a rapid loss of population in the Arctic and other remote areas. At the same time the crisis in Russia dictates the necessity of reform of the energy sector, in particular by reducing energy consumption. Some programs envisage the improvement of urban planning, concentration and increase in the density of population in large settlements and towns of Yakutia. Concentration allows to get a significant saving in energy costs, however it leads to an increase in the anthropogenic impact on the environment. Areas, where the largest power plants are located, provide the highest CO2 emission. These are Serebryany Bor (Neryungri district), Yakutsk and Svetly (Mirninsky district). These settlements are the centers of intensive anthropogenic impact on the environment by energy generation activity. The reform of energy system in Yakutia is complicated. It is closely related to the transformation of the spatial structure. Liquidation of the Arctic settlements is objectively impossible due to national security interests, historical and cultural traditions of indigenous peoples that we have to protect. The searching for new technological, spatial, financial and social mechanisms for wellbeing of northern communities is needed. Republic of Sakha (Yakutia) needs a new spatial structure. Moreover, it can be fundamentally new. For example, decentralized, allowing disperse anthropogenic load on the environment, if in the near future, new technologies will provide individual livelihoods and access to basic social services to households in rural areas. Alternatively, it could be more concentrated, not linear-focal and linear as now. When large urban settlements will be located on the main highways or rivers. This problem can be solved in the framework of strategic planning in the region. Continuing of studies of transport isolation, market and economic potential of northern communities are needed.
    Keywords: North; energy system; net cost; energy consumption; heat energy; cross-subsidization; Arctic settlements; population; territorial disparities
    JEL: Q28 Q41 Q56 R32
    Date: 2016–12
  30. By: Naqvi, Syed Ali Asjad
    Abstract: Economic policy in the EU faces a trilemma of solving three challenges simultaneously - growth, distribution, and the environment. In order to assess policies that address these issues simultaneously, economic models need to account for both sector-sector and sector-environment feedbacks within a single framework.This paper presents a multi-sectoral stock-flow consistent (SFC) macro model where a demand-driven economy consisting of multiple institutional sectors - firms, energy, households, government, and financial - interacts with the environment. The model is calibrated for the EU region and five policy scenarios are evaluated; low consumption, a capital stock damage function, carbon taxes, higher share of renewable energy, and technological shocks to productivity. Policy outcomes are tracked on overall output, unemployment, income and income distributions, energy, and emission levels. Results show that investment in mitigation technologies allows for absolute decoupling and ensures that the above three issues can be solved simultaneously. (author's abstract)
    Keywords: ecological macroeconomics; stock-grow consistent; growth; distribution; environment; European Union
    Date: 2015–02–06
  31. By: Houévoh Amandine R. Gnonlonfin (LEAD, Université de Toulon)
    Abstract: This study investigates the preventive effect and substitution effect of the Municipal Solid Waste (MSW) pricing policy in France. We examine the relationship between quantities of MSW and incentive taxes with the use of a panel of 96 French metropolitan departments between 2005 and 2011, and we use panel data and Heckman two-step estimation in order to consider sample selection. We perform the analysis for the collection of MSW and six technologies of management of the waste, namely recycling materials, composting, incineration with and without energy recovery, landfilling and dumping. We estimate the elasticity of the collection of MSW and the elasticity of these technologies in relation to three incentive taxes of the French pricing system by considering the endogeneity of municipality’s decisions about both local incentive tax and technology choice. The results confirm that the French MSW pricing system has a preventive and a substitution effect and show that these effects are complementary.
