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on Environmental Economics |
| By: | Kitessa, Rahel Jigi (Tilburg University, Center For Economic Research) |
| Abstract: | Standard economic theory suggests that agents make decision based on the outcomes. Subsequently, environmental valuation using contingent valuation method (CVM) assumes the agent’s valuation of a given environmental good is based on the (expected) results. However, Bulte et al. (2005) found that causes in addition to outcomes matter in valuation. I extended this notion to contribute to design of CVM that attenuate free riding, thus remove the downward bias of method. I used field experiment and tested if designing a scenario that reinforce responsibility in decision making (valuation), attenuates free riding. I do so by eliciting contributions to a reforestation program among farmers in an environmentally valuable area, the Bale eco-Region in Ethiopia, by including or omitting explicit information that one of the main forest related activities the respondents engage in, logging, is among the most important causes of local forest degradation. I find that explicitly stating that logging is one of the main causes of deforestation increases our respondents’ willingness to pay. More interestingly, I find that this “responsibility effect” is sufficiently strong to eliminate free rider behavior. When the information about the cause of deforestation is in place, the respondents’ willingness to pay for the reforestation project is not significantly different if they are informed of other forest protection projects, or not. |
| Keywords: | valuation of environment; incentive compatible valuation techniques; conservation; field experiment; forestry; public goods |
| JEL: | C93 D04 H41 O13 Q51 Q23 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiucen:3d1f1a62-d62a-44d3-8c8a-65bad2f0d7a8&r=env |
| By: | Yoon, Haeyeon (Sogang University); Heshmati, Almas (Jönköping University, Sogang University) |
| Abstract: | In an attempt to verify the pollution haven hypothesis, this study investigates the impact of environmental regulations on foreign direct investment (FDI). We use Korean outward FDI data covering the manufacturing sector for 2009-15. The study not only considers the stringency but also the enforcement of environmental regulations when measuring the degree of the host country's environmental regulations. Since the pollution haven's effects indicate moving the polluting production stages from the home country to other (host) countries, we distinguish between investments in the 'production' part from that in the non-production part using location information about the host country. The main results of the estimation of a FDI model show that the stricter the regulations in host countries in Asia the lower the FDI both intensively and extensively to those countries. This supports the prevalence of the effects of pollution havens. However, before we separate the FDI into the production part, the effect of environmental regulations on FDI is hindered by the FDI in the non-production part. The results indicate that environmental regulations are determinants of FDI in the production part, while environmental regulations do not have a significant effect on FDI decisions when the entire FDI is considered. |
| Keywords: | pollution haven hypothesis, environmental regulation, foreign direct investment |
| JEL: | F23 K32 L51 Q56 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10897&r=env |
| By: | Peter Bradley (University of the West of England, Bristol); Glenn Parry (University of the West of England, Bristol); Nicholas O’Regan (University of the West of England, Bristol) |
| Abstract: | The paper presents and applies a novel framework for incorporating ethical concerns for the natural environment and wellbeing into business design. In this sense we are directly confronting sustainable development. Within the context of business ethics, sustainable development can be seen as the application of ethical concerns for the natural environment and wellbeing to societal provisioning (‘meeting needs’). A novel framework proposed in this work synthesises 3 previous business model frameworks and builds in new categories and social, environmental and economic considerations to make it ‘fit’ for the purpose of investigating business models for sustainable development. The contribution made by the novel framework is through its new categories, incorporation of environmental and social considerations, and the ‘torch light articulation’ which aids communication of the concepts. The framework is applied to a case study of an energy provider, allowing a rich and powerful understanding of how the energy company’s business model works in practice and providing new insight of the interaction between different types of value: social, environmental and economic and how context shapes such value. |
| Keywords: | Business model; sustainability; servitization; sustainable business; sustainable development |
| Date: | 2016–01–06 |
| URL: | http://d.repec.org/n?u=RePEc:uwe:wpaper:20161606&r=env |
| By: | Habla, Wolfgang; Winkler, Ralph |
