nep-res New Economics Papers
on Resource Economics
Issue of 2012‒09‒03
fifteen papers chosen by
Maximo Rossi
Universidad de la Republica

  1. Targets for Global Climate Policy: An Overview By Richard S.J. Tol
  2. The ecological price of getting rich in a green desert: A contingent valuation study in rural Southwest China By Ahlheim, Michael; Börger, Tobias; Frör, Oliver
  3. Sources of Comparative Advantage in Polluting Industries By Fernando Broner; Paula Bustos; Vasco M. Carvalho
  4. Aviation, Carbon, and the Clean Air Act By Richardson, Nathan
  5. Agricultural Resources and Environmental Indicators, 2012 Edition By Osteen, Craig D.; Vasavada, Utpal
  6. Irrigation and Climatic Effects on Water Levels in the U.S. High Plains Aquifer By Rubin, Edward A.; Hunter-Pirtle, Ann K.
  7. Microfoundations for the Environmental Kuznets Curve: Invoking By-Production, Normality and Inferiority of Emissions By Sushama Murty
  8. Disaster in Paradise: A Preliminary Investigation of the Socio-Economic Aftermaths of Two Coastal Disasters in Hawaii By John Lynham; Ilan Noy
  9. What Affects the Environmental Performance of Pipelines in the US? An Empirical Analysis By Sarah L. Stafford
  10. The Heterogeneous Effects of Gasoline Taxes: Why Where We Live Matters By Spiller, Elisheba; Stephens, Heather M.
  11. Emissions Trading with Profit-Neutral Permit Allocations By Hepburn, C.J.; Quah, J.K.-H.; Ritz, R.A.
  12. Temperature, Human Health, and Adaptation: A Review of the Empirical Literature By Olivier Deschenes
  13. Optimal Learning on Climate Change: Why Climate Skeptics should reduce Emissions By Sweder van Wijnbergen; Tim Willems
  14. The rate of change of the social cost of carbon and the social planner's hotelling rule By Kögel, Tomas
  15. Sustainable Tourism and the emergence of new Environmental Norms By Malgorzata Ogonowska; Dominique Torre

  1. By: Richard S.J. Tol (Department of Economics, University of Sussex, UK; Institute for Environmental Studies, Department of Spatial Economics, Vrije Universiteit, Amsterdam, The Netherlands)
    Abstract: A survey of the economic impact of climate change and the marginal damage costs shows that carbon dioxide emissions are a negative externality. The estimated Pigou tax and its growth rate are too low to justify the climate policy targets set by political leaders. A lower discount rate or greater concern for the global distribution of income would justify more stringent climate policy, but would imply an overhaul of other public policy. Catastrophic risk justifies more stringent climate policy, but only to a limited extent.
    Keywords: climate change; climate policy; first-best
    JEL: Q54 Q58
    Date: 2012–08
  2. By: Ahlheim, Michael; Börger, Tobias; Frör, Oliver
    Abstract: The cultivation of rubber trees in Xishuangbanna Prefecture in China's Yunnan Province has triggered an unprecedented economic development but it is also associated with severe environmental problems. Rubber plantations are encroaching the indigenous rainforests at a large scale and a high speed in Xishuangbanna. Many rare plant and animal species are endangered by this development, the natural water management is disturbed and even the microclimate in this region has changed over the past years. The present study aims at an assessment of these environmental costs of the economic progress in Xishuangbanna. To this end a Contingent Valuation survey is conducted to elicit local residents' willingness to pay for a reforestation program that converts existing rubber plantations back into forest. It is shown that though local people's awareness of the environmental problems caused by increasing rubber plantation is quite high their willingness to pay in order to change things is rather low. It seems that from the perspective of local residents the economic advantages of rubber cultivation outweigh the resulting environmental threats. Another explanation of the low willingness to pay stated in this survey might be the fact that many respondents consider taxes and fees already too high in China so that they are not willing to make any further contributions to whatever purpose. --
    Keywords: rubber cultivation,deforestation,contingent valuation method,environmental costs,China
    Date: 2012
  3. By: Fernando Broner; Paula Bustos; Vasco M. Carvalho
    Abstract: We study the determinants of comparative advantage in polluting industries. We combine data on environmental policy at the country level with data on pollution intensity at the industry level to show that countries with laxer environmental regulation have a comparative advantage in polluting industries. Further, we address the potential problem of reverse causality. We propose an instrument for environmental regulation based on meteorological determinants of pollution dispersion identified by the atmospheric pollution literature. We find that the effect of environmental regulation on the pattern of trade is causal and comparable in magnitude to the effect of physical and human capital.