    Keywords: municipal solid waste pricing system, user fee, Extend Producer Responsibility, tax on elimination, preventive effect, substitution effect
    JEL: H21 H23 Q53 Q56
    Date: 2016–05
  32. By: Wieland, Hanspeter; Giljum, Stefan
    Abstract: Politics' demand for informative consumption-based emission assessments based on multi-regional input output (MRIO) databases is steadily increasing. Based on the MRIO database EXIOBASE 3, we exemplify the utility of a range of analytical tools and discus their potential insights for consumption-based policies. The analysis decomposes the overall EU carbon footprint into product groups as well as into emitting regions. Subsequently, we illustrate the potential of applying production layer decomposition (PLD) and structural path analysis (SPA) for the assessment of global supply-chains related to the EU carbon footprint and their structural changes over time. We close with some policy ecommendations on reducing carbon footprint hot spots.
    Keywords: Carbon footprint, multi-regional input-output analysis, analytical tools, supply chains, production layer decomposition, structural path analysis
    Date: 2016–11
  33. By: Quentin Perrier (CIRED, Engie); Philippe Quirion (CIRED, CNRS)
    Abstract: In the public debate on energy transition in France, employment figures prominently. We calculate, for the French economy in 2010, the employment content and greenhouse gas intensities in different branches, that is to say the number of jobs and tonne-CO2 equivalent per million euro of final demand. For this we use the input-output table at the most disaggregated level available (64 branches). We develop and then apply a unique methodology to decompose the differences in job content between industries in five factors: the rate of imports of final products, the rate of imports of intermediate goods, the rates of taxes and subsidies, the levels of wages and the share of labor compensation in value added. Finally, we study some intersectoral substitutions that would result from an energy transition to reduce emissions of greenhouse gases.
    Keywords: Emploi, Transition énergétique, Emissions de gaz à effet de serre, Substitutions intersectorielles, Input-output
    JEL: E2 Q5 O13
    Date: 2016–02
  34. By: FIORILLO, Damiano (CELPE - Centre of Labour Economics and Economic Policy, University of Salerno - Italy); SENATORE, Luigi (CELPE - Centre of Labour Economics and Economic Policy, University of Salerno - Italy)
    Abstract: In this paper, we examine some important aspects related to safeguarding environmental quality. Beginning by defining the identity of the agents considered, we conceptually describe how while they have different identities, they can be simultaneously influenced by three distinct elements: self image and environmental attitude and behavior. We define self image as the individual’s willingness to cooperate for the sake of the public good, we define environmental attitude as the individual’s concern regarding waste prevention and disposal, and the environmental behavior as the individual’s recycling behavior. Using the 1998 wave of the Multipurpose Household Survey (MHS), which is conducted annually by the Italian Central Statistical Office, and univariate probit models, we show that there is a positive relationship among these factors that is robust to the inclusion of social participation variables and to the use of a sub-sample of individuals who have no interest in environmental issues.
    Keywords: Self Image; Waste Concern; Recycling Behavior; Pro-Social Behaviors; Italy
    JEL: Q50 Q53 Q57 Q58
    Date: 2016–12–30
  35. By: Marco Battaglini; Bård Harstad
    Abstract: In recent decades, democratic countries have signed hundreds of international environmental agreements (IEAs). Most of these agreements, however, are weak: they generally do not include effective enforcement or monitoring mechanisms. This is a puzzle in standard economic models. To study this phenomenon, we propose a positive theory of IEAs in which the political incumbents negotiate them in the shadow of reelection concerns. We show that, in these environments, incumbents are prone to negotiate treaties that are simultaneously overambitious (larger than what they would be without electoral concerns) and weak (might not be implemented in full). The theory also provides a new perspective for understanding investments in green technologies, highlighting a channel through which countries are tempted to rely too much on technology instead of sanctions to make compliance credible. We present preliminary evidence consistent with these predictions.
    JEL: D72 F55 Q58
    Date: 2016–12
  36. By: Elsasser, Peter; Meyerhoff, Jürgen; Weller, Priska
    Abstract: This collection presents an updated bibliography of those empirical forest ecosystem service valuation studies in the German speaking countries which relate to demand oriented measures of the utility of public goods. The associated database (which is provided as a separately downloadable Excel-file) contains 77 data sets by October 2016. These data sets are characterised by about 40 descriptors (the exact number depending on the specific valuation method used in the respective study) which present details of the valuation object, the statistical and economic methods applied, the results of the valuation exercise, some other descriptors for study quality, and the associated publications. The structure of the database is explained in detail here.
