nep-res New Economics Papers
on Resource Economics
Issue of 2020‒01‒06
three papers chosen by
Maximo Rossi
Universidad de la República

  1. Children's Willingness to Pay for Environmental Protection By Valentino Dardanone; Carla Guerriero
  2. The role of an Environmental Goods Agreement in the quest to improve the regime complex for climate change By Jaime de Melo; Jean-Marc Solleder
  3. Directed technical change as a response to natural-resource scarcity By Hassler, John; Krusell, Per; Olovsson, Conny

  1. By: Valentino Dardanone (Università di Palermo); Carla Guerriero (Università di Napoli Federico II and CSEF)
    Abstract: Young generations will bear the cost of present natural capital degradation and, as the recent wave of school climate strikes for climate change proved, do not want their voices to be ignored. Discrete Choice Experiments are increasingly being used for the valuation of environmental goods, nevertheless, they have never been conducted with children. We designed and administered a discrete choice experiment to elicit children, aged 8-19 years, willingness to pay (WTP) for environmental protection projects. Our results suggest that children marginal WTP is higher for projects targeting natural protection in their own country (Italy) and that the utility of environmental protection is greater for females and for older children. Furthermore, we find that individual attitude towards environment negatively affect the probability of choosing the status quo alternative. Given recent findings on transfer of knowledge, attitudes and behaviours towards environmental protection from children to parents, these results are important to support policy makers decisions on how to deal with the issues of natural capital degradation.
    Keywords: Discrete Choice Experiment; Children; Natural Capital; Environmental Protection; Willingness to Pay
    JEL: C93 Q51 D83
    Date: 2019–12–17
  2. By: Jaime de Melo (FERDI - Fondation pour les Etudes et Recherches sur le Développement International); Jean-Marc Solleder (UNIGE - Université de Genève)
    Abstract: The environment-trade nexus requires action. Environmentalists have claimed that the interests of the trade community, as represented at the WTO, would trump environmental concerns while trade specialists have claimed that an open trading system is key to meet the environmental challenge facing us. After a decade-long negotiation at the WTO on the reduction of tariffs on environmental goods (EGs) failed to produce an agreement, in 2014 a group of 14 countries entered plurilateral negotiations aiming for an Environmental Goods Agreement (EGA) that would have substantially reduced or eliminated tariffs on a long list of EGs. This also failed. This paper discusses the hurdles faced by these negotiations, the resulting stalemate, and avenues for reviving the negotiations. We argue that conclusion of the EGA negotiations under the current narrow agenda would help build trust to go further but would produce only very modest gains. Extending the agenda to include non-tariff barriers (NTBs) and environmental services remains the acid test for an EGA to address meaningfully the climate-change challenge.
    Keywords: Environmental Goods,WTO,Climate Change
    Date: 2019–09–16
  3. By: Hassler, John (IIES, University of Gothenburg and CEPR); Krusell, Per (IIES, CEPR and NBER); Olovsson, Conny (Research Department, Central Bank of Sweden)
    Abstract: How do markets economize on scarce natural resources? With an applica-tion to fossil energy, we emphasize technological change aimed at saving on the scarce resource. We develop quantitative macroeconomic theory as a tool for interpreting the past and thinking about the future. We argue, first, that aggre-gate U.S. data calls for a short-run substitution elasticity between energy and the capital/labor inputs that is near Leontief. Given this fact and an aggregate CES function, we note that energy-saving technical change took o right as the oil shocks hit in the 1970s. We rationalize this observation using a theory that views technical change as directed: it can be used to save on different inputs and, hence, the long-run substitutability between inputs becomes higher than Leontief. For our application, we estimate long-run dependence on fossil energy - measured by its factor share - to climb to a little below 10%; absent endogenous technical change directed toward energy-saving, it would go to 100%.
    Keywords: Sustainability; Natural resource scarcity; technological change; economic growth; energy
    JEL: E13 E20 Q30 Q43
    Date: 2019–07–01

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