nep-env New Economics Papers
on Environmental Economics
Issue of 2017‒01‒29
forty papers chosen by
Francisco S. Ramos
Universidade Federal de Pernambuco

  1. Managing Climate Change: The Role of Islamic Finance By Obaidullah, Mohammed
  2. Carbon offsets out of the woods? The acceptability of domestic vs. international reforestation programmes By Andrea Baranzini; Nicolas Borzykowski; Stefano Carattini
  3. Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation By Casey, Gregory
  4. Green Finance: Recent developments, characteristics and important actors By Andreas Welling
  5. Парниковый эффект и рыночные механизмы Киотского протокола By Bukvić, Rajko; Petrović, Dragan
  6. Environmental Art and Environmental Beliefs: the Case of Plastic Bag Pollution in Oceans By Turner, Robert
  7. Modelling the effects of anti-poaching patrols on wildlife diversity in the Phou Chomvoy Provincial Protected Area By Hay, Eric J.; Kragt, Marit; Renton, Michael; Vongkhamheng, Chanthavy
  8. The Behavioral Effect of Pigovian Regulation: Evidence from a Field Experiment By Bruno Lanz; Jules-Daniel Wurlod; Luca Panzone; Timothy Swanson
  9. Extreme Weather Events, Farm Income, and Poverty in Niger By Nouve, Yawotse; Acharya, Ram N.
  10. Growth, environment and Islam By Hasan, Zubair
  11. Complexity and the Economics of Climate Change: a Survey and a Look Forward By Tomas Balint; Francesco Lamperti; Mauro Napoletano; Antoine Mandel; Andrea Roventini; Sandro Sapio
  12. Optimal Carbon Tax Scheme under Uncertainty in an Oligopolistic Market of Polluters By Andreas Welling
  13. Investigating the effect of efficiency and technical changes on productivity By Halkos, George; Bampatsou, Christina
  14. Shutting Down the Thermohaline Circulation By Richard S.J. Tol; David Anthoff; Francisco Estrada
  15. Carbon Pricing with an Output Subsidy under Imperfect Competition: The Case of Alberta's Restructured Electricity Market By Brown, David P.; Eckert, Andrew; Eckert, Heather
  16. Does Climate Aid Affect Emissions? Evidence from a Global Dataset By Sambit Bhattacharyya; Maurizio Intartaglia; Andy Mckay
  17. Dominant Supplier Approach to Liberalizing Trade in APEC Environmental Goods By Manzano, George N.; Prado, Shanti Aubren
  18. Distributional Implications of Geoengineering By Richard S.J. Tol
  19. Does Globalization Impede Environmental Quality in Bangladesh? The Role of Real Economic Activities and Energy Use By Ahad, Muhammad; Khan, Wali
  20. Winter is Coming: The Long-Run Effects of Climate Change on Conflict, 1400-1900 By Murat Iyigun; Nathan Nunn; Nancy Qian
  21. Standard implementation trajectories for sustainable product design: A configurational approach By Smits, Armand; Drabe, Viktoria; Herstatt, Cornelius
  22. Going Green To Be Seen: The Case of Biodiversity Protection on Farmland By Rupayan Pal; Prasenjit Banerjee; Ada Wossink
  23. Enabling private sector adaptation in developing countries and their semi-arid regions – case studies of Senegal and Kenya By Florence Crick; Mamadou Diop; Momadou Sow; Birame Diouf; Babacar Diouf; Joseph Muhwanga; Muna Dajani
  24. An Assessment of the Sectoral and Institutional Implementation of the National Disaster Risk Reduction and Management Plan By Domingo, Sonny N.
  25. Effects of Sea Level Rise on Economy of the United States By Richard S.J. Tol; Monika Novackova
  26. Take what you can: property rights, contestability and conflict By Thiemo Fetzer; Samuel Marden
  27. An analysis of potential conflict zones in the arctic region By F. Aleskerov; E. Victorova
  28. Improving Climate-Change Modeling of U.S. Migration By Partridge, Mark; Feng, Bo; Rembert, Mark
  29. Nuclear power learning and deployment rates: disruption and global benefits forgone By Peter A. Lang
  30. Optimal Food Waste: Taxes and Government Incentives By Katare, Bhagyashree; Serebrennikov, Dmytro; Wang, H. Holly; Wetzstein, Michael
  31. Climate risk and food security in Guatemala By Renato Vargas; Pamela Escobar; Maynor Cabrera; Javier Cabrera; Violeta Hernández; Vivian Guzmán; Martin Cicowiez
  32. Varieties of clean energy transitions in Europe Political-economic foundations of onshore and offshore wind development By Stefan ?etkovi?; Aron Buzogány; Miranda Schreurs
  33. Technology adoption in emission trading programs with market power By André, Francisco J.; Arguedas, Carmen.
  34. Subsidizing Fuel Efficient Cars: Evidence from China's Automobile Industry By Chia-Wen Chen; Wei-Min Hu; Christopher R. Knittel
  35. Pollinator Friendly Plants: Reasons for and Barriers to Purchase By Campbell, Ben; Khachatryan, Hayk; Rihn, Alicia
  36. The role of social aspect and gender factors as one of the inegrated water resources management (IWRM) approaches for drinking water saving in Turkmenistan in the strategy development of its economic use By Sabbatovskaya, Alla
  37. Capturing a Value-Added Niche Market: Articulation of Local Organic Grain By Baker, Brian; Russell, June
  38. Rainfall Patterns and Human Settlement in Tropical Africa and Asia Compared. Did African Farmers Face Greater Insecurity? By Frankema, Ewout; Papaioannou, Kostadis
  39. Perceptions of selected aquaculture practices: Shanghai residents’ views on water and feed quality By Wang, Chunxiao; Florkowski, Wojciech J.; Yang, Zhenyong; Li, Yanan
  40. Consumer Preference and Market Simulations of Food and Non-Food GMO Introductions By Berning, Joshua; Campbell, Ben

  1. By: Obaidullah, Mohammed (The Islamic Research and Teaching Institute (IRTI))
    Abstract: Environmental protection and sustainability fits in nicely with the Islamic finance agenda that seeks to enhance the general welfare of society. Protection of the planet and the environment, climate management and adaptation, as organizational goals are clearly in conformity with the goals of the Shariah as well as with the SDGs. This paper takes the argument further and seeks to demonstrate how Islamic finance can significantly contribute to the global search for climate finance solutions. Islamic social funds can potentially play a significant role in absorbing the incremental costs with clean technologies where subsidies are not forthcoming to absorb the same. For zakat funds to be used for the purpose, an additional condition need to be met, i.e. the beneficiaries must be poor. The institution of waqf, along with zakat and Sadaqa, can certainly play a role in coping with humanitarian crises resulting from climate change. Awqaf like foundations may directly engage in provision of goods and services related to mitigation and adaptation. Awqaf may also be dedicated to research and development and towards increasing consumer awareness and stronger support of action to mitigate climate change. Similar to SRI Funds, the Islamic Green Funds and similar to Green Bonds, the Islamic Green Sukuk can contribute significantly to the agenda of climate change.
