nep-res New Economics Papers
on Resource Economics
Issue of 2009‒12‒11
sixteen papers chosen by
Maximo Rossi
Universidad de la Republica

  1. Estimating Returns to Soil and Water Conservation Investments - An Application to Crop Yield in Kenya By Nyangena, Wilfred; Köhlin, Gunnar
  2. The Role of Production Risk in Sustainable Land-Management Technology Adoption in the Ethiopian Highlands By Kassie, Menale; Yesuf, Mahmud; Köhlin, Gunnar
  3. Soil Conservation and Small-Scale Food Production in Highland Ethiopia A Stochastic Metafrontier Approach By Medhin, Haileselassie A.; Köhlin, Gunnar
  4. Agricultural Risk Management through Community-Based Wildlife Conservation in Rural Zimbabwe By Muchapondwa, Edwin; Sterner, Thomas
  5. Natural Resource Dependency and Quality of Government By Anthonsen, Mette; Löfgren, Åsa; Nilsson, Klas
  6. Corporate environmental management in transition economies: The case of Central and Eastern Europe By Garcia, Jorge; Bluffstone, Randy; Sterner, Thomas
  7. Economics of Soil Conservation Adoption in High-Rainfall Areas of the Ethiopian Highlands By Kassie, Menale; Holden, Stein; Köhlin, Gunnar; Bluffstone, Randy
  8. Determinants of Household Fuel Choice in Major Cities in Ethiopia By Mekonnen, Alemu; Köhlin, Gunnar
  9. Market Imperfections and Farm Technology Adoption Decisions - A Case Study from the Highlands of Ethiopia By Yesuf, Mahmud; Köhlin, Gunnar
  10. Effects of Global Fisheries on Developing Countries Possibilities for Income and Threat of Depletion By Eggert, Håkan; Greaker, Mads
  11. The Role of Soil Conservation on Mean Crop Yield and Variance of Yield - Evidence from the Ethiopian Highlands By Kassie, Menale; Pender, John; Yesuf, Mahmud; Köhlin, Gunnar; Mulugeta, Elias
  12. Risk Implications of Farm Technology Adoption in the Ethiopian Highlands By Yesuf, Mahmud; Kassie, Menale; Köhlin, Gunnar
  13. Enforcement of Exogenous Environmental Regulations, Social Disapproval, and Bribery By Akpalu, Wisdom; Eggert, Håkan; Vondolia, Godwin K.
  14. Have Countries with Lax Environmental Regulations a Comparative Advantage in Polluting Industries? By Quiroga, Miguel; Sterner, Thomas; Persson, Martin
  15. Jens Warming (1931) on Open Access, Pigovian Tax, and Property Rights By Eggert, Håkan
  16. Bioeconomic Model of Community Incentives for Wildlife Management Before and After CAMPFIRE By Fischer, Carolyn; Muchapondwa, Edwin; Sterner, Thomas

  1. By: Nyangena, Wilfred (School of Economics, University of Nairobi); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Productivity gains from soil and water conservation (SWC) have empirical support in research stations. Previous empirical results from on-farm adoption of SWC are, however, varied. This study investigated the impact of soil conservation investment on farm productivity in three regions in Kenya. Using plot-level survey data, we focused on land productivity on plots with and without SWC. We tested the overall soil conservation hypothesis that increased SWC is beneficial for yield, as well as more specific hypotheses that SWC affects levels of inputs, returns from these inputs, and crop characteristics. The results showed a mixed picture where plots without SWC generally have higher yield values per hectare. However, plots with SWC are significantly steeper and more eroded than plots without SWC. A more careful analysis of a two-stage random effects–switching regression estimation comparing three SWC technologies to plots without SWC indicated that SWC increased the returns from degraded plots and sometimes from other inputs. A simulation exercise based on these estimations also showed that, in most cases, adoption has been beneficial for those who have done it and would be beneficial for those who have not.<p>
    Keywords: Kenya; soil conservation; switching regression; rural households; yields
    JEL: D61 Q12 Q16
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0402&r=res
  2. By: Kassie, Menale (Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute); Yesuf, Mahmud (Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper provides empirical evidence of production risk impact on sustainable land- management technology adoption, using two years of cross-sectional plot-level data collected in the Ethiopian highlands. We used a moment-based approach, which allowed a flexible representation of the production risk (Antle 1983, 1987). Mundlak’s approach was used to capture the unobserved heterogeneity along with other regressors in the estimation of fertilizer and conservation adoption. The empirical results revealed that impact of production risk varied by technology type. Production risks (variance and crop failure as measured by second and third central moments, respectively) had significant impact on fertilizer adoption and extent of adoption. However, this impact was not observed in adoption of conservation technology. On the other hand, expected return (as measured by the first central moment) had a positive significant impact on both fertilizer (adoption and intensity) and conservation adoption. Economic instruments that hedge against risk exposure, including downside risk and increase productivity, are important to promote adoption of improved technology and reduce poverty in Ethiopia.<p>
