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on Energy Economics |
| By: | Martinsson, Gustav (Royal Institute of Technology, Swedish House of Finance (SHoF)); Sajtos, László (Tillväxtanalys, Swedish House of Finance (SHoF), Misum); Strömberg, Per (Stockholm School of Economics, Swedish House of Finance (SHoF), CEPR, ECGI); Thomann, Christian (Royal Institute of Technology, Swedish House of Finance (SHoF), Misum) |
| Abstract: | Sweden was one of the first countries to introduce a carbon tax in 1991. We assemble a unique dataset tracking all CO2 emissions from the Swedish manufacturing sector to estimate the impact of carbon pricing on firm-level emission intensities. In panel regressions, spanning 26 years and around 4,000 firms, we find a statistically robust and economically meaningful negative relationship between emissions and marginal carbon pricing. We estimate an emission-to-pricing elasticity of around two, albeit with substantial heterogeneity across manufacturing subsectors. A simple calibration implies that 2015 CO2 emissions from Swedish manufacturing would have been roughly 30% higher without carbon pricing. |
| Keywords: | Carbon taxation; Emissions trading; Climate Policy; Climate change; Green growth; Tax policy |
| JEL: | H23 H23 Q54 Q58 |
| Date: | 2022–10–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hamisu:2022_010&r= |
| By: | Alkis Blanz (University of Potsdam, Mercator Research Institute on Global Commons and Climate Change); Ulrich Eydam (University of Potsdam); Maik Heinemann (University of Potsdam); Matthias Kalkuhl (University of Potsdam, Mercator Research Institute on Global Commons and Climate Change) |
| Abstract: | Prices of primary energy commodities display marked fluctuations over time. Market-based climate policy instruments (e.g., emissions pricing) create incentives to reduce energy consumption by increasing the user cost of fossil energy. This raises the question of whether climate policy should respond to fluctuations in fossil energy prices? We study this question within an environmental dynamic stochastic general equilibrium (E-DSGE) model calibrated on the German economy. Our results indicate that the welfare implications of dynamic emissions pricing crucially depend on how the revenues are used. When revenues are fully absorbed, a reduction in emissions prices stabilizes the economy in response to energy price shocks. However, when revenues are at least partially recycled, a stable emissions price improves overall welfare. This result is robust to different modeling assumptions. |
| Keywords: | energy prices, E-DSGE, climate policy, welfare |
| JEL: | E62 E64 Q43 Q52 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:pot:cepadp:51&r= |
| By: | Iania, Leonardo (Université catholique de Louvain, LIDAM/LFIN, Belgium); Algieri, Bernardina (University of Calabria); Leccadito, Arturo (University of Calabria) |
| Abstract: | In recent years, the international community has been increasing its efforts to reduce the human footprint on air pollution and global warming. Total CO2 emissions are a key component of global emission, and as such, they are closely monitored by national and supranational entities. This study evaluates the performance of a broad set of forecasting models and their combinations to predict energy’s carbon dioxide releases using an in-sample and out-of-sample analysis. The focus is on the US for the period 1973-2021 using quarterly observations. The results show that economic variables, energy and interannual climate variability indicators help forecast short-/medium- term CO2 emissions. In addition, a combination of models sharpens quantile predictions. |
| Keywords: | CO2 Emissions ; Forecasting Models ; Quantile Forecast ; Economic, Energy and Nature- related drivers ; Climate Change ; Drought Severity ; Interannual Variability |
| JEL: | C01 C13 C31 C51 C52 C53 C55 C82 Q43 Q47 Q53 Q59 |
| Date: | 2022–05–24 |
| URL: | http://d.repec.org/n?u=RePEc:ajf:louvlf:2022003&r= |
| By: | Georg Zachmann; Guntram B. Wolff; Agata Łoskot-Strachota; Simone Tagliapietra; Axel Ockenfels; Ricardo Hausmann; Ulrich Schetter |
| Abstract: | The most efficient way for Europe to sanction Russian energy would not be an embargo, but the introduction of an import tariff that can be used flexib |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:48117&r= |
| By: | World Bank |
| Keywords: | Public Sector Development - Public Sector Economics Energy - Energy Conservation & Efficiency Energy - Energy Demand Energy - Energy Policies & Economics Energy - Renewable Energy Energy - Solar Energy Environment - Climate Change and Environment Environment - Environment and Energy Efficiency |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35371&r= |
| By: | World Bank |
| Keywords: | Energy - Energy Technology & Transmission Energy - Renewable Energy Energy - Solar Energy Energy - Windpower |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35113&r= |
| By: | Yabei Zhang; Zijun Li |
| Keywords: | Energy - Energy Conservation & Efficiency Energy - Energy Demand Energy - Energy and Environment Energy - Fuels Energy - Renewable Energy |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35258&r= |
| By: | Clara Galeazzi; Jevgenijs Steinbuks; James Cust |
| Keywords: | Energy - Energy Demand Energy - Energy Policies & Economics Energy - Energy and Environment Energy - Oil & Gas Energy - Renewable Energy Industry - Mining & Extractive Industry (Non-Energy) International Economics and Trade - Export Competitiveness |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:34946&r= |
| By: | Kojima,Masami; Zhou,Xin |
| Abstract: | Analysis of household energy use has tended to focus on primary energy sources for cooking,lighting, and heating. However, even those using clean primary energy sources are not necessarily free fromhousehold air pollution and the burden of biomass collection because of commonly practiced fuel stacking. This paperexamines household energy use in 24 Sub-Saharan African countries with a focus on bottled cooking gas, which isexpected to play a pivotal role in the attainment of universal access to clean household energy by 2030. Theshare of people using clean energy (electricity and gas) as the primary source exceeded half only in five countries,with liquefied petroleum gas dominating in three and electricity in two. As income rose, households shifted awayfrom wood in every country, to clean energy in most countries and to charcoal in some. Of the 12 countries(nationally or in urban areas) in which at least one-fifth of the population used liquefied petroleum gas as theirprimary cooking fuel, more than three-fifths of primary liquefied petroleum gas users had abandoned polluting fuelsin five countries. Within per capita expenditure quintiles, households who had abandoned all polluting fuels wereconsistently smaller than those who continued to use polluting fuels, mainly charcoal or kerosene, perhapspointing to the ease of cooking for small families exclusively with liquefied petroleum gas and electricity.However, liquefied petroleum gas–using households in the top expenditure quintile who had not abandoned polluting fuelswere on average smaller than those in the fourth quintile who had abandoned polluting fuels. These findings point toreasons for fuel stacking that seem to go beyond the question of affordability. |
| Date: | 2022–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10089&r= |
| By: | Surbhi Goyal; Satyaki Bhattacharya; Shraddha Suresh; Georg Goldes; Saurabh Nirgudkar |
| Keywords: | Energy - Energy Technology & Transmission Energy - Renewable Energy Energy - Solar Energy |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35123&r= |
| By: | World Bank |
| Keywords: | Energy - Coal and Lignite Energy - Energy Conservation & Efficiency Energy - Energy and Environment Energy - Energy and Mining Social Protections and Labor - Social Protections & Assistance |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35323&r= |
| By: | World Bank |
| Keywords: | Energy - Electric Power Energy - Energy Policies & Economics Energy - Hydro Power Energy - Renewable Energy Energy - Solar Energy Energy - Thermal Energy Energy - Windpower |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:34586&r= |