    Keywords: Environmental Protection; Climate Change; Islamic Social Funds; Green Sukuk
    Date: 2017–01–01
  2. By: Andrea Baranzini; Nicolas Borzykowski; Stefano Carattini
    Abstract: Following the entry into force of the Paris Agreement in November 2016, governments around the world are now asked to turn their nationally determined contributions into concrete climate policies. Economic arguments justify implementing carbon pricing to achieve emission abatement targets in a cost-effective way, including the possibility to offset domestic greenhouse gas emissions in foreign countries. However, abating emissions abroad instead of domestically may face important political and popular resistance. We run a lab experiment with more than 300 participants by asking them to choose between a domestic and an international reforestation project. We test the effect of three informational treatments on the allocation of participants’ endowment between the domestic and the international project. The treatments consist in: (1) making more salient the cost-effectiveness gains associated with offsetting carbon abroad (2) providing guarantees on the reliability of reforestation programmes (3) stressing local ancillary benefits associated with domestic offset projects. We find that stressing the cost-effectiveness of the reforestation programme abroad is the best way to increase its support, the economic argument in favour of offsetting abroad being largely overlooked by participants. We relate this finding to the recent literature on the drivers of public support for climate policies, generally pointing to a gap between people’s preferences and economists’ prescriptions.
    Date: 2016–12
  3. By: Casey, Gregory
    Abstract: In the United States, rising energy efficiency, rather than the use of less carbon-intensive energy sources, has driven the decline in the carbon intensity of output. Thus, understanding how environmental policy will affect energy efficiency should be a primary concern for climate change mitigation. In this paper, I evaluate the effect of environmental taxes on energy use in the United States. To do so, I construct a putty-clay model of directed technical change that matches several key features of the data on U.S. energy use. The model builds upon the standard Cobb-Douglas approach used in climate change economics in two ways. First, it allows the elasticity of substitution between energy and non-energy inputs to differ in the short and long run. Second, it allows for endogenous and directed technical change. In the absence of climate policy, the new putty-clay model of directed technical change and the standard Cobb-Douglas approach have identical predictions for long-run energy use. The reactions to climate policies, however, differ substantially. In particular, the new putty-clay model of directed technical change suggests that a 6.9-fold energy tax in 2055 is necessary to achieve policy goals consistent with the 2016 Paris Agreement and that such a tax would lead to 6.8% lower consumption when compared to a world without taxes. By contrast, the standard Cobb-Douglas approach suggests that a 4.7-fold tax rate in 2055 is sufficient, which leads to a 2% decrease in consumption. Thus, compared to the standard approach, the new model predicts that greater taxation and more forgone consumption are necessary to achieve environmental policy goals.
    Keywords: Energy, Climate Change, Directed Technical Change, Growth
    JEL: H23 O30 O40 Q40 Q54
    Date: 2017–01–24
  4. By: Andreas Welling (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)
    Abstract: Various so-called green investments are intended to limit the warming of the earth's climate, thus minimizing social, environmental and economic damage. The article introduces into the corresponding research field of Green Finance by providing current data, by showing historical developments, and by forecasting future tasks. Further, the article depicts the major difficulties of research on Green Finance; particularly rapid technological progress, the dependence of governmental support, high uncertainties, and, especially the interactions of so many actors. Finally, the article gives a short review on the research field of Green Finance.
    Date: 2017–01
  5. By: Bukvić, Rajko; Petrović, Dragan
    Abstract: Russian Abstract. Рассматривается проблема парниковых газов (ПГ), и сокращения их выбросов. Эмиссия ПГ считается одной из главных антропогенных причин роста концентрации углерода в атмосфере, и глобальных климатических перемен. Борьба с атмосферным загрязнением пока шла тремя путями: административное регулирование, экономические механизмы и формирование рыночных отношений. Во второй половине XX века для решения проблем были предложены многие схемы создания рыночного механизма, считающегося более подходящим во многих отношениях. Эти усилия увеличились в 1990х г., и наконец Киотский протокол поддержал гибкие механизмы: торговля квотами (квотирование и торговля), проекты совместного осуществления и механизмы чистого развития, разработаные в 2001 году. Но, несмотря на все эти усилия, в течение первого периода их применения (2008–2012) выбросы углерода в атмосферу возросли. Теперь мировой «углеродный» рынок идёт к развитию национальных, региональных и субрегиональных систем регулирования, но при сохранении международного сегмента (системы РКИК ООН). Конференция в 2012 году уточнила условия, в которых Стороны Конвенции будут выстраивать свою климатическую политику в будущем. Ведущая тенденция (акценты на региональные, субрегиональные и национальные системы регулирования) сохранилась, но сохранилась и «киотская» система, которая на новом этапе будет переходной на пути к новому ожидающемуся глобальному соглашению. English Abstract. This article considers the problem of greenhouse gas (GHG) emissions, and its reduction. These missions are observed as one of the main anthropogenic causes of the increasing carbon concentration in the atmosphere, and the global climate change. The fight against atmosphere pollution goes in three directions: administrative regulations, economic mechanisms and market relations building. In the second half of the XX century many schemes for involving the market mechanism in solving these problems were proposed. These efforts increased in the 1990s and finally the Kyoto Protocol supported flexible mechanisms (trade of quotas – cap and trade, joint implementation projects and clean development mechanisms), as a solution to these problems, explained in 2001. In spite of all these efforts, during the first period of its implementation (2008– 2012) the emissions of carbon increased. Today, the world «carbon» market is moving to the development of national, regional and subregional regulation systems while keeping its international level (system UNFCCC). The Conference held in 2012 precised the conditions upon which the convention parties would define its climate policies in future. The leading tendency (transition to regional, subregional and national regulation systems) was maintained, as well as the «Kyoto» system, which in the new stage would play a transitional role on the road to a new expected global agreement.
