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on Regulation |
| By: | A. Denny Ellerman |
| Abstract: | Incentives for the development of renewable energy have increasingly become an instrument of climate policy, that is, as a means to reduce GHG emissions. This research analyzes the German experience in promoting renewable energy over the past decade to identify the ex-post cost of reducing CO2 emissions in the power sector through the promotion of renewable energy, specifically, wind and solar. A carbon surcharge and an implicit carbon price due to the renewable energy incentives for the years 2006-2010 are calculated. The carbon surcharge is the ratio of the net cost of the renewable energy over the CO2 emission reductions resulting from actual renewable energy injections. The net cost is the sum of the costs and cost savings due to these injections into the electric power system. The implicit carbon price is the sum of the carbon surcharge and the EUA price and it can be seen as a measure of the CO2 abatement efficiency of the renewable energy incentives. Results show that both the carbon surcharge and he implicit carbon price of wind are relatively low, on the order of tens of euro per tonne of O2, while the same measures for solar are very high, on the order of hundreds of euro per tonne of CO2. |
| Date: | 2014–03–07 |
| URL: | http://d.repec.org/n?u=RePEc:erp:euirsc:p0376&r=reg |
| By: | Joschka Gerigk (Institute for Environmental Decisions, ETH Zurich); Ian A. MacKenzie (School of Economics, The University of Queensland); Markus Ohndorf (Institute for Environmental Decisions, ETH Zurich) |
| Abstract: | The conventional economic argument favors the use of market-based instruments over ‘command-and-control’ regulation. This viewpoint, however, is often limited in the description and characteristics of the latter; namely, environmental standards are often portrayed as lacking structured abatement incentives. Yet contemporary forms of command-and-control regulation, such as standards stipulated via benchmarking, have the potential to be efficient. We provide a first formal analysis of environmental standards based on performance benchmarks. We show, in a variety of contexts, that standards can provide efficient incentives to improve environmental performance. |
| Date: | 2014–05–13 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:519&r=reg |
| By: | Zhu, Liangxu |
| Keywords: | Environmental Economics and Policy, Marketing, |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare14:165892&r=reg |
| By: | Kwok Ping Tsang; Gregory S. Amacher; Olli-Pekka Kuuselaa |
| Abstract: | Tradable permit markets for carbon dioxide (C02) emissions respond to short-run fluctuations in economic activity. To provide stability, both price and quantity interventions have been proposed. This paper focuses on the relative performance of fixed versus intensity allowances in the presence of both productivity and energy price uncertainty. Both instruments achieve the same steady-state emissions reduction target of 20 percent, which is similar to the current policy proposals, and the regulator then chooses the allowance policy that has the lowest expected abatement cost. A standard real business cycle (RBC) model is used to solve for the expected abatement cost under both policies. Expected cost outcomes are compared using data from the U. S. economy as the baseline scenario. Unlike previous studies, this paper's results show that, under a reasonable model calibration, fixed allowances outperform intensity allowances by a cost difference of as much as 30 percent. |
| Keywords: | Climate Finance, Productivity, IDB-WP-450 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:83016&r=reg |
| By: | Geraldine Henningsen (Department of Management Engineering, Technical University of Denmark); Arne Henningsen (Department of Food and Resource Economics, University of Copenhagen); Sascha T. Schröder (Department of Management Engineering, Technical University of Denmark); Simon Bolwig (Department of Management Engineering, Technical University of Denmark) |
| Abstract: | The Danish “Klima 2020” plan sets an ambitious target for the complete phasing-out of fossil fuels by 2050. The Danish energy sector currently accounts for 40% of national CO2 emissions. Based on an extended Farrell input distance function that accounts for CO2 as an undesirable output, we estimate the environmental productivity of individual generator units based on a panel data set for the period 1998 to 2011 that includes virtually all fuel-fired generator units in Denmark. We further decompose total productivity into technical efficiency, best practice ratio, and scale efficiency and use a global Malmquist index to calculate the yearly changes. By applying time series clustering, we can identify high, middle, and low performance groups of generator units in a dynamic setting. Our results indicate that the sectoral productivity only slightly increased over the fourteen years. Furthermore, we find that there is no overall high achiever group, but that the ranking, although time consistent, varies between the different productivity measures. However, we identify steam turbines and combustion engines for combined heat and power production as potential high performers, while combustion engines that only produce electricity are clearly low performers. |
