nep-res New Economics Papers
on Resource Economics
Issue of 2014‒02‒15
eight papers chosen by
Maximo Rossi
Universidad de la Republica

  1. Designing an Optimal 'Tech Fix' Path to Global Climate Stability: Directed R&D and Embodied Technical Change in a Multi-phase Framework By Paul David; Adriaan van Zon
  2. Carbon Tariffs Revisited By Christoph Böhringer; Andre Müller; Jan Schneider
  3. Green innovations and organizational change: Making better use of environmental technology By Hottenrott, Hanna; Rexhäuser, Sascha; Veugelers, Reinhilde
  4. Fast and Furious (and Dirty): How Asymmetric Regulation May Hinder Environmental Policy By Huse, Cristian
  5. Environment and Growth By Horii, Ryo; Ikefuji, Masako
  6. Rule-Based Resource Revenue Stabilization Funds: A Welfare Comparison By Landon, Stuart; Smith, Constance
  7. The Stability and Effectiveness of Climate Coalitions: A Comparative Analysis of Multiple Integrated Assessment Models By Kai Lessmann; Ulrike Kornek; Valentina Bosetti; Rob Dellink; Johannes Emmerling; Johan Eyckmans; Miyuki Nagashima; Hans-Peter Weikard; Zili Yang
  8. Spatial targeting of agri-environmental policy and urban development By Thomas Coisnon; Walid Oueslati; Julien Salanié