    Keywords: forest,non-market valuation,ecosystem services,Austria,Germany,Switzerland,meta-database,bibliography,Wald,Umweltbewertung,Monetarisierung,Ökosystemleistungen,Österreich,Schweiz,Deutschland,Metadatenbank,Bibliografie
    Date: 2016
  37. By: Md. Jahangir Kabir (School of Agriculture and Food Sciences, The University of Queensland); Mohammad Alauddin (School of Economics, The University of Queensland); Steven Crimp (CSIRO, Agriculture)
    Abstract: Using long-term district-level climate data and a case study from a drought-prone village in western Bangladesh, this research explores trends in climate change, and analyses farmers’ adaptation dynamics, profitability and risks. This is the first study of its kind for drought-prone areas in Bangladesh. District-level temperature trended upwards across all seasons except in winter, while rainfall patterns were more episodic with persistent dry periods. Farmers’ adaptation measures included changes in cropping systems, cropping calendar, crop varieties, agronomic practices, crop diversification and improved animal husbandry. Reducing environmental stress, ensuring self-sufficiency in staple crops (mainly rice) and other crop production practices, and enhancing economic viability of farm enterprises underpinned these adaptations. Off-farm and non-farm wage employment, temporary migration, self-employment and educating children, constituted core non-farm adaptation strategies. Emerging cropping systems like maize/cucumber and maize/stem amaranth/rice were economically more viable than the traditional rice/rice and rice/maize systems. Despite some uncertainties, farming was preferred to off-farm work, generating higher returns to labour for all cropping systems. Limited access to stress-tolerant varieties, extension services and affordable agricultural credit, combined with high production costs, variability in crop yields and output prices constituted man barriers to adaptation. Stronger agricultural research and support services, affordable credit, community-focussed farming education and training are critically important for effective adaptation to climate change.
    Keywords: Climate change, Drought severity, Farm budgeting, Risk analysis, Adaptation dynamics, Sustainability
    JEL: O1 Q0 Q2 Q12 Q25
    Date: 2016–12–28
  38. By: Zwickl, Klara; Disslbacher, Franziska; Stagl, Sigrid
    Abstract: Achieving low unemployment in an environment of weak growth is a major policy challenge; a more egalitarian distribution of hours worked could be the key to solving it. Whether worksharing actually increases employment, however, has been debated controversially. In this article we present stylized facts on the distribution of hours worked and discuss the role of work-sharing for a sustainable economy. Building on recent developments in labor market theory we review the determinants of working long hours and its effect on well-being. Finally, we survey work-sharing reforms in the past. While there seems to be a consensus that worksharing in the Great Depression in the U.S. and in the Great Recession in Europe was successful in reducing employment losses, perceptions of the work-sharing reforms implemented between the 1980s and early 2000s are more ambivalent. However, even the most critical evaluations of these reforms provide no credible evidence of negative employment effects; instead, the overall success of the policy seems to depend on the economic and institutional setting, as well as the specific details of its implementation. (authors' abstract)
    Keywords: Work-sharing; Working hours; Labor Supply; Labor Demand; Environmental Sustainability
    Date: 2015–06
  39. By: Kriström, Bengt (CERE and the Department of Forest Economics, SLU)
    Abstract: I embed a electricity certificate system, mandating that a certain fraction of total electricity production must come from renewable sources, in a stylized competitive economy and derive a general equilibrium cost-benefit rule from perturbing the regulation. The welfare consequences (ignoring distributional effects) of the perturbation are compactly summarized in a simple formula.
