nep-res New Economics Papers
on Resource Economics
Issue of 2013‒09‒06
six papers chosen by
Maximo Rossi
Universidad de la Republica

  1. Economic Analysis, Sustainability and Environmental Commons By Ignazio Musu
  2. The “green-impact” of the open innovation mode. Bridging knowledge sourcing and absorptive capacity for environmental innovations By Sandro Montresor; Claudia Ghisetti; Alberto Marzucchi
  3. Trade-offs in water policy: System-wide implications of changing water availability and agricultural productivity in the Mediterranean economies by 2050 By Roberto Roson; Martina Sartori
  4. Defensive Investments and the Demand for Air Quality: Evidence from the NOx Budget Program and Ozone Reductions By Deschenes, Olivier; Greenstone, Michael; Shapiro, Joseph S.
  5. Development Towards Sustainability: How to judge past and proposed policies? By Michael Dittmar
  6. Natural resources, physical capital and institutions : evidence from Eurasia By Vandycke, Nancy

  1. By: Ignazio Musu (Department of Economics, University of Venice Cà Foscari)
    Abstract: When confronted with market weaknesses and failures determining sustainability problems for environmental common-pool resources, economic analysis has proposed government intervention as the only alternative available. Elinor Ostrom showed that this dichotomy between market and government is not always helpful, and proposed a more complex approach to institutions focusing on an active role of communities, social norms and a polycentric system of governance. This paper summarizes the main factors at work in determining the role of institutions to deal with sustainability issues and explores the implications of this wider approach in dealing with environmental commons, particularly with global environmental commons, discussing two issues: climate change and biodiversity. Involvement of governments and a reference framework provided by intergovernmental agreements are necessary, but the difficulties of building a successful intergovernmental institutional framework require responsible and convinced actions at the level of consumers and firms, public opinion involvement in individual countries, and coordination between local and national levels of government: provided that some conditions are fulfilled, common resource management can be very helpful in achieving them.
    Keywords: Environment, Sustainability, Common-pool resources, Global environmental problems, Climate Change, Biodiversity
    JEL: B52 H0 H4 Q01 Q2 Q5
    Date: 2013
  2. By: Sandro Montresor (JRC-IPTS); Claudia Ghisetti (University of Bologna); Alberto Marzucchi (Catholic University of Milan)
    Abstract: This Policy Brief presents recent results on the impact that an open innovation mode has on European firms' environmental innovations. New evidence drawn from the CIS suggests that knowledge sourcing can increase the environmental innovation performance of firms. However, the way firms search for external knowledge and work to absorb it can lead them to different results, depending on whether they are involved in the adoption of an eco-innovation or the extension of their eco-innovation portfolio. Drawing on these results, policy implications for the European Research and Innovation Agenda are discussed.
    Keywords: innovation, environment, eco-innovation
    Date: 2013–08
  3. By: Roberto Roson (Department of Economics, University Of Venice Cà Foscari); Martina Sartori (Scuola di Studi Internazionali, University of Trento)
    Abstract: We evaluate the structural consequences of water availability scenarios in the Mediterranean, following a multidisciplinary approach and a sequential modelling methodology. This includes an assessment of future water availability and a general equilibrium macroeconomic analysis of changes in agricultural productivity. Lower productivity in agriculture, induced by reduced water availability, generates negative consequences in terms of real income and welfare. The magnitude of the loss depends on the amount of the productivity shock, but also on the share of agricultural activities in the economy and on the stringency of the environmental regulation. We find evidence of a dramatic cut in the supply of water for agriculture in the Middle East. We consider alternative scenarios, differing in terms of stringency of environmental regulation and assumptions about water efficiency. The largest welfare losses turn out to be in Morocco and Tunisia, in the “worst” scenario NM. Other very relevant impacts can be observed in Turkey, Italy and Rest of Middle East and North Africa (XMENA). There are also clear differences among the scenarios. First, applying a constraint on access to environmental water reserves only for Europe does make a big difference for non-European countries (Morocco, Tunisia and XMENA), implying that governments in the Middle-East could respond to increasing water scarcity by accepting, to some extent, lower environmental quality (deterioration of aquatic environments). Second, improvements in water efficiency, as envisaged in the simulation exercise, appear to curb the economic impact of water scarcity quite significantly. This is especially true for countries in the North, whereas efficiency does not compensate for a strict environmental policy in the South.