    JEL: F11 F18 Q53 Q56
    Date: 2012–08
  4. By: Richardson, Nathan (Resources for the Future)
    Abstract: This paper explores the policy options available to the United States for regulating greenhouse gas emissions from aircraft under existing law: the Clean Air Act (CAA). Europe has unilaterally and controversially moved to include aviation emissions in its Emissions Trading System. The United States can, however, allow its airlines to escape this requirement by imposing “equivalent” regulation. U.S. aviation emissions rules could also have significant environmental benefits and would limit domestic emissions beyond the reach of the European Union. With new legislation unlikely, the CAA is the only plausible vehicle for such regulation. Title II Part B of the CAA does grant EPA broad regulatory authority over aviation emissions, though this authority has not been used aggressively. EPA could impose meaningful aviation GHG limits and, by using performance standards, give airlines incentives to creatively comply. It might further be possible to allow some forms of emissions trading, though the law is unclear. Emissions by foreign airlines in the United States could be covered under the act, though international law might impose barriers.
    Keywords: Clean Air Act, aviation, aircraft, carbon, emissions, GHGs, European Union, trading, flexibility
    Date: 2012–07–24
  5. By: Osteen, Craig D.; Vasavada, Utpal
    Abstract: Agricultural Resources and Environmental Indicators, 2012, describes trends in economic, structural, resource, and environmental indicators in the agriculture sector, focusing on changes since the release of Agricultural Resources and Environmental Indicators, 2006. These indicators are useful to assess important changes in U.S. agriculture—the industry’s development; its environmental effects; and the implications for economic, social, and environmental sustainability. This report tracks key resources, including natural, produced, and management resources, that are used in and affected by agricultural production, as well as structural changes in farm production and the economic conditions and policies that influence agricultural resource use and its environmental impacts. Each chapter provides a concise overview of a specific topic with links to sources of additional information.
    Keywords: Agricultural biotechnology, conservation policy, conservation programs, farm types, fertilizer use, land use, land values, organic production, pest management, productivity, research and development, soil management, water use., Environmental Economics and Policy, Farm Management, Resource /Energy Economics and Policy,
    Date: 2012–08
  6. By: Rubin, Edward A.; Hunter-Pirtle, Ann K.
    Keywords: Irrigation, Climate, Water Levels, U.S. High Plains Aquifer, Ogallala Aquifer, Environmental Economics and Policy, Resource /Energy Economics and Policy,
    Date: 2012
  7. By: Sushama Murty (Department of Economics, University of Exeter)
    Abstract: A by-production-cum-preference based approach is adopted to study the relation between national income and environmental quality under non-cooperative behaviour. While emission is an inferior good for richly endowed economies, it is a normal good for the developing economies. With increases in endowments, the marginal willingness to pay declines (respectively, increases) in the set of poorly (respectively, richly) endowed economies. Hence, for emissions, the income and substitution effects work in opposite directions. Abatement strategies include cleaning-up; decreases in and substitution between fuels of varying costs, emission, and energy intensities; and the diversion of capital from fuel-intensive to non-fuel intensive uses. Poorly (respectively, richly) endowed economies are characterized by weak (respectively, strong) environmental policies. Consequently, deteriorating abatement practices are adopted by the developing economies. The shape of the income-environmental quality graph depends on the relative strengths of income and substitution effects and the set of available abatement strategies. Both inverted U and N-shaped environmental Kuznets curves are possible. The latter arises due to stronger substitution effects and lower opportunity costs of fuel-intensive capital in the more richer of the richest economies.
    Keywords: environmental Kuznets curve, income and substitution effects, inferior good, normal good, by-production of emissions, returns to scale, abatement, inter-fuel substitution.
    JEL: Q50 Q56 O12 O13 D62 H23
    Date: 2012
  8. By: John Lynham (Department of Economics, University of Hawaii at Manoa, USA); Ilan Noy (School of Economics and Finance, Wellington, New Zealand)
    Abstract: In spite of a long history of coastal disasters worldwide and detailed studies of their short-term impacts, there is still little information about the longer-term economic and socio-economic consequences of these events. The long-term impacts of natural disasters are “hidden” since distinguishing them from othe post disaster developments is difficult. A decade after an event, how many of the observed changes in an economy can confidently be attributed to the event itself? Because the long-term effects of coastal disasters have rarely been studied, they remain unaccounted for in any pre- and post-disaster planning and policy decisions. We focus on the 1960 tsunami and the 1992 Hurricane Iniki on Hawaii and Kauai islands, respectively. The other Hawaiian Islands, which were not hit by the tsunami or hurricane, provide an ideal control group that potentially enables us to distinguish between long-term impacts and other post-disaster developments. We describe the regional macro---economy for the Hilo region in Hawaii and the immediate aftermath of the tsunami. We use Hurricane Iniki to demonstrate how to disentangle long-term consequences on Kauai and speculate what were the long-term impacts of 1960 Hilo tsunami.