    Keywords: general equilibrium; cost-benefit
    JEL: D50 D61
    Date: 2016–12–09
  40. By: Bailey, Roy E. (University of Essex); Hatton, Timothy J. (University of Essex); Inwood, Kris (University of Guelph)
    Abstract: Atmospheric pollution was an important side effect of coal-fired industrialisation in the nineteenth century. In Britain emissions of black smoke were on the order of fifty times as high as they were a century later. In this paper we examine the effects of these emissions on child development by analysing the heights on enlistment during the First World War of men born in England and Wales in the 1890s. We use the occupational structure to measure the coal intensity of the districts in which these men were observed as children in the 1901 census. We find strong negative effects of coal intensity on height, which amounts to difference of almost an inch between the most and least polluted localities. These results are robust to a variety of specification tests and they are consistent with the notion that the key channel of influence on height was via respiratory infection. The subsequent reduction of emissions from coal combustion is one factor contributing to the improvement in health (and the increase in height) during the twentieth century.
    Keywords: atmospheric pollution, health and height
    JEL: I15 N13 Q53
    Date: 2016–12
  41. By: Luiza Andrade; André Luis Squarize Chagas
    Abstract: We analyse the effects of the Priority Municipalities List, that indicates the primary targets of environmental police monitoring, on deforestation of municipalities in the neighbourhood of the listed. We argue that being a neighbour to a priority municipality causes an exogenous variation in environmental authorities’ presence, and use a difference-in-differences estimator to determine the impact of such presence on deforestation. As an innovative feature, we introduce a spatial version of this estimator to correct spatial dependence. Our estimations show that the net effect of treatment is a decrease in deforestation of 15% to 36%. This result is robust to changes in the measure of deforestation as well as in the neighbourhood criteria. Estimates also indicate that effects get weaker the greater the distance to the priority municipality.
    Keywords: Deforestation; spillovers; Amazon; environmental policy
    JEL: Q23 Q28 C21
    Date: 2016–12–07
  42. By: Rezai, Armon; Stagl, Sigrid
    Abstract: The Great Recession of the past years has brought macroeconomics back. Many of the recession's phenomena, causes and consequences alike, cannot be understood using solely microeconomic decisionmaking. Over the past decades the economics profession has pursued the implications of rational choices and enshrined them in so-called "micro foundations" as a hallmark of modern economic theory. By focusing on the choices and actions of individual consumers, firms, or the government, however, one can easily miss important determinants of the economic system which only arise at the meso- or the macroeconomic levels where institutions, coordination, and complexity in general are important and sometimes even can take on a life of their own. To lesser extent, ecological economics has fallen prone to similar pitfalls by mostly focusing the unit of investigation on low-level, small-scale subsystems of the economy. There are, of course, notable exceptions including the early contributors Boulding and Georgescu-Roegen and the general interest of ecological economists in the field of (ecological) macroeconomics has been increasing. (authors' abstract)
    Date: 2016
  43. By: Loreno Cecconi
    Abstract: In questo paper andiamo ad analizzare un modello utilizzato da Baumol-Oates per mettere in relazione l’evoluzione dinamica dello stock di inquinante in rapporto al livello della carbon-tax. Del modello, inizialmente in tempo discreto, forniamo la soluzione ed alcune derivate di statica comparata della soluzione stessa. Il modello viene poi da noi posto in forma continua con una struttura leggermente diversa dall’originale e ampliato a due equazioni differenziali. Il modello ha struttura non lineare per cui si pone l’esigenza di linearizzarlo per analizzarne la dinamica almeno nell’intorno dei punti di equilibrio. L’analisi degli autovalori conferma la stabilità dei punti di equilibrio come il modello in forma discreta. Tuttavia, tale stabilità può essere accertata solo localmente. L’ulteriore estensione del modello a quattro equazioni non lineari comporta che i punti di equilibrio sono ora instabili per lo meno nell’intorno dei punti di equilibrio stessi. Successivamente, viene data una versione stocastica del modello, posta in forma strutturalmente diversa, anche se resta la filosofia di fondo del modello che pone in relazione inversa lo stock di inquinante con il livello del saggio di carbon-tax. Come è noto, tuttavia, nella soluzione di equazioni differenziali stocastiche, compare un processo di Wiener che è sconosciuto e la soluzione stessa non è derivabile. Conclude il paper una nota sulla efficacia del processo di linearizzazione di sistemi non lineari nel predirre la dinamica globale del sistema non-lineare stesso.