  1. By: Paul David (Stanford University); Adriaan van Zon (United Nations University)
    Abstract: The research reported here gives priority to understanding the inter-temporal resource allocation requirements of a program of technological changes that could halt global warming by completing the transition to a "green" (zero net CO2- emission) production regime within the possibly brief finite interval that remains before Earth's climate is driven beyond a catastrophic tipping point. This paper formulates a multi-phase, just-in-time transition model incorporating carbon-based and carbon-free technical options requiring physical embodiment in durable production facilities, and having performance attributes that are amenable to enhancement by directed R&D expenditures. Transition paths that indicate the best ordering and durations of the phases in which intangible and tangible capital formation is taking place, and capital stocks of different types are being utilized in production, or scrapped when replaced types embodying socially more efficient technologies, are obtained from optimizing solutions for each of a trio of related models that couple the global macro-economy's dynamics with the dynamics of the climate system. They describe the flows of consumption, CO2 emissions and the changing atmospheric concentration of greenhouse gas (which drives global warming), along with the investment dynamics required for the timely transformation of the production regime.
    Keywords: global warming, tipping point, catastrophic climate instability, extreme weather†related damages, R&D, directed technical change, capitalâ€embodied technologies, optimal sequencing, multiâ€phase optimal control, sustainable endogenous growth
    JEL: Q54 Q55 O31 O32 O3
    Date: 2014–01
  2. By: Christoph Böhringer (University of Oldenburg - Economic Policy & ZenTra); Andre Müller (Ecoplan); Jan Schneider (University of Oldenburg - Economic Policy)
    Abstract: Concerns about adverse impacts on domestic energy-intensive and trade-exposed (EITE) industries are at the fore of the political debate about unilateral climate policies. Tariffs on the carbon embod-ied in imported goods from countries without emission pricing appeal as a measure to reduce carbon leakage and protect domestic EITE industries. We show that the introduction of carbon tariffs can do more harm than good to domestic EITE industries. Two determinants drive the sign and magnitude of EITE impacts. Firstly, the composition of embodied emissions in goods: if a large share of embodied carbon is imported in intermediate inputs, industries might suffer from carbon tariffs. Secondly, the share of domestic output that is supplied to the export market: while carbon tariffs level the playing field on domestic markets, they increase the cost-disadvantage vis-à-vis competitors from abroad in foreign markets.
    Keywords: carbon tariffs, unilateral climate policy, multi-region input-output analysis, CGE
    JEL: Q58 D57 D58
    Date: 2014–02
  3. By: Hottenrott, Hanna; Rexhäuser, Sascha; Veugelers, Reinhilde
    Abstract: This study investigates productivity effects to firms introducing new environmental technologies. The literature on within-firm organisational change and productivity suggests that firms can get higher productivity effects from adopting new technologies if complementary organisational changes are adopted simultaneously. Such complementarity effects may be of critical importance for the case of adoption of greenhouse gas (GHG) abatement technologies. The adoption of these technologies is often induced by public authorities to limit social costs of climate change, whereas the private returns are much less obvious. We find empirical support for complementarity between green technology adoption and organisational change for a sample of firms located in Germany. The adoption of CO2 reducing and sustainable technologies innovations is associated with lower productivity. The simultaneous implementation of organisational innovations, however, increases the returns to the adoption of green technologies. --
    Keywords: technical change,environmental innovation,organisational change,productivity
    Date: 2014
  4. By: Huse, Cristian
    Abstract: In the first year after the inception of the Swedish Green Car Rebate (GCR), green cars had carved over 25 percent market share in the new vehicle market, an effect of unprecedented scale if compared to recent policies incentivizing the purchase of fuel-efficient vehicles. By awarding vehicles satisfying certain emission criteria a rebate, but giving alternative fuel vehicles (AFVs, those able to run on alternative fuels) a more lenient treatment than regular fuel vehicles (RFVs, those able to run only on gasoline and diesel), the GCR created a regulatory loophole which led carmakers to increase the emissions of AFVs as compared to RFVs. This paper examines the impact of regulation on market developments comparing CO2 emissions (and fuel economy) of AFVs and RFVs. Once carmakers adjust their product lines to the policy, CO2 emissions of AFVs increased significantly as compared to those of RFVs, thus undermining the very objectives of the GCR.
    Keywords: Automobiles; Emissions; Environmental policy; Alternative fuel vehicles; Flexible-fuel vehicles; Fuel economy; Greenhouse gases; Regulation; Alternative fuels; Renewable fuels.
    JEL: H23 L51 L62 L98 Q42 Q48 Q53
    Date: 2014
  5. By: Horii, Ryo; Ikefuji, Masako
    Abstract: This paper examines the implications of the mutual causality between environmental quality and economic growth. While economic growth deteriorates the environment through increasing amounts of pollution, the deteriorated environment in turn limits the possibility of further economic growth. In a less developed country, this link, which we call "limits to growth," emerges as the "poverty-environment trap," which explains the persistent international inequality both in terms of income and environment. This link also threatens the sustainability of the world's economic growth, particularly when the emission of greenhouse gases raises the risk of natural disasters. Stronger environmental policies are required to overcome this link. While there is a trade-off between the environment and growth in the short run, we show that an appropriate policy can improve both in the long run.
    Keywords: Environmental Kuznets Curve, Limits to Growth, Poverty-Environment Trap, Sustainability, Natural Disasters
    JEL: O41 O44 Q54 Q56
    Date: 2014–02
  6. By: Landon, Stuart (University of Alberta, Department of Economics); Smith, Constance (University of Alberta, Department of Economics)
    Abstract: Resource prices, and petroleum prices in particular, are volatile and difficult to predict, so government revenue in resource-producing regions is also uncertain and volatile. Adjusting government expenditure in response to these revenue movements involves economic, social and political costs. Many jurisdictions have established rule-based revenue stabilization funds to address revenue volatility, but there is little evidence on whether these funds improve welfare or if some fund designs increase welfare more than others. Using Monte Carlo techniques, we provide a quantitative welfare comparison of several types of rule-based stabilization funds for a petroleumproducing jurisdiction. We find large potential gains from the use of a fund to stabilize revenue, but some fund types reduce welfare, particularly those that accumulate large stocks of assets or debt. A fund that performs well, and is generally robust to changes in the simulation parameters, has a fixed deposit rate out of resource revenue and a fixed withdrawal rate out of assets.
    Keywords: petroleum prices; resource revenue volatility; fiscal rules; stabilization funds; savings funds
    JEL: H61 H63 O13 Q33 Q38 Q48
    Date: 2014–01–01
  7. By: Kai Lessmann (Potsdam Institute for Climate Impact Research (PIK)); Ulrike Kornek (Potsdam Institute for Climate Impact Research (PIK)); Valentina Bosetti (Università Bocconi and Fondazione Eni Enrico Mattei (FEEM)); Rob Dellink (Environmental Economics and Natural Resources Group, Department of Economics, Wageningen University); Johannes Emmerling (Fondazione Eni Enrico Mattei (FEEM) and Centro Euro-Mediterraneo sui Cambiamenti Climatici (CMCC)); Johan Eyckmans (KU Leuven – Center for Economics and Corporate Sustainability (CEDON)); Miyuki Nagashima (Research Institute of Innovative Technology for the Earth); Hans-Peter Weikard (Environmental Economics and Natural Resources Group, Department of Economics, Wageningen University); Zili Yang (Department of Economics, State University of New York at Binghamton)
    Abstract: In this paper we report results from a comparison of numerically calibrated game theoretic integrated assessment models that explore stability and performance of international coalitions for climate change mitigation. Specifically, by means of this ensemble of models we are able to identify robust results concerning incentives of nations to commit themselves to a climate agreement, and to estimate what stable agreements can achieve in terms of greenhouse gas mitigation. We also assess the potential of transfers that redistribute the surplus of cooperation in order to foster stability of climate coalitions. In contrast to much of the existing analytical game theoretical literature, we find substantial scope for self-enforcing climate coalitions in most models that close much of the abatement and welfare gap between complete absence of cooperation and full cooperation. This more positive message follows from the use of transfer schemes that are designed to counteract free riding incentives.
    Keywords: Coalition Stability, International Environmental Agreements, Numerical modeling, Transfers
    JEL: Q5 Q58 C7
  8. By: Thomas Coisnon (GRANEM, Agrocampus Ouest, Université d’Angers, 2 rue André Le Nôtre 49000 Angers, France); Walid Oueslati (Centre for Rural Economy, University of Newcastle, Newcastle NE1 7RU, UK); Julien Salanié (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France, Université Jean Monnet, Saint-Etienne, F-42000, France)
    Abstract: Widespread public support exists for the provision of natural amenities, such as lakes, rivers or wetlands, and for efforts to preserve these from agricultural pollution. Agri-environmental policies contribute to these efforts by encouraging farmers to adopt environmentally friendly practices within the vicinity of these ecosystems. A spatially targeted agri-environmental policy promotes natural amenities and may thereby affect household location decisions. The purpose of this paper is to investigate the extent of these impacts on the spatial urban structure. We extend a monocentric city model to include farmers’ responses to an agri-environmental policy. Our main findings are that the implementation of a spatially targeted agrienvironmental policy may lead to some additional urban development, which could conflict with the aim of the policy.
    Keywords: Land development, Urban sprawl, Leapfrog, Land rent, Monocentric model, Farming, Agri-environmental policy, Spatial targeting, Agricultural pollution
    JEL: R14 R21 Q18 Q24 Q25
    Date: 2014

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