    Keywords: парниковый эффект, парниковые газы (ПГ), антропогенные влияния, Киотский протокол, рынки углерода, гибкие механизмы, greenhouse effect, greenhouse gases (GHG), anthropogenic impact, the Kyoto Protocol, carbon markets, flexible mechanisms
    JEL: H23 K32 L50 L51 Q53 Q56
    Date: 2017
  6. By: Turner, Robert (Department of Economics, Colgate University)
    Abstract: This paper reports the results of two experiments exploring the impact of exposure to environmental art on environmental beliefs, using images of plastic bag pollution in oceans. Even though the experimental design investigates only the immediate impact of a brief exposure to artistic images, the design controls well for other factors that might influence changes in environmental beliefs. This study is one of the few to directly estimate the effect of environmental art and it is the first to use elements of the New Ecological Paradigm in that context. Beyond the main research question of whether environmental art has effects on beliefs, the study also investigates whether expected behavior is affected, whether it is art or the information conveyed along with the art that matters, whether other factors influence the effect of exposure to the artwork, and what personal characteristics are associated with pro-environmental behaviors with respect to plastic bags as well as pro-environmental beliefs.
    Keywords: environmental art, environmental beliefs, plastic pollution, New Ecological Paradigm
    Date: 2017–01–19
  7. By: Hay, Eric J.; Kragt, Marit; Renton, Michael; Vongkhamheng, Chanthavy
    Abstract: Worldwide, wildlife poaching results in significant losses to biodiversity, especially for those species which are most vulnerable and at risk of extinction. Strategies exist for reducing poaching pressure, including anti-poaching patrols that collect and remove wire snares. Studies are available that focus on the impact of poaching. Yet, not much work evaluates the effectiveness of poaching mitigation actions. We outline a modelling methodology that aims to predict the effectiveness of different management strategies on the poaching problem in the Phou Chomvoy Provincial Protected Area, Bolikhamxay Province, Lao PDR. Wildlife management in the study involves the local community through villager-led anti-poaching patrols. The goal is to develop a quantified relationship between patrol inputs and biodiversity outcomes. The results show that, without patrols, 18 out of the 19 species investigated would be poached and removed from the protected area over the next ten years. At low levels of patrol-effort ten species would survive. With increasing patrol effort, the total number of animals and species saved increase, but with diminishing marginal effect on species count improvement. At the highest patrol-effort management scenario modelled, all species are saved except for one; the Northern Pig-Tailed Macaque, which goes extinct under all management scenarios. This is the first time modelling has been undertaken at this scale to examine poacher-patrol interaction in the Southeast Asia region. Our work shows a positive effect of patrol effort on the number of endangered species saved. This work will be used to inform protected area management policy in Lao PDR, specifically, the development of Payment for Environmental Services schemes.
    Keywords: Anti-poaching Patrols, Biodiversity, Bio-physical Modelling, Payment for Environmental Services, Protected Area Management, Environmental Economics and Policy, Q57,
    Date: 2017–01
  8. By: Bruno Lanz (University of Neuchâtel, Department of Economics and Business; ETH Zurich, Chair for Integrative Risk Management and Economics; Massachusetts Institute of Technology, Joint Program on the Science and Policy of Global Change.); Jules-Daniel Wurlod (Boston Consulting Group, Geneva, Switzerland.); Luca Panzone (Newcastle University, School of Agriculture, Food and Rural Development, UK.); Timothy Swanson (Graduate Institute of International and Development Studies, Centre for International Environmental Studies, Switzerland.)
    Abstract: Pigovian regulation provides monetary penalties/rewards to incentivize prosocial behavior, and may thereby trigger behavioral effects beyond a more standard response associated with a change in relative prices. This paper quantifies the magnitude of these behavioral effects using data from an experiment on real product choices together with a structural model of consumer behavior. First, we show that information about external effects (products’ embodied carbon emissions) triggers voluntary substitution towards cleaner alternatives, and we estimate that this effect is equivalent to a change in relative prices of GBP30.69-165.15/tCO2. Second, comparing a Pigovian intervention (GBP19/tCO2) with a neutrally-framed price change of the same magnitude, we find a negative behavioral effect associated with regulation. Compensating this bias would require increasing the Pigovian price signal by up to 48.06/tCO2. Finally, based on a cross-product comparison, we show that the magnitude of behavioral effects declines with substitutability between clean and dirty product alternatives, a measure of effort to reduce emissions.
    Keywords: Externalities; Pigovian regulation; Consumer behavior; Information; Field experiments; Environmental policy.
    JEL: C93 D03 D12 H23 Q58
    Date: 2017–01
  9. By: Nouve, Yawotse; Acharya, Ram N.
    Abstract: Niger is one of the poorest countries in the world. The most recent UNDP1 report classifies Niger as the last country in terms of human development index. Although more than 80 percent of the economically active population is involved in farming, the agriculture sector generates only around 40 percent of the gross domestic product. Since farm production is heavily dependent on rainfall, frequent extreme weather events may have a severe impact on agricultural output and household income. In this light, this study examines the potential impact of extreme weather events such as prolonged drought and flooding and other selected climate variables on yield of the three major crops in this country: millet, sorghum, and dry bean. Using data from a nationally representative survey conducted in 2014, the estimation results show that drought has a significant negative effect on sorghum and dry bean yield. However, flood have no impact on any of the three crop yields. An increase in temperature affects negatively all three crops yield threatening therefore farm income, and household food security. These results are likely to be further amplified by rising global warming and climate change.