| Keywords: | Environmental productivity, energy sector, productivity analysis, CO2 mitigation, renewable energy, transition |
| JEL: | C50 D22 D24 O30 |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:foi:wpaper:2014_04&r=reg |
| By: | Ma, Chunbo; Burton, Michael |
| Abstract: | Green electricity products are increasingly made available to consumers in many countries in an effort to address a number of environmental and social concerns. Most of the existing literature on this green electricity market focuses on consumer's characteristics and product attributes that could affect participation. However, the contribution of this environmental consumerism to the overall environmental good does not depend on participation alone. The real impact made relies on market penetration for green consumers (the proportion of green consumers) combined with the level of green consumption intensity-the commitment levels, or proportion of consumption that is green. We design an online interface that closely mimics the real market environment for electricity consumers in Western Australia and use an error component model to analyze consumers' choice of green electricity products is much more strongly influenced by consumer characteristics than product attributes. When green products are selected, the vast majority select the minimum commitment possible, and this is insensitive to the premium being charged on green power, suggesting that we are largely observing a "warm glow" for carbon mitigation. |
| Keywords: | Green Electricity, Choice Modeling, Error Components Model, Warm Glow, Environmental Economics and Policy, Resource /Energy Economics and Policy, D11, Q42, Q51, |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare14:165858&r=reg |
| By: | Philip D. Adams; Brian R. Parmenter; George Verikios |
| Abstract: | Computable general equilibrium modelling in Australia is oriented towards providing inputs to the policy-formation process, a process that requires detail. We explain how the necessary level of detail can be provided using analysis of the potential economic impacts of a carbon price on the Australian economy that operates as part of a global emissions trading scheme. The global scheme sets the price and allocation of permits across countries. We find that domestic abatement falls well short of targeted abatement, Australia's GDP is 1.1% lower relative to the basecase, and some industries and regions are vulnerable to employment losses. |
| Keywords: | carbon pricing, computable general equilibrium modelling, emissions trading |
| JEL: | C68 Q52 Q58 |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:cop:wpaper:g-243&r=reg |
| By: | GianCarlo Moschini (Center for Agricultural and Rural Development (CARD)) |
| Abstract: | This paper develops a spatial equilibrium model suitable to analyze the economic impacts of measures (such as isolation distances and buffer zones) meant to ensure coexistence between GM and non-GM crops. We show that policies that put the cost of such measures exclusively on GM producers lead to a competitive equilibrium that is biased against GM products (relative to the welfare maximizing allocation). Efficient allocation is restored if the cost of implementing coexistence measures is shared equally between adjacent GM and non-GM farms. Key Words: Biotechnology; externality; nonconvexity; regulation; technology adoption. |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:ias:cpaper:14-wp548&r=reg |
| By: | Alessandro Gandolfo; Valeria De Bonis |
| Abstract: | The gaming sector has recently been characterized by a process of liberalization and technological innovation, which has increased the number of available products and operators, thus increasing the degree of market competition. On the fiscal side, the effect of these changes has been the paradox of a decrease in government revenues vis à vis the expansion undergone by the sector. If the interplay between different fiscal treatments and market evolutions of the various games is the immediate explanation of such a situation, the way out of it is a modernization of the taxation instruments applied to the sector. |
| Keywords: | gaming sector, government policy and regulation, taxation and profits. |