    Keywords: Carbon-tax. Stock di inquinamento. Equazioni alle differenze finite, equazioni differenziali e sistemi di equazioni differenziali. Punto di equilibrio. Linearizzazione di sistemi non lineari, jacobiano valutato ai punti di equilibrio e teorema Hartman-Grobman. Stabilità ed instabilità dei punti di equilibrio. Equazioni differenziali stocastiche (EDS) e processi di Wiener
    JEL: C02 C61 C62 F64 Q58
    Date: 2016–06
  44. By: Lothar Grall (Justus Liebig University Giessen)
    Abstract: This paper proposes somatic capital as a hitherto neglected variable in the discussion of factors impacting the timing of the Neolithic transition. It develops an evolutionary growth theory that builds on the trade-off between the quantity and the quality of offspring. The theory suggests that harsh climatic conditions during the ice age raised skill-intensity of the environment and altered the evolutionary optimal allocation of resources from offspring quantity to offspring quality. Higher somatic investment in offspring increased the innovation capability of individuals and ultimately accelerated the rate of technological progress. Thus, the adaptive response triggered within human populations living in cold and harsh climate for thousands of years had a significant impact on the timing of the Neolithic transition. The theory further suggests that differential somatic investment can be identified as deep-rooted determinant of comparative economic development.
    Keywords: Economic Growth, Human Evolution, Ice Age Climate, Neolithic Revolution, Out-of-Africa Expansion, Somatic Capital, Skill-Intensity, Technological Progress
    JEL: J10 O10 O30
    Date: 2016
  45. By: Bostedt, Göran (CERE and the Department of Economics, Umeå University); Brännlund, Runar (CERE and the Department of Economics, Umeå University); Carlén, Ola (CERE and the Department of Forest Economics, SLU); Gisselman, Fredrik (Enetjärn Natur AB); Persson, Lars (CERE and the Department of Economics, Umeå University)
    Abstract: This report is an economic cost-benefit analysis for each of the five no-take zones for fishing set up in Sweden, namely, Gålö south of Stockholm, Storjungfrun-Kalvhararna outside Söderhamn, Havstensfjord, Vinga and southern Kattegat. The aim has been to the extent possible, quantify the benefits and costs associated with these no-take areas. Some benefits and costs have not currently been possible to quantifying and those have been given a qualitative description. The introduction of no-take zones for fishing focuses primarily on managing fish stocks for recreation and commercial fishing, where the focus is on the management of specific target, but the introduction can also affect economic benefits and costs that are not directly linked to fishing, for example positive impacts on biodiversity and the improvement of the ability to generate ecosystem services. Therefore the report presents an analysis of ecosystem services and focus on the socio-economic benefits of these potential improvements to bring to the community at large and for specific interest groups. In the report, it is easy to focus interest on the benefits and costs that can, with varying accuracy, be quantified monetarily. This may create a false sense of precision in net results for the various fishing areas. For example, the value of ecosystem values mentioned above can be significant, while they can only be expressed qualitatively. Further, there is significant uncertainty in the biological basis and the economic estimates. To take this into account to some extent this analysis has been made in the form of a scenario analysis with four scenarios for each area. To this has been added a sensitivity analysis for certain key parameters. One significant uncertainty in the economic estimates relate to the spatial population effects, i.e. how far the substitutional effects of a no-fishing zone extends. An extreme case would be they recreational fishermen who used to fish in the closed area will not increase their fishing in other areas. Another extreme case would mean that the reduction of fishing days as a consequence of the no-take zone is not matched by equally large increases in related areas. The real impact we have in this study not been able to analyze.
