nep-res New Economics Papers
on Resource Economics
Issue of 2022‒08‒15
three papers chosen by
Maximo Rossi
Universidad de la República

  1. The value of scattered greenery in urban areas: A hedonic analysis in Japan By Yuta Kuroda; Takeru Sugasawa
  2. Trade, Leakage, and the Design of a Carbon Tax By David A. Weisbach; Samuel Kortum; Michael Wang; Yujia Yao
  3. Air Pollution and the Labor Market: Evidence from Wildfire Smoke By Borgschulte, Mark; Molitor, David; Zou, Eric Yongchen

  1. By: Yuta Kuroda; Takeru Sugasawa
    Abstract: This study investigates the impact of scattered greenery (street trees and yard bushes), rather than cohesive greenery (parks and forests), on housing prices. We identify urban greenspace from high-resolution satellite images and combine these data with data on both sales and rentals of condominiums to estimate hedonic pricing models. We find that scattered urban greenery within 100 meters significantly increases housing prices, while more distant scattered greenery does not. Scattered greenery is highly valued near highways but is less valued near the central business district (CBD). Additionally, the prices of inexpensive and small for-sale and of for-rent properties are less affected by scattered greenery. These results indicate that there is significant heterogeneity in urban greenery preferences by property characteristics and location. This heterogeneity in preferences for greenery could lead to environmental gentrification since the number of more expensive properties increases in areas with more green amenities.
    Date: 2022–07
  2. By: David A. Weisbach (The University of Chicago Law School); Samuel Kortum (Cowles Foundation, Yale University); Michael Wang (Northwestern University Feinberg School of Medicine); Yujia Yao (International Monetary Fund)
    Abstract: Climate policies vary widely across countries, with some countries imposing stringent emissions policies and others doing very little. When climate policies vary across countries, energy-intensive industries have an incentive to relocate to places with few or no emissions restrictions, an effect known as leakage. Relocated industries would continue to pollute but would be operating in a less desirable location. We consider solutions to the leakage problem in a simple setting where one region of the world imposes a climate policy and the rest of the world is passive. We solve the model analytically and also calibrate and simulate the model. Our model and analysis imply: (1) optimal climate policies tax both the supply of fossil fuels and the demand for fossil fuels; (2) on the demand side, absent administrative costs, optimal policies would tax both the use of fossil fuels in domestic production and the domestic consumption of goods created with fossil fuels, but with the tax rate on production lower due to leakage; (3) taxing only production (on the demand side), however, would be substantially simpler, and almost as effective as taxing both production and consumption, because it would avoid the need for border adjustments on imports of goods; (4) the effectiveness of the latter strategy depends on a low foreign elasticity of energy supply, which means that forming a taxing coalition to ensure a low foreign elasticity of energy supply can act as a substitute for border adjustments on goods.
    Keywords: climate change, carbon taxes, leakage, border adjustments
    JEL: F18 H23 Q54
    Date: 2022–07
  3. By: Borgschulte, Mark (University of Illinois at Urbana-Champaign); Molitor, David (University of Illinois at Urbana-Champaign); Zou, Eric Yongchen (University of Oregon)
    Abstract: We study how air pollution impacts the U.S. labor market by analyzing effects of drifting wildfire smoke that can affect populations far from the fires themselves. We link satellite smoke plume with labor market outcomes to estimate that an additional day of smoke exposure reduces quarterly earnings by about 0.1 percent. Extensive margin responses, including employment reductions and labor force exits, can explain 13 percent of the overall earnings losses. The implied welfare cost of lost earnings due to air pollution exposure is on par with standard valuations of the mortality burden. The findings suggest that labor market channels warrant greater consideration in policy responses to air pollution.
    Keywords: air pollution, labor market, wildfires
    JEL: J21 Q51 Q52 Q53 Q54
    Date: 2022–06

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