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on Resource Economics |
| By: | Jens Gudmundsson (University of Copenhagen); Jens Leth Hougaard (University of Copenhagen); Erik Ansink (Vrije Universiteit Amsterdam) |
| Abstract: | We take a decentralized approach to regulating environmental pollution in set- tings where each agent’s pollution possibly affects all others. There is no central agency to enforce pollution abatement or coordinate monetary transfers. Moreover, agents possess private information, which precludes deducing efficient abatement in general. We propose to implement transfer schemes through smart contracts to allow beneficiaries to compensate for abatement. We characterize all schemes that induce efficient abatement in unique dominant-strategy equilibrium. Moreover, appealing to classical fairness tenets, we pin down the “beneficiaries-compensates principle†. Supporting this principle through smart contracts provides a promising step towards decentralized coordination on environmental issues. |
| Keywords: | Pollution, Decentralization, Smart contracts, Beneficiaries-compensates principle |
| JEL: | C72 D62 Q52 H23 |
| Date: | 2024–05–23 |
| URL: | https://d.repec.org/n?u=RePEc:tin:wpaper:20240035 |
| By: | Sim, Armand (Monash University); Gultom, Sarah (Monash University); Widita, Alyas (Monash University); Lee, Wang-Sheng (Monash University); Khalil, Umair (Deakin University) |
| Abstract: | Promoting awareness and encouraging pro-sustainability behaviors to mitigate climate and environmental issues can be challenging due to their polarizing nature. We conduct a large-scale online experiment in Jakarta, the world's fastest sinking city, to examine the impact of messenger identity and narrative style on awareness and behavior regarding land subsidence, a human-induced climate change phenomenon. We vary the messenger identity (an actor portraying either a religious leader or a scientist) and the narrative style of the message (religious vs. scientific). Our results show that exposure to an environmental video message, as opposed to a placebo, increases beliefs, trust in institutions, and pro-sustainability behaviors. The largest impacts arise when a scientist delivers a message embedded with a religious narrative. The effects are more pronounced among individuals with low prior knowledge, high trust in authorities, and those less reliant on groundwater. However, we find limited evidence of heterogeneous treatment effects on actions. Our findings highlight the importance of carefully considering both the message and the messenger in communication strategies in a diverse population. |
| Keywords: | land subsidence, environmental awareness, religion, science, Indonesia |
| JEL: | Q54 Q58 Z12 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17184 |
| By: | Brown, David P. (University of Alberta, Department of Economics); Cajueiro, Daniel O. (University of Brasilia); Eckert, Andrew (University of Alberta, Department of Economics); Silveira, Douglas (University of Alberta, Department of Economics) |
| Abstract: | Real-time information has the potential to improve market outcomes in wholesale electricity markets. However, transparency can also facilitate coordination between firms, raising questions over the appropriate extent of information disclosure. Despite this ongoing debate, there is a lack of understanding of the information employed by firms when bidding in wholesale electricity markets. We use data from Alberta’s wholesale market and leverage machine learning techniques to evaluate the real-time information firms use when forming their bidding decisions. We find that aggregate market-level variables emerge as important predictors, while detailed firm-specific information does not lead to a material improvement in predicting firms’ bidding decisions. These results suggest that firm-specific information, which has raised concerns because of its potential use in facilitating coordinated behavior, may not be required to promote efficient market outcomes. |
| Keywords: | Machine Learning; Electricity; Price Forecasting; Competition Policy |
| JEL: | D43 L13 L50 L94 Q40 |
| Date: | 2024–08–18 |
| URL: | https://d.repec.org/n?u=RePEc:ris:albaec:2024_002 |
| By: | Fajardo Baquero, Nicolás (Universidad de los Andes) |
| Abstract: | International Environmental Agreements (IEAs) have been proposed as means to encourage green technological transfers between advanced and emerging economies, thereby promoting a global energy transition. This paper presents an endogenous growth model featuring two economies: a North representing a technological leader, and a South being its follower with the possibility of copying the Northern technologies. In addition to the standard technological flows, North and South can engage in cooperative negotiations to ease green technological transfers. I find that technological transfers are able to revert the path dependency in the South. Further, unconditional agreements reducing Northern technologies’ costs can immediately induce a global energy transition if (i) the North follows a clean growth path, and if (ii) Northern technologies are advanced enough. Otherwise, to ensure a global energy transition, the agreement must be coupled with additional policies encouraging clean innovations. |
| Keywords: | Climate change; Energy transition; International technology transfer; International agreements; Directed technical change |
| JEL: | F18 O31 O41 Q54 Q55 |
| Date: | 2024–08–23 |
| URL: | https://d.repec.org/n?u=RePEc:col:000089:021187 |
| By: | Berthold, Brendan (University of Lausanne); Cesa-Bianchi, Ambrogio (Bank of England); Di Pace, Federico (Bank of England); Haberis, Alex (Bank of England) |
| Abstract: | This paper investigates the economic effects of carbon pricing policies using a panel of countries that are members of the EU Emissions Trading System. Carbon pricing shocks lead, on average across countries, to a decline in economic activity, higher inflation, and tighter financial conditions. These average responses mask a large degree of heterogeneity: the effects are larger for higher carbon-emitting countries. To sharpen identification, we exploit granular firm-level data and document that firms with higher carbon emissions are the most responsive to carbon pricing shocks. We develop a theoretical model with green and brown firms that accounts for these empirical patterns and sheds light on the transmission mechanisms at play. |
| Keywords: | Business cycles; carbon pricing shocks; heterogeneity; asset prices |
| JEL: | E32 E50 E60 H23 Q54 |
| Date: | 2024–08–05 |
| URL: | https://d.repec.org/n?u=RePEc:boe:boeewp:1076 |