    Keywords: No-take zones; Fishing; Cost-Benefit Analysis
    JEL: D61 Q22
    Date: 2016–12–13
  46. By: Conti, Chiara; Mancusi, Maria Luisa; Francesca, Sanna-Randaccio; Roberta, Sestini; Elena, Verdolini
    Abstract: A major concern regarding innovation in clean technologies in the EU is that the fragmentation of its innovation system may hinder knowledge flows and, consequently, spillovers across member countries. A low intensity of knowledge flows across EU states can negatively impact their technological base, suppressing opportunities for further innovations and hindering the movement towards the technological frontier. This paper evaluates the fragmentation of the EU innovation system in the field of renewable energy sources (RES) by examining the intensity and direction of knowledge spillovers over the years 1985-2010. We modify the original double exponential knowledge diffusion model to provide information on the degree of integration of EU countries’ innovation efforts and to assess how citation patterns changed over time. We show that EU RES inventors have increasingly built “on the shoulders of the other EU giants”, intensifying their citations to other member countries and decreasing those to domestic inventors. Furthermore, the EU strengthened its position as source of RES knowledge for the US. Finally, we show that this pattern is peculiar to RES, with other traditional (i.e. fossil-based) energy technologies behaving in a completely different way.
    Keywords: Knowledge Spillovers, Renewable Energy Technologies, Fossil Energy Technologies, EU Innovation, Research and Development/Tech Change/Emerging Technologies, Q55, Q58, Q42, O31, O33,
    Date: 2016–12–15
  47. By: Mathilde Jeantil (Ecole Normale Supérieure de Cachan); Laura Recuero Virto (Sciences Po Paris and French Ministry of foreign affairs and international development); Jean-Louis Weber (University of Nottingham)
    Abstract: The initiatives in natural capital accounting have multiplied in the recent years, particularly concerning ecosystem accounts. Policy commitmments in natural capital accounts are also proliferating. Yet, natural capital accounting has been rarely used so far to inform public policy decisions. Based on a survey for statistical offices and ministries and independent experts worldwide, we seek to bring some light on the obstacles in the use of natural capital accounts for public policy decisions. We find that, independently of the income level, countries are equally engaged in the integration of natural capital accounts in their commitments and strategies. And yet, there is very little use of natural capital accounts for public policy decisions and, more so, in developing countries. The most relevant obstacles are the lack of political support by key people and institutional leadership unable to promote policy use by other ministries. Even if projects should preferably be demand-driven, raising awareness on the existence and uses of accounts is essential among the different levels of government administration. Concerning developing countries, the factor which is considered as the most relevant in preventing the use of natural capital accounts for policy making is the stage of development of the country. In addition, respondents from statistical institutes and developing countries are particularly concerned about institutional obstacles and, to a lesser extent, data availability and cooperation. Respondents from ministries and independent experts are also particularly concerned about design obstacles, such as the difficulty to draw a link between natural capital accounts and policy decisions and unclear guidelines for the creation of the accounts. Besides, natural capital accounts are used for policy decisions with a certain lag with respect to their creation and hence no rapid action should be expected immediately following initial investments on accounts. A key result of the survey is the need to evaluate the value-added of natural capital accounts with respect to statistics, prior to the development of accounts. Indeed, local problems and habitats might be better addressed through cost-benefit analysis. To conclude, most probably only once we witness a major environmental event, natural capital accounts will be considered as sufficiently relevant from a policy standpoint to attain the same degree of maturity as national income accounts both in their development and in their integration in the decision-making process.
