bargaining and devolution in the upper guadiana basin increasingly central governments approach contentious natural resource allocation problems by devolving partial decision making responsibility to local stakeholders this paper conceptualizes devolution as a three stage process and uses a simulation model calibrated to real world conditions to analyze devolution in spain s upper guadiana basin the spanish national government has proposed spending over a billion euros to reverse a 30 year decline in groundwater levels we investigate how the government can most effectively allocate this money to improve water levels by utilizing its power to set the structure of a local negotiation process using a numerical nash model of local bargaining we find that if the national government creates appropriate incentives local bargaining can produce water stabilization the actual water levels that will emerge are highly dependent on the central government s decisions about the budget available to local stakeholders and the default policy which will be influenced by the relative value the government places on various financial and environmental outcomes our paper concludes by determining the relationship between these relative valuations and the government s preferences over water levels

promoting groundwater reform in the guadiana basin in many parts of the world there is a substantial disconnect between existing water institutions and the institutions needed to ensure sustainable water supplies for the future implementing large scale institutional change is politically challenging in many cases changes must emerge from political bargaining or negotiation accordingly there is substantial literature looking at applications of negotiation theory to water policy carraro marchiori and sgobbi 2007 review this literature in detail

non mandatory approaches to environmental protection the approach to environmental protection has been evolving from a regulation driven adversarial government push approach to a more proactive approach involving voluntary and often business led initiatives to self regulate their environmental performance this has been accompanied by increasing provision of environmental information about firms and products to enlist market forces and communities in creating a demand for corporate environmental self regulation by signaling their preferences for environmentally friendly firms this paper provides an overview of the non mandatory approaches being used for environmental protection and surveys the existing theoretical literature analyzing the economic efficiency of such approaches relative to mandatory approaches it also discusses empirical findings on the factors motivating self regulation by firms and its implications for their economic and environmental performance it examines the existing evidence on the extent to which information disclosure is effective in generating pressures from investors and communities on firms to improve their environmental performance

environmental regulations and industrial competitiveness evidence from china economic activities are closely related to real world environmental issues currently more attention is paid to the association between environmental regulations and industrial competitiveness ic because of pressures on economic development and environmental protection in this study we identify and explain the association between environmental regulations and ic in china as the largest developing country in the world china has the unavoidable responsibility of protecting the environment and promoting global economic development we analyse the mechanisms behind environmental regulations and industrial competiveness at the provincial level and conclude that the impact of environmental regulations upon ic is not a simple linear one but a u shaped relationship it is argued that the crucial intervention to activate the u shaped relationship or porter s hypothesis is innovation which can be triggered by stringent regulations and well designed policies

determinants of international tourism a three dimensional panel data analysis international tourism is a fast growing industry generating half a trillion dollars in annual revenues and accounting for almost 10 of total international trade and almost half of total trade in services yet it has so far failed to receive the attention it deserves from mainstream economics this paper attempts to provide an initial understanding of the determinants of international tourism this paper claims that international tourism as other forms of trade in services is driven by unique factors of production and may be better dealt with in a single industry study rather than in a general equilibrium trade model in order to understand these determinants the world is viewed as a market of differentiated products and a discrete choice estimation technique is applied to a large three dimensional data set of tourist flows it is shown that a relatively simple estimation technique combined with a rich data set can deliver reasonable substitution patterns it is found among other things that pol

who is against immigration a cross country investigation of individual attitudes toward immigrants abstract this paper empirically analyzes economic and noneconomic determinants of individual attitudes toward immigrants within and across countries the two survey data sets used covering a wide range of developed and developing countries make it possible to test for interactive effects between individual characteristics and country level attributes in particular theory predicts that the correlation between pro immigration attitudes and individual skill should be related to the skill composition of natives relative to immigrants in the destination country skilled individuals should favor immigration in countries where natives are more skilled than immigrants and oppose it otherwise results based on direct and indirect measures of the relative skill composition are consistent with these predictions noneconomic variables also are correlated with immigration attitudes but they don t alter significantly the labor market results

food aid pitfalls and potential abstract in this article the author asks if it is possible to use food aid so that it meets short run needs while supporting and not undermining the achievement of long term goals of self reliance at household and national level the pitfalls and possibilities to elucidate methods of achieving this are explored after looking at the specific effects on nutrition and incentives to local agriculture it is concluded that most objectives are better achieved by the use of cash rather than food aid

toward a theoretical model of voluntary overcompliance abstract we explain why some firms voluntarily overcomply with environmental regulation in our model all consumers value environmental quality but differ in their willingness to pay which depends on their income levels publicly available information on environmental performance of firms enables consumers to identify clean firms firms participate in a two stage duopoly game where they first choose their levels of cleaning technology and next engage in price competition the market gets segmented by income levels a minimum standard binding on the dirty firm has the effect of improving the performance of the cleaner firm a subsidy obtains the same competitive outcome

