nep-res New Economics Papers
on Resource Economics
Issue of 2017‒08‒13
three papers chosen by
Maximo Rossi
Universidad de la República

  1. Valuation of Public Amenities and Differences in Quality of Life among Latin American Cities By Arrosa, María Laura; Gandelman, Néstor
  2. Amazonian farmers’ response to fire policies and climate change By Cammelli, Federico; Angelsen, Arild
  3. The Sustainable Management of a Productive Natural Capital By Julien Xavier Daubanes

  1. By: Arrosa, María Laura; Gandelman, Néstor
    Abstract: We use a life satisfaction approach for the valuation of public goods and amenities in Latin American cities. We apply a homogenous database of seventeen cities gathered by the Development Bank of Latin America CAF. Using the estimated monetary value for several public goods and neighborhood amenities we construct a city level quality of life index. We find that access to electricity, access to running water and security are the three largest valued urban characteristics in terms of life satisfaction and housing satisfaction. The monetary equivalent valuations represent more than duplicating the household per capita income. Lacking access to them has a tremendous impact on quality of life. We also show that although richer households have more access, public good and amenities are a source for reductions in quality of life disparities.
    Keywords: Ciudades, Investigación socioeconómica, Servicios públicos,
    Date: 2016
  2. By: Cammelli, Federico (School of Economics and Business, Norwegian University of Life Sciences); Angelsen, Arild (School of Economics and Business, Norwegian University of Life Sciences)
    Abstract: Despite a fall in deforestation, frequency and severity of fires in the Brazilian Amazon are rising, causing huge carbon emissions, biodiversity losses and local economic costs. The ignition sources are anthropogenic and mostly related to the accidental spread of agricultural fires. Fire risk mitigation is a coordination problem with strategic complementarities: a farmer’s benefit of mitigation depends on complementary action of other farmers. We experimentally assess ex-ante the impact of two different policies under varying exogenous drought risk scenarios. Command and control is more effective than payments for environmental services in promoting coordination, possibly because of participants’ risk aversion (to the fine) and a local demand for justice and law enforcement. We also find evidence of a human-mediated self-reinforcing loop of drought and fires: droughts increase the exogenous component of fire risk, giving farmers less incentives to mitigate fire risk coming from their own farms.
    Keywords: Brazilian Amazon; forest fires; climate change; framed field experiment; coordination games
    JEL: C93 Q23 Q54
    Date: 2017–08–09
  3. By: Julien Xavier Daubanes (Department of Food and Resource Economics, University of Copenhagen)
    Abstract: This paper examines an industry whose economic activity uses a natural capital on which its profit also relies. When such a productive natural capital has a limited capacity to recover from its exploitation, a free market tends to over-exploit it, calling for public intervention. The analysis is relevant, among other examples, to the case of naturebased tourism. I study the sustainable management of a productive natural capital: the conditions under which its exploitation generates maximum long-run social benefits; the various ways in which a regulator can implement such an exploitation; the rent that it generates for the industry; the effect of social discounting and operators’ short-termism, etc. Particular attention is given to situations in which the regulator gives more importance to the industry than it does to consumers, as when consumers are foreigners or when the industry generates needed tax revenues. In those contexts, I find that the industry should make more efforts of conservation, rather than less.
    Keywords: Renewable natural resources; Over-exploitation; Optimal regulation; Proindustry regulation; Public revenue needs; Optimum taxation; Nature-based tourism
    JEL: Q2 L1 H5
    Date: 2017–07

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