nep-res New Economics Papers
on Resource Economics
Issue of 2023‒08‒14
six papers chosen by
Maximo Rossi
Universidad de la República

  1. Is Air Pollution Regulation Too Stringent? Evidence from US Offset Markets By Joseph S. Shapiro; Reed Walker
  2. Pro-environment Attitudes and Worker Commuting Behavior By Gimenez-Nadal, José Ignacio; Molina, José Alberto; Velilla, Jorge
  3. Revisiting the Environmental Protection Agency's Value of Statistical Life By Cropper, Maureen L.; Joiner, Emily; Krupnick, Alan
  4. Climate change and reindeer herding – a bioeconomic model on the economic implications for Saami reindeer herders in Sweden and Norway By Irmelin Slettemoen Helgesen; Anne Borge Johannesen
  5. Historical Evolution of Global Inequality in Carbon Emissions and Footprints versus Redistributive Scenarios By Victor Yakovenko; Gregor Semieniuk
  6. Efficiency, perceived prices, and household water demand: A stochastic frontier analysis for the Spanish city of Gijón By Roberto Balado-Naves; Marian Garcia-Valiñas; David Roibas

  1. By: Joseph S. Shapiro; Reed Walker
    Abstract: This paper describes a framework to estimate the marginal cost of air pollution regulation, then applies it to assess whether a large set of existing U.S. air pollution regulations have marginal costs exceeding their marginal benefits. The approach utilizes an important yet under-explored provision of the Clean Air Act requiring new or expanding plants to pay incumbents in the same or neighboring counties to reduce their pollution emissions. These “offset” regulations create several hundred decentralized, local markets for pollution that differ by pollutant and location. We show that these markets cover much US economic activity, experience search frictions, have rising prices over time, and reflect local regulatory stringency. We provide empirical and theoretical evidence consistent with the idea that offset transaction prices are close to the marginal cost of pollution abatement, and we compare offset prices to estimates of the marginal benefit of abatement from leading air quality models. We find that for most regions and pollutants, the marginal benefits of pollution abatement exceed mean offset prices more than ten-fold. In at least one market, however, estimated marginal benefits are below offset prices.
    JEL: H23 Q52 Q53 R11
    Date: 2023–06
  2. By: Gimenez-Nadal, José Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza); Velilla, Jorge (University of Zaragoza)
    Abstract: The private vehicle is, for most developed countries, the prevalent commuting mode of workers, and one of the main source of CO2 emissions. The choice of the mode of transport for commuting trips clearly depends on individual preferences, and it may be that pro-environmental attitudes and values are related to environmental awareness and minimization of harm to the environment. This paper explores how pro-environmental attitudes and values relate to commuting behaviors, using data from the American Time Use Survey for the period 2003-2019. We focus on the time spent commuting, and on commuting modes. The results show that, net of observable factors, regions in which social attitudes are more pro-environmental are related to longer commuting times, but also to a higher percentage of active commuters and public transit commuters. These results suggest that policies aimed at shifting pro-environmental social values may help in reducing the use of private vehicles and encourage green means of transport, in order to reduce the environmental costs of commuting.
    Keywords: pro-environmental attitudes, commuting time, transport mode, American Time Use Survey, American Values Survey, general social survey
    JEL: A13 Q52 R41
    Date: 2023–06
  3. By: Cropper, Maureen L. (Resources for the Future); Joiner, Emily (Resources for the Future); Krupnick, Alan (Resources for the Future)
    Abstract: The US Environmental Protection Agency (EPA) bases its estimate of the value of statistical life (VSL) on 17 hedonic wage studies and five contingent valuation studies conducted between 1974 and 1991. We summarize advances in the mortality risk valuation literature since these papers were published, focusing on studies that value risks to adults and were conducted in the United States. We review hedonic wage, other revealed preference, and stated preference studies, identifying papers that satisfy appropriate validity criteria. We conclude that the recent literature is sufficiently rich to permit a revision of EPA’s baseline estimate. Importantly, VSL estimates from both the averting behavior and stated preference studies we review reflect the preferences of a wider range of demographic groups than the current VSL, and newer studies better target causes of death relevant to EPA regulations.
    Date: 2023–07–19
  4. By: Irmelin Slettemoen Helgesen (Department of Economics, Norwegian University of Science and Technology); Anne Borge Johannesen (Department of Economics, Norwegian University of Science and Technology)
