The following is an inventory of selected recent papers and books
concerning the Economics of Climate Change. Perusing this list will give you an
idea of the sorts of issues that have captured the attention of economists and
other related researchers over the last few years. You might also wish to pay
attention to the journals and publishers that have been interested in publishing
these articles or selling these titles. The items are listed roughly in reverse
chronological order. I will attempt to update these lists annually.
This inventory is intended for students in UCLA's graduate sequence in
Environmental and Natural Resource Economics.
Chen, Zhiqi, "Negotiating an Agreement on Global Warming:
A Theoretical Analysis," Journal of Environmental Economics and Management;
32(2), February 1997, 170-88.
Abstract: The outcome of international negotiation
on combatting global warming is derived and analyzed using a two-country
bargaining model. It is shown that while side payments between countries
will generally be part of an agreement, some of these payments are made
purely as a result of asymmetry in bargaining power and have nothing to
do with the polluter pays principle or the victim pays principle. Factors
affecting the outcome of negotiation include a country's size of population,
the welfare level at the disagreement point, and the order of making offers.
The enforcement issue is also discussed.
Torvanger, Asbjorn, "Uncertain Climate Change in
an Intergenerational Planning Model," Environmental and Resource Economics;
9(1), January 1997, 103-24.
Pearce, D., "Economists and Climate Change," Environment
and Planning A; 29(1), January 1997, 1-4.
International Association for Energy Economics, Energy
and economic growth: Is sustainable growth possible? Proceedings of
the 20th Annual International Conference. 3 vols, New Delhi: Tata Energy
Research Institute, 1997, 349; 353-689; 695-1004.
Abstract: Three-volume set contains proceedings
of the twentieth annual International Association for Energy Economics
conference on energy and economic growth held in January 1997. Papers in
volume 1 discuss a global approach to climate change; emerging development
paradigms and rural energy needs; the causes and impacts of greenhouse
gas emissions and global warming; environmental and resource economics;
energy efficiency and conservation; hydrocarbon economics; the economics
of climate change; the efficiency, equity, and environmental implications
of energy taxes and subsidies; renewable energy technologies; and energy
demand forecasting and analysis. Volume 2 contains papers focusing on financing
sustainable energy development; strategies to combat climate change; economics
and pricing; issues in the power sector; energy supply prospects and changes;
integration of energy systems and resource planning; financing sustainable
energy development; transportation and energy; and trends and developments
in the global oil economy. Papers in volume 3 describe the energy cycle
and environmental effects; lifestyles and consumption patterns; case studies
in economic growth; trade and environment; regulatory frameworks for energy
development; energy and environmental security; privatization and institutional
restructuring; imperatives and limits of economic growth; and energy markets;
and economic performance and environmental degradation in Mexico. No
index.
Tietenberg, Tom, ed., The economics of global warming,
Elgar Reference Collection Series. International Library of Critical Writings
in Economics, vol. 74. Cheltenham, U.K. and Lyme, N.H.: Elgar; distributed
by American International Distribution Corporation, Williston, Vt., 1997,
xxii, 624.
Abstract: Draws together thirty-one previously
published studies on the economics of global warming. Part 1 presents general
studies. Part 2 provides global-warming damage estimates, cost-of-control
estimates, and research focusing on deriving optimal solutions. Part 3
addresses the choice of policy instruments, examining carbon taxes, tradable
permits, and hedging strategies. Papers in part 4 address the problem of
defining appropriate discount rates and consider the suitability of the
intergenerational discounting framework from an ethical standpoint.
Hertel, Thomas W., ed., Global trade analysis: Modeling
and applications, Cambridge; New York and Melbourne: Cambridge University
Press, 1997, xvii, 403.
Abstract: Fourteen papers, drawn from the Global
Trade Analysis Project (GTAP), present a modeling framework for conducting
quantitative analyses of international economic issues and outline the
most refined GTAP applications undertaken to date. Five papers document
the GTAP modeling framework, database, and software. Seven papers examine
applications of the standard GTAP model, focusing on developing country
expansion and relative wages in industrial countries; the Cairns Group
strategies for agriculture in the Uruguay Round; free trade in the Pacific
Rim; the benefits of abolishing the Multifibre Arrangement in the Uruguay
Round package; global climate change and agriculture; environmental policy
modeling; and multimarket effects of agricultural research with technological
spillovers. Two papers provide an evaluation of the GTAP effort, evaluating
the model's performance in backcasting changes in export shares in the
Pacific Rim over the decade of the 1980s and considering the future course
of global trade analysis using the GTAP framework. Hertel is a professor
in the Department of Agricultural Economics at Purdue University and Director
of the Global Trade Analysis Project. Index.
Conrad, Jon M., "Global Warming: When to Bite the Bullet,"
Land Economics; 73(2), May 1997, 164-73.
Abstract: An option-value (or stopping-rule)
model is developed to determine the optimal timing and expected value of
policies (bullets) to slow global warming. The model and policies are calibrated
to reflect current estimates or predictions of temperature drift, variance,
damage, and the cost of slowing global warming. The 'basic' and 'asymptotic'
bullets have option values of between $600 and $700 billion dollars for
a discount rate of 5 percent. The most effective (platinum) bullet is not
adopted until mean global temperature reaches a trigger value of 15.54
degrees Celsius, which is not likely to be reached during the next two
decades.
Alig, Ralph et al., "Assessing Effects of Mitigation Strategies
for Global Climate Change with an Intertemporal Model of the U.S. Forest
and Agriculture Sectors," Environmental and Resource Economics;
9(3), April 1997, 259-74.
Abstract: A model of product and land markets
in U.S. forest and agricultural sectors is used to examine the private
forest management, land use, and market implications of carbon sequestration
policies implemented in a "least social cost" fashion. Results suggest:
policy-induced land use changes may generate compensating land use shifts
through markets; land use shifts to meet policy targets need not be permanent;
implementation of land use and management changes in a smooth or regular
fashion over time may not be optimal; and primary forms of adjustment to
meet carbon policy targets involve shifting of land from agriculture to
forest and more intensive forest management combinations varying with the
policy target. Coauthors are Darius Adams, Bruce McCarl, J. M. Callaway,
and Steven Winnett.
Nordhaus, William D.; Popp, David, "What Is the Value of
Scientific Knowledge? An Application to Global Warming Using the PRICE
Model," Energy Journal; 18(1), 1997, 1-45.
Abstract: Governments must cope with the enormous
uncertainties about both future climate change as well as the costs and
benefits of slowing climate change. This study analyses the value of improved
information about a variety of geophysical and economic processes. The
value of information is estimated using the "PRICE model" which is a probabilistic
extension of earlier models of the economics of global warming. The study
uses five different approaches to estimating the value of information about
all uncertain parameters and about individual parameters. It is estimated
that the value of early information is between $1 and $2 billion for each
year that resolution of uncertainty is moved toward the present. We estimate
that the most important uncertain variables are the damages of climate
change and the costs of reducing greenhouse gas emissions. Resolving the
uncertainties about these two parameters would contribute 75 percent of
the value of improved knowledge.
Plambeck, Erica L.; Hope, Chris; Anderson, John, "The Page95
Model: Integrating the Science and Economics of Global Warming," Energy
Economics; 19(1), March 1997, 77-101.
Abstract: PAGE is a computer simulation model
developed in 1992 for policy analysis of the global warming problem. This
paper surveys key developments in understanding the global warming problem
that have occurred since 1992. For example, anthropogenic sulphates have
been found to have a significant cooling effect. Halocarbons, once thought
to be the most potential greenhouse gases, are now believed to have only
a slight global warming effect because they destroy ozone, itself a strong
greenhouse gas. Furthermore, case studies in various regions of the world
have improved our ability to predict future damages from global warming.
These developments have strong implications for the economic consequences
of the greenhouse effect and motivated an update of the PAGE model. This
paper discusses the new mode version, PAGE 95, and conclusions for global
warming policy analysis.
Chen, Zhiqi, "Can Economic Activities Lead to Climate Chaos?
An Economic Analysis on Global Warming," Canadian Journal of Economics;
30(2), May 1997, 349-66.