| By: | Hugo Le Boulzec (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes); Louis Delannoy (Inria Grenoble - Rhône-Alpes - Inria - Institut National de Recherche en Informatique et en Automatique); Baptiste Andrieu (ISTerre - Institut des Sciences de la Terre - INSU - CNRS - Institut national des sciences de l'Univers - Institut de recherche pour le développement [IRD] : UR219 - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc - CNRS - Centre National de la Recherche Scientifique - Université Gustave Eiffel - UGA - Université Grenoble Alpes, The Shift Project - Redesigning the Economy to Achieve Carbon Transition); François Verzier (ISTerre - Institut des Sciences de la Terre - INSU - CNRS - Institut national des sciences de l'Univers - Institut de recherche pour le développement [IRD] : UR219 - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc - CNRS - Centre National de la Recherche Scientifique - Université Gustave Eiffel - UGA - Université Grenoble Alpes); Olivier Vidal (ISTerre - Institut des Sciences de la Terre - INSU - CNRS - Institut national des sciences de l'Univers - Institut de recherche pour le développement [IRD] : UR219 - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc - CNRS - Centre National de la Recherche Scientifique - Université Gustave Eiffel - UGA - Université Grenoble Alpes); Sandrine Mathy (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes) |
| Abstract: | The low-carbon energy transition requires a widespread change in global energy infrastructures which in turn calls for important inputs of energy and materials. While the transport and electricity sectors have been thoroughly analyzed in this regard, that of the hydrocarbon industry has not received the same attention, maybe in part due to the difficulty of access to the necessary data. To fill this gap, we assemble public-domain data from a wide variety of sources to present a stock-flow dynamic model of the fossil fuels supply chain. It is conducted from 1950 to 2050 and along scenarios from the International Energy Agency. We estimate the concrete, steel, aluminum and copper requirements for each segment, as well as the embedded energy and CO2 emissions through a dynamic material flow analysis (MFA) model. We find that (i) the material intensities of oil, gas and coal supply chains have stagnated for more than 30 years; (ii) gas is the main driver of current and future material consumption; and (iii) recycled steel from decommissioned fossil fuels infrastructures could meet the cumulative need of future low-carbon technologies and reduce its energy and environmental toll. Furthermore, we highlight that regional decommissioning strategies significantly affect the potential of material recycling and reuse. In this context, ambitious decommissioning strategies could drive a symbolic move to build future renewable technologies from past fossil fuel structures. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03780879&r= |
| By: | Catalano,Michele; Forni,Lorenzo |
| Abstract: | This paper compares the effectiveness of different fiscal policy instruments, carbon pricing,fiscal incentives for private green investments, and public green investment, in supporting a green recovery that isalso fiscally sustainable. It argues that relying on carbon pricing or green investments is not sufficient to achievethe transition to a low-carbon economy in a timely and sustainable way. Carbon pricing alone would result in rapidand significant energy price increases that would be recessionary. Similarly, the level of public greeninvestment needed to reach the Paris goals without recourse to carbon pricing would be so great that it would endangerdebt sustainability. The conclusion from the simulations supports the view that a mix of supply side policies (carbonpricing) and demand-side interventions (deficit financed green public investment) is necessary to achieve the Parisgoals within the specified period and with a fiscally sustainable outcome. The paper also assesses the costsassociated with transitioning to a low carbon economy by geographic area. It finds that deficit financed public greeninvestment by high-emitting countries only (typically advanced and emerging economies), would have positive growthimpacts for those countries and enhance their fiscal sustainability, while also providing large positivespillovers to other countries, particularly to highly climate sensitive nations. In turn, the simulations showthat wherever fiscally feasible it is in the best interest of all countries to increase public investment in the green economy. |
| Keywords: | Energy and Environment,Energy Demand,Energy and Mining,Financial Sector Policy,Climate Change Mitigation and Green House Gases,Public Sector Economics,Economic Adjustment and Lending,Macro-Fiscal Policy,Public Finance Decentralization andPoverty Reduction |
| Date: | 2022–06–27 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:9799&r= |
| By: | Xianglong Liu; Jason Nassios; James Giesecke |
| Abstract: | Recent surges in global crude oil prices, caused by supply disruptions from Russia's invasion of Ukraine and associated sanctions, have increased the cost of living globally. In response, in the 2022/23 Australian Federal budget, the former Coalition government announced a halving of Australia's fuel excise from 44 cents per litre to 22 cents per litre for six months. This paper explores the impact of an oil supply shock on the Australian economy, and the effectiveness of a fuel excise reduction as a policy response. We adopt a single-country dynamic computable general equilibrium (CGE) framework. Because Australia is a net oil-importing economy, ceteris paribus, the rise in world oil prices puts downward pressure on the terms of trade and household consumption. The impact at the macro level on real GDP is damped by a rise in net exports and world LNG prices, a key Australian export. Our analysis unpacks the role played by the linkage between world oil and LNG prices. While this linkage attenuates the macroeconomic effects of an oil price rise in Australia, its capacity to mitigate the economic damage is muted because of the LNG sector's low labour intensity, high foreign ownership, and the associated rise in domestic gas prices, which hurt domestic gas users. We find a 50 percent reduction in fuel excise can help damp the overall fall in real GDP and employment, at the expense of larger budget deficits. Rather than strengthening calls for a cut in fuel tax excise rates, we show that higher oil prices compromise calls for its reduction from an allocative efficiency perspective, because it is a specific tax. Finally, we study an alternative policy response to higher world oil prices in Australia: adoption of a UK-style energy profits levy on LNG producers. We find that such a policy would promote household consumption without compromising the federal budget. |
| Keywords: | taxation policy, CGE modelling, dynamics, oil prices |
| JEL: | C68 E62 H25 Q43 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:cop:wpaper:g-336&r= |
| By: | Candelon, Bertrand (Université catholique de Louvain, LIDAM/LFIN, Belgium); Hasse, Jean-Baptiste (Aix-Marseille University) |
| Abstract: | In this paper, we evaluate the causal effects of climate policies on carbon emissions reductions. Using Sweden as a case study, we compare the effects of the domestic carbon tax and the Kyoto Protocol over the period 1965–2018. A simulation exercise shows that the test for causality in the frequency domain offers policy-makers a useful tool for evaluating the effect of public policies. The empirical results indicate a significant causal effect of the carbon tax policy on carbon intensity dynamics in the long run. |
| Keywords: | Granger causality ; Spectral analysis ; Climate policy ; Carbon tax |
| Date: | 2022–06–28 |
| URL: | http://d.repec.org/n?u=RePEc:ajf:louvlf:2022005&r= |
| By: | Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique, VIET - Vietnam Initiative for Energy Transition) |
| Abstract: | Everybody knows now: The State cannot protect us against this energy crisis forever. Everybody knows now that the high prices of fossil fuels in international markets will impact the Vietnamese household energy bill. The costs of importing coal are to blame for the blackouts in Hanoi in early July 2022. What can we do about it, and how to navigate the global energy crisis? |
| Date: | 2022–09–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03775724&r= |