third party certification and the effectiveness of voluntary pollution abatement programs evidence from responsible care we analyze whether third party certification has been successful in improving the performance of voluntary pollution abatement in the responsible care rc program which made certification mandatory from 2005 onward we use facility level panel data from 821 plants between 1996 and 2010 and exploit the change in the program requirements to estimate the causal impact of third party certification on participating facility emissions compared to non rc plants in the u s chemical industry we address endogenous selection into rc via instrumental variables and explore heterogeneity in the treatment effect we find that on average there is no statistically discernible effect of third party certification on facility emissions and that this result is robust to a variety of models that correspond to different assumptions related to identification jel q53 q58 l60

erratum standards versus standards the effects of different pollution restrictions when economists refer to pollution standards they almost universally mean uniform restrictions on pollution emissions e g william j baumol and wallace e oates 1975 ch 13 susan rose ackerman 1973 david besanko 1978 however in practice standards take many forms not only emissions restrictions but restrictions on pollution per unit of output or per unit of an input restrictions on the use of a polluting input or mandated use of a particular pollution control technology these specifications of regulations will have a variety of effects on a firm s resource allocation decisions for instance allowing pollution per unit of output as the standard instead of directly restricting the level of pollution gives the firm some choice in addition to reducing pollution it can increase its output to dilute the pollution this paper examines the effects of five different forms of pollution standards on input decisions the level of production and firm profits the results show that the different standards by providing firms with different incentives change the firm s allocation decisions and affect the relative profitability of the standards section i reviews the existing literature on the incentives of different instruments the following section describes the model to be used five different forms of pollution constraints are individually examined in section iii using a graphical approach their relative effects as well as some special cases are assessed in section iv finally section v raises the case of different standards when firms are not identical

utility consistent discrete continuous choices in soil conservation a utility consistent model of participation and participation intensity choices for a voluntary soil conservation program is developed a modified form of roy s identity is used to derive a two equation system that links the discrete dichotomous choice participation and the continuous choice intensity to the same utility function the model corrects for selectivity bias that arises in single equation approaches an application to a filter strip program in two counties in illinois and michigan demonstrates that different factors affect responses to the program across the sample regions estimated willingness to accept payments for participation in the program suggest policy impacts are not uniform across locations

drivers of corporate environmentalism the case of the polish economy in transition abstract at the beginning of the 1990s the central and eastern european cee countries went through significant changes that were supposed to mould them into liberal market democracies those changes that took place in the legal institutional market and civil society fields have also significantly affected the sphere of environmental protection and management clark and cole 1998 as a result also corporate behaviour towards the natural environment has changed significantly apart from changes determined explicitly by legal developments poland has witnessed a rapid increase in voluntary corporate initiatives protecting the natural environment such as iso 14001 environmental management systems ems the purpose of this study is to uncover the drivers of corporate environmentalism as well as its specificity and dynamics during the transition period in poland in order to reach this goal 283 polish based companies were surveyed the conducted study showed that they tended to go green in order to improve their environmental performance and meet the ever changing environmental regulations expecting to capitalise on this type of corporate activity the latter was reflected in the corporate expectation to enhance their image surprisingly the research revealed that the importance of strictly economic drivers such as cost reduction and the market share was rather minor the findings also show that the pressure from various stakeholder groups was of little importance

immigration and trade creation econometric evidence from canada immigrants may expand trade with their country of origin owing to superior knowledge of or preferential access to market opportunities the authors test this proposition using canadian trade data with 136 partners from 1980 to 1992 in an augmented gravity equation they find that a 10 percent increase in immigrants is associated with a 1 percent increase in canadian exports to the immigrant s home country and a 3 percent increase in imports they also find that among the primary categories of immigrants independents have the greater influence on trade immigration via the entrepreneur class appears to have less impact on trade than all other classes except refugees

immigration and equity home bias abstract why do investors hold such large positions in domestic equity when there are gains to be made from international diversification this equity home bias puzzle has received considerable attention in the literature with asymmetric information on domestic and foreign assets whether by individual choice or by market imperfection emerging as the most plausible explanation what happens when we consider a subset of investors whose information sets are closer to investors in foreign countries i assess the relationship between immigration and equity home bias and find that inward migration is positively correlated with increased foreign equity positions and reduced home bias looking across income groups outward migration reduces home bias for relatively rich countries but may actually increase home bias when migration occurs to or from a developing country these results suggest that immigration generates a positive externality of increased information flows for developed countries but not for developing nations the effects of immigration on investment are strongest within the euro zone suggesting that this positive externality of immigration is largest when barriers to portfolio diversification such as currency risk are lowest

