Journal of Environmental Economics and Management最新文献

Li and Pizer derived upper and lower bounds on the time-dependent social discount rate that both converge in the long run to the consumption rate of interest. They went on to recommend using the consumption rate of interest as the social discount rate for investments relating to climate change for which the bulk of the benefits accrue in the far future. However, the bounds can be quite wide in the short-run, providing little guidance for shorter term discounting. Here, we show that if uncertainty in the social discount rate is encoded in a uniform distribution, then its expected value converges much more rapidly to the consumption rate of interest. The implications of this for project evaluation are more complicated than in the deterministic case considered by Li and Pizer.

This study examines the influence of relative energy prices on the geographical distribution of industrial investments across 41 countries. Employing a gravity model framework to analyse firms’ investment location decisions, we estimate the model using global bilateral investment flows derived from firm-level M&A data. Our findings reveal that a 10% increase in the energy price differential between two countries results in a 3.2% rise in cross-border acquisitions. This effect is most pronounced in energy-intensive industries and transactions targeting emerging economies. Furthermore, policy simulations suggest that the impact of unilateral carbon pricing on cross-border investments is modest.

While tenure security is essential to effective land management, there is little empirical evidence on its environmental impact. Exploiting the staggered rollout of the land registry program across Greece, we find the regions covered by the mandatory program witness large declines in agricultural fire events, burned areas, and air pollutants. Agricultural data reveal that landowners in those regions mitigate fire risks through reducing stubble burning, expanding farming areas, and stocking more fire-suppression equipment. Our findings indicate that strengthening property rights can lead to more sustainable farming practices and promote long-term land investment, thereby reducing fire hazards.

Hydrogen produced from renewable energy and other carbon-neutral sources has the potential of becoming an important medium for storing and transporting energy, partially taking on the role that fossil fuels play to date. We develop a novel theoretical and empirical model of sequential trade based on long-term contracts with one or more fixed-capacity projects entering each period in a modified Nash-Cournot competition. We simulate the emerging international trade in hydrogen using calibrated demand, supply, transportation, and policy data, exploring a set of scenarios to determine which factors have significant influence—in particular environmental, innovation, and trade policies. Our findings suggest that hydrogen trade exhibits significant price dispersion and two-way trade as vintages of contracts overlap in a market defined by endogenous innovation and policy interventions. Trade costs and the mode of transportation (pipelines or ammonia conversion, possibly others) play a pivotal role and influence the relative share of hydrogen production types (green, blue, or turquoise). Trade policies emerge as a more essential determinant of hydrogen trade than carbon and innovation policies.

This paper investigates the relationship between climate change and income inequality, recognizing that the economic impacts of climate change are not uniform across different levels of income within and across countries. Using methods from the existing literature on climate and economic growth, we analyze the economic impact of rising temperatures by within-country income decile. Our findings suggest that climate change disproportionately affects the poorer segments of the population within countries, even after accounting for a country’s ability to adapt to climate impacts, while richer households suffer lower damages. In the reference scenario without additional climate action (3.6°C warming), we estimate that climate impacts could lead to an increase in the Gini index by up to six percentage points, notably in Sub-Saharan Africa. We project impacts to 2100 through the RICE50+ model and estimate the income elasticity of impacts within countries. Our estimates indicate that climate change damages are regressive, with an income elasticity of damages of 0.6 under our preferred specification. On the other hand, climate benefits are approximately distribution-neutral or slightly progressive.

Finland introduced the planet’s first carbon tax in 1990 to experiment with, to most economists, the best policy to reverse carbon emissions. I estimate the causal effect of taxing carbon on Finnish emissions using the Synthetic Control Approach (Abadie, 2021). The results suggest that taxing carbon reduces emissions by big margins. Finnish emissions are 16% lower in 1995, 25% lower in 2000, and 30% lower in 2004 than emissions in the counterfactual consistent with carbon taxes whose value increasing by 20 fold in 1990–2005. The estimates suggest that the carbon tax’s abatement elasticity is about 9%.

The paper develops the concept of “Economic Pathways” (EPs), which characterizes theory-based scenarios for an economy that strives for decarbonization by the middle of the century. The theoretical framework derives closed-form analytical solutions for consumption, innovation, emissions, and population. The EPs differ in the stringency of assumed policies and associated income and emission development. Unlike the well-known “Shared Socioeconomic Pathways”, they allow the inclusion of important causalities between the economy and the environment and thereby considerably narrow down the scope of likely future developments. The quantitative part serves to illustrate the long-term consequences of climate policy. I show that deep decarbonization only moderately delays economic development, but requires increasing escalation of the carbon price. The paper argues that the adoption of more stringent climate policies becomes more likely as the phase-out of fossil fuels increases. The “Green Road” is not only feasible but also attractive and realistic.

Pro-poor policies can have economic benefits, but they may also have environmental costs. This paper examines the impact of China's “E-commerce into Countryside” project (the ECC project), one of the world's largest targeted poverty alleviation strategies, on local air quality. The project covers approximately 100 million poor people. Using a set of difference-in-differences identification strategies, we find that the pro-poor ECC policy has consistently and significantly contributed to local air pollution, despite its role in fighting poverty. The decline in local air quality is primarily caused by the increase in rural enterprises, destruction of vegetation, and traffic pollution resulting from the intention to sell more agricultural products to the city. Pro-poor policymakers face the challenge of balancing poverty reduction with environmental protection during the process of sustainable development. When making policy decisions, it is important to consider local environmental regulations, ecological vulnerability, and potential adaptation strategies in order to weigh economic benefits against environmental costs.

This study presents new causal evidence on how urban heat contributes to sorting within a city. We estimate a discrete choice residential sorting model that includes census-tract fixed effects and controls for open space and green coverage to analyze how differences in urban heat at the census-tract level influence the location choices of New York City homeowners given their race, ethnicity, and income. Our results show clear patterns of residential sorting, with whites and high-income households outcompeting other racial/ethnic groups and low-income households for housing in cooler neighborhoods. Our counterfactual exercise, inspired by Cool Neighborhoods NYC, reveals that heat-mitigation policies can make poorer and minority households, on average, worse off. These findings are striking, considering that such programs often aim to enhance welfare in heat-exposed neighborhoods predominantly inhabited by low-income and minority households.

The impacts of climate change will depend on how human societies adapt to higher temperatures. In this study we report empirical evidence suggesting that people living in warmer places prefer a higher temperature for their recreational outdoor activities. To arrive at this conclusion we examine a novel global dataset of mobile phone usage in parks in more than 2500 locations across 77 countries. We examine this dataset with econometric methods to identify the relationship between outdoor recreation and temperature from daily variation in weather. Overall we find that for every increase in annual mean temperature by 1 degree Celsius, the preferred daily mean temperature for outdoor activity increases by about 0.5 degrees Celsius. We explain how these results can be interpreted as evidence for partial adaptation. We also illustrate how ignoring adaptation can bias projections of future responses to climate change.