| Abstract: | We analyse a principal-agent relationship in the context of international climate policy. Principals in two countries first decide whether to merge domestic emission permit markets to an international market, then delegate the domestic permit supply to an agent. We find that principals select agents caring less for environmental damages than they do themselves in case of an international market regime, while they opt for self-representation in case of domestic markets. This strategic delegation incentive renders the linking of permit markets less attractive and constitutes a novel explanation for the reluctance to establish non-cooperative international permit markets. |
| Keywords: | non-cooperative climate policy,political economy,emissions trading,linking of permit markets,strategic delegation |
| JEL: | D72 H23 H41 Q54 Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:17025&r=env |
| By: | Mahfuz Kabir |
| Abstract: | The quality of the Gross Domestic Product in developing countries is as important as its sizegiven environmental degradation due to the aggressive extraction of subsoil minerals fromthe geo-sphere to accommodate production processes as well as emissions into the biosphere.Green national accounting is one way to come up with more durable environmentalpolicymaking, which does not compromise ongoing economic expansion in developing andemerging economies. The present paper is an attempt to conduct a valuation of the threemost important exhaustible natural resources, viz., natural gas, coal and hard rock, viathe System of Environmental-Economic Accounting, which has not yet been carried out inBangladesh. The study applies the net present value method for natural resources for thispurpose. We prepare physical and monetary balance sheets for each of the three resourcesfor the most recent accounting years. We test the sensitivity of the opening balance by usingdifferent discount rates for the selected minerals. The results reveal that the stock value ofcoal is about eight times higher than that of natural gas even though the latter is regardedas the most important subsoil mineral among the top three resources in Bangladesh. Thefindings of this study will be of use to policy makers to work on a more environmentallysensitive national accounting system. |
| URL: | http://d.repec.org/n?u=RePEc:snd:wpaper:122&r=env |
| By: | Njindan Iyke, Bernard; Ho, Sin-Yu |
| Abstract: | Using a composite trade share measure of trade openness, we examined the effects of trade openness on carbon dioxide emission for a sample of 17 Central and Eastern European (CEE) countries over the period 1994 to 2014. We found that high trade openness is associated with low carbon emission in the long run. When compared with the simple measure of trade openness (i.e. total trade as a percentage of GDP), the composite measure indicates that the effect of openness on carbon emission in the long run is smaller in absolute terms. Moreover, while high openness is associated with high emission in the short run using the simple measure, this association is non-existent when using the composite measure. These findings are robust to two historically closed economies and the recent Global Financial Crisis. When testing the Environmental Kuznets Curve (EKC) hypothesis using the composite measure, we found evidence in support of this in the long run. This finding connotes that high openness is associated with low emission in the long run, but up to a certain level of openness. That is, there is a turning point for openness beyond which further openness may spur high emission. Overall, our findings clearly suggest, to a large extent, that the measure of trade openness matters. |
| Keywords: | Measuring Trade Openness; Carbon Emissions; Central and Eastern Europe. |
| JEL: | Q56 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:80399&r=env |
| By: | Singh, Pushpa; Singh, K.M.; Shahi, Brajesh |
| Abstract: | Pulses has important role in contributing to food and nutritional security and replenishing soil nutrients having a huge potential in addressing needs like future global food security, nutrition and environmental sustainability needs. They also play an important role in mitigating greenhouse gas emissions in agriculture production by lowering GHG emissions. Farmers in grain and oilseed production have found economic benefits from lower input costs and increased profits by including a pulse crop in their rotation. In the face of shrinking natural resources and high population growths, enhancing production of pulses is now a major concern for Bihar in particular and nation as whole . The current shortfall in pulse availability is mainly due to less seed replacement rate of improved varieties, poor adoption of improved technologies by the farmers, abrupt climatic changes, complex disease pest syndrome, and emergence of new bio-types and races of key pests and pathogens and declining total factor productivity. The possibility of improving pulse productivity two to three times through existing varieties and available package of technologies has been demonstrated in FLDs by adoption of entirely new but simple and farmer-friendly technologies and tools. Considering that the frontiers of expansion of cultivated area are negligent, high demand of pulses must come from increase in yield by strengthening adaptive research and technology assessment, refinement and transfer capabilities, so that the existing technology transfer gaps can be bridged. For this, an appropriate network of extension service needs to be created to stimulate and encourage both top-down and bottom-up flows of information between farmers, extension workers, and research scientists to promote generation, adoption, and evaluation of location-specific farm technologies. |