| By: | AMORES Antonio F (European Commission - JRC); MAIER Sofia (European Commission - JRC); RICCI Mattia (European Commission - JRC) |
| Abstract: | The taxation of energy consumption is a central topic in the current policy debate of the European Union. While raising energy taxation is part of the European Commission's strategy for achieving its 2030/50 climate targets, the ongoing dramatic increases in the price of energy products are raising calls for reducing their taxation. Therefore, a close consideration of the incidence and redistributive effects of energy taxation is crucial to design compensatory measures and to ensure support for the Green transition. In this paper, we employ the EUROMOD microsimulation model to estimate the burden and the redistributive impact of energy consumption taxation on households across Member States. In doing so, we break down the role played by differences in consumption patterns, rates of taxation and their regressivity. We find that countries where energy taxation is the highest are often not the ones where its incidence on household income is the strongest. At the same time, the highest inequality impact is not always taking place in countries with the most regressive energy taxation. We therefore stress the importance of considering, not only the level of energy consumption taxation, but also its regressivity and its incidence over household income when assessing its inequality cost. |
| Keywords: | Energy consumption taxation, regressivity, redistributive effects, EUROMOD, Europe |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:taxref:202206&r= |
| By: | Jessika A. Bohlmann (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa); Roula Inglesi-Lotz (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa); Heinrich R. Bohlmann (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa) |
| Abstract: | This paper focuses on evaluating the economy-wide impact of a carbon tax as a policy mechanism designed to reduce GHG emissions in South Africa, with a particular focus on households. Impacts of the carbon tax are evaluated across different households, including low-income households, who are often said to be the least responsible for climate change. A dynamic CGE model of the South African economy that includes detailed tax information allowing for accurate measurement of the effects of imposing a carbon tax is used to conduct the modelling simulations. Results show that the effects of the carbon tax on economic growth are minimised when the revenue collected is recycled back into the economy. Additionally, low-income households are shown to be more affected by the carbon tax implementation compared to high-income households. The results from this study confirm that policymakers need to be careful in introducing new taxes on goods that form a large part of the consumption bundle of vulnerable households, such as energy, and have mitigation policies ready to support such households. |
| Keywords: | CGE Modelling, Carbon Tax, Households, South Africa |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:202248&r= |
| By: | Shen,Chang; Alberini,Anna; Timilsina,Govinda R. |
| Abstract: | During the 2020-2022 period, the COVID Pandemic affected, directly or indirectly, everyeconomic sector globally. While the effects on some sectors, such as travel and tourism, were highly visible, those onother sectors, such as utility services, require investigation. Whether COVID-19 affected total electricitygeneration and the electricity supply mix is an empirical question, which this study attempts to answer using paneldata of daily electricity generation between January 2018 and September 2021 from 26 countries. The study finds that a1-unit increase in the stringency measure of COVID-19 is linked with a 463 MWh decrease in the total dailyelectricity generation. The study does not find a significant change in the electricity generation mix due toCOVID-19 responses, although there is some evidence of some substitution of wind with solar and coal with natural gas. |
| Date: | 2022–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10116&r= |
| By: | Senzele, Joseph |
| Abstract: | The study aims at analyzing the relationship between economic growth Environmental degradation in Côte d'Ivoire over the period 1990-2020. To do so, we applied the STIRPAT (Stochastic Impacts by Regression on Population, Affluence and Technology) model of Ehrlich-oldren (1971 ; 1972), improved by Dietz and Rosa (1997) and York et al. (2003), which allows to catch the effects of macroeconomic variables on the environment. The results of the test indicate a long-run relationship between the variables, and the results of the long-run model confirm the Kuznets environmental curve hypothesis for the Ivorian economy with a GDP per capita turning point of 2008 US Dollars. We also find that energy consumption, urbanization and industry have significant positive effects on CO2 emissions. The Toda-Yamamoto approach shows that there is a unidirectional causality from economic growth to carbon dioxide emissions in Côte d'Ivoire. |
| Keywords: | Economic Growth, CO2 emissions, STIRPAT (Stochastic Impacts by Regression on Population, Affluence and Technology), AutoRegressive Distributed Lags, TodaYamamoto approach, Côte d’Ivoire |
| JEL: | Q5 |
| Date: | 2022–09–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:114754&r= |
| By: | Philipp Andreas Gunkel (Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark); Claire-Marie Bergaentzl\'e (Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark); Dogan Keles (Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark); Fabian Scheller (Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark; Faculty of Business and Engineering, University of Applied Sciences Wurzburg-Schweinfurt, Ignaz-Schon-Street 11, 97421 Schweinfurt, Germany); Henrik Klinge Jacobsen (Energy Economics and System Analysis, DTU Management, Technical University of Denmark, 2800 Kongens Lyngby, Denmark) |
| Abstract: | Electricity grid tariffs should reflect network costs in order to provide efficient incentives for timing electricity use and investment in new technologies. We compare tariff designs that deal with existing and expected future grid congestion. Although common volumetric tariff designs such as Time-Of-Use are partly cost-reflective, their designs have fundamental drawbacks in terms of the principles of cost allocations and potentially may lead to social disparities. In a case study of 1.56 million Danish households divided into 90 socio-techno-economic categories, we compare three alternative grid tariffs and investigate their impact on annual electricity bills. This study shows that penalizing consumption above a certain threshold leads to higher costs for owners of electric vehicles regardless of the timing of their consumption. In contrast, penalizing consumption during system peaks mainly affects the electricity bills of heat pump owners. The results of our design simultaneously applying a time-dependent threshold and a system peak tariff show (a) a range of different allocations that distribute the burden of additional grid costs across both technologies and (b) strong positive outcomes, including reduced expenses for lower-income groups and smaller households. Our study offers policymakers a menu that assigns grid costs to demand technologies, thereby giving them valuable input. |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2210.03514&r= |
| By: | Kahn,Matthew Edwin; Lall,Somik V. |
| Abstract: | As billions of people in the developing world seek to increase their living standards,their aspirations pose a challenge to global efforts to cut greenhouse gas emissions. The emerging middle class isbuying and operating energy intensive durables ranging from vehicles to air conditioners to computers. Owners of thesedurables represent an interest group with a stake in opposing carbon pricing. The political economy ofencouraging middle class support for carbon pricing hinges on offsetting its perceived negative income effects. Risingenvironmentalism in the developing world could also increase support for credible greenhouse gas reduction policy. Thispaper quantifies these effects by estimating Engel curves of durables ownership, comparing the grid’s carbon intensity bynation, and studying the demographic correlates of support for prioritizing environmental protection. |