Abstract: This paper presents a two-sector dynamic
general equilibrium model in which the productivity of the agricultural
sector depends on the atmospheric temperature, which in turn is influenced
by the activities of the manufacturing sector. The equilibrium time paths
of the world economy and temperature depend on the rate at which the Earth
sheds heat. If this decay is too small, the dynamic interaction between
the climate system and the market mechanism, both of which are stable in
isolation, may lead to cycles or even chaos. Furthermore, economic growth
may push the world economy and temperature from a stable stead state into
a cyclical or chaotic time path.
Chao, Philip T.; Hobbs, Benjamin F., "Decision Analysis of
Shoreline Protection under Climate Change Uncertainty," Water Resources
Research; 33(4), April 1997, 817-29.
Parikh, Jyoti; Babu, P. G.; Kumar, K. S. Kavi, "Climate
Change, North-South Co-operation and Collective Decision-Making Post-Rio,"
Journal of International Development; 9(3), May-June 1997, 403-13.
Abstract: This article reviews the progress made
since the signing of the Framework Convention on Climate Change. We argue
for increasing the efforts to introduce a collective decision making process.
Developing arguments mainly from a Southern perspective, the article discusses
the risk factors that need to be assessed for collective decision making,
the implications of such processes and policy instruments such as Joint
Implementation to implement the decision making framework. The criteria
for interregional allocation of emission abatement and the potential cooperation
between North and South in the context of climate change are also discussed.
The article highlights the need to reduce the risk of climate change by
early action.
Brown, Katrina, "The Road from Rio," Journal of International
Development; 9(3), May-June 1997, 383-89.
Abstract: This special Policy Arena marks the
fifth anniversary of the United Nations Conference on Environment and Development
(UNCED) held in Rio de Janeiro, Brazil in June 1992. It coincides with
the UN General Assembly Special Session in June 1997 which will review
progress on Sustainable Development and the implementation of Agenda 21,
the blueprint for development agreed at Rio. Three papers here give different
perspectives on the issues which have emerged since the Earth Summit and
on the process of implementation of two of the international agreements
signed at Rio, the Framework Convention on Climate Change (FCCC) and the
Convention on Biological Diversity (CBD). This introductory paper reviews
and appraises UNCED and outlines some of the developments since 1992. It
highlights issues of equity and of the apparent inability of the international
order to make significant impact in the environmental sphere, issues which
are discussed in more detail in the subsequent contributions.
Hayami, Hitoshi et al., "Environmental Management in Japan:
Applications of Input-Output Analysis to the Emission of Global Warming
Gases," Managerial and Decision Economics; 18(2), March 1997,
195-208.
Abstract: Environmental management requires,
among other things, the incorporation of environmentally friendly technologies
into production processes at the producer level and the adoption of energy
consumption patterns which save energy use at the household level. The
systemwide approach involving both technology choice and consumer preference
seems particularly essential for controlling the total emission of global
warming gases. CO2 and other global warming gases, as well
as certain pollution causing gases, are produced when fossil fuels are
burnt; and the consumption of fossil fuels occurs in both the production
and consumption of goods and services. In this paper we discuss how input-output
analysis can be used to estimate the entire production and consumption
of global warming gases conditional on production technology and consumer
preferences. We also present estimation results and their application to
some environmental management issues in Japan. Coauthors are Masao Nakamura,
Mikio Suga, and Kanji Yoshioka.
Dalton, Michael G., "The Welfare Bias from Omitting Climatic
Variability in Economic Studies of Global Warming," Journal of Environmental
Economics and Management; 33(3), July 1997, 221-39.
Abstract: This article analyzes the welfare effects
of climatic variability from global warming in a stochastic economic growth
model and shows that these may be significant. An empirical analysis indicates
that the effects of climate change with variability are greater than the
corresponding effects without it. Effects with variability are also shown
to be more sensitive to variations in the rate of climate change.
Ulph, Alistair; Ulph, David, "Global Warming, Irreversibility
and Learning," Economic Journal; 107(442), May 1997, 636-50.
Abstract: A number of economists have argued
that the literature on the irreversibility effect implies that current
abatement of greenhouse gas emissions should be greater when there is the
possibility of obtaining better information in the future about the potential
damages from global warming than when there is no possibility of obtaining
better information. In this paper the authors show that even the simplest
model of global warming does not satisfy either of Epstein's (1980) sufficient
conditions, so it is not possible to use Epstein's analysis to tell whether
the irreversibility effect applies to models of global warming. They derive
an alternative sufficient condition for the irreversibility effect to
hold.
Soroos, Marvin S., The endangered atmosphere: Preserving
a global commons, Columbia: University of South Carolina Press, 1997,
xv, 339.
Abstract: Discusses how the atmosphere is being
altered and degraded by a rapidly growing human population and what is
being done to regulate its use in order to preserve its essential qualities.
Provides a brief, nontechnical primer on the physical features of the atmosphere
and the principal ways it is being polluted and altered. Traces the evolution
of scientific knowledge about the atmosphere and air pollutants, emphasizing
the roles played by international scientific programs and projects. Presents
case studies of the evolution and the impact of the principal international
regimes that have been established to address atmospheric problems resulting
from human pollutants, including the atmospheric testing of nuclear weapons,
the long range transboundary air pollution responsible for acid precipitation,
the depletion of the ozone layer, and global climate change. Considers
the atmosphere as a global commons susceptible to overuse. Analyzes the
problem of regulating the use of the atmosphere from an environmental security
perspective. Reviews the progress that has been made in addressing atmospheric
problems; examines the greater challenges that lie ahead; and considers
the prospects for strengthening the climate change regime and for creating
a comprehensive law of the atmosphere.
Pachauri, R. K.; Qureshy, Lubina F., eds., Population,
environment, and development, Foreword by Maurice Strong. New Delhi:
Tata Energy Research Institute, 1997, x, 357.
Abstract: Sixteen papers discuss population environment
interactions, addressing diverse issues related to poverty, food security,
consumption patterns, energy use, global warming, biodiversity, and water
scarcity. Papers examine population policy options; factors affecting the
maximum population the earth can support; the interrelationship of population,
environment, and development; the effects of population pressure and poverty
on biodiversity conservation in the Philippines; perceptions of community
participation in population and environment in Lampung, Indonesia, a
transmigration
area; the connections between human population and freshwater problems;
the nature of the Middle East's hydrodemograhic problems, their relationship
to peace in the region, and strategies for achieving water availability;
population growth, poverty, and the environment in India since the 1970s;
population, development, and environmental conditions at the village level
in the Kota district of Rajasthan State, 1981-91; population and environment
interrelationships in Nepal; how China has fueled the world's largest population
and its fast-growing economy; the Tehri Dam Hydro Power project in Western
Himalaya and issues of population, development, and environment; the role
of population growth, structure, and distribution in social and political
conflict; international institutional challenges raised by population,
development, and global warming; the effects of life-style and technology
and possible alternatives; and diet and environmental sustainability in
the agricultural sector. No index.
Chakravorty, Ujjayant; Roumasset, James; Tse, Kinping, "Endogenous
Substitution among Energy Resources and Global Warming," Journal of
Political Economy; 105(6), December 1997, 1201-34.
Abstract: A model of global warming with endogenous
substitution of energy resources and multiple energy demands is developed.
It suggests that, if historical rates of cost reduction in the production
of solar energy are maintained, most of the world's coal will never be
used. The world will move from oil and natural gas use to solar energy.
Temperatures will rise by only about 1.5-2.0 degrees centigrade by the
middle of the twenty-first century and then decline to preindustrial levels.
These results are significantly lower than those predicted by the
Intergovernmental
Panel on Climate Change and suggest that the case for global warming may
be seriously overstated.
Tucker, Michael, "Climate Change and the Insurance Industry:
The Cost of Increased Risk and the Impetus for Action," Ecological
Economics;
22(2), August 1997, 85-96.
Schaeffer, Robert K., Understanding globalization:
The social consequences of political, economic, and environmental change,
Lanham, Md. and Oxford: Rowman and Littlefield, 1997, xii, 360.