    Keywords: Production risk; sustainable land management technology adoption; moment based estimation; Ethiopia
    JEL: C33 D13 D81 O33 Q24
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0407&r=res
  3. By: Medhin, Haileselassie A. (Environmental Economics Policy Forum for Ethiopia and Ethiopian Development Research Institute); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This study adopts the stochastic metafrontier approach to investigate the role of soil conservation in small-scale highland agriculture in Ethiopia. Plot-level stochastic frontiers and metafrontier technology-gap ratios were estimated for three soil-conservation technology groups and a group of plots without soil conservation. Plots with soil conservation were found to be more technically efficient than plots without. The metafrontier estimates showed that soil conservation enhances the technological position of naturally disadvantaged plots.<p>
    Keywords: Soil conservation; technical efficiency; metafrontier; technology adoption; Ethiopia
    JEL: L25 Q12 Q16
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0405&r=res
  4. By: Muchapondwa, Edwin (School of Economics, University of Cape Town); Sterner, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper investigates whether the risk faced by rural farmers in Zimbabwe could poten- tially be managed by using community-based wildlife conservation. Community-based wildlife conservation could be an additional asset in the rural farmers’ investment portfolio thereby potentially diversifying and consequently reducing the risk they face. Such investment could also help e¤orts to conserve wildlife. By making use of national historical data and statistical analysis, this paper …nds that community-based wildlife conservation is a feasible hedge asset for agricultural production in rural Zimbabwe. The bene…ts of diversi…cation into community-based wildlife conservation are likely to be high only in those rural areas that can sustain wildlife pop- ulations su¢cient to generate adequate returns from wildlife activities such as tourism, trophy hunting, live animal sales and meat cropping.<p>
    Keywords: CAMPFIRE; diversi…cation; risk management; wildlife conservation; Zimbabwe
    JEL: D81 G11 Q29
    Date: 2009–12–03
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0409&r=res
  5. By: Anthonsen, Mette (The Quality of Government Institute, Department of Political Science University of Gothenburg); Löfgren, Åsa (Department of Economics, School of Business, Economics and Law, Göteborg University); Nilsson, Klas (Department of Political Science University of Gothenburg)
    Abstract: This paper introduces quality of government rather than regime type as dependent variable in studies of the political effects of natural resources. It consists of two parts. First, it theorizes the role of fiscal dependency of oil and gas rents in relation to three different dimensions of quality of government; low corruption, bureaucratic quality and legal impartiality. Second, it finds significant, negative effects of oil and gas rent dependency on all three dimensions of quality in a sample of 139 states in the period 1984 to 2006. The results hold for inclusion of control variables such as regime type, income, region and religion.<p>
    Keywords: Oil; gas; corruption; bureaucracy; legal impartiality; large-N
    JEL: N50 O13 O43 P48 Q34
    Date: 2009–12–04
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0415&r=res
  6. By: Garcia, Jorge (Department of Economics, School of Business, Economics and Law, Göteborg University); Bluffstone, Randy (Department of Economics, Portland State University); Sterner, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: We use firm-level data to study the adoption of Environmental Management Practices (EMPs) in the most polluting industrial sectors in Bulgaria, Hungary, Lithuania, Poland, Romania, and Slovakia during the 1990 – 1998 period when these countries were in a transition away from a centrally planned economy. Despite the stickiness of a long established managerial regime and the declines in industrial output during this period, around 42% of the firms in our sample adopted Environmental Plans (EPs) and/or established Environmental Departments (EDs). The analysis reveals that enforcement and public disclosure of the environmental performance of firms are the most important forces behind the implementation of both of these EMPs. Also, but to a lesser extent, export oriented firms and larger firms are prone to adoption. Finally, we use a methodology that clarifies some of the links between different EMPs not addressed in earlier studies. Notably, once a firm has decided to adopt (or not adopt) an ED, additional increases in enforcement do not to lead to EP implementation.<p>
    Keywords: Environmental Management; Bivariate Analysis; Central and Eastern Europe