| JEL: | H25 K34 M31 M38 |
| Date: | 2013–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:pie:dsedps:2013/173&r=reg |
| By: | François-Gaël Lataste; Aurélie Trouvé; Marielle Berriet-Solliec; Janet Dwyer |
| Abstract: | - De nombreux débats ont mis en lumière l'ambiguïté de la notion de « biens publics ». Nous proposons d'éclairer ces débats à partir du cas de la Politique agricole commune (PAC). Nous faisons l'hypothèse que l'utilisation de la notion de « biens publics » dans le débat sur la PAC, tout en mettant l'accent sur les effets environnementaux, conforte la remise en cause de la PAC en tant que politique commune de régulation des marchés qui concerne des objectifs multiples. Pour tester cette hypothèse, nous nous appuyons sur une revue de la littérature économique, ainsi que sur une analyse des prises de position d'acteurs institutionnels (rencontrés à Bruxelles et au Royaume-Uni). - Numerous debates reveal the ambiguity surrounding the concept of "public goods". We seek to examine and clarify these in the particular case of Europe's Common Agricultural Policy (CAP). Our hypothesis is that the use of the concept of ?public goods' in the debate on the CAP and its role, whilst emphasizing environmental issues, actually calls into question the notion of the CAP as a common policy with multiple objectives also embracing market regulation, cohesion and quality of life. To test this hypothesis, we review the economic literature and make an analysis of the perspectives and stand-points of institutional actors in Brussels and the United Kingdom. |
| Keywords: | bien public, politique agricole, régulation, multifonctionnalité de l'agriculture, Royaume-Uni / public goods, agricultural policy, regulation, multifunctionality, United Kingdom |
| JEL: | Q18 H50 R58 |
| Date: | 2014–05–05 |
| URL: | http://d.repec.org/n?u=RePEc:ceo:wpaper:47&r=reg |
| By: | Stravelakis, Nikos |
| Abstract: | It was more than four decades ago when James Tobin stressed the fallacy underlying the Latin motto "Post Hoc ergo Propter Hoc". His point was that a causal relation, back then between money and income, must rely on something more than time precedence. However, this fact has not received proper attention, contemporary literature explains the current depression from the financial crisis which preceded it and its' resolution depends on proper rules of financial regulation. This paper argues different, the current depression resulted from weak growth reflecting weak profitability. We show that under this reasoning financial crisis episodes are highly probable, serving as the trigger of depressions. The latter implies that financial assets valuation depends on a highly variable required rate of return, contrary to the postulations of modern investment theory. Highly volatile asset returns places financial markets in a world of true uncertainty as opposed to calculable risk. This shred of realism gives different meaning and limitations to financial regulation. Any regulatory policy monitoring liquidity or solvency ratios can prove insufficient as zero or weak growth turns unstable, an event usually preceded by increased amounts of speculative investments. Therefore, financial regulation should focus on what kind of assets financial intermediaries can sell and what kind of assets banks, pension funds, corporations and the broad public can hold to protect taxpayers from future bailout costs at least in part. |
| Keywords: | Crisis, Financial Crisis, Asset Valuation, Rate of Profit, Rate of Profit of Enterprise, Financialization. |
| JEL: | E11 E32 G12 |
| Date: | 2014–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:55944&r=reg |
| By: | Sauvé, Pierre (World Trade Institute, University of Bern, Switzerland); Shingal, Anirudh (World Trade Institute, University of Bern, Switzerland) |
| Abstract: | More than half of the World Trade Organization (WTO)-notified services trade agreements (STAs) in effect since 2008 have involved at least one (South or Southeast) Asian trading partner. Drawing on Baier and Bergstrand’s (2004) determinants of preferential trade agreements and using the World Bank’s database on the restrictiveness of domestic services regimes (Borchert et.al. 2012), we examine the potential for negotiated regulatory convergence in Asian services markets. Our results suggest that countries within Asia that are more remote from the rest of the world and that have similar economic sizes, greater differences in relative factor endowments compared to the rest of the world, common legal origins, high levels of preexisting trade, and restrictive services regulations are more likely candidates for regulatory convergence. Our empirical model successfully predicts 10 of the 14 STAs negotiated during 2008–12 and 88 of the 89 dyads within Asia that lack an STA. |