Abstract: Traces the history of contemporary
global problems and developments related to economic, environmental, and
political and social change, and evaluates the success or failure of efforts
to address contemporary problems and the changes associated with them.
Discusses changing relations among the first, second, and third worlds
in the postwar period; dollar devaluations in 1972 and 1985; the U.S. government's
use of wage and price controls and high interest rates to fight inflation
during the 1970s; debt and taxes in the third world; debt and taxes in
the United States during the 1980s; how stock price inflation led to job
losses for American workers; technology, food supplies, and hunger; free
trade agreements; population growth; global climate change; the fall of
dictatorship and the emergence of democracy in more than thirty countries
since the mid-1970s; the spread of separatism; and regional mafias and
the global drug trade.
World Bank, Environment matters at the World Bank: The
World Bank Group and the environment: Fiscal 1996, Washington, D.C.:
Author, 1997, 122.
Abstract: Compendium of the Fall 1996 issue of
the World Bank magazine Environment Matters, containing the annual review
of World Bank environmental projects for fiscal 1996, and a ten year accounting
of the World Bank's environmental project portfolio in a project matrix.
Includes regional overviews for Africa; East Asia and the Pacific, and
South Asia; Europe and Central Asia; Latin America and the Caribbean; and
the Middle East and North Africa. Discusses the efforts of the International
Finance Corporation. Addresses issues of supporting biodiversity convention;
stratospheric ozone depletion and climate change; measuring and valuing
the environment; legal dimensions of environmental management; strengthening
partnerships for the environment; addressing the pollution challenge; the
environment as a business opportunity; supporting social sustainability;
and strategically managing the world's water. No index.
Bohm, Peter, The economics of environmental protection:
Theory and demand revelation, New Horizons in Environmental Economics
series. Cheltenham, U.K. and Lyme, N.H.: Elgar; distributed by American
International Distribution Corporation, Williston, Vt., 1997, xviii, 378.
Abstract: Sixteen previously published papers
address policy issues having to do with externalities and public goods.
Papers focus on the theory of externalities and environmental policy; policies
to protect the ozone layer; climate change policy; and estimating demand
for environmental protection and other public goods.
Sandler, Todd, Global challenges: An approach to environmental,
political, and economic problems, Cambridge; New York and Melbourne:
Cambridge University Press, 1997, xvii, 234.
Abstract: Identifies a host of potential global
and regional crises, and uses economic reasoning to consider how nations
are likely to confront the challenges on the horizon and whether institutions
could be devised to avert disaster. Presents basic tools and principles
to conceptualize the study of global crises, introducing elementary concepts
of game theory and collective action. Considers intergenerational aspects
of the problems confronting the world today. Investigates tropical deforestation,
population growth, global warming, ozone depletion, acid rain, transnational
terrorism, and peacekeeping. Addresses the design of institutional structures
for addressing transnational problems. Examines evolutionary issues--whether
nations will change with time so as to better coordinate their actions.
Studies the effects of inequality among nations on global challenges.
Barathan, Sharmila, ed., Workshop on stimulating technological
change: The FCCC in the context of developing country initiatives at the
second session of the Conference of the Parties, Foreword R. K. Pachauri.
New Delhi: Tata Energy Research Institute, 1997, viii, 93.
Abstract: Proceedings of a workshop held by the
Tata Energy Research Institute (TERI) in Geneva in July 1996, include three
papers, plus discussions, examining the U.N. Framework Convention on Climate
Change (FCCC) and the need for a system of effective technology transfer
and use of energy efficient, environmentally sound technologies. Presents
the conference theme paper by R. K. Pachauri, Ajay Mathur, Sharmila Barathan,
Chandra Shekhar Sinha, and Pankaj Bhatia; the opening address by Pachauri;
and a summation by Leena Srivastava. Barathan is with TERI. No index.
Nordhaus, William D., The Swedish nuclear dilemma: Energy
and the environment, Washington, D.C.: Resources for the Future, 1997,
xii, 167.
Abstract: Addresses the decision Sweden must
make about how it will deal with a 1980 national referendum that decided
nuclear power should be phased out, with existing nuclear reactors closing
at the end of their expected lifetime, often taken to be the year 2010.
Explains the structure of the Swedish energy system; the environmental
issues involved in the nuclear debate, including issues of climate-change
policy; and the regulatory debate. Discusses alternative projections of
output and growth in the electricity market and assesses how a nuclear
phase-out would affect the Swedish electricity market. Describes the Swedish
Energy and Environmental Policy (SEEP) Model, an economic model of the
Swedish energy-environment system and uses the model to analyze the impacts
of different phase-out proposals and other possible nuclear policies on
prices, electricity demands, the overall price level, and economic welfare
in Sweden. Also considers the extent to which rising electricity prices
resulting from nuclear phase-out would affect key industries and analyzes
the interaction of the nuclear power decisions with Sweden's commitments
on climate change and with other options. Summarizes the Swedish situation,
considering the overall economic and political commitments, as well as
fiscal, health, safety, and environmental impacts, of Sweden's pursuit
of its nuclear options.
Kaufmann, Robert K.; Snell, Seth E., "A Biophysical Model
of Corn Yield: Integrating Climatic and Social Determinants," American
Journal of Agricultural Economics; 79(1), February 1997, 178-90.
Abstract: The authors estimate a model that accounts
for both climatic and social determinants of corn yield in the United States.
Climate variables are specified for periods that correspond to phenological
stages of development. Social determinants include market conditions, technical
factors, scale of production, and the policy environment. The model accounts
for the historical and cross-sectional variation in yield, and the interpretation
of coefficients is consistent with independent analyses of the climatic
and social determinants. The hybrid model provides a framework for assessing
the effect of, and adaptation to, climate change.
Stephan, Gunter; Muller Furstenberger, Georg; Previdoli,
Pascal, "Overlapping Generatons or Infinitely-Lived Agents: Intergenerational
Altruism and the Economics of Global Warming," Environmental and Resource
Economics; 10(1), July 1997, 27-40.
Halvorsen, Robert (Reviewer), "Review of: Risks, costs,
and lives saved: Getting better results from regulation," Journal of
Economic Literature; 35(4), December 1997, 2077-2079.
FONT SIZE=-1>Hahn, Robert W., ed. Risks, costs, and lives saved:
Getting better results from regulation. New York and Oxford: Oxford University
Press; Washington, D.C.: AEI Press, 1996.
Lim, Dongsoon, "The Economic Impacts of Global Warming
Policy on the Chinese Economy," Pennsylvania State University, Ph.D. 1997
Mikesell, Raymond F. (Reviewer), "Review of: Global challenges:
An approach to environmental, political, and economic problems," Journal
of Economic Literature; 35(4), December 1997, 2098-2100.
Sandler, Todd. Global challenges: An approach to
environmental,
political, and economic problems. Cambridge; New York and Melbourne:
Cambridge University Press, 1997.
Fankhauser, Samuel; Tol, Richard S. J.; Pearce, David
W., "The Aggregation of Climate Change Damages: A Welfare Theoretic Approach,"
Environmental and Resource Economics; 10(3), October 1997, 249-66.
Carmichael, Jeffrey J., "Guidelines for River Quality
Management during Economic Transition Issues of Multiple Pollutant Modeling,
Climate Change and Economic Instruments," University of Colorado, Ph.D.
1997
Cragg, Michael; Kahn, Matthew, "New Estimates of Climate
Demand: Evidence from Location Choice," Journal of Urban Economics;
42(2), September 1997, 261-84.
Abstract: The authors develop and apply to Census
data a new method for estimating climate demand. The method is useful for
ranking quality of life based upon a willingness-to-pay criterion. Their
two major findings are that the willingness-to-pay quality-of-life index
is correlated with the hedonic approach's ranking but that the migration
approach generates much larger estimates of willingness to pay for a more
moderate climate. This finding is relevant for evaluating the economic
impact of global warming.
Fujita, Toshiyuki, "A Game Theoretic Study of Transboundary
Pollution Problems and International Cooperation. (In Japanese. With English
summary.)," Economic Review (Keizai Kenkyu); 48(3), July 1997,
244-51.