    Keywords: natural capital accounts, public policy
    JEL: Q0 Q28 Q38 Q58
    Date: 2016–04
  48. By: Ngo Van Long; Vincent Martinet
    Abstract: We propose a new criterion reflecting both the concern for rights and the concern for welfare in the evaluation of economic development paths. The concern for rights is captured by a pre-ordering over combinations of thresholds corresponding to floors or ceilings on various quantitative indicators. The resulting constraints on actions and on levels of state variables are interpreted as minimal rights to be guaranteed to all generations, for intergenerational equity purposes. The levels of these rights are endogenously chosen, accounting for the “cost in terms of welfare” of granting them. Such a criterion could embody the idea of sustainable development. We provide an axiomatization of such a criterion and characterize the tension between rights and welfare in a general economic framework. We apply the criterion to the standard Dasgupta-Heal-Solow model of resource extraction and capital accumulation. We show that if the weight given to rights in the criterion is sufficiently high, the optimal solution is on the threshold possibility frontier. The development path is then “driven” by the rights. Specifically, if a minimal consumption is considered as a right, constant consumption can be optimal even with a positive utility discount rate. In this case, the shadow value of the right plays an important role in the determination of the rate of discount to be applied to social investment projects. Nous proposons un nouveau critère reflétant à la fois le souci des droits et le souci du bien-être dans l’évaluation des sentiers de développement économique. La préoccupation pour les droits est saisie par une structure de préférences envers des combinaisons de seuils de divers indicateurs quantitatifs. Les contraintes sont interprétées comme des droits minimaux à garantir à toutes les générations. Les niveaux de ces droits sont choisis de façon endogène, en tenant compte du coût en termes de bien-être. Un tel critère pourrait incarner l’idée du développement durable. Nous caractérisons la tension entre droits et bien-être dans un cadre économique général. Nous appliquons le critère au modèle de Dasgupta-Heal-Solow. Nous montrons que si le poids accordé aux droits dans le critère est suffisamment élevé, la solution optimale se situe sur la frontière des seuils. Le chemin de développement est alors « piloté » par les droits. Plus précisément, si une consommation minimale est considérée comme un droit, la consommation constante peut être optimale même avec un taux d’actualisation positif. Dans ce cas, la valeur implicite du droit joue un rôle important dans la détermination du taux d’actualisation à appliquer aux projets d’investissement social.
    Keywords: Rights, Welfare, Intergenerational Equity, Sustainable Development, Droits, Bien-être, Equité entre les générations, Développement durable
    JEL: D63 H43 Q01
    Date: 2016–12–21
  49. By: Michael J Bommarito II; Daniel Martin Katz
    Abstract: Over the last 23 years, the U.S. Securities and Exchange Commission has required over 34,000 companies to file over 165,000 annual reports. These reports, the so-called "Form 10-Ks," contain a characterization of a company's financial performance and its risks, including the regulatory environment in which a company operates. In this paper, we analyze over 4.5 million references to U.S. Federal Acts and Agencies contained within these reports to build a mean-field measurement of temperature and diversity in this regulatory ecosystem. While individuals across the political, economic, and academic world frequently refer to trends in this regulatory ecosystem, there has been far less attention paid to supporting such claims with large-scale, longitudinal data. In this paper, we document an increase in the regulatory energy per filing, i.e., a warming "temperature." We also find that the diversity of the regulatory ecosystem has been increasing over the past two decades, as measured by the dimensionality of the regulatory space and distance between the "regulatory bitstrings" of companies. This measurement framework and its ongoing application contribute an important step towards improving academic and policy discussions around legal complexity and the regulation of large-scale human techno-social systems.
