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Attitudes to Personal Carbon Allowances: The effect of trust in politicians, perceived fairness and ideology

The idea of personal carbon allowances (PCAs) was presented by the UK Environment Secretary, David Miliband, in 2006. Although no nation state is seriously developing proposals for them, they have been discussed within academia, NGOs and policy-making circles. PCAs can be seen as a logical extension of emissions trading schemes, which has so far only applied at the firm level, to individuals. The purpose of this article is to analyse some critical aspects of the public’s support for a PCA scheme.


Swedish CO2-Emissions 1993 - 2006 – An Application of Decomposition Analysis and Some Methodological Insights

This study undertakes a decomposition analysis to identify the drivers of carbon emissions change in the Swedish business and industry sectors 1993 - 2006. On aggregate, energy intensity decreased, but this does not seem to have been very important for reducing emissions. Rather, fuel substitution seems to have been more important, which is in line with findings from the decomposition literature on Sweden.


To trade or Not to Trade: A Firm-Level Analysis of Emissions Trading in Santiago, Chile

The authors surveyed firms participating in emissions trading programs in Santiago, Chile, to explore further whether tradable permits are appropriate for transition and developing economies. Their survey information revealed serious implementation and design flaws in Chile’s trading, but they are not more severe than the EU or U.S. systems. Countries with similar income levels and institutional maturity as Chile should be able to develop well-functioning permit trading schemes.


Tradable Permits in Developing Countries: Evidence from Air Pollution in Santiago, Chile

Santiago was one of the first cities outside the OECD to implement a tradable permit program to control air pollution. This paper looks closely at the program’s performance over the past 10 years, stressing its similarities and discrepancies with trading programs in developed countries, and analyzing how it has reacted to regulatory adjustments and market shocks. Studying Santiago’s experience allows us to discuss the drawbacks and advantages of applying tradable permits in less developed countries.


Impacts of the Productive Safety Net Program in Ethiopia on livestock

We evaluated the impacts of the Ethiopian Productive Safety Net Program (PSNP) on rural households' holdings of livestock and forest assets/trees. We found no indication that participation in PSNP induces households to disinvest in livestock or trees. In fact, households that participated in the program increased the number of trees planted, but there was no increase in their livestock holdings.


Consequences of Subpopulation Structure on Fisheries Management: Cod (Gadus morhua) in the Kattegat and Öresund (North Sea)

This study shows how cod subpopulations may have been eradicated as a consequence of the use of imperfect models for assessing stock assessment, depleting what was formerly a productive sea. The Kattegat and resund (North Sea) were chosen as study objects due to the combination of different exploitation patterns and the possible existence of separate stock units. The scenario was further elaborated by simulating the potential harvest of fishing for different long-run levels of fishing effort as well as stock size. The study clearly indicated that new policy instruments are needed but these instruments need to be carefully fine-tuned to take into account real biological as well as social factors.


The Progress of GHG Markets: Opportunities and Risks

The purpose of this report is to build knowledge about the effects of the development of regional and international carbon markets and the auxiliary technology agreements that might be needed. Among the topics we address are: the evolution and integration of carbon markets, the impacts of policy and technology cost uncertainty on the cost of meeting targets through a carbon market mechanism, the effect of banking, price floors and ceilings, institutional constraints and technological change in the further development of carbon markets and their links to other environmental policy instruments, and the potential of REDD-plus to encourage sustainable forest development and climate mitigation.


Regulatory Compliance in Lake Victoria Fisheries

This analysis of the fishers’ compliance with regulations in Lake Victoria, Tanzania, gives support to the traditional economics-of-crime model and shows that the extension of the basic deterrence model can lead to a richer model with substantially higher explanatory power.


A choice experiment on coca cropping

From 1997 to 2005, an astonishing 5200 million USD was invested to reduce cocaine production in Colombia, the world's main cocaine producer. However, little is known about the effectiveness of policies targeting coca cultivation. This paper uses a survey-based experiment to evaluate the effects of the two main policies: eradication and alternative development programs.


Climate Change and Total Factor Productivity in the Tanzanian Economy: A Computable General Equilibrium Analysis

The paper analyses the economic impacts of climate change-induced adjustments on the performance of the Tanzanian economy, using a country-wide CGE model. The general equilibrium framework enables comparison of the effects of climate change to the overall growth of the economy, as responsiveness to shocks is likely to depend on the macroeconomic structure of the economy.


On the interaction between imperfect compliance and technology adoption: taxes versus tradable emissions permits

This paper analyzes the effects of the interaction between technology adoption and incomplete enforcement on the extent of violations and the rate of abatement technology adoption. We focus on price-based and quantity-based emission regulations. First, we show that in contrast to uniform taxes, under tradable emissions permits (TEPs), the fall in permit price produced by technology adoption reduces the benefits of violating the environmental regulation at the margin and leads firms to modify their compliance behavior.


Paying for Mitigation: A Multiple Country Study

Unique survey data from a contingent valuation study conducted in three different countries (China, Sweden, and the United States) were used to investigate the ordinary citizen’s willingness to pay (WTP) for reducing CO2 emissions. We found that a large majority of the respondents in all three countries believe that the mean global temperature has increased over the last 100 years and that humans are responsible for the increase.


Farmers’ Choice between Public Goods and Agricultural Extension Packages in Ethiopia: A Stated Preference Analysis

Currently, there is a general dichotomy in rural development policies. This dichotomy between extension-driven adoption of modern inputs on the one hand, and community-driven local public goods on the other hand, is particularly evident in the highlands of Ethiopia. Despite the obvious trade-offs between these two approaches, the target populations seldom get the chance to express their preferences for them.