| Date: | 2022–07–20 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10125&r= |
| By: | Tavoni, Alessandro; Winkler, Ralph |
| Abstract: | In the wake of 25 United Nations Climate Change Conferences of the Parties (and counting), international cooperation on mitigating greenhouse gas emissions to avoid substantial and potentially irreversible climate change remains an important challenge. The limited impact of the Kyoto Protocol on curbing emissions, and the gap between the ambitions of its successor and the Paris Agreement's lack of sanctioning mechanisms for addressing noncompliance, demonstrates both the difficulties in negotiating ambitious environmental agreements and the reluctance of countries to comply with their agreed emission targets once they have joined the treaty. Therefore, a better understanding of the obstacles and opportunities that the interactions between domestic and international policy pose for the design of successful international climate cooperation is of utmost importance. To shed light on the roots of the stalemate (and suggest possible ways out), this article reviews and draws lessons from a growing theoretical, experimental, and empirical literature that accounts for the hierarchical interplay between domestic political pressure and international climate policy. |
| Keywords: | domestic pressure; hierarchical policy making; International climate cooperation; special interest groups; strategic delegation; (strategic) delegation; international climate cooperation |
| JEL: | D72 P48 Q58 Q54 |
| Date: | 2021–10–05 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:112608&r= |
| By: | Ambec, Stefan |
| Abstract: | This report uses an economic lens to analyze the Carbon Border Adjustment Mechanism (CBAM) which is currently under discussion at the European Union (EU). The CBAM, which is set to replace free allowances for specific ETS sectors after a transition period, aims to address carbon leakage and preserve the competitiveness of industries participating in the EU ETS. Although the two policy instruments share the same goals, their economic impacts differ. On the one hand, free allowances level the playing field both within the EU and on international markets by reducing the cost of the EU ETS for firms. European firms have an incentive to reduce their carbon emissions even if they obtain a certain part of their allowances for free. On the other hand, the CBAM levels the playing field only within the EU unless it is complemented with export rebates (such as benchmark-free allowances on exported production). However, the CBAM incentivizes not only European firms but also foreign firms to reduce their carbon emissions when exporting to the EU. Furthermore, unlike free allowances, the CBAM is more consistent with the polluter-pays principle. The CBAM calls for product-based pricing of embedded carbon emissions equivalent to the manufacturing plant-based pricing of the EU ETS. The shift of the pricing base requires choices to be made on the economic sectors to target, the scope of emissions, the adjustments to be made for firmspecific carbon intensity and to country-specific carbon pricing. The pros and cons of those choices are discussed. The CBAM will generate substantial revenues which can be used to foster and smooth out decarbonization. The CBAM differs substantially from the Climate Club that has been proposed by the Nobel Prize winner, William Nordhaus, for extending carbon pricing worldwide. Yet, by allowing importers to pay only the carbon price difference between the CBAM jurisdiction and the manufacturing country, the CBAM also incentivizes countries to implement their own carbon price. |
| Date: | 2022–09–30 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:127382&r= |
| By: | Monasterolo,Irene; Mandel,Antoine; Battiston,Stefano; Mazzocchetti,Andrea; Oppermann,Klaus; Coony,Jonathan D'Entremont; Stretton,Stephen John; Stewart,Fiona Elizabeth; Dunz,Nepomuk Max Ferdinand |
| Abstract: | Green financial sector initiatives, including financial policies, regulations, and instruments,could play an important role in the low-carbon transition by supporting countries in the implementation of economicpolicies aimed to decarbonize their economy. Thus, it is fundamental to understand the conditions under which and theextent to which green financial sector initiatives could enable the scaling up of green investments and theachievement of national climate mitigation objectives, while, at the same time, avoiding unintended effects onmacroeconomic and financial stability. However, this understanding is currently limited, in particular in thecontext of emerging markets and developing economies. This paper contributes to filling this knowledge gap by analyzingopportunities and challenges associated with the implementation of green financial sector initiatives. Italso considers the specificities of green financial sector initiatives in emerging markets and developing economies,which are often characterized by budget constraints, debt sustainability concerns, and limited access to finance. Theanalysis focuses on green macroprudential policies, green monetary policies, and green public co-funding. For eachgreen financial sector initiative, the paper qualitatively investigates the transmission channels through which itaffects the availability and cost of capital for high- andlow-carbon goods, but also investments, output, and greenhouse gas emissions, considering the design andimplementation of the green financial sector initiative. For each green financial sector initiative, the paper furtheridentifies its entry point in the economy and its direct and indirect impacts. Building on these insights, the paperdevelops a theory of change about the role of green financial sector initiatives in climate mitigation and inthe low-carbon transition, identifying the criteria for applicability and conditions to maximize impact. |
| Date: | 2022–09–14 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10181&r= |
| By: | Nicholas Z. Muller |
| Abstract: | Carbon intensity from fossil fuel use in the United States economy peaked in 1917. World War I ended, and the Spanish Flu pandemic broke out one year later in 1918. This paper contends that these events, coupled with associated turmoil in the domestic coal industry, were largely responsible for the turning point in carbon intensity. It is instructive to consider that geopolitics, labor markets, and public health at the time of peak carbon intensity bear relevance to the global economy from 2019 to the present. Interventions in markets intended to mitigate detrimental consequences of pandemic and war may induce ancillary impacts for long-run climate change and environmental quality. |
| JEL: | N41 N42 N51 N52 N71 N72 Q43 Q54 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30522&r= |
| By: | Juan-Pablo Rud (University of London); Michael Simmons (Umeå University); Gerhard Toews (Orléans University); Fernando Aragon (Simon Fraser University) |
| Abstract: | The reduction of carbon emissions will require a rapid phasing out of coal and the displacement of millions of coal miners. How much could this energy transition cost mining workers? We use the dramatic collapse of the UK coal industry to estimate the long-term impact on displaced miners. We find evidence of substantial losses: wages fell by 40% and earnings fell by 80% to 90% one year after job loss. These losses are persistent and remain significantly depressed fifteen years later, amounting to present discounted value earnings losses of between four and six times the miners pre-displacement earnings |
| JEL: | J30 J63 J64 O4 |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:aoz:wpaper:184&r= |
| By: | Erika Moreno (SIO - Scripps Institution of Oceanography - UC San Diego - University of California [San Diego] - University of California); Lara Schwarz (Herbert Wertheim School of Public Health and Human Longevity Science , SDSU - San Diego State University); Sabine Host (ORSIDF - Observatoire régional de santé Île-de-France [Paris, France]); Olivier Chanel (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); Tarik Benmarhnia (SIO - Scripps Institution of Oceanography - UC San Diego - University of California [San Diego] - University of California) |
