nep-res New Economics Papers
on Resource Economics
Issue of 2009‒11‒21
seven papers chosen by
Maximo Rossi
Universidad de la Republica

  1. Economic Potential of Renewable Energy in Vietnam's Power Sector By Nhan Thanh Nguyen; Minh Ha-Duong
  2. Introducing carbon constraint in the steel sector: ULCOS scenarios and economic modeling By Elie Bellevrat; Philippe Menanteau
  3. Institutions and the environment: the case for a historical political economy By Ali DOUAI (GREThA-GRES); Damien TALBOT (GREThA-GRES)
  4. Fairness Concerns in Environmental Economics - Do They Really Matter and If So How? By Johansson-Stenman, Olof; Konow, James
  5. Biomass Fuel Consumption and Dung Use as Manure - Evidence from Rul Households in the Amrahara Region of Ethiopia By Mekonnen, Alemu; Köhlin, Gunnar
  6. Can local communities in Zimbabwe be trusted with wildlife management?: Evidence from contingent valuation of elephants By Muchapondwa, Edwin; Carlsson, Fredrik; Köhlin, Gunnar
  7. Global Climate Policy Architecture and Political Feasibility: Specific Formulas and Emission Targets to Attain 460 ppm CO2 Concentrations By Valentina Bosetti; Jeffrey A. Frankel