Abstract: In this paper, a dynamic game model
of transboundary pollution and international cooperation is presented.
In the model, we assume that a country is a player and that its strategy
is the pollutant emission abatement rate of pollutants. Each country chooses
its strategy to minimize the discounted sum of the abatement cost and the
damage caused by the accumulation of pollutants, taking into account the
strategies of others. We consider technological and economic aid among
countries as international cooperation and analyze the effect of cooperation
by comparing noncooperative Nash equilibria of the model. Numerical results
are shown for a global warming model, and it is shown that extensive technological
aid can contribute to lowering each country's long run cost, while the
effect of economic aid is not remarkable.
Jia, Qiaoping, "Global Warming: Contribution by and Impacts
on China--An Application of the Dice Model," Oklahoma State University,
Ph.D. 1996
Hartwick, John M. (Reviewer), "Review of: Sustainability
and policy: Limits to economics" Journal of Economic Literature;
34(4), December 1996, 1997-1999.
Common, Michael. Sustainability and policy: Limits
to economics. Fundamental Questions Program series. Cambridge; New
York; and Melbourne: Cambridge University Press, 1995.
Stavins, Robert N. (Reviewer), "Review of: Valuing climate
change: The economics of the greenhouse," Journal of Economic Literature;
34(4), December 1996, 1999-2000.
Fankhauser, Samuel. Valuing climate change: The economics
of the greenhouse. London: Earthscan, 1995.
Cash, David W. (Reviewer), "Review of: The economics and
ecology of biodiversity decline: The forces driving global change," Journal
of Economic Literature; 34(4), December 1996, 2002-2003.
Swanson, Timothy M. The economics and ecology of
biodiversity
decline: The forces driving global change. Cambridge; New York and
Melbourne: Cambridge University Press, 1995.
Ulph, Alistair; Ulph, David, "Global Warming, Irreversibility
and Learning," University of Southampton, Discussion Paper in Economics
and Econometrics: 9601, January 1996, 28.
Abstract: Analysis of policies to deal with global
warming is complicated by three features of the problem: uncertainty about
the extent of damages from global warming, the fact that global warming
depends on stocks of greenhouse gases, which introduces an element of
irreversibility
into the problem, and the fact that decision makers in the future are likely
to have better information about the possible damages from global warming.
This raises the question whether the possibility of getting better information
in the future about damages from global warming should lead policy makers
to take more or less action now to abate emissions of greenhouse gases.
A number of economists have argued that the literature on the "irreversibility
effect", based on seminal papers by Arrow and Fisher (1974), Henry (1974a,b),
suggests that society should take stronger action now to abate greenhouse
gas emissions when there is the possibility of obtaining better information
than would be the case if there was no possibility of obtaining better
information. This view seems to be commonly held by those advising policy
makers about policies towards climate change. However, Epstein (1980) showed
that the analysis of the irreversibility effect by Arrow and Fisher, Henry
and others was based on special cases, and he derived sufficient conditions
for the irreversibility effect to hold, and for the opposite of the
irreversibility
effect to hold. In this paper we show that even the simplest model of global
warming does not satisfy either of Epstein's sufficient conditions, so
it is not possible to use Epstein's analysis to tell whether the irreversibility
effect applies to models of global warming. We then derive our own sufficient
condition for the irreversibility effect to hold. Finally we adapt an empirical
model of global warming due to Maddison (1994) to include uncertainty,
learning and irreversibility and show that for most parameter values current
abatement of emissions of greenhouse gases should be lower when we allow
for the possibility of obtaining better information about damages caused
by global warming than when there is no possibility of obtaining better
information.
Morse, Stephen; Stocking, Michael, eds., People and
environment,
Vancouver: UBC Press, 1996, viii, 215.
Abstract: Seven papers address some fundamental
facets of the complicated relationships between people, their environment,
and development, tackling issues from the perspectives of global environmental
change, political economy, gender analysis, technology, and conservation.
Piers Blaikie focuses on understanding environmental issues. David Gibbon,
Alex Lake, and Michael Stocking explore sustainable agricultural development.
Mick Kelly and Sarah Granich assess global warming and development. Cecile
Jackson examines environmental reproduction and gender in the third world.
Stephen Morse discusses biotechnology. Stocking, Scott Perkin, and Katrina
Brown consider coexisting with nature in a developing world. Ian Thomas
addresses development and population growth. Stocking and Morse are at
the University of East Anglia. Name and subject indexes.
Caplan, Arthur J., "Asymmetric Externalities and Strategic
Behavior: The Case of Moderate Global Warming," University of Oregon, Ph.D.
1996
Chichilnisky, Graciela, "Markets with Endogenous Uncertainty
Theory and Polic" Theory and Decision; 41(2), September 1996,
99-131.
Abstract: Classic formulations of market regard
uncertainty as originating from acts of nature. I extend this to a formulation
of markets which face risks induced by the economy itself, such as the
environmental risks of atmospheric and climate change induced by CFC and
CO2 emissions. I formulate and prove the existence of a general competitive
equilibrium where the state space and the probabilities of events are endogenously
determined as part of the equilibrium. Traders take optimal positions with
respect to the uncertainty which their own actions induce. The equilibrium
allocations are efficient in a restricted sense. I show that scientific
uncertainty can be fully hedged. However, uncertainty induced by the unknown
level of output at an equilibrium cannot be hedged fully. I discuss applications
for CAT Futures, recently introduced on the Chicago Board of Trade, and
to international environmental strategies.
Eismont, Oleg; Welsch, Heinz, "Optimal Greenhouse Gas Emissions
under Various Assessments of Climate Change Ambiguity," Environmental
and Resource Economics; 8(2), September 1996, 129-40.
Lovejoy, Derek, "Limits to Growth?," Science and Society;
60(3), Fall 1996, 266-78.
Abstract: The idea of limits to growth has,
understandably,
achieved notoriety since the days of Malthus. However, there must be some
limit to the ability of the earth to sustain a growing population. Fortunately,
population models suggest that the world's population will probably level
out at about two to three times the present numbers over the next hundred
years. The question is whether the earth's resources are sufficient to
sustain that population at a high standard of living for all. In this the
key issue is energy. It is clear that present trends in energy consumption,
especially oil, cannot be sustained much longer. Regardless of this, however,
prudence demands a drastic reduction in fossil fuel consumption, in view
of the possibility of global warming. It can be shown that, combined with
greatly improved energy efficiency, a transition to a solar (renewable)
energy based economy capable of sustaining the anticipated growth in the
world economy, is possible, but the constraints are extremely tight.
Fankhauser, Samuel; Kverndokk, Snorre, "The Global Warming
Game--Simulations of a CO2-Reduction Agreement," Resource and Energy
Economics; 18(1), March 1996, 83-102.
Abstract: We analyse incentives for, and the
benefits of a possible international cooperation to reduce
CO2-emissions. The negotiations are modelled as a
reciprocal-externality
game in CO2-emissions between 5 world regions. CO2-emissions
affect the players in two ways: First, each country's income
depends (via energy inputs) on the amount of CO2 emitted. But
emissions may also cause future damage due to climate change. The paper
calculates illustrative estimates of the Nash equilibrium and the social
optimum. It shows that the currently observed differences in countries'
attitudes towards a CO2-reduction agreement can largely be
explained by economic factors.
Rose, Adam et al., "Global Warming Policy, Energy, and the
Chinese Economy," Resource and Energy Economics; 18(1), March 1996,
31-63.
Abstract: China is the world's largest user of
coal and therefore a major generator of greenhouse gases. This paper addresses
the issue of whether the country can reconfigure its energy structure without
hindering its future economic development. We construct a dynamic linear
programming model of the Chinese economy and use it to simulate five alternative
strategies to stabilize CO2 emissions at 20% of projected year
2000 baseline levels. Our results, under more optimistic assumptions, indicate
this goal can be achieved with no growth penalty. However, if major technological
changes relating to energy conservation and coal displacement, as well
as vastly increasing availabilities of clean fuels, are not forthcoming,
China could suffer a significant decline in its rate of economic growth.