| Abstract: | Background Reducing the mortality burden associated with urban air pollution constitutes a public health priority, and evidence of unequal exposure and susceptibility across population subgroups is growing. Many European countries have implemented low emission zones (LEZs) in densely populated city centers. Although LEZs decrease air pollution exposure and health impacts, evidence is lacking on their impact across neighborhoods and socio-economic groups. Objectives The aim of this study was to evaluate the most equitable approach to implementing the second phase of the LEZ in Paris, France. We also present a literature review of the studies evaluating the benefits associated with LEZs in Europe. Methods A health impact assessment (HIA) was conducted to quantify changes in air pollution exposure and expected health benefits by socioeconomic group and neighborhood related to four hypothetical scenarios for the second phase of the LEZ based on French Deprivation Index scores. The study focused on NO 2 and PM 2.5 as air pollutants and evaluated the impact of the LEZ on the inequitable burden of childhood asthma and all-cause premature adult mortality. We also conducted an economic evaluation associated with the LEZ benefits on prevented deaths and asthma cases. Results The scenario with the largest LEZ perimeter and the most stringent vehicle standards prevented the highest number of cases and produced the most equitable distribution of health benefits, especially childhood asthma. It is expected that 810 deaths and 3200 cases of asthma could be prevented from the LEZ extension in this scenario. These results were distributed heterogeneously across three socioeconomic (SES) groups, most noticeably with asthma cases as 230, 180, and 210 cases were avoided per 100,000 inhabitants in high, medium, and low SES groups, respectively. We found substantial economic benefits associated with LEZ, with estimates ranging from €0.76 billion to €2.36 billion for prevented deaths. The benefits associated with asthma reduction ranged from €2.3 million to €8.3 million. Discussion Conducting HIAs with a focus on equity will further inform policy makers of the impact of LEZ models on air pollution, health, and environmental justice. Developing these systematic methods and applying them to future LEZs and other air pollution policies will increase their effectiveness to reduce the burden of ambient air pollution on society and the environment. |
| Keywords: | Low emission zones,Traffic-related air pollution,Air pollution,Air pollution policy,Health equity,Environmental justice |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03781372&r= |
| By: | A. Balietti (Heidelberg University); S. Datta (ETH Zürich - Eidgenössische Technische Hochschule - Swiss Federal Institute of Technology [Zürich]); S. Veljanoska (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | In this paper, we study the impact of air pollution on child growth in India. We rely on wind direction to capture quasi-random variation in three main criteria air pollutants. We show that an increase in the average concentration of fine particulate matter by one standard deviation is accountable for almost 5 and 2.4 percentage points of stunting and severe stunting rates, respectively. We also find that ozone and carbon monoxide impact weight-related outcomes. Stunting has critical long-term health and economic consequences; through its impact on stunting, pollution exacerbates the height premium in earnings, with girls being more adversely affected than boys in India. © 2022 Elsevier Inc. |
| Keywords: | Ambient air pollution,Anthropometry,Child health,Height premium,Wind direction |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03662124&r= |
| By: | Arezki,Rabah; Cho,Caleb Sungwoo; Ha Nguyen; Pham,Anh |
| Abstract: | This paper explores the effect of oil price fluctuations on the stock returns of U.S. oil firmsusing an identification strategy through heteroskedasticity, exploiting the 2020 oil price crash. The results aretwofold. First, a decline in oil prices significantly reduces oil firms’ stock returns. On average, a 1 percentdecline in oil prices leads to a 0.44 percent decline in stock prices. Second, firm debt appears irrelevant inmediating the effect of oil prices on oil firms’ stock returns. Moreover, the muted role of debt was not likelycaused by the liquidity backstop provided by the Federal Reserve. |
| Date: | 2022–06–13 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10079&r= |
| By: | Walter Boltz; Klaus-Dieter Borchardt; Thierry Deschuyteneer; Leigh Hancher; François Lévêque; Jean Pisani-Ferry; Ben McWilliams; Axel Ockenfels; Simone Tagliapietra; Georg Zachmann |
| Abstract: | The platform could become an effective emergency tool to safeguard Europe’s gas supply, but policymakers need to address challenges to make it work. |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polbrf:node_7985&r= |
| By: | Georg Zachmann |
| Abstract: | The transition to climate neutrality requires the reallocation of production factors from polluting activities to non-polluting activities. |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:node_7994&r= |
| By: | Natalia Garcia; Beth Olberding; Jorge Macias |
| Keywords: | Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Climate Change Mitigation and Green House Gases Environment - Pollution Management & Control Urban Development - City Development Strategies Urban Development - National Urban Development Policies & Strategies Urban Development - Transport in Urban Areas Urban Development - Urban Economic Development |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:34827&r= |
| By: | Selahmi, Basma; Liu, Chunping |
| Abstract: | This paper investigates whether natural resource revenues in the GCC countries lead to economic growth or if the resource curse is evident. Using panel data for six countries during 1996-2019, we investigate the indirect relationship in which natural resources and economic growth operate through different institutional qualities. Using two different classifications of export composition, we show that point-source resources, particularly fuel exportation, worsen the economic performance of a country. In contrast, diffuse-source resources do not follow this pattern. Nevertheless, the results also provide the threshold level of institutional, beyond which fuel wealth enhances economic growth. This result suggests that for fuel exportation to have a meaningful impact on economic growth, GCC countries must attain a certain threshold of institutional quality. The results confirm our hypothesis that institutions are decisive for the resource curse, therefore contrasting the claims of Sachs and Warner (1995, 2001) that institutions do not play a role. It, therefore, suggests that countries must adopt appropriate policy measures to improve their levels of institutional quality and soften the impact of a resource curse. |
| Keywords: | C5; E02; N5; O4 |
| JEL: | O13 O43 Q32 |
| Date: | 2022–01–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:114924&r= |
| By: | Hintermann, Beat (University of Basel); Ludwig, Markus (University of Basel) |
| Abstract: | We examine the pattern of allowance trades in the European Union Emissions Trading System (EU ETS) using highly disaggregated trading data and identify a significant and robust home market bias. Our results point to informational transactions costs that increase when trading across national borders. The existing trade pattern in goods and services explains two thirds of the home bias, with the remainder due to other causes. Our finding suggests that firms make use of existing trade networks to overcome search costs in bilateral allowance trade. Since the home bias differs across firms, it follows that marginal abatement costs are not equalized across market participants of the EU ETS. |
| Keywords: | Emission permit market, EU ETS, transactions costs, gravity model, home bias |
| JEL: | F14 F18 Q52 Q54 Q58 |
| Date: | 2022–10–02 |
| URL: | http://d.repec.org/n?u=RePEc:bsl:wpaper:2022/07&r= |
| By: | Felbermayr, Gabriel; Peterson, Sonja; Wanner, Joschka |