    Keywords: extreme weather events, farm production, poverty, Agricultural and Food Policy, Crop Production/Industries, Food Security and Poverty, Production Economics, Productivity Analysis, Risk and Uncertainty,
    Date: 2017–01–18
  10. By: Hasan, Zubair
    Abstract: The environmental devastation that today confronts not only human-beings but all life forms on the planet earth has brought up the concept of sustainability contextual to growth-oriented development. Western though in origin and understanding, the implications of sustainable development extend to Islam in which, as in the other Abrahimic faiths, one can find an essence of this idea. Several economists have in recent years have examined the debate on the meaning of sustainable development in Islam and attempts to explain the Islamic position on environmental issues the world now faces. This Chapter examines the debate on several interpretations of sustainability and attempts to expound upon a concrete, Islamic definition for sustainable development. It argues that development is intricately linked to the environment as any definition of sustainability ends with environmental concerns. Such linkage assumes importance contextual to Islamic finance as the developmental funding is now being increasingly used to serve environmental ends. Islamic Finance is so far based essentially upon a negative-screen methodology, relying upon averting investments and actions contrary to Islamic law rather than positive investment in socially responsible concerns. While organizations such as the Islamic Development Bank do engage in development projects, positivism, and particularly the environment, is absent in most of the criteria of Islamic financial institutions. The development of a definition for Islamic sustainable development this chapter presents implies another opportunity for convergence between Islamic Finance and other ethical investments. With the growing popularity of socially responsible investment principles in the world of conventional finance, perhaps an Islamic counterpart would provide an opportunity for collaboration, particularly given the great liquidity of the Gulf region, for it could provide the framework for a positive-screen methodology. Finally, we take a brief look at the sort of environmental problems and the solutions suggested to resolve them, especially the viability of the Coase theorem.
    Keywords: Growth; Environment; Sustainability; Finance; War; Coase theorem; Islamic approach.
    JEL: O1
    Date: 2017–01–20
  11. By: Tomas Balint (Université Panthéon-Sorbonne - Paris 1 (UP1)); Francesco Lamperti (Université Panthéon-Sorbonne - Paris 1 (UP1)); Mauro Napoletano (Observatoire français des conjonctures économiques); Antoine Mandel (Ecole d'Économie de Paris - Paris School of Economics); Andrea Roventini (Laboratory of Economics and Management (Pisa) (LEM)); Sandro Sapio (Università degli Studi di Napoli Parthenope)
    Abstract: We provide a survey of the micro and macro economics of climate change from a complexity science perspective and we discuss the challenges ahead for this line of research. We identify four areas of the literature where complex system models have already produced valuable insights: (i) coalition formation and climate negotiations, (ii) macroeconomic impacts of climate-related events, (iii) energy markets and (iv) diffusion of climate-friendly technologies. On each of these issues, accounting for heterogeneity, interactions and disequilibrium dynamics provides a complementary and novel perspective to the one of standard equilibrium models. Furthermore, it highlights the potential economic benefits of mitigation and adaptation policies and the risk of under-estimating systemic climate change-related risks.
    Keywords: Climate change; Climate policy; Climate economics; Complex systems; Agent-based models; Socio-economics networks
    JEL: C63 Q40 Q50 Q54
    Date: 2016–07
  12. By: Andreas Welling (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)
    Abstract: Carbon taxation is used by several countries to internalize the negative effects of carbon emissions to the emitters of carbon. In this article the effects of a carbon tax on an oligopolistic market of polluters are analyzed. With the help of a multi-criteria optimization model the optimal carbon tax rate is determined; first under certainty and then in presence of demand uncertainty. It is shown that demand uncertainty leads to a lower optimal carbon tax rate, while it simultaneously increases carbon emissions. Finally, the influence of a possible carbon emission reducing investment is analyzed with the help of a real option model.
    Keywords: Carbon Tax; Climate Change; Real Option; Technological Progress; Uncertainty; Oligopolistic competition
    Date: 2017–01
  13. By: Halkos, George; Bampatsou, Christina
    Abstract: Better management of natural capital, an efficient allocation of resources and technological progress can contribute to productivity change. The present study uses Data Envelopment Analysis to determine the Total Factor Productivity Index, in the case of the EU15 countries, using panel data on energy consumption for a period spanning from 1995 to 2011. The aim is not only to determine the index of total factor productivity change but also to record its driving forces for the decision making units under consideration, showing whether the productivity gains come mainly from an improvement in efficiency or derive merely as a result of technological progress. In terms of eco-efficiency, the paper contributes in showing whether the overall development is more driven by input-saving or environmental-saving processes. The detailed decomposition offers policy makers additional insights into more valuable reference material representing the driving forces of productivity gains or losses.
    Keywords: Energy; Energy Consumption; Environmental Economics; Carbon emissions; Eco-Efficiency; Data envelopment analysis; Total factor productivity index.
    JEL: O11 O57 Q01 Q40 Q43 Q48 Q50 Q58
    Date: 2016–12
  14. By: Richard S.J. Tol (UK Department of Economics, University of Sussex,UK Institute for Environmental Studies and Department of Spatial Economics, Vrije Universiteit, Amsterdam, The Netherlands Tinbergen Institute, Amsterdam, The Netherlands); David Anthoff (University of California, Berkeley, Energy and Resources Group, 310 Barrows Hall # 3050, Berkeley, CA 94703, USA); Francisco Estrada (Universidad Nacional Autónoma de México, Circuito Exterior S/N, Mexico DF, 04510; Institute for Environmental Studies, Vrije Universiteit Amsterdam)
    Abstract: Past climatic changes were caused by a slowdown of the thermohaline circulation. We use results from experiments with three climate models to show that the expected cooling due to a slowdown of the thermohaline circulation is less in magnitude than the expected warming due to increasing greenhouse gas concentrations. The integrated assessment model FUND and a meta-analysis of climate impacts are used to evaluate the change in human welfare. We find modest but by and large positive effects on human welfare since a slowdown of the thermohaline circulation implies decelerated warming.