| Keywords: | Pulses, Constraints in pulses production, Area Expansion under pulses, Bihar |
| JEL: | O13 O33 Q13 Q16 |
| Date: | 2016–05–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:80269&r=env |
| By: | Alain de JANVRY (Université de Californie Berkeley); Elisabeth SADOULET (Université de Californie Berkeley) |
| Abstract: | Achieving the Sustainable Development Goal on poverty eradication requires focusing on agriculture and rural areas. Increasing technology adoption in staple food agriculture—the Green Revolution—will however not suffice. Key is to manage an agricultural and a rural transformation whereby farming systems become more diversified and a rural non-farm economy emerges to complement agricultural sources of income and smooth labor calendars for the rural labor force. |
| Keywords: | SDG, Sustainable development goals |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:3780&r=env |
| By: | Alain de JANVRY (University of California Berkeley); Elisabeth SADOULET (University of California Berkeley) |
| Abstract: | Achieving the Sustainable Development Goal on poverty eradication requires focusing on agriculture and rural areas. Increasing technology adoption in staple food agriculture—the Green Revolution—will however not suffice. Key is to manage an agricultural and a rural transformation whereby farming systems become more diversified and a rural non-farm economy emerges to complement agricultural sources of income and smooth labor calendars for the rural labor force. |
| Keywords: | SDG, Sustainable development goals |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:3781&r=env |
| By: | Ross McKitrick (Department of Economics, University of Guelph, Guelph ON Canada) |
| Abstract: | This paper makes two contributions to the economics of pollution policy. First, many studies have looked at the effects of emission taxes in the absence of regulations and vice versa, but the implications for optimal tax design when one is layered on top of the other have been ignored, even though the practice is commonly observed. I develop a model of multiple polluting sectors capable of providing a tractable characterization of this case. Second, numerical modeling has shown that tax interactions can yield a positive damage threshold below which any emission tax is welfare-reducing even if marginal damages are positive, but this has largely been ignored in both the theoretical and policy literatures. I show that a positive damage threshold occurs when the policy is not revenue-raising and/or the rest of the tax system is not optimized, but can also occur in a second-best context with optimal taxes and full revenue-recycling, a result not previously shown. Introducing a pollution tax when one firm is already subject to an emissions constraint yields a positive damage threshold that goes up, the more the regulation distorts the income tax base. Hence, under more general conditions than have previously been realized, pollution taxes are not guaranteed to raise welfare even when marginal damages are positive and revenues are fully recycled. |
| Keywords: | emissions taxes, tax interactions, second-best, carbon taxes |
| JEL: | H21 H23 Q54 Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:gue:guelph:2017-05&r=env |
| By: | Michael Spanbauer (Department of Economics, Tulane University); Lindsay Johnson (KIPP McDonogh 15 School for the Creative Arts); Patrick Button (Department of Economics, Tulane University) |
| Abstract: | We estimate the national average passive use value for Alaskan National Parks. Passive use refers to the value that individuals get from the existence of a public good without actually using it. We field a questionnaire asking respondents, using the contingent valuation method, how much they would pay for a 5% expansion of Denali National Park. We find that respondents are willing to pay $115 to $409 for this expansion, according our preferred specifications. Respondents answers to questions about what motivated their support and questions about their connections to Alaska indicate that support for the expansion is driven by passive use values. |
| Keywords: | National Parks; willingness-to-pay; nature conservation; contingent valuation; biodiversity; environmental policy |
| JEL: | Q24 Q28 Q51 Q57 Q58 R52 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1707&r=env |
| By: | Esra Ball? (Çukurova University); Salih Çam (Çukurova University); Müge Manga (Çukurova University); Çiler Sigeze (Çukurova University) |
| Abstract: | This study investigates the relationship between energy use, GDP, carbon dioxide emissions, population, financial development, and industrialization utilizing ARDL and artificial neural network for Turkey. The data covers the period from 1968 to 2013. The study performed a two stage analysis. At the first stage, we examined the long run relationship and causality between variables. The variables are found to be cointegrated. The Granger causality test results shows that there is a unidirectional causality running from energy use to both carbon dioxide emissions and industrialization. According to the artificial neural network results, the most important effect on energy use comes from GDP. The predicted energy use from 1968 to 2013 has maximum absolute error of % 11. 31 and minimum absolute error of %0.07. Neural network evidence shows that the R-square coefficient is 98% for the sample period. |