Coauthors are Juan Benavides, Dongsoon Lim, Oscar Frias.
Kolstad, Charles D., "Learning and Stock Effects in Environmental
Regulation: The Case of Greenhouse Gas Emissions," Journal of Environmental
Economics and Management; 31(1), July 1996, 1-18.
Abstract: This paper concerns the optimal regulation
of greenhouse gases that lead to global climate change. In particular,
we focus on uncertainty and learning (which, over time, resolves uncertainty).
We present an empirical stochastic model of climate-economy interactions
present results on the tension between postponing control until more is
known vs. acting now before irreversible climate change takes place. Uncertainty
in our model is in the damage caused by global warming. The results suggest
that a temporary carbon tax may dominate a permanent one because a temporary
tax may induce increased flexibility.
Ward, Tony, "Climate Change and the National Policy," Canadian
Journal of Economics; 29(0), Sp. Iss. Part 1 April 1996, S344-48.
Wirl, Franz, "Can Leviathan Governments Mitigate the Tragedy
of the Commons?," Public Choice; 87(3-4), June 1996, 363-77.
Abstract: This paper explores the conjecture
whether the Leviathan motive of politicians--to tax for the purpose of
raising revenues rather than for benevolent, Pigovian motives--helps to
overcome the inefficiency of international pollution spillovers such as
in the cases of acid rain and global warming. It turns out that this conjecture
is true in a static context that captures flow externalities (e.g., acid
rain) as long as environmental damages are not too high. In contrast, Leviathan
motives aggravate the already existing inefficiency in the case of stock
externalities (e.g., global warming) despite probably high taxes at the
beginning.
Jenkins, T. N., "Democratising the Global Economy by Ecologicalising
Economics: The Example of Global Warming," Ecological Economics;
16(3), March 1996, 227-38.
Tsur, Yacov; Zemel, Amos, "Accounting for Global Warming
Risks: Resource Management under Event Uncertainty," Journal of Economic
Dynamics and Control; 20(6-7), June-July 1996, 1289-1305.
Abstract: Optimal management of atmospheric pollution
is discussed with a special emphasis on the uncertainty concerning the
occurrence of undesirable events associated with the greenhouse effect.
The uncertainty considered here stems from our ignorance of the exact pollution
level required to trigger the event rather than from the genuinely stochastic
nature of the processes involved. Taking atmospheric pollution level as
the state variable, it is found that uncertainty implies the existence
of an equilibrium interval, within which the emission rate of the greenhouse
gases should be kept equal to the natural removal rate of these gases.
Processes initiated outside the equilibrium interval must converge monotonically
to its nearest endpoint. The determination of the interval requires no
knowledge of the optimal policy. In contrast, ignoring event occurrence
risk implies a single equilibrium level, attracting the optimal process
from any initial level.
Kolstad, Charles D., "Fundamental Irreversibilities in Stock
Externalities," Journal of Public Economics; 60(2), May 1996,
221-33.
Abstract: This paper concerns the irreversibility
effect in stock externalities. In an environment of uncertainty with learning
taking place, one may wish to underemit today to avoid potential environmental
irreversibilities. Alternatively, one may wish to underinvest in pollution
control capital, avoiding investments in sunk capital that turn out to
be wasted. The paper develops theoretical results on the tension between
these two effects and separates risk aversion from the irreversibility
effect. The paper also presents a simple example in climate change
policy.
Leimbach, Marian, "Development of a Fuzzy Optimization
Model, Supporting Global Warming Decision-Making," Environmental and
Resource Economics; 7(2), March 1996, 163-92.
Rothwell, Geoffrey (Reviewer), "Review of: Managing the
global commons: The economics of climate change," Journal of Economic
Literature; 34(2), June 1996
Nordhaus, William D. Managing the global commons: The
economics of climate change. Cambridge, Mass. and London: MIT Press,
1994.
Fullerton, Don (Reviewer), "Review of: Environment and
resource policies for the world economy," Journal of Economic Literature;
34(3), September 1996, 1358-1360.
Cooper, Richard N. Environment and resource policies
for the world economy. Integrating National Economies: Promise and
Pitfalls series. Washington, D.C.: Brookings Institution, 1994.
Khanna, Neha; Chapman, Duane, "Time Preference, Abatement
Costs, and International Climate Policy: An Appraisal of IPCC 1995,"
Contemporary
Economic Policy; 14(2), April 1996, 56-66.
Abstract: This paper appraises current economic
methodologies used in analyzing the social rate of time preference and
discounting, abatement costs, and value of life estimates as they relate
to climate change. It makes a case for choosing an appropriate rate of
time preference when assessing climate policies, including both positive
and normative considerations. Furthermore, the paper argues that the currently
estimated disparity in the cost of the greenhouse gas abatement between
developed countries and developing countries may be inaccurate. Integrating
discount rates, abatement costs, and value of life estimates highlights
important and contrasting implications of international climate policy
for developing and high-income countries. The context of the paper is the
forthcoming Second Assessment Report of Working Group III of the Intergovernmental
Panel on Climate Change.
Ekins, Paul, "The Secondary Benefits of CO2 Abatement: How
Much Emission Reduction Do They Justify?," Ecological Economics;
16(1), January 1996, 13-24.
Abstract: The combustion of fossil fuels emits
a range of damaging pollutants, the emissions of which are reduced if fossil
fuel use is reduced in order to achieve CO2 abatement. These
reductions are termed the secondary benefits of such abatement. The paper
reviews estimates of the size of these benefits. Although the estimates
are few and uncertain, they uniformly suggest that the secondary benefits
are of the same order of magnitude as the gross costs of medium to high
levels of CO2 abatement, and are substantially larger than
the (equally uncertain) estimates of the primary benefits of CO2
abatement, except where these benefits derive from consideration of
damages from unabated global warming in the very long term. The paper concludes
that the existence of significant secondary benefits greatly reinforces
the economic case for an aggressive policy of CO2
abatement.
Birge, John R.; Rosa, Charles H., "Incorporating Investment
Uncertainty into Greenhouse Policy Models," Energy Journal; 17(1),
1996, 79-90.
Abstract: Greenhouse gas policy decisions require
comprehensive understanding of atmospheric, economic, and social impacts.
Many studies have considered the effects of atmospheric uncertainty in
global warming but economic uncertainties have received less analysis.
We consider a key component of economic uncertainty: the return on investments
in new technologies. Using a mathematical programming model, we show that
ignoring uncertainty in technology investment policy may lead to decreases
as great as two percent in overall expected economic activity in the U.S.
with even higher losses in possible future scenarios. These results indicate
that both federal and private technology investment policies should be
based on models explicitly incorporating uncertainty.
Braden, John B.; Folmer, Henk; Ulen, Thomas S., eds.,
Environmental
policy with political and economic integration: The European Union and
the United States, New Horizons in Environmental Economics series.
Cheltenham, U.K.: Elgar; distributed by Ashgate, Brookfield, Vt., 1996,
xiii, 488.
Abstract: Sixteen papers explore environmental
policy-making in a federal or confederal system by comparing various environmental
policies and practices in the United States and the European Union. Papers
focus on the economic and philosophical foundations of environmental policy;
the law and economics of authority in a federal system; the political economy
of instrument choice; international trade and environmental policies; agricultural
pollution; global warming; tropospheric ozone pollution; and environmental
dimensions of national and international security. Contributors are mainly
economists. Braden and Ulen are at the University of Illinois. Folmer is
at Wageningen Agricultural University. Index.
Lewis, David K.; Turner, David P.; Winjum, Jack K., "An
Inventory-Based
Procedure to Estimate Economic Costs of Forest Management on a Regional
Scale to Conserve and Sequester Atmospheric Carbon," Ecological Economics;
16(1), January 1996, 35-49.
Abstract: Estimation of the costs of managing
forests to conserve and sequester atmospheric carbon is necessary to define
the role of forests to mitigate the onset of projected global climate change.