    Keywords: Climate change, water use, agriculture, General Equilibrium Models, Mediterranean.
    JEL: C68 Q15 Q25 Q56
  4. By: Deschenes, Olivier (University of California, Santa Barbara); Greenstone, Michael (MIT); Shapiro, Joseph S. (Yale University)
    Abstract: Demand for air quality depends on health impacts and defensive investments that improve health, but little research assesses the empirical importance of defenses. We study an important cap-and-trade market, which dramatically reduced NOx emissions, a key ingredient in ozone formation. A rich quasi-experiment reveals that it decreased summertime ozone, pharmaceutical expenditures, and mortality rates. Reductions in pharmaceutical purchases and mortality are each valued at $900 million annually, suggesting that defensive investments are a substantial portion of willingness-to-pay. We cautiously conclude that ozone reductions are the primary channel for these effects, implying that ozone's costs are larger than previously understood.
    Keywords: pharmaceuticals, ozone, cap and trade, willingness to pay for air quality, mortality, compensatory behavior, human health
    JEL: H4 I1 Q4 Q5 D1
    Date: 2013–08
  5. By: Michael Dittmar (Institute of Particle Physics, ETH Zurich, Switzerland)
    Abstract: The scientific data about the state of our planet, presented at the 2012 (Rio+20) summit, documented that today's human family lives even less sustainably than it did in 1992. The data indicate furthermore that the environmental impacts from our current economic activities are so large, that we are approaching situations where potentially controllable regional problems can easily lead to uncontrollable global disasters. Assuming that (1) the majority of the human family, once adequately informed, wants to achieve a "sustainable way of life" and (2) that the "development towards sustainability" roadmap will be based on scientific principles, one must begin with unambiguous and quantifiable definitions of these goals. As will be demonstrated, the well known scientific method to define abstract and complex issues by their negation, satisfies these requirements. Following this new approach, it also becomes possible to decide if proposed and actual policies changes will make our way of life less unsustainable, and thus move us potentially into the direction of sustainability. Furthermore, if potentially dangerous tipping points are to be avoided, the transition roadmap must include some minimal speed requirements. Combining the negation method and the time evolution of that remaining natural capital in different domains, the transition speed for a "development towards sustainability" can be quantified at local, regional and global scales. The presented ideas allow us to measure the rate of natural capital depletion and the rate of restoration that will be required if humanity is to avoid reaching a sustainable future by a collapse transition.
    Date: 2013–09
  6. By: Vandycke, Nancy
    Abstract: Natural resource abundance can lead to strong economic growth if resource rents are well invested in physical assets and other forms of productive capital. This paper focuses on the case of the resource-abundant economies in Eurasia, which has been less documented in the literature on natural resource-led development than other parts of the world. The analysis shows that the stock of productive physical assets is relatively low, contrary to common perceptions about the Soviet system. The infrastructure that was inherited from the Soviet system primarily serves to meet basic human needs; few assets support the development of competitive and sustainable economies. At a deeper level, the paper documents that low accumulation of physical capital over the past two decades has been driven by weak institutions and economic policies associated with the presence of resource rents, along with a poor public investment management process. This paper complements existing empirical studies by presenting evidence on the mechanisms through which natural resources and physical capital have interacted in setting Eurasian economies on a fragile development path.
    Keywords: Transport Economics Policy&Planning,Economic Theory&Research,Banks&Banking Reform,Public Sector Economics,Investment and Investment Climate
    Date: 2013–08–01

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