Using contingent valuation to price ecotourism sites in developing countries

National parks attract tourists to developing countries. However, there are only rare cases where the full economic rent from tourism in protected areas has been captured by these countries. This severely limits the capacity of developing countries to sustain these protected areas. The present study investigates the efficiency of the current pricing policies of Kakum National Park in Ghana.


The Bioeconomics of Conservation Agriculture and Soil Carbon Sequestration in Developing Countries

Improving soil carbon through conservation agriculture in developing countries may generate some private benefits to farmers, as well as sequester carbon emissions, which is a positive externality to society. Leaving crop residue on the farm has become an important option in conservation agriculture practice. However, in developing countries, using crop residue for conservation agriculture has the opportunity cost of feed for livestock.


Does Relative Position Matter in Poor Societies? Evidence from a Survey Experiment in Rural Ethiopia

The authors investigated attitudes toward positionality among rural farmers in northern Ethiopia, using a tailored two-part survey experiment. On average, they found positional concerns neither in income per se, nor in income from aid projects among the farmers. These results support the claim that positional concerns are correlated with absolute level of income of a country.


Paying the Price of Sweetening Your Donation: Evidence from a Natural Field Experiment

Using a natural field experiment in a recreational site, a public good almost fully dependent on voluntary donations, the authors explored the crowding-out effect of gift rewards. First, they investigated whether receiving a map in appreciation of a donation crowded out prosocial behavior and found no significant effect of giving the map. Second, they explored the effect of adding the map to a treatment designed to increase donations. Interestingly, when the gift was combined with their attempt to trigger reputational and self image motives, the probability of donating decreased significantly, compared to the social reference treatment alone.


In defence of sensible economics

How can economics best contribute to the scientific and public debates? Professor Thomas Sterner, University of Gothenburg, together with Nicholas Stern, who wrote the The Stern Review, and Nobel laureates Thomas Schelling and Robert Solow are among the scholars who explain in this book both how economics has changed environmental understanding and how the study of climate change has modified the economy.


To trade or Not to Trade: A Firm-Level Analysis of Emissions Trading in Santiago, Chile

The authors surveyed firms participating in emissions trading programs in Santiago, Chile, to explore further whether tradable permits are appropriate for transition and developing economies. Their survey information revealed serious implementation and design flaws in Chile’s trading, but they are not more severe than the EU or U.S. systems. Countries with similar income levels and institutional maturity as Chile should be able to develop well-functioning permit trading schemes.


Enforcement of Exogenous Environmental Regulations, Social Disapproval, and Bribery

Many resource users are not involved in formulating and enforcement of resource management regulations in developing countries and do not generally accept such rules. Enforcement officers who have social ties to resource users may encounter social disapproval if they enforce regulations zealously, so they may accept bribes to avoid it. The authors present a neoclassical utility maximization framework that characterizes this situation, derive results for situations where officers are passively and actively involved in the bribery, and make some interesting policy recommendations.


Sustainable Development Innovation Brief #7

"The contribution of sustainable agriculture and land management to sustainable development" - This brief discusses the potential for sustainable agriculture to contribute towards sustainable development with a particular focus on developing countries. It briefly describes different sustainable agricultural practices and the extent of their adoption, identifies constraints to their further adoption, and presents some actions and policy options that could accelerate the widespread adoption of sustainable agricultural practices.


Climate Change Abatement: Not "Stern" Enough?

This article, "Climate Change Abatement: Not "Stern" Enough?", by Thomas Sterner and Dallas Burtraw, is forthcoming in a book, Parry and Day, eds. "100 Policy Commentaries on Environmental, Energy, Urban and Public Health Problems: Volume 1", RFF Press.


Which Firms are More Sensitive to Public Disclosure Schemes for Pollution Control? Evidence from Indonesia’s PROPER Program

This paper analyzes differences in firms’ responsiveness to PROPER, Indonesia’s public disclosure program for industrial pollution control. The overall effectiveness of this program at achieving emissions reductions and its low regulatory costs have earned it a good reputation around the world. PROPER had no deterrents or incentives other than those that arose indirectly from publicly disclosing information about the environmental performances of firms.


The Effect of Risk, Ambiguity, and Coordination on Farmers´Adaptation to Climate Change: A Framed Field Experiment

The authors used a framed field experiment with coffee farmers in Costa Rica after tropical storm Alma to explore how farmers react to different levels of risk to income and productive means from extreme weather under measurable and unmeasurable uncertainty. They also examined whether investment costs to reduce vulnerability exhibit economies of scope.


Conditional Cooperation and Social Group: Experimental Results from Colombia

There is growing interest in understanding whether behavior is the same across locations. By holding cross- and within-country dimensions constant (in contrast to previous studies on cross-group comparisons of conditional cooperation), the authors investigated cooperative behavior between social groups in the same location. Their results reveal significantly different cooperation behavior, suggesting that different social groups exhibit differences both in terms of composition of types and extent of conditional cooperation.


Risk Aversion and Expected Utility of Consumption over Time

The calibration theorem by Rabin (2000) implies that seemingly plausible smallstake choices under risk imply implausible large-stake risk aversion. This theorem is derived based on the expected utility of wealth model. However, Cox and Sadiraj (2006) show that such implications do not follow from the expected utility of income model. One may then wonder about the implications for more applied consumption analysis.