| Abstract: | While international trade can offer gains from specialization and access to a wider range of products, it is also closely interlinked with global environmental problems, above all, anthropogenic climate change. This survey provides a structured overview of the economic literature on the interaction between environmental outcomes, trade, environmental policy and trade policy. In this endeavor, it covers approaches reaching from descriptive data analysis based on Input-Output tables, over quantitative trade models and econometric studies to game-theoretic analyses. Addressed issues are in particular the emission content of trade and emissions along value chains, the relocation of dirty firms and environmental impacts abroad, impacts of specific trade polices (such as trade agreements or tariffs) or environmental policy (such as Border Carbon Adjustment), transportation emissions, as well as the role of firms. Across the different topics covered, the paper also tries to identify avenues for future research, with a particular focus on extending quantitative trade and environment models. |
| Keywords: | trade,trade policy,environment,climate,carbon emissions |
| JEL: | F13 F18 Q54 Q58 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:2233&r= |
| By: | Böhringer,Christoph; Fischer,Carolyn; Rivers,Nicholas |
| Abstract: | Carbon pricing policies worldwide are increasingly coupled with direct or indirect subsidies whereemissions pricing revenues are rebated to the regulated entities. This paper analyzes the incentives created by twonovel forms of rebating that reward additional emission intensity reductions: one given in proportion to output(intensity-based output rebating) and another that rebates a share of emission payments (intensity-based emissionrebating). These forms are contrasted with output-based rebating, abatement-based rebating, and lump sum rebating.Given the same emission price, intensity-based output rebating incentivizes the most intensity reductions, whileabatement-based rebating incentivizes the most output reductions, and output-based rebating puts the leastpressure on output (and emissions); intensity-based emissions rebating lies in between these, by implicitlysubsidizing emissions while incentivizing intensity reductions. The paper supplements partial equilibriumtheoretical analysis with numerical simulations to assess the performance of different mechanisms in a multisectorgeneral equilibrium model that accounts for economywide market interactions. |
| Date: | 2022–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10069&r= |
| By: | World Bank |
| Keywords: | Environment - Adaptation to Climate Change Environment - Carbon Policy and Trading Environment - Climate Change Mitigation and Green House Gases Environment - Climate Change and Environment Environment - Environmental Economics & Policies |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35412&r= |
| By: | Gregory Casey; Stephie Fried; Matthew Gibson |
| Abstract: | Existing climate-economy models use aggregate damage functions to model the effects of climate change. This approach assumes climate change has equal impacts on the productivity of firms that produce consumption and investment goods or services. We show the split between damage to consumption and investment productivity matters for the dynamic consequences of climate change. Drawing on the structural transformation literature, we develop a framework that incorporates heterogeneous climate damages. When investment is more vulnerable to climate, we find short-run consumption losses will be smaller than leading models with aggregate damage functions suggest, but long-run consumption losses will be larger. We quantify these effects for the climate damage from heat stress and find that accounting for heterogeneous damages increases the welfare cost of climate change by approximately 4 to 24 percent, depending on the discount factor. |
| Keywords: | climate change; productivity; consumption; investments; structural changes; growth |
| JEL: | Q56 |
| Date: | 2022–10–04 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:94890&r= |
| By: | Giacomo Battiston (University of Padova); Gianmarco Daniele (University of Milan); Marco Le Moglie (Catholic University of Milan); Paolo Pinotti (Bocconi University) |
| Abstract: | We show that the War on Drugs launched by the Mexican President Felipe Calderón in 2007 pushed drug cartels into large-scale oil thefts. Municipalities that the presidential candidate’s party barely won at the local elections in 2007-2009 exhibit a larger increase in illegal oil taps over the following years, compared to municipalities in which the presidential candidate’s party barely lost the elections. Challenger cartels in the drug market leapfrog incumbent drug cartels when entering the new illegal activity, analogous to what is typically observed in legal markets. Since challengers and incumbents specialize in different criminal sectors, the expansion of challengers does not increase violence in municipalities traversed by oil pipelines. At the same time, the municipalities traversed by a pipeline witness a decrease in schooling rates. |
| Keywords: | organized crime, war on drugs, oil thefts, leapfrogging |
| JEL: | K42 L20 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:pad:wpaper:0286&r= |
| By: | World Bank |
| Keywords: | Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Pollution Management & Control Health, Nutrition and Population - Health Indicators |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35376&r= |
| By: | World Bank |
| Keywords: | Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Pollution Management & Control Health, Nutrition and Population - Health Indicators |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35721&r= |
| By: | Gong Cheng (Bank for International Settlements (BIS)); Eric Jondeau (University of Lausanne - Faculty of Business and Economics (HEC Lausanne); Swiss Finance Institute; Swiss Finance Institute); Benoît Mojon (Bank for International Settlements (BIS)) |
| Abstract: | We propose a strategy to build portfolios of sovereign securities with progressively declining carbon footprints. Passive investors could use it as a new Paris-consistent benchmark to construct a “net zero” (NZ) portfolio while tracking closely the risk-adjusted returns of a business-as-usual (BAU) benchmark. Our strategy rewards sovereign issuers that have made stronger efforts in reducing carbon intensity, measured by total domestic emissions per capita. The NZ portfolio would have reduced carbon intensity by 41% between 2014 and 2019, by assigning higher weights to countries that have had lower carbon emissions. Among advanced economies, rebalancing leads to raising shares of France, Italy and Spain in the portfolio at the expense of the United States. And among emerging market economies, this leads to higher shares for Chile, the Philippines and Romania at the expense of China. Importantly, the NZ portfolio retains the same creditworthiness as the BAU benchmark without entailing materially higher foreign exchange risks. |
| Keywords: | Carbon footprints, sovereign debt, portfolio rebalancing, portfolio optimisation, active share, tracking error. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:chf:rpseri:rp2266&r= |
| By: | Alimi,Omoniyi Babatunde; Gibson,John |
| Abstract: | Burning off the gas coming out of oil wells—gas flaring—is a common practice in oil-producingdeveloping countries. This economically wasteful and environmentally damaging process occurs becauseinfrastructure has been built with a focus on oil production rather than gas capture and because weak regulations andlimited environmental monitoring make flaring an attractive choice for oil producers. Moreover, gas flaring is harmfulto human health, especially because of pollutants. This research focuses on Nigeria, where over 10 percent of allgas produced is flared and about 2 million people in the Niger Delta live within four kilometres of a gas flare.While several studies from developed countries examine relationships between gas flaring and human (especiallyinfant) health, a lack of data limits what research is possible in developing countries. This paper uses infanthealth data from Demographic Health Surveys, and satellite-detected data on gas flaring to examine theeffects of flaring on disease incidence and infant mortality in oil-producing regions of Nigeria. The findings show astrong positive association between gas flaring and the incidence of respiratory diseases and fever among childrenyounger than five years. The study contributes to the literature measuring the wider cost to society of oil andgas production and adds to a growing body of work using satellite data to understand well-being in places whereconventional data sources are unavailable or unreliable. |
