nep-res New Economics Papers
on Resource Economics
Issue of 2012‒10‒06
twelve papers chosen by
Maximo Rossi
Universidad de la Republica

  1. India’s economic growth and environmental sustainability : what are the tradeoffs ? By Mani, Muthukumara; Markandya, Anil; Sagar, Aarsi; Sahin, Sebnem
  2. Pollution Generating Technologies and Environmental Efficiency By Färe, Rolf; Grosskopf, Shawna; Lundgren, Tommy; Marklund, Per-Olov; Zhou, Wenchao
  3. Assessing the investment climate for climate investments : a comparative framework for clean energy investments in South Asia in a global context By Mani, Muthukumara S.
  4. Do Environmental Regulations Disproportionately Affect Small Businesses? Evidence from the Pollution Abatement Costs and Expenditures Survey By Randy A. Becker; Ronald J. Shadbegian; Carl Pasurka
  5. Recreation Demand Analysis of the "Sensitive Natural Areas" (Hérault District, France) : A Travel Cost Appraisal using Count Data Models By Sébastien Roussel; Jean-Michel Salles; Léa Tardieu
  6. Territorial Economic Impacts of Climate Anomalies in Brazil By Eduardo A. Haddad; Alexandre A. Porsse, Paula C. Pereda
  7. Trade-offs between environmental regulation and market competition: airlines, emission trading systems and entry deterrence By Cristina Barbot; Ofelia Betancor; M. Pilar Socorro; M. Fernanda Viecens
  8. The environmental Effect of Green Taxation : The case of the french "Bonus/Malus" By Xavier d'Haultfoeuille; Pauline Givord; Xavier Boutin
  9. Rural Households in a Changing Climate By Baez, Javier E.; Kronick, Dorothy; Mason, Andrew D.
  10. Do people avoid opportunities to donate? A natural field experiment on recycling and charitable giving By Knutsson, Mikael; Martinsson, Peter; Wollbrant, Conny
  11. Resource Wars and Confiscation Risk By Frederick van der Ploeg
  12. The Optimal Carbon Tax and Economic Growth: Additive versus multiplicative damages By Armon Rezai; Frederick van der Ploeg; Cees Withagen

  1. By: Mani, Muthukumara; Markandya, Anil; Sagar, Aarsi; Sahin, Sebnem
    Abstract: One of the key environmental problems facing India is that of particle pollution from the combustion of fossil fuels. This has serious health consequences and with the rapid growth in the economy these impacts are increasing. At the same time, economic growth is an imperative and policy makers are concerned about the possibility that pollution reduction measures could reduce growth significantly. This paper addresses the tradeoffs involved in controlling local pollutants such as particles. Using an established Computable General Equilibrium model, it evaluates the impacts of a tax on coal or on emissions of particles such that these instruments result in emission levels that are respectively 10 percent and 30 percent lower than they otherwise would be in 2030. The main findings are as follows: (i) A 10 percent particulate emission reduction results in a lower gross domestic product but the size of the reduction is modest; (ii) losses in gross domestic proudct from the tax are partly offset by the health gains from lower particle emissions; (iii) the taxes reduce emissions of carbon dioxide by about 590 million tons in 2030 in the case of the 10 percent reduction and 830 million tons in the case of the 30 percent reduction; and (iv) taken together, the carbon dioxide reduction and the health benefits are greater than the loss of gross domestic product in both cases.
    Keywords: Environmental Economics&Policies,Climate Change Mitigation and Green House Gases,Climate Change Economics,Energy Production and Transportation,Environment and Energy Efficiency
    Date: 2012–09–01
  2. By: Färe, Rolf (Dept. of Economics); Grosskopf, Shawna (Dept. of Applied Economics); Lundgren, Tommy (CERE); Marklund, Per-Olov (CERE); Zhou, Wenchao (CERUM)
    Abstract: technology. Pollutants, or bads, are explicitly modeled by imposing technology properties of disposability and null-jointness. With data on firms from Swedish manufacturing, we investigate the potential to reduce emissions, and we take a closer look at the pulp and paper sector. Dividing the firms into “brown” and “green” firms, we find that there is significant potential, in both categories, to improve environmental efficiency, and hence lower emissions, of three air pollutants. Furthermore, we suggest that treating biofuels as entirely carbon neutral (as is common practice) may underestimate environmental efficiency scores and generate misleading policy implications.