    JEL: C25 Q53 Q58
    Date: 2009–12–04
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0411&r=res
  7. By: Kassie, Menale (Environmental Economics Policy Forum for Ethiopia and Ethiopian Development Research Institute); Holden, Stein (Department of Economics and Resource management, Norwegian University of Life Sciences); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University); Bluffstone, Randy (Department of Economics, Portland State University)
    Abstract: This study measures the impact of fanya juu bunds (an important soil and water conservation technology and the most popular type of contour bund in east Africa) on the value of crop production in a high-rainfall area in the Ethiopian highlands using cross-sectional multiple plot observations. We applied switching regression, stochastic dominance analysis (SDA), and decomposition and propensity score matching methods to ensure robustness. The switching regression, SDA, and decomposition analyses relied on matched observations, which was important because regression and SDA often do not ensure that comparable plots with conservation technology (conserved) and plots without (unconserved) actually exist in the distribution of covariates. All models told a consistent story that the value of crop production for plots with bunds was lower than for plots without bunds. In addition, the yield decomposition results showed that, although there was little difference in endowments between conserved and unconserved plots, the returns to endowments were substantially higher for unconserved plots. Based on these findings, it was hard to avoid the conclusion that these technologies might reduce soil erosion and associated off-site effects, but they did so at the expense of poor farmers in the Ethiopian highlands. We concluded that unless productivity was increased—for example by increasing fodder grass production on bunds—fanya juu bunds reduced on-farm production and therefore could not be characterized as a “win-win” measure to reduce soil erosion.
    Keywords: Ethiopia; soil conservation; matched data; decomposition
    JEL: C21 C23 Q12 Q15 Q16
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0400&r=res
  8. By: Mekonnen, Alemu (Department of Economics, Addis Ababa University); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper looks at the fuel choice of urban households in major Ethiopian cities, using panel data collected in 2000 and 2004. It examines use of multiple fuels by households in some detail, a topic not much explored in the household fuel-choice literature in general, and in sub-Saharan Africa in particular. The results suggest that as households’ total expenditures rise, they increase the number of fuels used, even in urban areas, and they also spend more on the fuels they consume (including charcoal but not wood). The results also show that even fuel types such as wood are not inferior goods. The results support more recent arguments in the literature (using Latin American and Asian data) that multiple fuel use (fuel stacking) better describes fuel-choice behavior of households in developing countries, as opposed to the idea that households switch (completely) to other (more expensive but cleaner) fuels as their incomes rise. This study shows the relevance of fuel stacking (multiple fuel use) in urban areas in sub-Saharan Africa. While income is an important variable, the results of this study suggest the need to consider other variables such as cooking and consumption habits, dependability of supply, cost, and household preferences and tastes to explain household fuel choice, as well as to recommend policies that address issues associated with household energy use.<p>
    Keywords: Household fuel; urban; Ethiopia
    JEL: D11 O12
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0399&r=res
  9. By: Yesuf, Mahmud (Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper investigates the impacts of market and institutional imperfections on technology adoption in a model that considers fertilizer use and soil conservation to be joint decisions. Controlling for plot characteristics and other factors, we found that a household’s decision to adopt fertilizer significantly and negatively depends on whether the same household adopts soil conservation. The reverse causality, however, was insignificant. We also found that outcomes of market imperfections, such as limited access to credit, plot size, risk considerations, and rates-of-time preference, were significant factors in explaining variations in farm technology adoption decisions. Relieving the existing market imperfections will most likely increase the adoption rate of farm technologies.<p>
    Keywords: Bivariate probit; fertilizer adoption; market imperfections; risk aversion; time preferences; soil conservation
    JEL: C35 D43 Q12 Q24
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0403&r=res