| Date: | 2022–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10153&r= |
| By: | Ekaterina M. Gratcheva; Teal Emery; Dieter Wang |
| Keywords: | Environment - Adaptation to Climate Change Environment - Climate Change Mitigation and Green House Gases Environment - Environmental Governance Social Development - Social Accountability |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:35586&r= |
| By: | Ben McWilliams; Giovanni Sgaravatti; Simone Tagliapietra; Georg Zachmann |
| Abstract: | The current crisis looks set to leave behind it a radically different system, but what that system will look like remains an open question |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polbrf:node_8275&r= |
| By: | Johnston, David W. (Monash University); Knott, Rachel (Monash University); Mendolia, Silvia (University of Wollongong) |
| Abstract: | Many people remain opposed to climate change mitigation policies. This opposition is an obstacle to policy action and, therefore, important to understand. We explore how unusually high temperatures (heat waves), which observably increase the salience of climate change-related issues, affect people's support for policies to reduce emissions. We additionally test whether this relationship is moderated by economic status and employment conditions. By linking local temperature observations to attitudes collected in large U.K. surveys, we find that unusually hot weather caused significant reductions in support in 2012-2013, a high-unemployment period, but not in 2018-2019, a low-unemployment period. The negative effects in 2012-2013 were driven by people working in carbon-intensive industries and people who felt economically insecure. Overall, these findings suggest that economically vulnerable groups can respond negatively to the promotion of climate change mitigation policies, but that this negativity is mutable. |
| Keywords: | climate change, attitudes, economic insecurity, employment |
| JEL: | D83 H23 Q54 Q58 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15562&r= |
| By: | Burgi,Constantin Rudolf Salomo; Hovhannisyan,Shoghik; Joshi,Santosh Ram; Ahmad Famm Alkhuzam |
| Abstract: | Environmental regulations and their enforcement play a critical role in reducing emissions andtheir devastating effects on humanity and the environment. However, many developing countries have large informalsectors—accounting for more than 70 percent of total employment, that operate outside government control. Thepresence of the informal sector could have detrimental consequences on the environment as informal firms do notcomply with regulations, which could jeopardize the effectiveness of environmental policies. The paper usesreduced form equations to estimate the relationship between both CO2 and non-CO2 emissions per value added and theinformal sector measured as the share of informal workers in total across countries. The estimates indicate thatemissions per value added in the informal sector are higher as opposed to in the formal sector. At the sector level,higher informality is associated with lower CO2 emissions per value added only in manufacturing and other servicessectors. In particular, a one percentage point increase in the share of informal workers in total sector employmentreduces the CO2 emissions per value added by 1.44 percent in manufacturing and 1.773 percent in services. This impliesthat the magnitude of emissions per value added in the formal sector relative to the informal sector is ambiguous.Sector-specific estimations for non-CO2 emissions yield positive significant coefficients for agriculture, trade,mining, and utilities and a negative significant coefficient for manufacturing. |
| Date: | 2022–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10158&r= |
| By: | World Bank |
| Keywords: | Public Sector Development - Regulatory Regimes Environment - Adaptation to Climate Change Environment - Climate Change Mitigation and Green House Gases Environment - Climate Change and Environment Environment - Environmental Economics & Policies Environment - Environmental Governance Environment - Environmental Strategy |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:34972&r= |
| By: | Strand,Jon |
| Abstract: | The Paris Agreement provides for parties to use internationally transferred mitigationoutcomes in implementing their Nationally Determined Contributions. This paper analyzes forward trading of theseoutcomes in the presence of two forms of uncertainty: (1) uncertainty about the fulfillment of Nationally DeterminedContribution targets, and (2) uncertainty about the existence and functioning of the forward, options, andfuture spot markets markets for internationally transferred mitigation outcomes. When parties can sell and buyinternationally transferred mitigation outcomes forward, access to call options for late purchases leads tocorrespondingly larger forward sales, or less current mitigation. Access to put options for late internationallytransferred mitigation outcome sales does not affect forward trading outcomes but increases late sales for net sellers.Access to options markets is welfare enhancing for all parties, and call options help parties stay in compliancewith their Nationally Determined Contributions at the Paris Agreement end point, 2030. The existence of internationallytransferred mitigation outcome markets may be in peril, however, as banking beyond 2030 is not allowed. Theavailability and functioning of internationally transferred mitigation outcome markets can be enabled or improved byincreased climate finance provided by donors. With no options markets, host countries will still sellinternationally transferred mitigation outcomes forward, albeit less so, and rely on access to more expensive“backstop” mitigation for ex-post compliance with their Nationally Determined Contributions. Closed-form solutionsare derived for trading and its welfare impacts in all the option contract alternatives, given that parties’uncertainties about fulfilling their commitments are uniformly distributed. The welfare impact of theavailability of put and call option contracts is then strongly increasing in uncertainty, and in ex-post andforward outcome prices. |
| Date: | 2022–05–16 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10045&r= |
| By: | Liotta,Charlotte; Avner,Paolo; Viguié,Vincent; Selod,Harris; Hallegatte,Stephane |
| Abstract: | Opposition to climate policies seems to arise, at least partly, from their effects on inequality.However, so far, the impact of climate policies on inequality has mainly been studied through the lens ofincome inequality, and their spatial dimension is poorly understood. This paper, using Cape Town, South Africa, as acase study, investigates the impact of a fuel tax on both spatial and income inequalities. It uses a model derivedfrom the standard urban economics land use model, accounting for four income classes and four housing types. Thismodeling framework allows decomposing the impacts of the tax by income class, housing type, and housing location. Theanalysis also decomposes the impacts of the tax over different timeframes, assuming that households anddevelopers progressively adapt to the tax. The findings reveal strong evidence that in the short term, there areboth income and spatial inequalities, with households being more negatively impacted by the fuel tax if they earn lowincomes or live far from employment centers. In the medium and long term, these inequalities persist: the pooresthouseholds, living in informal settlements or subsidized housing, have few or no ways to adapt to changes in fuelprices by changing housing type, adjusting their dwelling sizes or locations, or shifting transportation modes.Low-income households living in formal housing also remain impacted by the tax over the long term due to complexeffects driven by the competition with richer households on the housing market. Complementary policies promoting afunctioning labor market that allows people to change jobs easily, affordable public transportation, or subsidieshelping low-income households to rent houses closer to employment centers will be key to enable the socialacceptability of climate policies. |