The role of forests as both carbon pools and an element in the flux of
atmospheric carbon dictate new requirements in estimating the costs of
forest management to mitigate climate change. These requirements include
recognition of the inventory as a capital stock in the estimation of the
costs; the need to allow the integration of biological, social and economic
considerations across nations and regions; and the need to facilitate
consideration
of the distributional impacts of forest policy alternatives. An inventory-based
procedure is presented to estimate forest management costs based on recognition
of the opportunity costs of holding forest inventories. To demonstrate
this procedure, the costs of four policy scenarios projected in the carbon
budget of the United States are examined. Based on the demonstration, the
inventory-based procedure is shown to meet the requirements for estimating
forest management costs to conserve and sequester atmospheric carbon on
a regional scale. The demonstration also illustrates the potential of the
procedure to provide insights into differences in costs associated with
management of forest ecosystems among geographic regions and forest
policies.
Hall, Darwin C., "Geoeconomic Time and Global Warming: Renewable
Energy and Conservation Policy," International Journal of Social Economics;
23(4-5-6), 1996, 64-87.
Nordhaus, William D.; Yang, Zili, "A Regional Dynamic
General-Equilibrium Model of Alternative Climate-Change Strategies," American
Economic Review; 86(4), September 1996, 741-65.
Abstract: Most analyses treat global warning
as a single-agent problem. The present study presents the Regional Integrated
model of Climate and the Economy (RICE) model. By disaggregating into countries,
the model analyzes different national strategies in climate-change policy:
pure market solutions, efficient cooperative outcomes, and noncooperative
equilibria. This study finds that cooperative policies show much higher
levels of emissions reductions than do noncooperative strategies; that
there are substantial differences in the levels of controls in both the
cooperative and the noncooperative policies among different countries;
and that high-income countries may be the major losers from
cooperation.
Watson, Robert T.; Zinyowera, Marufu C.; Moss, Richard H.,
eds., Climate change 1995: Impacts, adaptations and mitigation of climate
change: Scientific-technical analyses, Cambridge; New York and Melbourne:
Cambridge University Press for the Intergovernmental Panel on Climate Change,
1996, x, 878.
Abstract: Reviews the state of knowledge concerning
the impacts of climate change on physical and ecological systems, human
health, and socioeconomic sectors as well as the available information
on the technical and economic feasibility of a range of potential adaptation
and mitigation strategies. Represents the contribution of Working Group
II to the Second Assessment Report of the Intergovernmental Panel on Climate
Change. Includes primers on ecophysiological, ecological, and soil processes
in terrestrial ecosystems, and on energy production and use. Provides an
assessment of the impacts of climate change and adaptation options with
regard to forests; rangelands; deserts; land degradation and desertification;
mountain ranges; nontidal wetlands; the cyrosphere; oceans; coastal zones
and small islands; hydrology and freshwater ecology; industry, energy,
and transportation; human settlements; agriculture; water resources management;
world production; fisheries; financial services; and the health of the
human population. Evaluates mitigation options relating to energy supply,
industry, the transportation sector, human settlements, greenhouse gas
emissions, and forests. Watson is with the Office of Science and Technology
Policy, Executive Office of the President. Zinyowera is with Zimbabwe
Meteorological
Services. Moss is at Battelle Pacific Northwest National Laboratory. Glossary;
no index.
Houghton, J. T., et al., eds., Climate change 1995: The
science of climate change, Cambridge; New York and Melbourne: Cambridge
University Press for the Intergovernmental Panel on Climate Change, 1996,
xii, 572.
Abstract: Assesses scientific knowledge relating
to climate change, in particular that arising from human activities. Represents
the contribution of Working Group I to the Second Assessment Report of
the Intergovernmental Panel on Climate Change. Provides an overview of
the climate system. Covers the radiative forcing of climate change; observed
climate variability and change; and climate processes. Assesses existing
climate models. Presents estimates of the likely response of the climate
system to scenarios of greenhouse gas and aerosol emissions. Evaluates
the current state of knowledge regarding climate and sea level change.
Reviews recent work that has attempted to detect a statistically significant
change in the global climate system and attributes at least part of the
change to anthropogenic factors. Considers what is known about terrestrial
and marine biotic responses to environmental change and feedbacks to climate.
Outlines the individual research activities and national and internationally
coordinated programs needed to advance the understanding of climate change.
Coeditors are L. G. Meira Filho, B. A. Callander, N. Harris, A. Kattenberg,
and K. Maskell. No index.
Hahn, Robert W., ed., Risks, costs, and lives saved: Getting
better results from regulation, New York and Oxford: Oxford University
Press; Washington, D.C.: AEI Press, 1996, xvi, 267.
Abstract: Nine papers explore scientific, economic,
and policy issues underlying risk assessment and risk management. Bruce
N. Ames and Lois Swirsky Gold examine the causes and prevention of cancer.
William R. Hendee focuses on modeling risks at low levels of exposure.
Bernard D. Goldstein considers risk assessment as an indicator for decision
making. Richard S. Lindzen discusses global warming and eugenics. Lester
B. Lave assesses benefit-cost analysis. W. Kip Viscusi addresses the dangers
of unbounded commitments to regulate risk. Tammy O. Tengs and John D. Graham
evaluate the opportunity costs of haphazard social investments in life-saving.
John D. Graham presents an agenda for Congress. Robert W. Hahn assesses
regulatory reform. Hahn is a resident scholar at the American Enterprise
Institute and an adjunct professor of economics at Carnegie Mellon University.
Author and subject indexes.
Tol, Richard S. J., "The Damage Costs of Climate Change towards
a Dynamic Representation," Ecological Economics; 19(1), October
1996, 67-90.
Abstract: Economic assessments of climate change
impacts are commonly presented as the effect of a climate change associated
with a doubling of the atmospheric concentration of carbon dioxide on the
current economy. This paper is an attempt to express impact as a function
of both climate change and socio-economic change. With regard to climate
change, issues discussed are level versus rate of change, speed of adaptation,
speed of restoration and value adjustment, and symmetry. With regard to
socio-economic change, agriculture, migration and the valuation of intangible
losses are addressed. Uncertainty and higher order impacts are treated
briefly. It is qualitatively argued and quantitatively illustrated that
these issues matter a great deal for the damage profile over the next century.
A damage model, based on my best guesses, is presented in the
Appendix.
Lewis, Kenneth A.; Seidman, Laurence S., "An Optimal Greenhouse
Tax in an Optimal Growth Model," Southern Economic Journal; 63(2),
October 1996, 418-28.
Abstract: The authors investigate global warming
in an optimal growth framework by adapting William D. Nordhaus's DICE model.
They find the time paths of the greenhouse gas emissions control rate and
the saving rate that maximize a welfare function, and the path of the greenhouse
gas emissions tax that would induce profit-maximizing firms to generate
the optimal emissions control rate path. The authors calculate optimal
paths for alternative preferences of a citizen planner, projections of
technical progress, and estimates of abatement cost and temperature damage.
They find that optimal policy depends critically on the economics, not
just the science, of global warming.
Ekins, Paul, "How Large a Carbon Tax Is Justified by the
Secondary Benefits of CO2 Abatement?," Resource and Energy Economics;
18(2), June 1996, 161-87.
Abstract: The combustion of fossil fuels emits
a range of damaging pollutants, the emissions of which are reduced if fossil
fuel use is reduced in order to achieve CO2 abatement. These
reductions are termed the secondary benefits of such abatement. The paper
reviews estimates of the size of these benefits at current levels of emissions
of the relevant pollutants. Although the estimates are few and uncertain,
their mid-range suggests that the secondary benefits are of the same order
of magnitude as the gross costs of medium to high levels of CO2
abatement, and are substantially larger than the (equally uncertain)
estimates of the primary benefits of CO2 abatement, except
where these benefits derive from consideration of damages from unabated
global warming in the very long term. The paper then reviews these calculations
in the light of the limits on SO2 emissions mandated by the
Second Sulphur Protocol (SSP). It finds that the secondary benefits from
abating SO2 alone beyond the limits of the SSP still provide
a substantial offset to the costs of a carbon tax. The paper concludes
that the existence of significant secondary benefits greatly reinforces
the economic case for an aggressive policy of CO2
abatement.