    Abstract: The Arctic is warming three times faster than the global average. Rising temperatures could reduce the snow-covered season and increase plant productivity in the spring, fall and summer. While this may increase carrying capacity and growth of semi-domesticated reindeer, rising temperatures could also lead to an increase the frequency of ice-locked pastures, negatively affecting reindeer body mass, survival and reproductive success. We create a stage-structured bioeconomic model of reindeer herding that incorporates two counteracting effects of climate change on reindeer growth, reproduction, and survival. The model is calibrated using historical data on reindeer numbers and slaughter weights, in combination with weather data. We find that one more day with ice-locked pastures has a greater negative impact than the benefit of earlier spring. Then the model is used to simulate the economic impact of three climate change scenarios, and four areas in Norway and Sweden. All areas experience an improvement in herding profits in the Paris Agreement scenario. In the BAU scenario, the impact of climate change is negative for all areas. We also find that the potential loss in pasture related to certain emission mitigating policies may be more detrimental to reindeer husbandry than climate change itself.
    Keywords: reindeer husbandry, climate change, commons, livestock, food limitation
    JEL: Q24 Q54
    Date: 2023–07–07
  5. By: Victor Yakovenko (University of Maryland); Gregor Semieniuk (University of Massachusetts Amherst)
    Abstract: Ambitious scenarios of carbon emission redistribution for mitigating climate change in line with the Paris Agreement and reaching the sustainable development goal of eradicating poverty have been proposed recently. They imply a strong reduction in carbon footprint inequality by 2030 that effectively halves the Gini coefficient to about 0.25. This paper examines feasibility of these scenarios by analyzing the historical evolution of both weighted international inequality in CO2 emissions attributed territorially and global inequality in carbon footprints attributed to end consumers. For the latter, a new dataset is constructed that is more comprehensive than existing ones. In both cases, we find a decreasing trend in global inequality, partially attributed to the move of China from the lower to the middle part of the distribution, with footprints more unequal than territorial emissions. These results show that realization of the redistributive scenarios would require an unprecedented reduction in global inequality far below historical levels. Moreover, the territorial emissions data, available for more recent years up to 2017, show a saturation of the decreasing Gini coefficient at a level of 0.5. This observation confirms an earlier prediction based on maximal entropy reasoning that the Lorenz curve converges to the exponential distribution. This saturation further undermines feasibility of the redistributive scenarios, which are also hindered by structural tendencies that reinforce carbon footprint inequality under global capitalism. One way out of this conundrum is a fast decarbonization of the global energy supply in order to decrease global carbon emissions without relying crucially on carbon inequality reduction.
    Keywords: Carbon footprint, Sustainable development, Maximum entropy
    JEL: Q01 Q54 Q56 Q43
    Date: 2023–07
  6. By: Roberto Balado-Naves (Oviedo Efficiency Group - University of Oviedo); Marian Garcia-Valiñas (Oviedo Efficiency Group - University of Oviedo); David Roibas (Oviedo Efficiency Group - University of Oviedo)
    Abstract: In the current context of pressure on available water resources, sustainable patterns of water consumption emerge as an important matter of concern. In this sense, efficient consumption is usually understood as the optimal usage of the available resources. Thus, we study households' efficiency levels by considering a stochastic frontier analysis of the demand for water services using a representative sample of a northern city in Spain. Besides, efficient consumption habits require a costly acquisition of accurate information, whether in terms of prices or the effective demand of a given resource. Thus, we also study the impact of several determinants on the efficiency levels of water demand, as in Hung et al. (2017). These range from the deviations between perceived and real prices to social characteristics such as the average age of households or their degree of environmental awareness. We find strong evidence in favor of higher efficiency levels among more informed households which also commit themselves to the environment. The relevance of this research to the current state of the empirical literature is twofold: first, it expands the number of scarce analyses on stochastic frontiers of residential water demand; second, it contributes to a better understanding of the importance of accurate information on optimal decisions of consumers. Moreover, we use a novel and exclusive database for a representative sample of households in the city of Gijón (Spain) between 2017 and 2021, where we combine real data on water prices and consumption with consumer perceptions obtained from a survey.
    Date: 2023–01–01

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