| Keywords: | Energy use, ARDL, Neural network, Turkey |
| JEL: | C10 Q43 C22 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:4607826&r=env |
| By: | Adela Zubikova (University of Economics in Prague, Faculty of Economics) |
| Abstract: | The aim of the article is to verify the validity of resource curse in the case of Nigeria at the beginning of the new millennium. The theoretical part defines the role of natural resources as a form of capital, the symptoms of the alleged curse and transmission channels of resource curse. The practical part verifies several hypotheses established by comparing research papers on impacts of natural resources. The validity of the Prebisch-Singer hypothesis, Dutch disease symptoms and a negative impact on political institutions (inclination toward authoritarianism, high level of corruption, high government spending and low efficiency of economic and political decision-making) are verified. Results confirm most of the manifestations of the resource curse. |
| Keywords: | resource curse, natural capital, economic growth, Prebisch-Singer hypothesis, Dutch disease |
| JEL: | O13 Q00 Q33 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iefpro:4507411&r=env |
| By: | Lee, Sang-Ho; Xu, Lili |
| Abstract: | This paper examines an endogenous timing game in product differentiated duopolies under price competition when emission tax is imposed on environmental externality. We show that a simultaneous-move (sequential-move) outcome can be an equilibrium outcome in a private duopoly under significant (insignificant) environmental externality, but this result can be reversed in a mixed duopoly. We also show that when environmental externalities are significant, public leadership yields greater welfare than private leadership, and that public leadership is more robust than private leadership as an equilibrium outcome. Finally, we find that privatization can result in a public leader becoming a private leader, but this worsens welfare. |
| Keywords: | Emission tax; Endogenous timing; Mixed duopoly; Private duopoly |
| JEL: | D6 L5 Q28 |
| Date: | 2017–07–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:80342&r=env |
| By: | Caterina Gennaioli (School of Business and Management, Queen Mary University of London.); Gaia Narciso (Department of Economics, Trinity College Dublin) |
| Abstract: | Illegal disposal of toxic waste has become an issue of concern in both developing and developed countries. Recycling hazardous waste entails very high costs, which might give strong incentives to dispose toxic material in an illegal way. This paper adopts an innovative strategy to identify where toxic waste might have been illicitly dumped. The strategy relies on a crucial premise: road constructions provide an ideal setting in which the burial of hazardous waste may take place. Guided by the medical literature, we investigate the health outcomes of individuals living along recently constructed roads in Ethiopia. We construct a unique dataset, which includes the extensive Demographic and Health Survey, together with georeferenced data on roads, villages and economic development, covering a 10-year period. We find that an additional road within a 5 kilometres radius is associated with an increase in infant mortality by 3 percentage points. Moreover, we provide evidence that young children living near a recently built road show a lower level of haemoglobin and are more likely to suffer from severe anaemia. A series of robustness checks confirms the above findings and excludes other potential confounding factors. |
| Keywords: | Hazardous Waste, Health, Infant Mortality, Ethiopia |
| JEL: | I15 Q51 Q53 O10 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep1817&r=env |
| By: | Agüero, Jorge M. (University of Connecticut); Balcázar, Carlos Felipe (World Bank); Maldonado, Stanislao (Universidad del Rosario); Nopo, Hugo R. (GRADE) |
| Abstract: | We exploit time and spatial variation generated by the commodities boom to measure the effect of natural resources on human capital formation in Peru, a country with low governance indicators. Combining test scores from over two million students and district-level administrative data on mining production and the redistribution of mining taxes to local governments, we find no effect from production. However, redistribution of mining taxes increases math test scores by 0.23 standard deviations. We identify the improvements in the quality of teachers and in school infrastructure, together with increases in adult employment and health outcomes of adults and children, as key mechanisms from the redistribution. Policy implications for the avoidance of the natural resource curse are discussed. |
| Keywords: | resource booms, academic achievement, intergovernmental transfers |
| JEL: | H7 H23 I25 O15 Q32 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10884&r=env |