  10. By: Eggert, Håkan (Department of Economics, School of Business, Economics and Law, Göteborg University); Greaker, Mads (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This study deals with fisheries and trade, focusing on developing countries. Fish is globally traded, and for many developing countries, it is an important net export good. In most of these countries, fisheries are often characterized by poorly defined property rights, accompanied by overcapitalization where too many vessels and fishermen catch too few fish from too small stocks. Management is often de facto open access, where vessels with or without permission to fish land as much as they can catch due to limited monitoring and enforcement activities. Even in developed countries, many fisheries are poorly managed, and recent studies indicate that marine ecosystems are in global decline. While trade generally is beneficial for growth and welfare, the combination of pure open access and trade liberalization may both reduce welfare and stocks for a country—an outcome that can be reinforced by the common use of bad subsidies. However, trade liberalization may have an additional positive impact by promoting the development of property rights in response to increased fish exploitation. The WTO can play a role by adopting a broader classification of subsidies to help eliminate bad subsidies, such as like public support of vessel construction, fuel subsidies, or fishing rights outside developing coastal countries provided at limited or zero cost. The WTO can also ssist by distinguishing good subsidies (e.g., improving fisheries management or improving monitoring and enforcement), which are desirable targets when rich countries allocate aid resource to developing countries.<p>
    Keywords: Fisheries; marine resources; property rights; trade and environment; WTO
    JEL: F18 Q20 Q22 Q56
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0393&r=res
  11. By: Kassie, Menale (Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute); Pender, John (International Food Policy Research Institute, Washington, DC); Yesuf, Mahmud (Environmental Economics Policy Forum for Ethiopia, Ethiopian Development Research Institute); Köhlin, Gunnar (Department of Economics, School of Business, Economics and Law, Göteborg University); Mulugeta, Elias (International Livestock Research Institute)
    Abstract: Land degradation has been one of the major areas of concern in Ethiopia. Governments and development agencies have invested substantial resources to promote land management technologies and reduce land degradation. However, there is little understanding of the impacts that land management technologies have on yield and yield variability. This paper investigates the impact of stone bunds on mean yield and variance of yield, using multiple plot observations per household in low- and highrainfall areas of the Ethiopian highlands. Our analysis incorporated the propensity score matching method, stochastic dominance analysis, and exogenous and endogenous switching regression methods. We found statistically significant and positive impact of stone bunds on yield in low-rainfall areas. This did not hold in high-rainfall areas. We did not find a statistically significant stone-bund impact on production risk in either high- or low-rainfall areas. The results were robust to both parametric and nonparametric analysis. The overall conclusion from the analysis is that the performance of stone bunds varies by agro-ecology type. This implies the need for designing and implementing appropriate technologies that enhance productivity and are better adapted to local conditions.<p>
    Keywords: Switching regression; stochastic dominance; propensity score matching; stone bunds; yield; yield risk; Ethiopia
    JEL: C35 O33 Q15 Q24
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0408&r=res
  12. By: Yesuf, Mahmud (Environment for Development-Kenya, Kenyan Institute for Public Policy Research and Analysis (KIPPRA)); Kassie, Menale (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: In countries where insurance and credit markets are thin or missing, production and consumption risks play a critical role in the choice and use of production inputs and adoption of new farm technologies. In this paper, we investigated impacts of chemical fertilizer and soil and water conservation technologies adoption on production risks, using a moment-based approach and two years of cross-sectional data. A pseudo-fixed-effect model was estimated to generate first, second, and third moments of farm production. Our results revealed that fertilizer adoption reduces yield variability, but increases the risk of crop failure. However, adopting soil and water conservation technology has no impact on yield variability, but reduces the downside risk of crop failure. The results underscore that the risk implications of farm technology adoption vary by technology type. Furthermore, policies that promote adoption of fertilizers should be complemented by desirable instruments that hedge against downside risk. In that respect, if properly implemented, the safety net program and the weather insurance programs currently piloted in some parts of Ethiopia are actions in the right direction.<p>
