New Economics Papers
on Resource Economics
Issue of 2014‒06‒07
four papers chosen by

  1. Semi-Endogenous Growth and Pollution: No Double Dividend in the Long Term By Pascal Da Costa
  2. An Integrated Environmental and Economic Modeling Framework for Technological Transitions By Randall Jackson
  3. Household fuel choice in urban China: A random effect generalized probit analysis By Zhang, Xiao-Bing; Hassen, Sied
  4. Worse off from reduced cost? The role of policy design under uncertain technological advancement By Matthias Weitzel

  1. By: Pascal Da Costa (LGI - Laboratoire Génie Industriel - EA 2606 - Ecole Centrale Paris)
    Abstract: Literature on endogenous growth shows that a polluting economy can grow sustainably and that a double-dividend or win-win effect comprising growth and the environment is possible. Even with a semi- endogenous growth approach, which occur when the knowledge stock yield falls below the unit in the production of innovations, what happens to sustainability and the double dividend? This paper presents the first semi-endogenous growth model with pollution which answers this very question. We first illustrate that the dynamics of this economy can be sustainable even if its long-term growth rate is exogenous. To ensure the latter, a knowledge stock yield that is greater than a certain strictly positive threshold is required. We then demonstrate that the double dividend is impossible since the level of support for innovation no longer has a positive impact on the long-term growth rate. And the environmental policy always has a negative effect on growth.
    Keywords: Innovation; Pollution; Semi-Endogenous Growth; Double Dividend
    Date: 2014–05–22
  2. By: Randall Jackson (Regional Research Institute, West Virginia University)
    Abstract: There is an increasing demand for models that address both environment and economy, and that also estimate or forecast the impacts of introducing new and markedly different technologies from those already existing in the systems under study. Because most conventional models are calibrated to recent data characterizing current economic structure and conditions, their standard turn-key operation will need to be replaced by more comprehensive algorithms and procedures designed to explicitly accommodate shifts in technology and economic structure. This paper lays out one viable alternative for integrating environmental and economic modeling frameworks, and focuses specifically on one of the major challenges to this kind of modeling, that of dovetailing life cycle assessment and input-output modeling frameworks. (Acknowledgements: This material is based upon work supported by the National Science Foundation under Grant No. 1235684 and USDA NIFA Award 2012-67009-19660.)
    Keywords: environement, environmental modeling, life cycle assessment
    JEL: Q55
    Date: 2014–02–17
  3. By: Zhang, Xiao-Bing (Department of Economics, School of Business, Economics and Law, Göteborg University); Hassen, Sied (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Using seven rounds of household survey data that span more than a decade, this paper analyzes the determinants of household fuel choice in urban China. Unlike the existing studies, we use an empirical strategy that takes into account the potential heterogeneous effects of socio-economic factors in households’ preference ordering. Robustness of this empirical strategy is checked against alternative methods. The results show that household fuel choice in urban China is related to fuel prices, household’s economic status and size, and household head’s gender, education and occupation. Our results suggest that policies and interventions that raise household income, reduce prices of clean fuel sources, and empower women in the household are of great significance in encouraging the adoption of clean energy sources.
    Keywords: Household fuel choice; Panel data; Random effect generalized probit model; Urban China
    JEL: C25 Q23 Q40 Q42
    Date: 2014–05
  4. By: Matthias Weitzel
    Abstract: A simple model is used to illustrate the effects of a reduction in (marginal) abatement cost in a two country setting. It can be shown that a the country experiencing a cost reduction can actually be worse off. This holds true for a variety of quantity and price based emission policies. The most important channel is that a country with lower abatement costs engages in additional abatement effort for which it is not compensated. Under a quantity based policy with a given allocation, a seller of permits can also be negatively affected from a lower carbon price. We also argue that abatement cost shocks to renewable energy and carbon capture and storage (CCS) are different in terms of their effects on international energy markets. A shock to renewable energy reduces fossil fuel rents benefiting energy importers, while the opposite holds for a shock to CCS. The channels obtained in the theoretical model can be confirmed in a more complex global computable general equilibrium model. Some regions are indeed worse off from shock that lowers their abatement costs
    Keywords: Climate policy, prices vs. quantities, renewable energy, CCS, technological uncertainty, CGE model
    JEL: C68 Q54 Q58
    Date: 2014–05

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.