Hoel, Michael; Kverndokk, Snorre, "Depletion of Fossil Fuels
and the Impacts of Global Warming," Resource and Energy Economics;
18(2), June 1996, 115-36.
Abstract: This paper combines the theory of optimal
extraction of exhaustible resources with the theory of greenhouse externalities,
to analyze problems of global warming when the supply side is considered.
The optimal carbon tax will initially rise but eventually fall when the
externality is positively related to the stock of carbon in the atmosphere.
It is shown that the tax will start falling before the stock of carbon
in the atmosphere reaches its maximum. If there exists a non-polluting
backstop technology, it will be optimal to extract and consume fossil fuels
even when the price of fossil fuels is equal to the price of the backstop.
The total extraction is the same as when the externality is ignored, but
in the presence of the greenhouse effect, it will be optimal to slow the
extraction and spread it over a longer period. If, on the other hand, the
greenhouse externality depends on the rate of change in the atmospheric
stock of carbon, the evolution of the optimal carbon tax is more complex.
It can even be optimal to subsidize carbon emissions to avoid future rapid
changes in the stock of carbon, and therefore future damages.
Farzin, Y. H., "Optimal Pricing of Environmental and Natural
Resource Use with Stock Externalities," Journal of Public Economics;
62(1-2), October 1996, 31-57.
Abstract: Underlying some of the most pressing
environmental problems are the interlinked resource and environmental stock
externalities with threshold effects. Using a simple dynamic model, it
is shown how in the face of such externalities the static market-based
policy instruments such as Pigouvian taxes should be modified. It is shown
that even if for an initial period there is going to be no pollution stock
damage, the optimal policy still requires that abatement begins immediately
and at increasing rates. Simulation of the model for the case of fossil
fuel burning and the consequent global warming shows that the optimal carbon
tax, and therefore the optimal control strategy, is particularly sensitive
to changes in the marginal abatement cost and the level of fossil fuel
demand. Policy simulations contrast the optimal control policy with, and
estimate the welfare losses from, alternative policies deriving from arbitrary
tax paths. The latter include: (1) a no-tax policy, (2) a constant carbon
tax rate, (3) the European Community's proposed carbon tax path, and (4)
a delayed optimal tax path.
Azar, Christian; Sterner, Thomas, "Discounting and Distributional
Considerations in the Context of Global Warming," Ecological Economics;
19(2), November 1996, 169-84.
Hammitt, James K.; Adams, John L., "The Value of International
Cooperation for Abating Global Climate Change," Resource and Energy
Economics; 18(3), October 1996, 219-41.
Abstract: Because abatement of global climate
change is a public good, independent national actions may not produce the
efficient quantity. Using a numerical integrated-assessment model, abatement
costs and damages induced by climate change are compared at the cooperative
and noncooperative solutions to a set of two-party dynamic games between
the industrialized and developing countries. Games with perfect and imperfect
information about climate and economic factors are considered. Across 144
games with perfect information, incorporating different values of climate
and economic parameters, the noncooperative solution usually yields global
benefits comparable to those of the cooperative solution. In about one-fifth
of these games, however, a second noncooperative solution exists which
yields none of the benefits of the cooperative solution. In a game with
imperfect information, where the state of nature is uncertain in the first
but known in the second of two periods, the expected benefits of the
noncooperative
solution are 98% of the expected benefits of the cooperative solution.
In contrast to single-agent studies which show little cost to delaying
abatement, the benefits of cooperation are usually lost if cooperation
is delayed 20 years.
Howarth, Richard B., "Climate Change and Overlapping Generations,"
Contemporary Economic Policy; 14(4), October 1996, 100-111.
Abstract: This paper examines the interplay between
discounting and the distribution of welfare between generations in formulating
climate change response strategies. The analysis shows that one can understand
Nordhaus's (1994) standard representative agent model for climate policy
analysis as a reduced form of an overlapping generations model that embodies
more realistic demographic assumptions. In this setting, alternative Pareto
efficient allocations may be supported as competitive equilibria given
appropriate sets of income transfers between generations. Numerical simulations
establish that increased intergenerational transfers entail reduced monetary
discount rates and increased rates of greenhouse gas emissions abatement.
Short-run policy choices are highly sensitive to normative judgments concerning
the relative weight attached to the welfare of future generations.
Mendelsohn, Robert; Nordhaus, William, "The Impact of Global
Warming on Agriculture: Reply," American Economic Review; 86(5),
December 1996, 1312-15.
Cline, William R., "The Impact of Global Warming on Agriculture:
Comment," American Economic Review; 86(5), December 1996, 1309-11.
Tata Energy Research Institute, TERI Energy Data Directory
and Yearbook: 1996/97, New Delhi: Author, 1996, xxi, 470.
Abstract: Provides up to date information on
energy and environment related variables pertaining to India. Presents
tables of data, with commentary, pertaining to energy economy linkages;
the organization of the energy sector; supply and consumption of coal and
lignite, hydrocarbons, power, and renewable energy sources; energy use
in agriculture, industry, transport, the domestic sector, and the
commercial/services
sector. India's forests and their future prospects; environmental effects
of energy use and India's environmental standards; and the greenhouse effect
and global warming. Index.
May, Peter H.; da Motta, Ronaldo Seroa, eds., Pricing
the planet: Economic analysis for sustainable development, New York:
Columbia University Press, 1996, x, 220.
Abstract: Ten papers respond to a number of issues
that arise in considering prospects for sustainable development. Papers
examine sustainability challenges to economic analysis and policy (Peter
H. May); consumption patterns as the driving force of environmental stress
(Jyoti Parikh); a tradable carbon entitlements approach to global warming
policy--sustainable allocations (Adam Rose and Brandt Stevens);
back-of-the-envelope
estimates of environmental damage costs in Mexico (Sergio Margulis); health
costs associated with air pollution in Brazil (Ronaldo Seroa da Motta and
Ana Paula Fernandes Mendes); managing the transition to sustainable development
and the role for economic incentives (Thomas H. Tietenberg); ecological
economics--creating a transdisciplinary science (Robert Costanza); carrying
capacity as a tool of development policy in the Ecuadoran Amazon and the
Paraguayan Chaco (Herman Daly); green accounting for sustainable development
(Peter Bartelmus); and measuring sustainable income--mineral and forest
depletion in Brazil (da Motta and May). May is at the Federal Rural University
of Rio de Janeiro. Da Motta is with the Institute for Applied Economic
Research of Brazil's Ministry of Planning. Index.
Bruce, James P.; Lee, Hoesung; Haites, Erik F., eds., Climate
change 1995: Economic and social dimensions of climate change, Cambridge;
New York and Melbourne: Cambridge University Press for the Intergovernmental
Panel on Climate Change, 1996, x, 448.
Abstract: Eleven papers, contributed by Working
Group III of the Intergovernmental Panel on Climate Change (IPCC) to the
IPCC's Second Assessment Report, focus on socioeconomic aspects of climate
change and formulate response strategies. Papers discuss the scope of the
analysis; decision making under uncertainty; equity issues; intertemporal
equity and discounting; applicability of cost-benefit analysis to climate
change; social costs of climate change; response options; estimating the
costs of mitigating greenhouse gases; a review of mitigation cost studies;
integrated assessment of climate change; and economic assessment of policy
options to address climate change. Bruce is with the Canadian Climate Program
Board. Lee is with the Korea Energy Economics Institute. Haites is with
Margaree Consultants. Index.
Nordhaus, William D.; Popp, David, "What is the Value of
Scientific Knowledge?," Yale University, Cowles Foundation Discussion Paper:
1117, March 1996, 49.
Abstract: Governments must cope with the enormous
uncertainties about both future climate change as well as the costs and
benefits of slowing climate change. This study analyses the value of improved
information about a variety of geophysical and economic processes. The
value of information is estimated using the "PRICE model" which is a probabilistic
extension of earlier models of the economics of global warming. The study
uses five different approaches to estimating the value of information about
all uncertain parameters and about individual parameters. It is estimated
that the value of early information is between $1.5 and $2 billion for
each year that resolution of uncertainty is moved toward the present. We
estimate that the most important uncertain variables are the damages of
climate change and the costs of reducing greenhouse gas emissions. Resolving
the uncertainties about these two parameters would contribute 75 percent
of the value of improved knowledge.
