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on Regulation |
| By: | Carlén, Björn (VTI); Hernández, Aday (University of Las Palmas de Gran Canaria) |
| Abstract: | We study an environmental policy that (i) tax some emitters while others are covered by a cap-and-trade system and (ii) index the tax level to the permit price. Such a policy could be attractive in a world where abatement costs are uncertain and the regulator has information about the correlation between the cost shocks to the two groups. We show that this index policy yields lower expected social cost than the policy mix studied in Mandell (2008). The value of indexing is higher the stronger the correlation is, the steeper the marginal abatement benefit curve is, and the more uncertain we are about the taxed sector’s abatement costs. The index policy may also outperform the uniform policy alternatives emission tax and cap-and-trade system. The conditions for this are more restrictive, though. Given parameter values plausible for the European climate change policy context, expected net-gains are small or negative. |
| Keywords: | Uncertainty; Environmental policy; Emissions tax; Tradable permits |
| JEL: | H23 Q23 Q58 |
| Date: | 2013–10–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2013_033&r=reg |
| By: | Ovtchinnikov , Alexei V. |
| Abstract: | Regulation and subsequent deregulation significantly affect firms’ debt decisions. Prior to deregulation, regulated firms depend significantly more on long-term and public debt but reduce this dependence considerably during deregulation. Cross-sectional analysis shows that the reduction in the use of long-term and public debt results from changing firm sensitivities to determinants of debt decisions triggered by deregulation. Consistent with credit and liquidity risk theories of debt maturity, the concave relation between firm quality and debt maturity is significantly attenuated among regulated firms. Inconsistent with these theories, the convex relation between firm quality and the preference for public debt exists only among regulated firms. I find limited support for other theories. |
| Keywords: | Debt decisions; debt maturity; public and private debt issues; deregulation |
| JEL: | G32 G38 |
| Date: | 2013–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:1000&r=reg |
| By: | Masini, Andrea; Menichetti , Emanuela |
| Abstract: | Notwithstanding their many environmental, economic and social advantages, renewable energy technologies (RE) account for a small fraction of the world’s primary energy supply. One possible cause for this limited diffusion is that private investments in the RE sector, although potentially appealing, remain insufficient. The lack of adequate financing is also a clear indication that our understanding of the process by which investors fund RE ventures is still incomplete. This paper aims to fill in this gap and to shed new light on RE investment decisions. Building upon behavioral finance and institutional theory, we posit that, in addition to a rational evaluation of the economics of the investment opportunities, various nonfinancial factors affect the decision to invest in renewables. We analyze the investment decisions of a large sample of investors, with the objective to identify the main determinants of their choices. Our results shed new light on the role of institutional and behavioral factors in determining the share of renewable energy technologies in energy portfolios, and have important implications for both investors and policy makers: they suggest that RE technologies still suffer from a series of biased perceptions and preconceptions that favor status quo energy production models over innovative alternatives |
| Keywords: | Renewable Energies; behavioral finance; empirical analysis; portfolio; investments diversification; survey research |
| JEL: | G00 |
| Date: | 2013–04–13 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:0976&r=reg |
| By: | Timothy Halliday (Department of Economics, University of Hawaii at Manoa); Sumner La Croix (Department of Economics, University of Hawaii at Manoa) |
| Abstract: | We examine the welfare consequence of emissions tax with and without a Border Tax Adjustment for an imperfectly competitive industry, where intra-industry trade arises between countries. BTA allows a government to impose a pollution-content tariff on imports and refund an emission tax for export sales. We analyze the structure of an optimal emission tax with BTA when a government chooses its emission tax rate to maximize its national welfare. We show that the optimal emission tax policy with BTA achieves greater national welfare and higher environmental quality than the optimal policy without BTA. |
| Keywords: | trade and environment, border tax adjustment, intra-industry trade |
| JEL: | F18 F12 Q56 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:hai:wpaper:201318&r=reg |
| By: | Eliasson, Jonas (KTH); Börjesson, Maria (KTH) |
| Abstract: | The benefits captured in an appraisal of a railway investment are determined by what timetables the analyst assumes in the scenarios with and without the investment. Without an explicit, objective and verifiable principle for which timetables to assume, the appraisal outcome is virtually arbitrary. This means that appraisals of railway investments cannot be compared to each other, and opens the door for strategic behaviour by stakeholders conducting seemingly objective cost-benefit analysis. We explain and illustrate the nature and extent of the problem, and discuss the practical consequences for appraisal comparability and conscious or unconscious misrepresentation. Finally, we discuss possible objective principles for appraisal timetable construction and contrast this with current practice, which is shown to be likely to exaggerate investment benefits in an appraisal. |
| Keywords: | Cost-benefit analysis; Appraisal; Railway investments; Timetables |
| JEL: | R40 |
| Date: | 2013–10–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2013_031&r=reg |