    Keywords: Climate change; thermohaline circulation; integrated assessment; climate impacts
    JEL: Q54
    Date: 2016–03
  15. By: Brown, David P. (University of Alberta, Department of Economics); Eckert, Andrew (University of Alberta, Department of Economics); Eckert, Heather (University of Alberta, Department of Economics)
    Abstract: In this paper, we examine the use of carbon pricing and an output-based subsidy in a market with imperfect competition. We consider a carbon pricing policy in Alberta's electricity market as a case study. This policy consists of two phases. In the first phase, the carbon price is doubled with the output subsidy being based on a fraction of facility-level emission intensity. In the second phase, the carbon price will remain constant, while the output subsidy is altered to be uniform across assets and based on the emissions intensity of an efficient natural gas asset. Using a model of oligopoly competition, we simulate the short-run impacts of the two phases on electricity prices, emissions, and unit and firm-level profitability. We find that the mechanisms by which electricity prices and emissions change in response to carbon pricing differ depending on whether the market is perfectly competitive or oligopolistic. We demonstrate that regardless of market structure, changing the basis of the output subsidy has substantially larger effects than a doubling of the carbon price. The estimated effects of carbon pricing vary as the firms' generation portfolios change.
    Keywords: Electricity; Market Power; Carbon Price; Pass-Through
    JEL: D43 L51 L94 Q40 Q58
    Date: 2017–01–24
  16. By: Sambit Bhattacharyya (Department of Economics, University of Sussex); Maurizio Intartaglia (Department of Economics, University of Sussex); Andy Mckay (Department of Economics, University of Sussex)
    Keywords: Climate Aid; Emissions; Energy
    JEL: D72 O11
    Date: 2016–05
  17. By: Manzano, George N.; Prado, Shanti Aubren
    Abstract: If member-economies of the Asia-Pacific Economic Cooperation (APEC) are to implement the APEC environmental goods (EGs) initiative, how should they go about it? This paper proposes an alternative modality to liberalizing a number of EGs in the APEC list. This involves accounting for two economic issues: the free-rider problem that usually afflicts liberalization on a most-favored-nation basis and the significance of trade in EGs for APEC and its individual members. Using the framework developed by Wonnacott (1994), this paper assesses the predominance of APEC in the world supply of each good and the comparative advantage of the region in the clusters of EGs. This paper finds that, on average, the world sources nearly 56 percent of EGs from APEC. Overall, the comparative advantage of the APEC is greatest in goods, which the region supplies about 60 percent of world supply. For this subset of EGs, free riding by non-APEC nations is relatively a small problem. In terms of functional areas, the most promising category for the APEC is renewable energy and clean technology production. However, the optimal benchmarks and potential areas could vary across member-economies.
    Keywords: APEC, environmental goods, trade liberalization, Asia-Pacific Economic Cooperation, environmental goods and services, free riding
    Date: 2016
  18. By: Richard S.J. Tol (UK Department of Economics, University of Sussex,UK Institute for Environmental Studies and Department of Spatial Economic, Vrije Universiteit, Amsterdam, The Netherlands Tinbergen Institute, Amsterdam, The Netherlands)
    Abstract: Greenhouse gas emission reduction is a global public good. The main problem is underprovision, and the inequitable distribution of the impacts of excessive climate change. Geoengineering is a private good with externalities. Individual countries, and indeed medium-sized organizations and companies, can geoengineer unilaterally and impose their preferred climate on others. In this paper, I use the FUND model to illustrate the implications, comparing and contrasting efficient, optimal, and equitable solutions to emission reduction and geoengineering.
    Keywords: Climate change, geoengineering, efficiency, equity
    JEL: Q54
    Date: 2016–01
  19. By: Ahad, Muhammad; Khan, Wali
    Abstract: This research investigates the relationship between globalization, environment degradation, industrial production, energy consumption and economic growth over the period of 1972-2015 for Bangladesh. The long run relationship between variables is examined using ARDL bound test and combined cointegration approach. These cointegration approaches predict the long run relationship between underlying variables. The empirical findings demonstrate that globalization, industrial production and energy consumption drives environmental degradation positively, but economic growth pushes environmental degradation negatively in the long run as well as short run. Further, the direction of causality is examined by VECM Granger causality which shows bidirectional causality between energy consumption and environment degradation, economic growth and environment degradation, industrial production and economic growth, and energy consumption and economic growth for both short-long run. Our results suggest a unidirectional causality runs from environmental degradation and energy consumption to industrial production. The empirics of Innovative Accounting Approach (IAA) confirm the findings of VECM Granger causality. Our findings suggest that Policymakers may focus on imports of advance technology and export led growth strategy to control environmental pollution.
    Keywords: Globalization, Environment Degradation, Bangladesh
    JEL: F64 Q4
    Date: 2016–04
  20. By: Murat Iyigun; Nathan Nunn; Nancy Qian
    Abstract: We investigate the long-run effects of cooling on conflict. We construct a geo-referenced and digitized database of conflicts in Europe, North Africa, and the Near East from 1400-1900, which we merge with historical temperature data. We show that cooling is associated with increased conflict. When we allow the effects of cooling over a fifty-year period to depend on the extent of cooling during the preceding period, the effect of cooling on conflict is larger in locations that experienced earlier cooling. We interpret this as evidence that the adverse effects of climate change intensify with its duration.