    Keywords: coastal disasters, disaster impact, Hilo, tsunami, hurricane, Hawaii
    JEL: Q54 R11
    Date: 2012–08
  9. By: Sarah L. Stafford (Department of Economics, College of William and Mary)
    Date: 2012–08–26
  10. By: Spiller, Elisheba (Resources for the Future); Stephens, Heather M.
    Abstract: Using disaggregated confidential household data, we estimate spatial variation in household-level gasoline price elasticities and the welfare effects of gasoline taxes. A novel approach allows us to model a discrete-continuous household choice of vehicle bundles, while disaggregating the choice set and including vehicle-specific fixed effects and unobserved consumer heterogeneity. The mean elasticity of demand for gasoline is -0.67, but with tremendous variation across location and income. We find that rural households have 30 percent more negative welfare impacts than urban households from gasoline taxes. Finally, we explore different policies that can help to mitigate welfare inequalities due to these taxes.
    Keywords: gasoline taxes, welfare, elasticity, rural, commuting, transportation
    JEL: Q0 R0 H0
    Date: 2012–07–18
  11. By: Hepburn, C.J.; Quah, J.K.-H.; Ritz, R.A.
    Abstract: This paper examines the impact of an emissions trading scheme (ETS) on equilibrium emissions, output, price, market concentration, and profits in a generalized Cournot model. We develop formulae for the number of emissions permits that have to be freely allocated to firms to neutralize the profit impact of the ETS. We show that its profit impact is usually limited: in a Cournot oligopoly with constant marginal costs, total industry profits are preserved so long as freely allocated permits cover a fraction of initial emissions that does not exceed the industry's Herfindahl index.
    Keywords: Cap-and-trade, permit allocation, profit-neutrality, cost pass-through, abatement, grandfathering
    JEL: D43 H23 Q58
    Date: 2012–08–17
  12. By: Olivier Deschenes
    Abstract: This paper presents a survey of the empirical literature studying the relationship between health outcomes, temperature, and adaptation to temperature extremes. The objective of the paper is to highlight the many remaining gaps in the empirical literature and to provide guidelines for improving the current Integrated Assessment Model (IAM) literature that seeks to incorporate human health and adaptation in its framework. I begin by presenting the conceptual and methodological issues associated with the measurement of the effect of temperature extremes on health, and the role of adaptation in possibly muting these effects. The main conclusion that emerges from the literature is that despite the wide variety of data sets and settings most studies find that temperature extremes lead to significant reductions in health, generally measured with excess mortality. Regarding the role of adaptation in mitigating the effects of extreme temperature on health, the available knowledge is limited, in part due to the lack of real-world data on measures of adaptation behaviors. Finally, the paper discusses the implications of the currently available evidence for assessments of potential human health impacts of global climate change.
    JEL: I1 Q5 Q54
    Date: 2012–08
  13. By: Sweder van Wijnbergen (University of Amsterdam); Tim Willems (Oxford University)
    Abstract: Climate skeptics argue that the possibility that global warming is exogenous implies that we should not take additional action towards reducing greenhouse gas emissions until we know more. However this paper shows that even climate skeptics have an incentive to reduce emissions: such a change of direction facilitates their learning process on the causes of global warming. Since the optimal policy action depends on these causes, they are valuable to know. Although an increase in emissions would also ease learning, that option is shown to be inferior because emitting greenhouse gases is irreversible. Consequently the policy implications of the different positions in the global warming debate turn out to coincide - thereby diminishing the relevance of this debate from a policy perspective. Uncertainty is no reason for inaction.
    Keywords: climate policy; global warming; climate skepticism; active learning; irreversibilities
    JEL: D83 Q54 Q58
    Date: 2012–08–20
  14. By: Kögel, Tomas
    Abstract: This paper derives the social cost of carbon (SCC) and its rate of change. It does so in a deterministic Ramsey model of optimal economic growth with carbon emissions from burning fossil fuels. It is shown that the determinants of the rate of change of the SCC are substantially almost identical to the determinants in the social planner's Hotelling rule if a unit of fossil fuel use leads to exactly one unit of carbon emission, while otherwise these formulas differ substantially. As is also shown in this paper, in the special case in which the two formulas are substantially almost identical, a Pigovian tax on fossil fuel use and a Pigovian tax on carbon emissions are both equal to the SCC, while otherwise only a Pigovian tax on carbon emissions equals the SCC. --
    Keywords: climate change,social cost of carbon
    JEL: D61 Q54
    Date: 2012
  15. By: Malgorzata Ogonowska (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université de Nice Sophia Antipolis (UNS)); Dominique Torre (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université de Nice Sophia Antipolis (UNS))
    Abstract: Since 1990s environmental protection and awareness became major issues. Consumers are more and more aware of environmental issues and conscious of existing pollution caused by mass tourism. Consequently a new segment of demand desiring sustainable tourism products have appeared, enhancing service providers to offer this type of products. This paper analyzes the evolution of service provider's offer adapting to demand preferences modification. Using a theoretical framework, it explains how environmental quality standards can become general norms in tourism industry. By analyzing a case of monopoly and duopoly, it considers different possible frameworks and strategic choices that may be implemented by the incumbent. Though, it explains the role of industry in the emergence of the new environmental norms.
    Keywords: Economics of Tourism, tourism products' distribution, sustainable tourism, branding policies, environmental norms.
    Date: 2012–06–07

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