| Keywords: | PTAs; services; regulation; regulatory convergence; Asia |
| JEL: | F10 F13 F15 |
| Date: | 2014–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbrei:0129&r=reg |
| By: | Andrew Cornford |
| Abstract: | In the post-crisis agenda of reform of financial regulation, macroprudential regulation has been assigned a central role. Some of the measures of this agenda involve restrictions on cross-border financial flows and discriminatory restrictions targeting particular financial institutions and activities. Others target corporate form and the relations between the constituent parts of banking groups. Many of the measures implemented or proposed as part of the reform agenda may be inconsistent with the WTO General Agreement on Trade in Services (GATS) and with other bilateral and regional agreements on trade and investment in banking services. As a result both sets of rules may eventually require revision. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:unc:dispap:216&r=reg |
| By: | Rieger, Jörg |
| Abstract: | This papers studies the impact of a financial transactions tax on the trading volume and asset price volatility in a model with heterogeneous beliefs. To model heterogeneous beliefs we follow Kurz (1994, 1997) and restrict the class of beliefs to the subset of rational beliefs. We study a tax on bond and asset purchases. The simulated model shows that the introduction of a transaction tax results in a lower trading volume and therefore in less liquid financial markets. Because of the decreased liquidity the volatility of the stock market increases. We also study the welfare effects of a financial transaction tax and the simulation results also show that there is only a small change in welfare. |
| Keywords: | Transaction Tax; Financial Regulation; Heterogeneous Beliefs |
| Date: | 2014–05–19 |
| URL: | http://d.repec.org/n?u=RePEc:awi:wpaper:0563&r=reg |
| By: | Khabyuk, Olexiy (Department of Economics of the Duesseldorf University of Applied Sciences) |
| Abstract: | The paper at hand illustrates the history and the current state of the media economics tradition in German-speaking countries. After describing early, inter- and transdisciplinary approaches in media economics the author will discuss boundaries of the market provision of media goods (“market failure”), which represents the basic paradigm of the German media economics tradition. Research ideas equally interesting for both German and Russian scientists will be proposed in order to pave the way for а future cooperation. |
| Abstract: | Der vorliegende Beitrag veranschaulicht die Entstehungsgeschichte und den aktuellen Stand der deutschsprachigen Medienökonomie. Neben der Diskussion früherer sowie ihrer inter- und transdisziplinärer Ansätze wird durch die schwerpunktmäßige Erörterung der Grenzen marktlicher Bereitstellungsverfahren (Marktversagen) das Grundparadigma der deutschsprachigen Medienökonomie dargestellt. Die Skizzierung von für deutsche und russische Wissenschaftler gleichermaßen interessanten Forschungsfeldern soll den Weg für eine künftige Zusammenarbeit ebnen. |
| Keywords: | Marktversagen, Mediengütern, interdisziplinäre Medienökonomie, deutschsprachige Tradition, Medienökonomie, Medienregulierung, Russland, market failure, provision, media goods, interdisciplinary media economics, media economics tradition, German-speaking countries, media regulation |
| JEL: | L82 |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:ddf:wpaper:fobe29&r=reg |
| By: | Martin D O’Brien (Central Bank of Ireland); Karl Whelan (University College Dublin) |
| Abstract: | This paper examines how banks respond to shocks to their equity. If banks react to equity shocks by more than proportionately adjusting liabilities, then this will tend to generate a positive correlation between asset growth and leverage growth. However, we show that in the presence of changes in liabilities that are uncorrelated with shocks to equity, a positive correlation of this sort can occur without banks adjusting to equity shocks by more than proportionately adjusting liabilities. The paper uses data from US bank holding companies to estimate an empirical model of bank balance sheet adjustment. We identify shocks to equity as well as orthogonal shocks to bank liabilities and show that both equity and liabilities tend to adjust to move leverage towards target ratios. We also show that banks allow leverage ratios to fall in response to positive equity shocks, though this pattern is weaker for large banks, which are more active in adjusting liabilities after these shocks. We show how this explains why large banks have lower correlations between asset growth and leverage growth. |
| Keywords: | Banks, Leverage, Banking Regulation |
| Date: | 2014–03–18 |
| URL: | http://d.repec.org/n?u=RePEc:ucn:wpaper:201404&r=reg |