    JEL: N43 N53 O13 P16 Q34
    Date: 2017–01
  21. By: Smits, Armand; Drabe, Viktoria; Herstatt, Cornelius
    Abstract: While sustainability issues increasingly gain importance for new product design, they also further complicate the NPD process. In many cases it is hard to exactly measure the socio-environmental impact of new products, and sustainability targets may conflict with other ones. Innovators can aim to manage these challenges by turning to voluntary sustainability standards (VSS), like the practices and certificates that come with the EU Ecolabel, Greenguard or Cradle to Cradle standards. VSS are predefined rules, procedures, and methods for common and voluntary use and focus on social and environmental performance. It is proposed that the local implementation of these general standards from outside the organization will likely lead to a variety of firm-specific implementation trajectories, ultimately leading to different levels of VSS implementation extensiveness across firms. This variety that is not sufficiently addressed in extant research, is researched in the current study. Using organizational learning as theoretical lens this study investigates configuration(s) of factors, including the embeddedness of the relationship between the focal firm and standard specific organizations that drive VSS implementation extensiveness. In doing so, it uses the configurational research approach fuzzy set Qualitative Comparative Analysis (fsQCA). Empirically the study draws on qualitative and quantitative data from an international collection of firms that implemented the Cradle to Cradle standard. The study shows that VSS are multifaceted and that configurations that consistently drive VSS certification extensiveness differ from the ones that drive VSS practice implementation extensiveness. Additionally, it is found that configurations that consistently lead to the absence of high implementation extensiveness do not simply mirror the ones for high implementation extensiveness but have unique properties. Finally the study illustrates that similar levels of implementation extensiveness can result from multiple distinct configurations. The study mainly contributes to extant research on sustainable product design and how to integrate general principles of sustainable design into the NPD process.
    Keywords: sustainable product design,voluntary sustainability standards,fsQCA,implementation,Cradle to Cradle
    Date: 2016
  22. By: Rupayan Pal; Prasenjit Banerjee; Ada Wossink
    Date: 2017
  23. By: Florence Crick; Mamadou Diop; Momadou Sow; Birame Diouf; Babacar Diouf; Joseph Muhwanga; Muna Dajani
    Abstract: Climate change poses increasing risks to economic growth and development efforts across the world. Semi-arid regions (SARs) are one of the hotpots that have been identified by the Intergovernmental Panel on Climate Change as being particularly exposed and vulnerable to the impacts of climate change. Indeed, the majority of SARs across the world suffer from the combination of high levels of poverty, lack of development and high climate risk. Many of these issues will be further exacerbated by climate change. In addition, climate change will have significant impacts on economic activity within SARs, as the profits, competitiveness and operations of businesses become affected and production systems are altered to deal with the changing conditions. While a lot of climate change adaptation research in developing countries and semi-arid areas has focused on households and communities, particularly in rural environments, very little research has focused on the private sector. Yet, the private sector plays a critical role in contributing to developing countries’ growth and development efforts and is increasingly recognised as a key actor that can help society successfully adapt and become more resilient to climate change. Indeed, national governments are placing increasing emphasis on private sector action on climate change adaptation. Nevertheless, there is limited research examining how to promote and facilitate private sector adaptation and in particular how governments can create an enabling environment to stimulate and incentivise domestic private sector adaptation. This is especially true for the private sector in developing countries. In this paper we address this gap in the adaptation literature by reviewing the key factors required to provide an enabling environment for the private sector, with a focus on adaptation by small and medium enterprises (SMEs) in the SARs of Kenya and Senegal. We focus on SMEs as they form a critical part of the economy in the SARs of developing countries and are highly vulnerable to climate change. We draw insights from a much larger, yet generally separate, literature on enabling environments for private sector development. This literature disaggregates the private sector and highlights key constraints to the development and growth of African SMEs, including deficient infrastructure and evidence of an African gap in access to and use of finance by SMEs. We combine both areas of scholarship to develop an assessment framework to better understand the key elements of an enabling environment for private sector adaptation and apply it to Senegal and Kenya to reveal where improvements are required to create conditions conducive to private sector and SME adaptation. This framework reveals that both Senegal and Kenya have taken action to provide an enabling environment for private sector and SME development and to strengthen the competitiveness of the private sector. Yet, much remains to be done with regards to supporting private sector adaptation to climate change, in particular for SMEs in SARs.
    Date: 2016–12
  24. By: Domingo, Sonny N.
    Abstract: This study examines the grounding and sectoral translation of the National Disaster Risk Reduction Management Plan (NDRRMP), focusing on the thematic areas of disaster prevention and mitigation, preparedness, response, and recovery. Republic Act 10121, also known as the Philippine Disaster Risk Reduction and Management Act of 2010, provided for the crafting and implementation of the NDRRMP, outlining the activities aimed at managing risks and strengthening institutional arrangements and capacity at the national and subnational levels. The NDRRMP supposedly outlines the way toward mainstreaming of DRRM and climate change adaptation in policy formulation, development planning, budgeting, and governance with its four priority pillars. Notwithstanding evident weaknesses in grounding and institutional translation, policy support and departmental creativity exhibited by the theme leaders attest to the competence of local executive servants. It was evident that disaster risk management, as espoused, had influenced development processes and institutional initiatives within five years from the NDRRMP’s launching. Ultimately, strengthening of RA 10121 through appropriate translation and more apt institutional arrangements will ensure the realization of the full potential of the law.
    Keywords: Philippines, disaster risk reduction and management, climate change adaptation, National Disaster Risk Reduction and Management Plan (NDRRMP), disaster risk management policy, Republic Act 10121, Philippine Disaster Risk Reduction and Management Act of 2010
    Date: 2016
  25. By: Richard S.J. Tol (UK Department of Economics, University of Sussex, UK; Institute for Environmental Studies and Department of Spatial Economics, Vrije Universiteit, Amsterdam, Netherlands; Tinbergen Institute, Amsterdam, Netherlands; CESifo, Munich, Germany); Monika Novackova (Department of Economics, University of Sussex, Falmer, UK)
    Abstract: We report the first ex post study of the economic impact of sea level rise. We apply two econometric approaches to estimate the past effects of sea level rise on the economy of the USA, viz. Barro type growth regressions adjusted for spatial patterns and a matching estimator. Unit of analysis is 3063 counties of the USA. We fit growth regressions for 13 time periods and we estimated numerous varieties and robustness tests for both growth regressions and matching estimator. Although there is some evidence that sea level rise has a positive effect on economic growth, in most specifications the estimated effects are insignificant. We therefore conclude that there is no stable, significant effect of sea level rise on economic growth. This finding contradicts previous ex ante studies.
