|
on Resource Economics |
|
Issue of 2023‒11‒27
four papers chosen by |
| By: | Romain Fillon (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, UMR PSAE - Paris-Saclay Applied Economics - AgroParisTech - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Céline Guivarch (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); Nicolas Taconet (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, TU - Technical University of Berlin / Technische Universität Berlin, PIK - Potsdam Institute for Climate Impact Research) |
| Abstract: | We investigate the implications of absolute risk aversion with respect to intertemporal utility, i.e. temporal risk aversion, in the presence of a stylized climate tipping risk affecting productivity irreversibly. Optimal climate policy is more stringent under temporal risk aversion, in order to reduce all present and future probabilities of crossing the tipping point and avoid a situation where all generations are badly off. Temporal risk aversion implies a 30% increase in the social cost of carbon (SCC) under our benchmark calibration and for a 10% irreversible increase in the level of economic damage from climate change. The optimal SCC under temporal risk aversion increases sharply with the level of damage brought by a potential tipping point. |
| Keywords: | Stochastic climate-economy modeling, Risk-sensitive recursive preferences, Environmental policy, Risk aversion, Environmental Economics, Climate change |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04250702&r=res |
| By: | Odersky, Moritz (University College Maastricht); Löffler, Max (Maastricht University) |
| Abstract: | We analyze the exposure of different income groups to the 2021 floods in Germany, which serve as an exemplary case of natural disasters intensified by anthropogenic climate change. To this end, we link official geo-coded satellite data on flood-affected buildings to neighborhood-level information on socio-economic status. We then document the empirical relationship between flood damages and household income. We limit comparisons to the vicinity of affected rivers and absorb a rich set of regional fixed effects to assess the differential exposure at the local level. Average household income is around 1, 500 euros or three percent lower in flood-affected neighborhoods than in non-affected neighborhoods nearby. Our study is the first to document this regressive exposure along the income distribution based on actual flood damage data in Europe. |
| Keywords: | climate change, differential exposure, floods, income distribution |
| JEL: | Q52 Q54 D30 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16540&r=res |
| By: | Jafarov, Jafar (Georgia State University); Singh, Tejendra P. (Georgia State University); Sahoo, Soham (Indian Institute of Management Bangalore) |
| Abstract: | We investigate how air pollution impacts outdoor activity avoidance, leveraging changes in local wind direction in an instrumental variable setup for causal identification. Our findings reveal a substantial reduction in time spent outdoors during polluted days, mainly driven by decreased engagement in employment-related activities. This effect varies significantly across age, education level, usual principal activity status, consumption expenditure, and residential location. Moreover, reduced outdoor time due to air pollution can potentially promote a more equitable allocation of unpaid caregiving responsibilities within households via increased male involvement. Our results rule out information provision as the primary mechanism and remain robust under various sensitivity tests. |
| Keywords: | air pollution, time-use, labor supply, intrahousehold bargaining, avoidance behavior, India |
| JEL: | D13 J22 O13 Q53 Q56 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16552&r=res |
| By: | Leisner, Jonathan (University of Copenhagen); Munch, Jakob R. (University of Copenhagen); Nielsen, August Twile (University of Copenhagen); Schaur, Georg (University of Tennessee) |
| Abstract: | We use Danish firm-level data to examine the causal link between carbon emissions, offshoring, and import competition. Offshoring reduces firms' emission intensity but increases their production. Import competition reduces firms' production without affecting their emission intensity. For Denmark, these effects imply that observed offshoring trends reduced the overall manufacturing emission intensity while import competition did not. However, despite the emission reducing effects in local manufacturing, offshoring did not affect global emissions. Furthermore, import competition substantially increased global emissions. Therefore, based on offshoring and Chinese import competition, our results suggest that international trade may be bad for the global environment. |
| Keywords: | carbon emissions, offshoring, import competition |
| JEL: | F14 F18 Q54 Q56 |
| Date: | 2023–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16556&r=res |