Mendelsohn, Robert; Shaw, Daigee, eds., The economics
of pollution control in the Asia Pacific, New Horizons in Environmental
Economics series. Cheltenham, U.K. and Lyme, N.H.: Elgar; distributed by
American International Distribution Corporation, Williston, Vt., 1996,
xv, 354.
Abstract: Fifteen papers, originally presented
at a conference organized by the Institute of Economics, Academia Sinica,
Taiwan, and held in March 1994, adapt environmental economics to the special
situation of the nations of the Asia Pacific region. Papers examine the
impact of global warming on Pacific Rim countries; the framework convention
and climate change policy in Asia; the impact of climate change on rice
yield in Taiwan; acute health effects of major air pollutants in Taiwan;
the value of reduced morbidity in Taiwan; hedonic housing values and benefits
of air quality improvement in Taipei; the benefit of air quality improvement
in Seoul; comparing contingent valuation elicitation techniques of measuring
the benefits of air quality improvement in Taipei; the value of drinking
water protection in Seoul; the demand for environmental quality and models
for contingent policy referendum experiments; hierarchical government,
environmental regulations, transfer payments, and incomplete enforcement;
pollution regulation in open lobbying economies; the pros and cons of equal-rate
Pigovian taxes and tradable permits in controlling global pollution; difficulty
in enforcing efficient prices for regulating shiftable externalities; and
optimal environmental quality improvement in a multi-goods R&D growth
model. Contributors are mainly economists. Mendelsohn is at Yale University.
Shaw is at Academia Sinica. Index.
Wolfrum, Rudiger, ed., Enforcing environmental standards:
Economic mechanisms as viable means?, Beitrage zum auslandischen offentlichen
Recht und Volkerrecht, Band 125. Heidelberg and New York: Springer, 1996,
viii, 640.
Abstract: Twenty papers, originally presented
at a symposium held by the Max Planck Institute for Comparative Public
Law and International Law in July 1995, touch upon two modern developments
in international law: the creation of an international law for the protection
of the environment and reformulation of an international economic order.
Topics include environmental law; sustainable development; the GATT/WTO
dispute settlement process; trade and the protection of the environment
after the Uruguay Round; an assessment of whether trade restrictions are
a viable means of enforcing compliance with international environmental
law; the convention on trade in endangered species; trade restrictions
as a means of enforcing compliance with international environmental law;
the United Nations Climate Change Convention as a step toward sustainable
development; energy efficiency instruments in the liberalized international
energy market; the Convention on Biological Diversity and using state jurisdiction
as a means of ensuring compliance; the implementation of the Basel Convention
in German National Environmental Law as an example for the use of economic
mechanisms; the interrelationship between environment and trade at the
EC level; the second phase of the NAFTA environmental regime; the potential
impact of the global environment facility of the World Bank; the pros and
cons of "ecolabeling"; quotas and the conservation and management of marine
living resources in the Northwest Atlantic; and potential conflicts between
world trade rules and measures nations might take to encourage domestic
recycling of hazardous waste. Contributors include economists and specialists
in law and policy. Wolfrum is with the Max Planck Institute for Comparative
Public Law and International Law at the University of Heidelberg. No
index.
Young, Peter; Parkinson, Stuart; Lees, Matthew, "Simplicity
Out of Complexity in Environmental Modelling: Occam's Razor Revisited,"
Journal of Applied Statistics; 23(2-3), June 1996, 165-210.
Abstract: While large models based on a
deterministic-reductionist
philosophy have an important part to play in environmental research, it
is advantageous to consider alternative modelling methodologies which overtly
acknowledge the poorly defined and uncertain nature of most environmental
systems. The paper discusses this topic and presents an integrated statistical
modelling procedure which involves three main methodological tools: uncertainty
and sensitivity studies based on Monte Carlo simulation techniques; dominant
mode analysis using a new method of combined linearization and model-order
reduction; and data-based mechanistic modelling. This novel approach is
illustrated by two practical examples: modelling the global carbon cycle
in relation to possible climate change; and modelling a horticultural glasshouse
for the purposes of automatic climate control system design.
Miller, Kathleen A.; Rhodes, Steven L.; MacDonnell, Lawrence
J., "Global Change in Microcosm: The Case of U.S. Water Institutions,"
Policy Sciences; 29(4), 1996-1997, 271-90.
Abstract: aspects of global change and whose
availability in time and place may be substantially further altered by
global warming. As human demands and impacts on water resources have increased,
institutions governing water use have evolved in response to pressures
exerted by competing resource users. The record of such institutional evolution
and its implications for the impacts of environmental change on human welfare
can provide a glimpse of issues that are likely to arise as other natural
resources are increasingly subject to the effects of global environmental
transformations. Efforts to manage multiple interdependent water uses present
informative analogies to the general problem of managing the many interrelated
aspects of global change.
Bertram, I. G., "Tradable Emission Quotas, Technical Progress
and Climate Change," Environment and Development Economics; 1(4),
October 1996, 465-87.
Abstract: The paper reviews two alternative rules
for allocation of property rights in a global greenhouse-gas emissions
budget, assuming implementation of a tradable-quota arrangement. These
are the per capita rule and no-regrets-for-the-South (NRFTS) rule. The
operation of a quota market under these alternative regimes is simulated
on a spreadsheet, using 1990-1 data from 125 countries. A significant result
is that once the South has secured a quota allocation based on the per
capita principle, it stands collectively to lose from progress in abatement
technology because of the strong link from technical progress to the world
market price of quota. The more restricted NRFTS rule gives the South smaller
gains from the quota system, but enables it to retain some of the rents
from its own technical progress. Some implications for the South's position
in future negotiations are noted.
Fisher, Anthony C.; Rubio, Santiago J., "A Model of Optimal
Water Reserves Under Climate Change Uncertainty," University of California,
Berkeley Department of Agricultural and Resource Economics and Policy Working
Paper: 776, February 1996, 41.
Abstract: In this paper we study the determination
of optimal water reserves in a region, taking into account that the supply
of the resource, the flow into the reserve, is uncertain, that building
the reserve is costly, and that the commercial development of water resources
may entail also environmental costs. We find that water reserves in the
long run are positively related to increases in uncertainty, and that,
for the case of costly reversibility of investment in reserves, a range
of inaction for investment appears, and the stability of reserves with
respect to changes in variance increases.
Cooper, Ronald L., "Energy Conservation and Renewable Energy
Supplies: A Survey," Journal of Energy and Development; 21(2), Spring
1996, 259-81.
Abstract: Energy conservationists often charge
that the market process for energy fuels fails to reflect the true cost
of using energy (e.g., failure of marginal cost pricing, global environmental
damage, market barriers to conservation) so that government policies are
needed to force energy conservation. In this paper we discuss some of the
energy conservation proposals that have been put forth and provide and
evaluation of their validity. In examining these proposals, we first look
at the historical record of conservation, demand-side management programs
energy conservation and the cost of developing renewable energy sources.
We also examine some of the engineering economics approaches that have
been used to justify government-sponsored energy conservation programs.
Finally, we discuss some of the energy policy problems that arise in promoting
conservation along with the global warming controversy.
Krupnick, Alan J.; Burtraw, Dallas, "The Social Costs of
Electricity: Do the Numbers Add Up?," Resource and Energy Economics;
18(4), December 1996, 423-66.
Abstract: This paper considers the credibility
of the monetary estimates of the environmental and health damages from
electricity. It also evaluates whether the modeling strategies and results
can be transferred to other benefit measurement or environmental costing
analyses from the existing large scale models developed for the case of
electricity. These issues are addressed through a detailed comparative
evaluation of several large scale modeling efforts in the US and Europe.
Effects of electricity fuel cycles on employment, government revenues and
global warming are also considered.