    Keywords: Sea level rise, Climate change, Barro type growth regression, Economic growth, USA counties, Spatial autoregressive model
    JEL: Q54
    Date: 2016–07
  26. By: Thiemo Fetzer (Department of Economics, University of Warwick); Samuel Marden (Department of Economics, University of Sussex)
    Abstract: Weak property rights are strongly associated with underdevelopment, low state capacity and civil conflict. In economic models of conflict, outbreaks of violence require two things: the prize must be both valuable and contestable. This paper exploits spatial and temporal variation in contestability of land title to explore the relation between (in)secure property rights and conflict in the Brazilian Amazon. Our estimates suggest that, at the local level, assignment of secure property rights eliminates substantively all land related conflict, even without changes in enforcement. Changes in land use are also consistent with reductions in land related conflict.
    Keywords: property rights, land titling, conflict, deforestation
    JEL: O12 Q15 D74 Q23
    Date: 2016–04
  27. By: F. Aleskerov; E. Victorova
    Abstract: As a result of the climate change the situation in Arctic area leads to several important consequences. On the one hand, oil and gas resources can be exploited much easier than before. Thus, one can already observe discussions on disputed shelf zones where the deposits are located. On the other hand, oil and gas excavation leads to serious potential threats to fishing by changing natural habitats which in turn can create serious damage to the economies of some countries in the region. Another set of problems arises due to the extension of navigable season for Arctic Shipping Routes.
    Date: 2016–11
  28. By: Partridge, Mark; Feng, Bo; Rembert, Mark
    Abstract: Manmade climate change (CC) has catastrophic consequences. The United States has already experienced wholesale population realignment due to climate as households have relocated to the Sunbelt and West. The irony is that people are moving towards the heat and major storms associated with CC. As CC intensifies, with high rates of internal U.S. factor mobility, firms and households will likely again relocate to areas with higher utility and profits, reducing CC costs. Yet current research typically focuses on CC costs in a given location without considering this realignment. We propose several avenues to overcome such shortcomings in U.S. CC modelling.
    Keywords: Climate change, migration, prediction, spatial equilibrium
    JEL: Q54 R0 R11 R23
    Date: 2017–01
  29. By: Peter A. Lang
    Abstract: A transition to nuclear power was disrupted in the late-1960s. Counterfactual analyses suggest the foregone benefits of the disruption are substantial. Learning rates are presented for nuclear power in seven countries comprising 58% of all nuclear power reactors ever built. Learning rates and deployment rates changed in the late-1960s from rapidly falling costs and accelerating deployment to rapidly rising costs and stalled deployment. If the early rates had continued nuclear power could now be around 10% of its current cost. The additional nuclear power could have substituted for 69,000-186,000 TWh of coal and gas generation, thereby avoiding up to 9.5 million deaths and 174 Gt CO2 emissions. In 2015 alone nuclear power could have replaced up to 100% of coal and 76% of gas-generated electricity, thereby avoiding up to 540,000 deaths and 11 Gt CO2. Rapid progress was achieved in the past and could be again, with appropriate policies. Research is needed to identify impediments to progress, and policy is needed to remove them.
    Keywords: Nuclearpower, Constructioncost, Learningrate, Experience curve, Energy transition, Forgone benefits, Deaths, CO2 emissions
    Date: 2017–01
  30. By: Katare, Bhagyashree; Serebrennikov, Dmytro; Wang, H. Holly; Wetzstein, Michael
    Abstract: In 2010, 21% of the total U.S. food available for consumption was wasted at the household level. In response to this waste, a number of counties and U.S. localities have instituted policies (disposal taxes) directed toward reducing this waste. However, currently, there is no federal food-waste disposal tax. The aim of this paper is to establish a theoretical foundation for household food waste, and based on this theory, determine an optimal food-waste (disposal) tax along with government incentives. The theory unravels the interrelation between social food insecurity and external environmental costs, not generally considered by households when they waste food. An optimal disposal tax and government incentives involve Pigovian mechanisms and government benefits. For a zero level of food waste, the optimal disposal taxes and government incentives approach infinity.
    Keywords: Externalities, Food insecurity, Food waste, Social welfare, Sustainability, Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety, D11, D62, H21, H23, I18, I31, Q51,
    Date: 2016–07
  31. By: Renato Vargas; Pamela Escobar; Maynor Cabrera; Javier Cabrera; Violeta Hernández; Vivian Guzmán; Martin Cicowiez
    Abstract: In this study, we used a Computable General Equilibrium model of the Guatemalan economy to conduct simulations for a) a reduction in productivity due to climate change; and b) the effects of drought in agriculture. The reduction in productivity due to climate change would mean an important drop in the value added of agriculture and animal production, as well as a slight drop in industrial food production and the service industry. Under this scenario we should expect a fall in real GDP of 1.2%. The reduction of productivity could mean a reduced fiscal space, and a reduction in government expenditure because of lower tax revenues. More importantly, due to higher prices and lower income of households, this scenario could mean that consumption of agricultural goods for each type of household would be reduced in a relevant manner with great impacts on the food security aspect of access. One of the findings in the effects of drought in agriculture is a decrease of the value added of 23%. As expected, this situation would negatively affect the wages paid to unskilled workers, but also urban non-poor households would see a reduction of their disposable income due to higher food prices. One of the most interesting results is that the demand for land would fall by 38%. This is because as water would become scarcer, there would be fewer incentives to engage in agricultural activities. However, due to the importance of agricultural production for ensuring food security, these results show that a proper water allocation system is needed.
    Keywords: Regional Economics Measurement, Computable General Equilibrium, Spatial Analysis, Natural Resource, Agricultural Employment, Farm Household, Farm Input Markets
    JEL: R15 R22 Q12
    Date: 2017
  32. By: Stefan ?etkovi?; Aron Buzogány; Miranda Schreurs
    Abstract: The paper introduces a novel framework for classifying different types of national political economies. It applies the outlined framework to analyse in an historical perspective the development of one mature renewable energy sector (onshore wind) and one infant renewable energy sector (offshore wind) across three major types of European economies.The paper shows that the presence of strategic coordination and the decentralized pluralist polity constitute key enabling factors that drive the development of new renewable energy technologies. The commonalities and differences in the political economy of the onshore and offshore wind sectors are also discussed.