    Keywords: Pollution; Environmental Efficiency
    JEL: D24 Q01 Q53
    Date: 2012–09–28
  3. By: Mani, Muthukumara S.
    Abstract: One of the strong messages that came out of the recent United Nations Climate Change conference in Durban was that the private sector has to play an important role if we are to globally move toward a low carbon, climate resilient -- or"climate compatible"-- future. However, private investment will only flow at the scale and pace necessary if it is supported by clear, credible, and long-term policy frameworks that shift the risk-reward balance in favor of less carbon-intensive investment. The private sector also needs information on where to invest in clean energy in emerging markets, and it needs policy support to lower investment risk. Barriers to low carbon investments often include unclear and inconsistent energy policies, monopoly structures for existing producers, stronger incentives for conventional energy than clean energy, and a domestic financial sector not experienced in new technologies. With the long-term goal of promoting and accelerating the implementation of climate mitigation technologies, this study aims to facilitate development of a policy framework for promoting sustainable investment climates for clean energy investments in South Asia and elsewhere. A key aspect of the study is also the pilot construction of the Climate Investment Readiness Index for several countries. The index is a tool to objectively evaluate the enabling environment for supporting private sector investment in select climate mitigation or low carbon technologies.
    Keywords: Energy Production and Transportation,Environmental Economics&Policies,Climate Change Mitigation and Green House Gases,Climate Change Economics,Debt Markets
    Date: 2012–09–01
  4. By: Randy A. Becker; Ronald J. Shadbegian; Carl Pasurka
    Abstract: It remains an open question whether the impact of environmental regulations differs by the size of the business. Such differences might be expected because of statutory, enforcement, and/or compliance asymmetries. Here, we consider the net effect of these three asymmetries, by estimating the relationship between plant size and pollution abatement expenditures, using establishment-level data on U.S. manufacturers from the Census Bureau’s Pollution Abatement Costs and Expenditures (PACE) surveys of 1974-1982, 1984-1986, 1988-1994, 1999, and 2005, combined with data from the Annual Survey of Manufactures and Census of Manufactures. We model establishments’ PAOC intensity – that is, their pollution abatement operating costs per unit of economic activity – as a function of establishment size, industry, and year. Our results show that PAOC intensity increases with establishment size. We also find that larger firms spend more per unit of output than do smaller firms.
    Keywords: Environmental Regulation, costs, Business size, U. S.manufactoring
    JEL: L51 L60 Q52
    Date: 2012–09
  5. By: Sébastien Roussel; Jean-Michel Salles; Léa Tardieu
    Abstract: Natural areas are essentially multifunctional, contributing in multiple ways to human well-being. Ecosystem goods and services are provided through ecosystem func- tions (regulation, habitat, production and information). Among the multiple services provided by natural areas, recreational services are increasingly valuable. The main objective of our paper is to evaluate the recreation demand of the Sensitive Natural Areas(SNA) public policy in the Hérault District (Languedoc-Roussillon Region, France). These natural areas are acquired as land ownership by the Hérault District to ensure their protection from urban pressure and making them free to access. We highlight the recreation bene…ts in a Cost-Bene…t Analysis (CBA) whilst measuring [...].
    Date: 2012–09
  6. By: Eduardo A. Haddad; Alexandre A. Porsse, Paula C. Pereda
    Abstract: This paper evaluates the systemic impact of climate variations in a regional perspective using an interregional CGE model integrated with a physical model estimated for agriculture in order to catch the effects of climate change. The climate anomalies are estimated for 2005 and represent deviations over the historic trend. The results of this paper suggest that the economic costs of climate anomalies can be significantly underestimated if only partial equilibrium effects (direct impact/damage) are accounted for. The results show that a general equilibrium approach can provide a better comprehension about the systemic impact of climate anomalies, suggesting the economic costs are higher than those that would be observed in a partial equilibrium analysis. In addition, intersectoral and interregional linkages as well price effects seem to be important transmission channels in the context of systemic impact of climate anomalies.
    Keywords: climate anomalies, systemic impact, interregional CGE analysis
    JEL: Q54 R13
    Date: 2012–09–15
  7. By: Cristina Barbot; Ofelia Betancor; M. Pilar Socorro; M. Fernanda Viecens
    Abstract: Emission trading systems (ETS) are being applied worldwide and in different economic sectors as an environmental regulatory tool that induces reductions of CO2 emissions. In Europe such a system is in place since 2005 for energy intensive installations and, since 1st January 2012, for airlines with flights arriving and departing from Community airports. The efficiency of the system should consider not only how it allows reaching an environmental goal, but also it should take into account its implications for market competition. In this work we develop a theoretical model that analyses the European ETS’s main features as devised for airlines, focusing on its effects on potential competition and entry deterrence. Contrary to other economic activities under ETS, potential competition is usual in most airline markets. Our results indicate that the share of capped allowances allocated initially for free to air operators may be a key element in deterring or allowing entry into the market. This result may be in collision with the general European principle of promoting competition and may represent a step backwards in the construction of a single European air transport market.