immigration and international inbound tourism empirical evidence from australia abstract immigration can potentially influence tourism flows however in spite of the vast number of studies on tourism demand modelling the immigration tourism linkage has not received much attention in the empirical literature this paper seeks to address this gap a dynamic demand model is developed and estimated using data from 1980 to 2008 for the 15 main markets of australia the explanatory variables included are income own price price of a substitute destination airfare and immigration the estimation results empirically establish the connection between immigration and inbound tourism the short run and long run immigration elasticities generated are 0 028 and 0 09 respectively additionally this paper demonstrates that omission of prices of substitutes affects the value of the own price elasticity of demand the results have implications for future research and for stakeholders who can improve the efficiency of their planning exercises by taking into account additional information on immigration trends

tourism demand modelling and forecasting a review of recent research abstract this paper reviews the published studies on tourism demand modelling and forecasting since 2000 one of the key findings of this review is that the methods used in analysing and forecasting the demand for tourism have been more diverse than those identified by other review articles in addition to the most popular time series and econometric models a number of new techniques have emerged in the literature however as far as the forecasting accuracy is concerned the study shows that there is no single model that consistently outperforms other models in all situations furthermore this study identifies some new research directions which include improving the forecasting accuracy through forecast combination integrating both qualitative and quantitative forecasting approaches tourism cycles and seasonality analysis events impact assessment and risk forecasting

quality leadership when regulatory standards are forthcoming in many markets governments set minimum quality standards while some sellers compete on the basis of quality by exceeding them such quality leadership strategies often win public acclaim especially when they involve environmental attributes using a duopoly model of vertical product differentiation we show that if the high quality firm can commit to a quality level before regulations are promulgated it induces the regulator to weaken standards and welfare falls our results raise doubts about the social benefits of corporate self regulation and highlight the dangers of lengthy delays between legislative mandates for new regulations and their implementation

a dynamic approach to voluntary environmental contributions in tourism abstract in an evolutionary game theoretical model of tourism firms that use an endogenous natural common pool resource cpr we show that stable equilibria with voluntary environmental initiatives may coexist with other equilibria where voluntary abatement is absent the basins of attraction of the equilibria are identified and a bifurcation analysis is carried out producing two results with policy implications first there is a highly non linear relationship between the cost of abatement required to be green and the share of green firms second increases in the number of the cpr s users will ultimately dissipate the incentives to make abatement beyond regulation

insecurity and the pattern of trade an empirical investigation corruption and imperfect contract enforcement dramatically reduce international trade this paper estimates the reduction using a structural model of import demand in which insecurity acts as a hidden tax on trade we find that inadequate institutions constrain trade as much as tariffs do we also find that omission of indices of institutional quality biases the estimates of typical gravity models obscuring a negative relationship between per capita income and the share of total expenditure devoted to traded goods finally we argue that cross country variation in the effectiveness of institutions and the consequent variation in the prices of traded goods offer a simple explanation for the stylized fact that high income capital abundant countries trade disproportionately with each other

voluntary environmental agreements good or bad news for environmental protection abstract there has been growing interest in the use of voluntary agreements vas as an environmental policy tool this article uses a simple model to determine whether vas are likely to lead to efficient environmental protection we consider cases where polluters are induced to participate either by a background threat of mandatory controls the stick approach or by cost sharing subsidies the carrot approach the results suggest that the overall impact on environmental quality could be positive or negative depending on a number of factors including the allocation of bargaining power the magnitude of the background threat and the social cost of funds

voluntary environmental investment and responsive regulation instances of corporate voluntary environmental investments have been rising in recent years motivations for such activities include corporate image building regulatory preemption and production cost savings while some of these investments arise from industry attempts to set environmental standards where none currently exist many investments seem to be aimed at reducing the costs of complying with existing regulations using a simple game theoretic model we investigate firm motivations for and welfare consequences of these types of voluntary investments by focusing on the role regulatory enforcement might play we find that such investments unambiguously increase when an enforcement regulator acts as a stackelberg follower a regulatory structure we refer to as responsive regulation in setting its monitoring and enforcement strategy these additional investments may be socially undesirable necessitating a restructuring of non compliance penalties

the impacts of immigrants and institutions on bilateral tourism flows abstract in this paper we use data on recent bilateral tourism flow from 34 organisation for economic co operation and development oecd countries to 52 middle to low income countries for the period 1995 2010 to determine whether immigration trade and institutional quality play a role in driving oecd nationals to visit immigrant source countries except for the african countries the results show that immigrants residing in oecd countries have a positive advertising effect for their home country inducing tourism flows from oecd countries we also find that the quality of institutions along with freedom and civil liberty indices are important in selecting tourism destinations a massive 8 of the variation in tourism flows can be accounted for by these factors these results hold for the subsample and the whole sample with two exceptions european and african destinations we posit that this feature of the data exists because european african countries are so similar to each other and small differences in the indexes do not matter at the top bottom of the distribution by controlling for gravity and macroeconomic stability variables we also show that the trade flows between countries among other factors play a crucial and stable role on tourism flows dynamic panel data estimation is used to account for the influence of repeat visits and support our findings