    Keywords: Capitalism, Industrial productivity, Renewable energy sources, Sustainable development
    Date: 2016
  33. By: André, Francisco J. (Departamento de Análisis Económico. Universidad Complutense de Madrid.); Arguedas, Carmen. (Departamento de Análisis Económico (Teoría e Historia Económica). Universidad Autónoma de Madrid.)
    Abstract: In this paper we study the relationship between market power in emission permit markets and endogenous technology adoption. The presence of market power results in a di- vergence of both abatement and technology adoption levels with respect to the benchmark scenario of perfect competition, as long as technology adoption becomes more e¤ective in reducing abatement costs. Also, the initial distribution of permits, in particular, the amount of permits initially given to the dominant rm, is crucial in determining over- or under-investment in relation to the benchmark model. Speci cally, if the dominant rm is initially endowed with more permits than the corresponding cost e¤ective allocation, this results in under- investment by the dominant rm and over- investment by the competitive fringe, regardless of the speci c amount of permits given to the latter rms. The results are reversed if the dominant rm is initially endowed with relatively few permits. Our ndings seem consistent with some empirical evidence about the performance of the power sector in the initial phases of the European Union Emission Trading System.
    Keywords: environmental policy, emission permits, market power, environmentally-friendly technologies
    JEL: C72 D43 D62 L51 Q55 Q58
    Date: 2017–01
  34. By: Chia-Wen Chen; Wei-Min Hu; Christopher R. Knittel
    Abstract: The Chinese automobile market is the largest in the world with annual sales exceeding 20 million vehicles. The tremendous growth in sales---over 200 percent from 2008 to 2015---and concerns over local air quality have prompted China's policy makers to incentivize the adoption of more fuel efficient vehicles. We examine the response of vehicle purchase behavior to China's largest national subsidy program for fuel efficient vehicles during 2010 and 2011. Using variation from the program's eligibility cutoffs, we find that the program boosted sales for subsidized vehicle models, but that the program also created a substitution effect within highly fuel efficient vehicles and most subsidies went to inframarginal consumers. This substitution effect greatly reduces the cost effectiveness of the program. We calculate that the average cost per ton of carbon dioxide saved is over 82 USD, well above the social cost of carbon used in U.S. regulatory filings. Using the framework in Boomhower and Davis (2014) and accounting for local pollution benefits, we show that ignoring the substitution effect would lead one to conclude that the program is welfare enhancing, whereas in fact the marginal cost of the program exceeds the marginal benefit by almost as much as 300 percent. We also show that the program was not well-targeted; the effect of the subsidy on sales of fuel efficient vehicles was smaller in areas where consumers were more likely to purchase fuel inefficient models or were lower educated.
    JEL: L5 L91 Q4 Q5
    Date: 2017–01
  35. By: Campbell, Ben; Khachatryan, Hayk; Rihn, Alicia
    Keywords: Agribusiness,
    Date: 2017–01–18
  36. By: Sabbatovskaya, Alla
    Abstract: The selected paper presented at the IAMO Samarkand Conference
    Keywords: Agricultural and Food Policy, Environmental Economics and Policy,
    Date: 2016–11–03
  37. By: Baker, Brian; Russell, June
    Abstract: Submitted for the Invited Case Study session of the Agricultural and Applied Economics Association 2016 Annual Meeting Boston, MA
    Keywords: Food Consumption/Nutrition/Food Safety, Marketing, Production Economics,
    Date: 2016–07
  38. By: Frankema, Ewout; Papaioannou, Kostadis
    Abstract: We explore a new dataset of annual and monthly district-level rainfall patterns to assess the longstanding idea that climatological conditions were more conducive to the development of dense rural populations in Asia than in Africa. We test whether there existed significant cross-regional differences in both the frequency and intensity of rainfall shocks (i.e. annual mean deviations exceeding one standard deviation). Our results confirm that rainfall shocks in tropical Africa were both more frequent and more severe. Second, we test the separate effects of precipitation levels and variability on district-level population densities from colonial population censuses. We hypothesize that higher mean levels of precipitation facilitate agricultural intensification and human settlement, while unpredictability of rainfall has the opposite effect. Controlling for average rainfall levels, we find a strong negative effect of rainfall variation on population densities. This study thus lends further support to a wide literature arguing that the ecological conditions of agricultural intensification were more challenging in the African than in the Asian tropics.
    Keywords: Africa; agriculture; Asia; Climate; Settlement
    JEL: N55 N57 O13 O44
    Date: 2017–01
  39. By: Wang, Chunxiao; Florkowski, Wojciech J.; Yang, Zhenyong; Li, Yanan
    Abstract: The paper examines importance Shanghai consumers attach to four issues associated with the production of aquatic products. Three potential problems involve quality of production inputs, i.e., water quality, the use of feed without medication, and the use of only natural ingredients in feed. The fourth issue was the importance to consumers of releasing water from fish farms without treatment to surface water bodies. The estimation of four specified equations uses 394 observations and the ordered logit technique. Results consistently show the increasing importance of all issues as the educational attainment level of respondents’ increases. The presence of children is associated with importance of feed quality, but has the opposite effect on the importance of releasing untreated water. Age also increases the importance of feed quality, but decreases the importance of releasing untreated water to rivers and the sea. Male as compared to women respondents view the issues as less important. Overall, the results are consistent with expectations of better educated or older consumers attaching more importance to presented issues associated with aquatic production, except for the unexpected effect of child presence in a household on treatment of water.
    Keywords: Natural feed ingredient, medication in feed, water quality, water treatment, survey, Environmental Economics and Policy, Food Consumption/Nutrition/Food Safety, Marketing, Q22, Q53, M31,
    Date: 2017–01–18
  40. By: Berning, Joshua; Campbell, Ben
    Keywords: Agribusiness, Agricultural and Food Policy,
    Date: 2017–01–18

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