  1. By: Nhan Thanh Nguyen (CIRED - Centre international de recherche sur l'environnement et le développement - CIRAD : UMR56 - CNRS : UMR8568 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Nationale des Ponts et Chaussées - Ecole Nationale du Génie Rural des Eaux et Forêts); Minh Ha-Duong (CIRED - Centre international de recherche sur l'environnement et le développement - CIRAD : UMR56 - CNRS : UMR8568 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Nationale des Ponts et Chaussées - Ecole Nationale du Génie Rural des Eaux et Forêts)
    Abstract: A bottom-up Integrated Resource Planning model is used to examine the economic potential of renewable energy in Vietnam's power sector. In a baseline scenario without renewables, coal provides 44% of electricity generated from 2010 to 2030. The use of renewables could reduce that figure to 39%, as well as decrease the sector's cumulative emission of CO2 by 8%, SO2 by 3%, and NOX by 4%. In addition, renewables could avoid installing 4.4 GW in fossil fuel generating capacity, conserve domestic coal, decrease coal and gases imports, improving energy independence and security. Wind could become cost-competitive assuming high but plausible on fossil fuel prices, if the cost of the technology falls to 900 US$/kW.
    Keywords: integrated resource planning; renewable energy; electricity generation
    Date: 2009
  2. By: Elie Bellevrat (Enerdata S.A. - Aucune); Philippe Menanteau (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II)
    Abstract: Modeling activities and scenario building are at the heart of the economic analysis delivered by the ULCOS program. Two main objectives were followed in the framework of SP9. First the modeling team had to provide a set of coherent energy economic scenarios using POLES model. Second, the economic conditions for the emergence of the ULCOS technologies were analyzed. ULCOS contributes to the elaboration of contrasted scenarios that the steel industry could face in the long term. To aim at these objectives specific tools have been used: POLES model for the global energy system modeling and ISIM model for the steel sector based prospective ([1] Hidalgo, 2003). The most promising steel production technologies identified in ULCOS Phase 1 have been introduced into ISIM as generic technologies. ISIM was then integrated as a module into POLES modeling system. The main model outputs are the energy prices and mixes and the steel sector balances with a focus on the technology mix. Actually the climate policy scenarios developped in project allow making recommendations to the steel industry in terms of sustainable development but also in terms of business strategy.
    Date: 2009–09
    Abstract: This paper provides a critical review of the ‘state of the art’ of institutional analysis applied essentially by social-ecological economists in the environmental domain. It highlights both areas of strength and issues where there is still room for improvement in analytical terms, by construing these approaches in the context of a general taxonomy of institutionalisms – widely used in politics and applied here in the economic realm. This provides the rationale for re-construing a number of related issues drawn from the core insights of a historical institutionalist approach to human-nature
    Keywords: Ecological economics, institutional analysis, socio-economy, regulation
    JEL: Q01 Q57 B52 P16
    Date: 2009
  4. By: Johansson-Stenman, Olof (Department of Economics, School of Business, Economics and Law, Göteborg University); Konow, James (Department of Economics, Loyola Marymount University)
    Abstract: Are fairness concerns of relevance to environmental economics and, if so, are they sufficiently structured to improve analysis in this field? On both of these questions, we answer in the affirmative, arguing that people’s fairness views are based on both general rules and the context, where context refers to the set of variables and persons employed to interpret and apply the principles. The fairness rules analyzed are accountability (i.e., rewards that are proportional to contributions individuals control), efficiency, need and equality. We conclude that stakeholders typically exhibit a “fairness bias”, i.e., they tend, consciously or not, to interpret and apply fairness principles in a self-serving manner, whereas the views of spectators, or impartial third parties, tend to converge significantly more. Further, we argue that fairness considerations are relevant to both descriptive and prescriptive analysis in environmental economics. These fairness concerns are reflected in the behavior of private and public decision-makers and have potentially important policy implications through the overall social objective function.<p>
    Keywords: Justice; Fairness rules; accountability; equity theory; environmental economics
    JEL: D63 H40 Q50
    Date: 2009–11–16
  5. By: Mekonnen, Alemu; Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Soil nutrient depletion is a critical problem, contributing to low agricultural productivity and the limited domestic food supply in sub-Saharan Africa. Fertilizer use in Ethiopia is one of the lowest in sub-Saharan Africa. Particularly in the northern half of the Ethiopian highlands, use of dung as manure is also limited partly because of a significant level of dung consumption as a source of household fuel. Use of dung as fuel is also an important cause of health problems, mainly through indoor air pollution. Plantation interventions are carried out based on the expectation that fuelwood could substitute for dung, thus increasing agricultural productivity. This study examined (1) the determinants of rural households’ decision to use dung as fuel and as manure, and (2) the determinants of consumption of woody biomass and dung as household fuel sources. We found that the decision to use dung as fuel and manure was influenced by household assets (such as livestock and land size), as well as household characteristics (such as family size and age-sex composition of members), suggesting the important role of asset, product, and labor market imperfections. The type of stove and distance to towns also influenced fuel use. We found no evidence that woody biomass and dung were substitutes as household fuel, and in fact there were indications that they are complements. These results suggest the need to focus on asset-poor households to address the limited use of manure. Moreover, energy issues should be considered simultaneously. Encouraging the use of more appropriate (or energy efficient) stoves and other sources of energy that can reduce the use of dung as fuel are important options because they can improve energy efficiency and agricultural productivity, as well as improved health from reduced indoor air pollution.<p>
    Keywords: Biomass fuel; dung use; manure; Ethiopia
    JEL: Q12 Q42 Q56
    Date: 2009–11–19
  6. By: Muchapondwa, Edwin (School of Economics, University of Cape Town); Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: If local communities living adjacent to the elephant see it as a burden, then they cannot be trusted to be its stewards. To assess their valuation of it, a CVM study was conducted for one CAMPFIRE district in Zimbabwe. Respondents were classi…ed according to their preferences over the elephant. The median WTP for the preservation of 200 elephants is ZW$260 (US$4.73) for respondents who considered the elephant a public good while the same statistic is ZW$137 (US$2.49) for those favouring its translocation. The preservation of 200 elephants yields an annual net worth of ZW$10,828 (US$196) to CAMPFIRE households. However, the majority of households (62%) do not support elephant preservation. This is one argument against devolution of elephant conservation to local communities. Adequate economic incentives must be extended to local communities if their majority is to partake in sound elephant conservation. External transfers constitute one way of providing additional economic incentives.<p>
    Keywords: CAMPFIRE; contingent valuation; double bounded spike model; elephant; Zimbabwe
    JEL: C25 H41 Q26
    Date: 2009–11–19
  7. By: Valentina Bosetti; Jeffrey A. Frankel
    Abstract: Many analysts have identified three important gaps in the Kyoto Protocol: the absence of emission targets extending far into the future, the absence of participation by the United States, China, and other developing countries, and the absence of reason to think that members will abide by commitments. It appears that political constraints on the country-by-country distribution of economic costs are a key stumbling block to filling these gaps. This paper investigates formulas that assign quantitative allocations of emissions, across countries, one budget period at a time, to see if it is possible to satisfy the constraints. The two-part plan: (i) China and other developing countries accept targets at BAU in the coming budget period, the same period in which the US first agrees to cuts below BAU; and (ii) all countries are asked in the future to make further cuts in accordance with a formula which sums up a Progressive Reductions Factor, a Latecomer Catch-up Factor, and a Gradual Equalization Factor. An earlier plan for specific parameter values in the formulas – Frankel (2009), as analyzed by Bosetti, et al (2009) – achieved the environmental goal that concentrations of CO2 plateau at 500 ppm by 2100. It succeeded in obeying our political constraints, such as keeping the economic cost for every country below the thresholds of Y=1% of income in Present Discounted Value, and X=5% of income in the worst period. In pursuit of more aggressive environmental goals, we now advance the dates at which some countries are asked to begin cutting below BAU, within our framework. We also tinker with the values for the parameters in the formulas. The resulting target paths for emissions are run through the WITCH model to find their economic and environmental effects. We find that it is not possible to attain a 380 ppm CO2 goal (roughly in line with the 2°C target) without violating our political constraints. We were however, able to attain a concentration goal of 460 ppm CO2 with looser political constraints. The most important result is that we had to raise the threshold of costs above which a country drops out, to as high as Y =3.4% of income in PDV terms, or X =12 % in the worst budget period. Whether one concludes from these results that the more aggressive environmental goals are, or are not, attainable at reasonable economic costs, the approach developed here provides a framework for exploring maximization of the tradeoff between the benefits of cutting global emissions and the political feasibility of getting individual countries to share the burden.
    JEL: Q50
    Date: 2009–11

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