nep-res New Economics Papers
on Resource Economics
Issue of 2023‒03‒20
six papers chosen by
Maximo Rossi
Universidad de la República

  1. Urban pollution: A global perspective By Rainald Borck; Philipp Schrauth
  2. Beyond Climate: `EU taxonomy' criteria, materiality, and CDS term structure By Andreas G. F. Hoepner; Johannes Klausmann; Markus Leippold; Jordy Rillaerts
  3. Green subsidies as strategic trade policy tools By Buccella, Domenico; Fanti, Luciano; Gori, Luca
  4. Distributional effects of urban transport policies to discourage car use: A literature review By Robin Lindsey; Ioannis Tikoudis; Katherine Hassett
  5. Environmental Kuznets curve on water pollution in Chinese provinces By Taguchi, Hiroyuki; Fujino, Takeshi; Asada, Hidekatsu; Ma, Jui-Jun
  6. Dirty density: air quality and the density of American cities By Carozzi, Felipe; Roth, Sefi

  1. By: Rainald Borck; Philipp Schrauth
    Abstract: We use worldwide satellite data to analyse how population size and density affect urban pollution. We find that density significantly increases pollution exposure. Looking only at urban areas, we find that population size affects exposure more than density. Moreover, the effect is driven mostly by population commuting to core cities rather than the core city population itself. We analyse heterogeneity by geography and income levels. By and large, the influence of population on pollution is greatest in Asia and middle-income countries. A counterfactual simulation shows that PM2.5 exposure would fall by up to 36% and NO2 exposure up to 53% if within countries population size were equalized across all cities.
    Keywords: Population density, air pollution, gridded data
    JEL: Q53 R12
    Date: 2022–12–14
  2. By: Andreas G. F. Hoepner (Smurfit Graduate Business School, University College Dublin; European Commission's Platform on Sustainable Finance); Johannes Klausmann (ESSEC Business School); Markus Leippold (University of Zurich; Swiss Finance Institute); Jordy Rillaerts (University of Zurich - Department of Banking and Finance; Swiss Finance Institute)
    Abstract: This paper examines the impact of the EU Taxonomy's non-climate environmental criteria on the corporate credit risk term structure. We focus on infrastructure firm-level credit risk transmitted through CDS with differential maturities (e.g., ten-year minus one-year) in relation to biodiversity, water risks, and pollution prevention to understand the incentives created by these criteria for green infrastructure investments. Where these criteria describe risks of the environment for the firm (i.e., conventional materiality), we find that firms managing any of these three risks best have up to 93bps better relative long-term refinancing conditions than the worst ones. With respect to the second part of double materiality (i.e., the impact of the firm on the environment), we find statistically significant results only for pollution prevention of up to 70bps. Unexpected political right-wing shocks, such as the Trump election, had reversing effects on biodiversity and pollution prevention but not on water risks. These reversals were evident on the short end of the CDS curve but modest on the long end. Overall, our results suggest that investors appear to credit better management of the environmental criteria beyond climate with improved long-term financing conditions on infrastructure investments.
    Keywords: Double materiality, EU Taxonomy, infrastructure, term structure.
    JEL: G12 G18 G32 M14 Q52
    Date: 2023–02
  3. By: Buccella, Domenico; Fanti, Luciano; Gori, Luca
    Abstract: In a three-country model in which export countries adopt environmental policies, this note analyses how abatement ("green") subsidy can become a potential strategic trade policy tool. When governments set the optimal policy tool considering their local environmental damages, a rich set of equilibria arise. In contrast to the standard result, it is shown that subsidising pollution abatement can 1) emerge as a Pareto-efficient equilibrium of the game; and 2) be the only feasible environmental policy when environmental awareness is low, irrespective of the technological efficiency. Therefore, "green" subsidies can lead to a win-win situation.
    Keywords: Abatement subsidy, Exports, International duopoly
    JEL: H23 F13 L13
    Date: 2023
  4. By: Robin Lindsey; Ioannis Tikoudis; Katherine Hassett
    Abstract: This report takes stock of scientific findings to date regarding the distributional effects of policies discouraging car use in urban areas. These policies include cordon tolls, distance-based charges, fuel taxes, parking measures and public transport subsidies. The report describes the mechanisms responsible for the distributional effects of these policies and offers insights regarding how such policies can be designed to minimise adverse equity outcomes. It also provides recommendations regarding the design and procedural modifications that standard instruments require in order to be more acceptable to the public and to governments. Finally, it identifies a number of issues that warrant further research in the pursuit of greater equity in the outcomes of urban road transport policies.
    Keywords: environmental externalities, fuel tax, income distribution, inequality, road pricing
    JEL: D63 H23 Q52 Q54 R40 Q56
    Date: 2023–03–03
  5. By: Taguchi, Hiroyuki; Fujino, Takeshi; Asada, Hidekatsu; Ma, Jui-Jun
    Abstract: This study, focusing on the water pollutions in terms of chemical oxygen demand (COD) and ammonia nitrogen by industrial and household discharges in Chinese provinces, investigates the contribution of capacity shortage for pollution control to the provincial pollution levels, by conducting a factor analysis to the heterogeneity of provincial pollutions under the environmental Kuznets curve (EKC) framework. The study’s contribution to the literature lies in its framework of analyzing the heterogeneity of Chinese provinces’ EKCs in terms of their positions (not their shapes) by using a fixed-effect model to extract the province-specific pollution effects. The main finding of this study is that the capacity shortage for pollution control accounts for around 30% as a pollution factor of industrial COD and ammonia nitrogen, and accounts for around 60% and 80% as a pollution factor of household COD and ammonia nitrogen, respectively. It suggests that China has still much policy space and room to mitigate the water pollutions, by building the capacity for pollution control through developing human resources and training them.
    Keywords: water pollutions, pollution-control capacity, Chinese provinces, chemical oxygen demand (COD), ammonia nitrogen, environmental Kuznets curve
    JEL: O53 Q53 Q58
    Date: 2022
  6. By: Carozzi, Felipe; Roth, Sefi
    Abstract: We study the effect of urban density on the exposure of city dwellers to air pollution using data from the United States urban system. Exploiting geological features to instrument for density, we find an economically and statistically significant pollution-density elasticity of 0.14. We assess the health implications of these estimates and find that increased density in an average city leads to sizeable mortality costs. Our findings highlight the possible trade-off between reducing global greenhouse gas emissions, which is associated with denser cities according to prior empirical research, and preserving local air quality and human health within cities.
    Keywords: air pollutiuon; cities; density; health; UK Cities’ seed fund
    JEL: Q53 R11
    Date: 2023–03–01

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