    Date: 2012–09
  8. By: Xavier d'Haultfoeuille (Crest); Pauline Givord (INSEE); Xavier Boutin (European Commission-Team)
    Abstract: At the beginning of 2008 was introduced in France a feebate on the purchase of new cars called the “Bonus/Malus”. Since January 2008, the less polluting cars benefited from a price reduction of up to 1,000 euros, while the most polluting ones were subject to a taxation of 2,600 euros. We estimate the impact of this policy on carbon dioxide emissions in the short and long run. These emissions depend on the market shares and the average emissions per kilometer of each car, but also on their manufacturing and the number of kilometers traveled by their owners. We first develop a simple tractable model that relates car choice and mileage. We then estimate this model, using both the exhaustive dataset of car registrations and a recent transportation survey which provides information on individual journeys. We show that if the shift towards the classes benefiting from rebates is spectacular, the environmental impact of the policy is negative. The reform has notably increased sales, leading to an important increase in manufacturing and traveling emissions. We thus stress that such policies may be efficient tools for reducing CO2 emissions (French consumers do react to the feebate in their car choice), but should be designed with care to achieve their primary goal
    Keywords: Environmental taxation, automobiles, carbon dioxide emissions, policy evaluation
    JEL: C25 D12 H23 L62 Q53
    Date: 2012–07
  9. By: Baez, Javier E. (World Bank); Kronick, Dorothy (World Bank); Mason, Andrew D. (World Bank)
    Abstract: This paper argues that climate change poses two distinct, if related, sets of challenges for poor rural households: challenges related to the increasing frequency and severity of weather shocks and challenges related to long-term shifts in temperature, rainfall patterns, water availability, and other environmental factors. Within this framework, we examine evidence from existing empirical literature to compose an initial picture of household-level strategies for adapting to climate change in rural settings. We find that although households possess numerous strategies for managing climate shocks and shifts, their adaptive capacity is insufficient for the task of maintaining – let alone improving – household welfare. We describe the role of public policy in fortifying the ability of rural households to adapt to a changing climate.
    Keywords: climate change, rural households, adaptation, risk-coping mechanisms, long-term effects
    JEL: Q12 Q54 O13
    Date: 2012–09
  10. By: Knutsson, Mikael (Dept of Psychology, University of Gothenburg); Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University); Wollbrant, Conny (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: We use a natural field experiment to investigate the hypothesis that generosity is partly involuntary, by examining whether individuals tend to avoid opportunities to act generously. In Sweden, new recycling machines for bottles and cans with an option of donating the returned deposit to charity were gradually introduced in one of the largest store chains. We find a substantial decline in recycling the month these new machines were introduced and a further decline in the following months. These results indicate that individuals avoid opportunities to act generously and corroborate findings from both lab and field studies supporting the claim that generous behavior is partly involuntary
    Keywords: Generosity; Donations; Natural field experiment; Avoidance behavior
    JEL: C93 D01 D03 D64
    Date: 2012–09–25
  11. By: Frederick van der Ploeg
    Abstract: Resource wars can be modeled with two-way regime switch uncertainty and contest success functions. Fighting is more intense if the plitical system is less cohesive, fighting technology is well developed, oil reserves are high and the wage is low. More government stability intensifies resource wars, but leads to less voracious oil depletion. Oil extraction is more aggressive in the presence of contested resources, but less so with more government stability. Our model of resource wars builds on a model of confiscation risk and of perennial political cycles. Not confiscation, but risk of confiscation matters for efficiency. Before confiscation, oil reserves are depleted too rapidly. Risk of confiscation is associated with a hold-up problem, which depresses exploration investment and exacerbates the inefficiences. A subsidy can correct for this. If there is a chance that the economy flips back to no confiscation outcomes are less distorting.
    Keywords: resource wars, contest success functions, political cohesiveness, confiscation risk, taxation, regime switch, oil reserves uncertainty, Hotelling principle, exhaustible resources, exploration investment, hold-up problem
    JEL: D81 H20 Q31 Q38
    Date: 2012
  12. By: Armon Rezai; Frederick van der Ploeg; Cees Withagen
    Abstract: In a calibrated integrated assessment model we investigate the differentia impact of additive and multiplicative damages from climate change for both a socially optimal and a business-as-usual scenario in the market economy within the context of a Ramsey model of economic growth. The sources ofenergy are fossil fuel which is available at a cost which rises as reserves diminish and a carbon-free backstop supplied at a decreasing cost. if damages are not proportional to aggregate production output, and the economy is along a development path, the social cost of carbon and the optimal carbon tax are smaller as damages can more easily be compensated for by higher output. As a result, the economy switches later from fossil fuel to the carbon-free backstop and leaves less fossil fuel in situ. This is in contrast to a partial equilibrium analysis with dmages in utility rather than in production which finds that the willingness to forsake current consumption to avoid future global warming is higher (lower) under additive damages in a growing economy if the elasticity of intertemporal substitution is smaller (bigger) than one.
    Keywords: climate change, multiplicative damages, additive damages, integrated assessment models, Ramsey growth model, fossil fuel, carbon-free backstop
    JEL: H21 Q51 Q54
    Date: 2012

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