nep-res New Economics Papers
on Resource Economics
Issue of 2014‒01‒10
four papers chosen by
Maximo Rossi
Universidad de la Republica

  1. Beyond inducement in climate change: Does environmental performance spur environmental technologies? By Claudia Ghisetti; Francesco Quatraro
  2. Optimal Trading Ratios for Pollution Permit Markets By Stephen Holland; Andrew J. Yates
  3. Biased Technological Change and the Relative Abundance of Natural Resources By John Boyce
  4. Taxes versus Standards (Again): Misallocation and Productivity Effects of Intensity Targets By Trevor Tombe; Jennifer Winter

  1. By: Claudia Ghisetti (Département des sciences économiques - Università di Bologna); Francesco Quatraro (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université Nice Sophia Antipolis [UNS])
    Abstract: This paper contributes to the debate on the inducement of environmental innovations by analysing the extent to which endogenous inducement mechanisms spur the generation of greener technologies in contexts characterized by weak exogenous inducement pressures. In the presence of a fragile environmental regulatory framework, inducement can indeed be endogenous and environmental innovations may be spurred by firms' reactions to their direct or related environmental performance. Cross-sector analysis focuses on a panel of Italian regions, over the time span 2003-2007, and is conducted by implementing zero-inflated regression models for count data variables. The empirical results suggest that in a context characterized by a weak regulatory framework, such as the Italian one, environmental performance has significant and complementary within- and between-sector effects on the generation of green technologies.
    Keywords: Green technologies; Environmental Performance; Regional NAMEA; Technological innovation; Knowledge production function
    Date: 2013–12–02
  2. By: Stephen Holland; Andrew J. Yates
    Abstract: We analyze a novel method for improving the efficiency of pollution permit markets by optimizing the way in which emissions are exchanged through trade. Under full-information, it is optimal for emissions to exchange according to the ratio of marginal damages. However, under a canonical model with asymmetric information between the regulator and the sources of pollution, we show that these marginal damage trading ratios are generally not optimal, and we show how to modify them to improve efficiency. We calculate the optimal trading ratios for a global carbon market and for a regional nitrogen market. In these examples, the gains from using optimal trading ratios rather than marginal damage trading ratios range from substantial to trivial, which suggests the need for careful consideration of the structure of asymmetric information when designing permit markets.
    JEL: D82 H23 Q53
    Date: 2014–01
  3. By: John Boyce (University of Calgary)
    Abstract: This paper documents that natural resources that are more abundant have higher production, lower prices, higher primary industry revenues, and higher R&D. These empirical facts are explained by a model of biased technological change in which relatively more abundant resources attract greater R&D because the return from obtaining a patent is higher in larger markets. Resource specific R&D may be targeted either towards upstream extraction technologies or towards downstream production technologies, and R&D is subject to diminishing knowledge spillovers and diminishing productivity of labor. The estimated elasticity of substitution between natural resources is greater than one, implying that natural resources are substitutes in production. Declining real resource prices in the face of rising resource production are explained by the increasing productivity of labor as knowledge stocks grow.
    Date: 2013–01–21
  4. By: Trevor Tombe (University of Calgary); Jennifer Winter
    Abstract: Firm-level idiosyncratic policy distortions lower aggregate productivity, especially if such distortions are correlated with firm productivity. Many environmental policies, such as energy intensity standards, exhibit this correlation. In contrast to the existing environmental literature comparing taxes to standards, we explicitly consider distortions among a large number of heterogenous firms in multiple industries in a model that matches the industrial structure and energy use patterns of developed economies. We demonstrate that taxes are always superior to intensity standards, especially standards that impose a common target on all firms. We also examine ways to mitigate the costs of standards.
    Date: 2013–12–02

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