| Date: | 2022–09–19 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10185&r= |
| By: | Simplice A. Asongu (Yaounde, Cameroon); Samba Diop (Alioune Diop University, Bambey, Senegal) |
| Abstract: | This study investigates how governance and infrastructure modulate the effect of natural resource rents on economic growth in a sample of 110 countries for the period 2000-2018. The empirical evidence is based on Panel Smooth Transition Regressions (PSTR). The following findings are established. First, the nexus between economic growth and natural resources is not linear and the underlying non-linearity is contingent on existing infrastructural and governance levels. Second, evidence of a “natural resource curse†is apparent in countries with extremely low levels of governance and infrastructural development. Third, the favorable effect of natural resources on economic growth requires a governance threshold of -1.210 and an infrastructure threshold of 2.583 indicating that countries with governance and infrastructure level higher than these values tend to benefit much more from the wealth of natural resources. With high levels of the transition variables (governance and infrastructure), the established thresholds are low and situated between the 5th and the 10th percentiles. Countries identified below the established thresholds are mainly from Africa. Policy implications are discussed with specific emphasis on African countries. |
| Keywords: | Natural Resources; Economic Growth; Governance; Infrastructure; Threshold |
| JEL: | H10 Q20 Q30 O11 O55 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:exs:wpaper:22/072&r= |
| By: | Jürgen Schupp; Rolf G. Heinze; Nico A. Siegel |
| Abstract: | Ein Klimageld als sozialer Kompensationsmechanismus zur CO2-Bepreisung gehört zu den Kernprojekten der Ampel-Regierung, um die Akzeptanz der Marktsystems zu gewährleisten. Zuletzt wurde die Erhöhung der CO2-Bepreisung im Rahmen des dritten Entlastungspaket bis 2024 allerdings ausgesetzt. Eine repräsentative Befragung zeigt jetzt, dass rund drei Viertel der deutschen wahlberechtigten Personen mit Onlinezugang einem Klimageld als monatliche Pro-Kopf-Erstattung für alle Bürger*innen zustimmen. Ähnlich viele Menschen stimmen einer Erhöhung der sogenannten Pendlerpauschale zu, mit der Arbeitswege steuerlich abgeschrieben werden können. Vertiefende Analysen zeigen, dass vor allem mit Menschen, die sich um die eigene wirtschaftliche Situation sorgen, das Klimageld unterstützen. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwakt:85de&r= |
| By: | Phiri Kampanje, Brian |
| Abstract: | This paper briefly analysed the social costs and environment impact of the Moatize- Nkaya Nacala Rail on the Malawian communities as well as the economic impact on the country. The findings are that Malawi is worse off than before in view of poor negotiations and failure to enter into agreement with Mozambican Government. It is recommended that Malawi must introduce a carbon levy of USD5.00 per tonne and earn at least USD100,000,000.00 in each fiscal year. This money should be used for restoration of the environment across the country but also serve the affected communities. This will be a guaranteed source of much needed forex as well. |
| Keywords: | Carbon; Tax; Rail; Coal; Malawi; Forex |
| JEL: | H20 H23 H27 |
| Date: | 2022–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:114350&r= |
| By: | Cust,James Frederick; Rivera Ballesteros,Alexis; Zeufack,Albert G. |
| Abstract: | The commodity price boom from 2004–2014 was a huge economic opportunity for Africancountries abundant in oil, gas and minerals. During this period their government revenues from resources grew by anaverage of 1.1 billion US$ per year, and economic growth in those same resource-rich countries surged. GDP growth inresource-rich countries accelerated from 4.6% to 5.4% as countries entered a decade long period of sustained highcommodity prices. Nonetheless, the paper traces a significant missed opportunity for resource-rich countriesin Africa, with little to show for it in the post-boom period, which saw growth collapse far below pre-boom levels,to 2.7% per annum. This paper considers the record of performance during the boom (2004–2014) and subsequent bustfrom 2015 onwards. The paper describes four main outcomes of the boom: 1) measures of resource dependency rose inSub-Saharan Africa during the boom, 2) the growth record was strong during the boom but collapsed once commodity pricesfell, 3) poverty and inequality rose during the boom despite strong GDP growth, 4) resource-rich countries failed todiversify both their exports and their asset base, leaving thempoorly prepared for the end of the boom and a period of lower commodity prices and subsequent COVID-19 pandemic. Theconclusions are stark. During this golden decade of sustained high commodity prices and booming revenues, therewas limited re-investment of those revenues into building sustainable assets for the future. In other words, countriesconsumed the boom, rather than successfully transformed their economies. The conclusion is that many resource-richcountries in the region squandered their “once in a generation” opportunity for economic transformation,offering policy lessons that may prove valuable as we enter a new period of elevated commodity prices. |
| Date: | 2022–07–06 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:10120&r= |
| By: | Richard S.J. Tol (Department of Economics, University of Sussex, BN1 9SL Falmer, United Kingdom) |
| Abstract: | Earlier meta-analyses of the economic impact of climate change are updated with more data, with three new results: (1) The central estimate of the economic impact of global warming is always negative. (2) The confidence interval about the estimates is much wider. (3) Elicitation methods are most pessimistic, econometric studies most optimistic. Two previous results remain: (4) The uncertainty about the impact is skewed towards negative surprises. (5) Poorer countries are much more vulnerable than richer ones. A meta-analysis of the impact of weather shocks reveals that studies, which relate economic growth to temperature levels, cannot agree on the sign of the impact whereas studies, which make economic growth a function of temperature change do agree on the sign but differ an order of magnitude in effect size. The former studies posit that climate change has a permanent effect on economic growth, the latter that the effect is transient. The impact on economic growth implied by studies of the impactof climate change is close to the growth impact estimated as a function of weather shocks. The social cost of carbon shows a similar pattern to the total impact estimates, but with more emphasis on the impacts of moderate warming in the near and medium term. |
| Keywords: | climate change; weather shocks; economic growth; social cost of carbon |
| JEL: | O44 Q54 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:sus:susewp:0422&r= |
| By: | Michael Böheim (WIFO); Ulrike Huemer (WIFO); Claudia Kettner; Daniela Kletzan-Slamanig (WIFO); Margit Schratzenstaller |
| Abstract: | Unterstützungsmaßnahmen für Unternehmen zur Abfederung hoher Energiekosten sollten auf jene Unternehmen beschränkt werden, die ihre Kosten nicht weitergeben können, da sie im internationalen Wettbewerb stehen. Um den Binnenmarkt nicht zu verzerren, ist prinzipiell ein koordiniertes Vorgehen auf europäischer Ebene anzustreben und nationalen "Insellösungen" vorzuziehen. Aus ökologischer Perspektive sind insbesondere ein Aussetzen des nationalen Emissionshandels sowie der Ende September 2022 von der Bundesregierung vorgestellte Energiekostenzuschuss für Unternehmen kritisch zu sehen. Mit dem konkreten Programmdesign des Energiekostenzuschusses für Unternehmen hat sich die Bundesregierung für ein breitflächig ausgerolltes Subventionsregime unter Inkaufnahme entsprechend hoher Mitnahmeeffekte und gegen eine zielgerichtete Unterstützung von Unternehmen mit intakten Geschäftsmodellen entschieden. Ein allgemeiner Verlustrücktrag kombiniert mit Liquiditätshilfen (Haftungen und Garantien) und einer Senkung der Lohnnebenkosten wäre budgetschonender und ökonomisch effizienter gewesen. |
| Date: | 2022–10–12 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:rbrief:y:2022:i:24&r= |