    Keywords: production risks; farm technology; moment-based approach; Ethiopia
    JEL: C33 D21 Q16 Q24
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0404&r=res
  13. By: Akpalu, Wisdom (Department of History, Economics and Politics, State University of New York at Farmingdale); Eggert, Håkan (Department of Economics, School of Business, Economics and Law, Göteborg University); Vondolia, Godwin K. (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Many resource users are not directly involved in the formulation and enforcement of resource management rules and regulations in developing countries. As a result, resource users do not generally accept such rules. Enforcement officers who have social ties to the resource users may encounter social disapproval and possible social exclusion from the resource users if they enforce regulations zealously. The officers, however, may avoid this social disapproval by accepting bribes. In this paper, we present a simple model that characterizes this situation and derives results for situations where officers are passively and actively involved in the bribery.<p>
    Keywords: Natural resource management; bribery; law enforcement; social exclusion
    JEL: Q20 Q28 Z13
    Date: 2009–11–30
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0392&r=res
  14. By: Quiroga, Miguel (Department of Economics, School of Business, Economics and Law, Göteborg University); Sterner, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University); Persson, Martin (department of Energy and Environment, Chalmers University of Technology, Gothenburg)
    Abstract: We aim to study whether lax environmental regulations induce comparative advantages, causing the least-regulated countries to specialize in polluting industries. The study is based on Trefler and Zhu’s (2005) definition of the factor content of trade. For the econometrical analysis, we use a cross-section of 71 countries in 2000 to examine the net exports in the most polluting industries. We try to overcome three weaknesses in the empirical literature: the measurement of environmental endowments or environmental stringency, the possible endogeneity of the explanatory variables, and the influence of the industrial level of aggregation. As a result, we do find some evidence in favor of the pollution-haven effect. The exogeneity of the environmental endowments was rejected in several industries, and we also find that industrial aggregation matters.<p>
    Keywords: comparative advantage; environmental regulation; trade; pollution haven; Porter hypothesis
    JEL: F18 Q56
    Date: 2009–12–04
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0412&r=res
  15. By: Eggert, Håkan (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This article summarizes the contribution in fisheries economics by the Danish economist Jens Warming and gives a translation of his article “Aalegaardsretten” (The Danish Right to Eel Weir, 1931). Warming, provides an early reference on the problem of open access, precedes Arthur Pigou in suggesting an optimal tax as a correction measure, which I refer to as a Warming landing tax in fisheries, and explains how property rights in fisheries will lead to maximized resource rent and prevent overfishing. What is missing in Warming’s description of the problem is the dynamic aspect and that the economics of natural resources should be analyzed in a capital theoretic framework, which was later established by Anthony Scott (1955a; 1955b).<p>
    Keywords: Common pool resource management; fisheries; optimal tax; Pigou tax; property rights
    JEL: B20 H20 Q20
    Date: 2009–12–01
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0401&r=res
  16. By: Fischer, Carolyn (Resources for the Future (RFF),); Muchapondwa, Edwin (Department of Economics, University of Zimbabwe); Sterner, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper formulates a bioeconomic model to analyze community incentives for wildlife management under benefit-sharing programs like the Communal Areas Management Programme for Indigenous Resources (CAMPFIRE) in Zimbabwe. Two agents influence the wildlife stock: a parks agency determines hunting quotas, and a local community chooses to either aid or discourage outside poachers. Wildlife generates revenues from hunting licenses and tourism; it also intrudes on local agriculture. We consider two benefit-sharing regimes: shares of wildlife tourism rents and shares of hunting licenses. Resource sharing does not necessarily improve community welfare or incentives for wildlife conservation. Results depend on the exact design of the benefit shares, the size of the benefits compared with agricultural losses, and the way in which the parks agency sets hunting licenses.<p>
    Keywords: bioeconomic; CAMPFIRE; community; poaching; wildlife; benefit sharing
    JEL: H41 Q20
    Date: 2009–12–03
    URL: http://d.repec.org/n?u=RePEc:hhs:gunwpe:0410&r=res

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