    Date: 2016–12
  50. By: Stefano Aragona
    Abstract: Objectives The purpose of the paper is to consider the natural and cultural resources as key elements in the planning and design of the territory and the city. That is to think the local conditions as guidelines in the transformations both of the space and the social environment. So overturning the logic that in most cases has guided the formation of the modern city: i.e. to build everywhere without caring the sustainability of the areas and thinking the land as an infinite resource. The chances and opportunities possible thank to smart city must be used by a ?cultured technology? (Del Nord, 1991) to build ?local Communities inclusive and sustainable, either materially and socially? (Smart City, 2010), that is ?ecological". Methods A multidisciplinary vision, thus multicriteria, is the base of the proposed methodology. It requires an integrated approach of material and immaterial elements. With the overall vision that characterizes the Leipzig Charter (2007) where it are required ??planning strategies that connect rural and not rural areas, small, medium, big towns, metropolitan areas?. And the focus that Smart City gives to the flows of things and energy, with the goals of Horizon 2020. The starting point consists in considering the city as common good characterized by a number of physical and social local resources. Remembering that the mission of the modern town planners, from the Athena Chart 1931, is the wellbeing of the inhabitants. Renewable resources and interactive communications may help to better the design. But all that must be done having as goal construct local communities and not only to reinforce individual power. Flows of energy and flows of communications characterize the contemporaneous city: the immaterial city (Aragona, 1993, 2000). The town, its shape, its economical structure and the functional one, are changing. For the most the town planners accept these changes without trying to address them. In the countries where the city as common good is less felt these changes for bettering wellbeing and social sustainability are not caught or left to the ?free market? alone. while Ecolonia ( 1989-1993) or Sustainable Copenhagen (2009) are examples of what can be done. All this leads to redevelop the territory and the cits using indicators of life quality, going beyond GDP as the 134 of the Fair and Equitable Wellbeing and (BES) proposed by ISTAT alongside those suggested by the Charter of Quality by AUDIs since 2007. Conclusions The current crisis, can be a turning point - the meanings of the originary Greek word ?????? - of the model based on the industrial paradigm (Kuhn, 1962) whose limits were declared in "The Limits of Growth" (1972). This paper suggests to replace the industrial model of ?making the city? with the ecological approach that starts from the local conditions such as indications of plan/project/construction for the transformation of the anthropocosmo. That is to relate the ?????, discourse, analyses, with the ?????, the environment ( finally the purpose of Smart City.
    Keywords: Ecologica approach; Integrated town planning; Crisis as opportunity
    Date: 2016–12
  51. By: Matsumura, Toshihiro; Yamagishi, Atsushi
    Abstract: We investigate the long-run effect of energy conservation regulation, which forces firms to raise energy-saving investment above the cost-minimising level (i.e. the business-as-usual level). If Pigovian tax is imposed, additional regulation always harms social welfare under perfect competition. However, under imperfect competition, additional regulation can improve welfare even if Pigovian tax is imposed. Thus, under imperfect competition, there is a rationale for additional energy conservation regulation even in the presence of Pigovian tax. Our result under imperfect competition holds regardless of whether strategies are strategic substitutes or complements in contrast to direct entry regulation.
    Keywords: energy-saving, environmental tax, free entry market, consumer-benefiting regulation
    JEL: D61 H54 L13
    Date: 2016–11–13
  52. By: Löschel, Andreas; Lutz, Benjamin Johannes; Managi, Shunsuke
    Abstract: We investigate the effect of the European Union Emissions Trading System (EU ETS) on the economic performance of manufacturing firms in Germany. Our difference-in-differences framework relies on several parametric conditioning strategies and nearest neighbor matching. As a measure of economic performance, we use the firm specific distance to the stochastic production frontier recovered from official German production census data. None of our identification strategies provide evidence for a statistically significant negative effect of emissions trading on economic performance. On the contrary, the results of the nearest neighbor matching suggest that the EU ETS rather had a positive impact on the economic performance of the regulated firms, especially during the first compliance period. A subsample analysis confirms that EU ETS increased the efficiency of treated firms in at least some two-digit industries.
    Keywords: Control of Externalities,Emissions Trading,Economic Performance,Manufacturing,Difference-in-Differences,Nearest Neighbor Matching,Stochastic Production Frontier
    JEL: Q52 D22 Q38 Q48
    Date: 2016

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