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on Resource Economics |
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Issue of 2011‒10‒01
six papers chosen by |
| By: | Anne Neumann; Karsten Neuhoff |
| Abstract: | Decarbonisation of energy and transport infrastructure requires significant private sector investments. The natural gas industry has demonstrated such large scale private sector infrastructure investment over the last decades, typically using long-term contractual arrangements. Are therefore institutional frameworks necessary that facilitate long-term contracting or provide regulation reassuring about future resource streams associated with low-carbon infrastructure - or do factors idiosyncratic to natural gas explain the prevalence of long-term contracts in natural gas infrastructure investment? We identify four reasons for the use of long-term contracting arrangements. The transformation of the natural gas industry and regulatory structure has gradually reduced the rational for three of these reasons, suggesting that remaining rational, securing of revenue streams to finance investments has become the main motivation for the use of long-term contracts. This rational is not idiosyncratic to the natural gas industry, and thus suggests that long-term contracting can also play a significant role in facilitating low-carbon infrastructure investment. We furthermore discuss the role of institutional frameworks necessary for long-term contracting, and identify the significant role governments have been playing in sharing the counterparty risk inherent in long-term contracts. |
| Keywords: | Investment, low-carbon economy, natural gas |
| JEL: | L78 O13 Q58 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1154&r=res |
| By: | Claude Ménard (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | This paper focuses on how to deal with environmental problems, through the lenses of the New Institutional Economics. The emphasis is on the intertwined role of organizational solutions and their institutional settings. This is not to say that technological solutions to environmental problems should be dismissed. However, it is argued that 'environmental innovation' is often of organizational nature, deeply embedded in institutions that adapt very slowly, making 'societal transitions' particularly challenging. The New Institutional Economics provides some key concepts to explore these dimensions and their interactions, thus shedding light on alternative solutions and the conditions of their implementation. Most examples come from the water sector. |
| Keywords: | Organizations, Institutions, Property Rights, Contracts, Regulation, Transaction Costs, Water |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00624307&r=res |
| By: | Claude Ménard (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Shirley Mary M. (RCI - Ronald Coase Institute - Ronald Coase Institute) |
| Abstract: | Douglass North, along with Ronald Coase and Oliver Williamson, transformed the early intuitions of new institutional economics into powerful conceptual and analytical tools that spawned a robust base of empirical research. NIE arose in response to questions not well explained by standard neoclassical models, such as make or buy and why rich or poor? Today NIE is a success story by many measures: four Nobel laureates in under 20 years, increasing penetration of mainstream journals, and significant impact on major policy debates from anti-trust law to development aid. This paper provides a succinct overview of North's evolving ideas about institutions and explains how North's work shaped the emerging field of new institutional economics and had a potent impact on economics and the social sciences more broadly. North provides a powerful example of how persistent and well placed confidence and hard work can productively transform the status quo. North's influence continues strong and his enthusiasm for exploring new frontiers and cooperating across artificial academic boundaries has never waned. |
| Keywords: | New Institutional Economics, institutions, transaction costs, development and growth |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00624297&r=res |
| By: | Estrada, Francisco; Tol, Richard S. J.; Gay-García, Carlos |
| Abstract: | This paper revises some relevant aspects of The Economics of Climate Change in Mexico (ECCM), one of the most important documents for supporting national decisionmaking regarding the climate change international negotiations. In addition to pointing out some important methodological inadequacies, this paper shows that the ECCM's main results are questionable. Even though this study was inspired on the Stern Review and benefited from the support of original members of the Stern team, the ECCM is not consistent with the world portrayed in the Stern Review in many aspects, particularly regarding the importance of climate change impacts. The estimates of the costs of climate change for Mexico are so low that can hardly be considered to be consistent with the previous studies that have been reported in the literature concerning regional and global scales. Furthermore, it is shown that the document's main conclusion is not supported even by the estimates of the costs of the impacts of climate change and of the mitigation strategies that are presented in it. It is argued that this document has important deficiencies that do not make it adequate for supporting decision-making. In addition, the ECCM has inspired other reports regarding the economics of climate change in Central and Latin America, and as is shown here, their results are also questionable. This raises further reasons for concern because these national documents are building a regional view of what climate change could imply for Latin America that severely underestimates the importance of this phenomenon. |
| Keywords: | Climate change/stern review/impacts/cost/Impacts of climate change |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp408&r=res |
| By: | Kohlin, Gunnar; Sills, Erin O.; Pattanayak, Subhrendu K.; Wilfong, Christopher |
| Abstract: | This report reviews the literature on the links between energy access, welfare, and gender in order to provide evidence on where gender considerations in the energy sector matter and how they might be addressed. Prepared as a background document for the 2012 World Development Report on Gender Equality and Development, and part of the Social Development Department's ongoing work on gender and infrastructure, the report describes and evaluates the evidence on the links between gender and energy focusing on: increased access to woodfuel through planting of trees and forest management; improved cooking technologies; and access to electricity and motive energy. The report's main finding is that energy interventions can have significant gender benefits, which can be realized via careful design and targeting of interventions based on a context-specific understanding of energy scarcity and household decision-making, in particular how women's preferences, opportunity cost of time, and welfare are reflected in household energy decisions. The report focuses on the academic peer-reviewed literature and, although it applies fairly inclusive screening criteria when selecting the evidence to consider, finds that the evidence on many of the energy-gender linkages is often limited. There is thus a clear need for studies to evaluate interventions and identify key design elements for gender-sensitive project design. |
| Date: | 2011–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5800&r=res |
| By: | Farber, Daniel A |
| Abstract: | Cap and trade is controversial in part because of claims that it is unjust, an issue that was highlighted by recent litigation against California’s proposed carbon market. This essay considers an array of fairness issues relating to cap and trade. In terms of fairness to industry, the conclusion is that distributing free allowances overcompensates firms for the cost of compliance, assuming any compensation is warranted. Industry should not receive, in effect, ownership of the atmosphere at the expense of the public. Environmental justice advocates argue that cap-and-trade systems promote hotspots and encourage dirtier, older plants to continue operating to the detriment of some communities. Designers of cap-and-trade systems should be alert to possible hotspots, particularly in disadvantaged communities. Little reason exists, however, to believe that any such hotspots are systematically linked with disadvantage. Finally, any regulation of emissions raises costs, with a disproportionate impact on low-income consumers. This effect can be greatly ameliorated through adroit use of revenue from auctions. The bottom line is that fairness issues are not a deal-breaker for cap and trade, but do deserve thoughtful consideration in designing a system. |
| Keywords: | Administrative Law, Economics, Energy and Utilities Law, Environmental Law, Social Welfare, Administrative Law, Energy Law, Environmental Law, Law and Economics, Social Welfare Law |
| Date: | 2011–09–20 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:oplwec:2247937&r=res |