immigrant links to the home country empirical implications for u s bilateral trade flows immigrants ties to their home countries can play a key role in fostering bilateral trade linkages immigrant ties include knowledge of home country markets language preferences and business contacts that have the potential to decrease trading transaction costs empirical results for the united states suggest that immigrant links have historically been important in increasing bilateral trade flows with immigrants home countries copyright 1994 by mit press

program enrollment and acreage response to reforestation cost sharing programs five alternative sets of predictions are presented of the total acreage of southern pine that would have been planted after clear cut harvest if existing government forest improvement programs had made different levels of cost sharing available to nonindustrial private forest owners the predictions illustrate the importance of separating and accounting for both the number of tracts enrolled and for the size of enrolled tracts predictions are obtained from a profit maximization model that represents the owner s decision as a simultaneous choice of reforestation practice and size of tract to harvest and reforest

confucius institute s effects on international travel to china do cultural difference or institutional quality matter abstractthis article uses a panel data of china s inbound tourist flows from 2005 to 2015 to investigate confucius institute ci s influence on china s tourism we find that ci as a comprehensive platform for china s foreign cultural exchange has a significant positive effect on china s tourist flows the effects of ci on china s inbound tourism are transmitted through bridging cultural gaps and promoting chinese language which reduces psychic distance and transaction costs ci also stimulates china s inbound tourist flows via reducing information asymmetry caused by different levels of institutional quality interestingly we find that the heterogeneous effects of ci on china s inbound tourism depend on institutional quality and the effects of ci to boost china s tourists are more prominent in departure countries with larger cultural difference

epa s voluntary 33 50 program impact on toxic releases and economic performance of firms abstract this paper examines the motivations for participation in the voluntary 33 50 program and the program s impact on the toxic releases and economic performance of firms in the u s chemical industry it demonstrates that the benefits due to public recognition and the potentially avoided costs of liabilities and compliance under mandatory environmental regulations provide strong incentives for participation after controlling for sample selection bias and the impact of other firm specific characteristics this paper shows that program participation led to a statistically significant decline in toxic releases over the period 1991 93 the program also had a statistically significant negative impact on the current return on investment of firms but its impact on the expected long run profitability of firms was positive and statistically significant

economic prescriptions for environmental problems how the patient followed the doctor s orders o ne of the dangers with ivory tower theorizing is that it is easy to lose sight of the actual set of problems which need to be solved and the range of potential solutions as one who frequently engages in this exercise i can attest to this fact in my view this loss of sight has become increasingly evident in the theoretical structure underlying environmental economics which often emphasizes elegance at the expense of realism in this paper i will argue that both normative and positive theorizing could greatly benefit from a careful examination of the results of recent innovative approaches to environmental management the particular set of policies examined here involves two tools which have received widespread support from the economics community marketable permits and emission charges pigou 1932 dales 1968 kneese and schultze 1975 both tools represent ways to induce businesses to search for lower cost methods of achieving environmental standards they stand in stark contrast to the predominant command and control approach in which a regulator specifies the technology a firm must use to comply with regulations under highly restrictive conditions it can be shown that both of the economic approaches share the desirable feature that any gains in environmental quality will be obtained at the lowest possible cost baumol and oates 1975 until the 1960s these tools only existed on blackboards and in academic journals as products of the fertile imaginations of academics however some countries have recently begun to explore using these tools as part of a broader strategy for managing environmental problems

sustainable farm income in the presence of soil erosion an agricultural hartwick rule soil erosion is a physical and economic problem of natural capital degradation even along an intertemporally efficient trajectory one can have in a loss of soil fertility and a continuous decline of agricultural net revenue moreover soil erosion is a major source of surface water pollution in rural areas erosion control is thus a challenge for sustainable resource management and internalizing external effects to sustain the level of farm income an agricultural hartwick rule is proposed which addresses both on farm and off farm effects of soil erosion first it requires the investment of the soil rents into alternative capital second additional measures are required to comply with an ambient quality target a charge subsidy scheme proves the most adequate from a perspective of cost effectiveness and sustainability if effluent charge revenues are earmarked to subsidize cropland retirement at the watershed scale in combination with the investment of soil rents this enables to maintain the level of farm income constant over time while respecting the ambient quality target altogether this fulfills the requirements of efficiency and sustainability 2003 elsevier science b v all rights reserved

dealing with uncertainties when governing csr policies as corporate social responsibility involves a voluntary business endeavour to address social and environmental issues beyond legal compliance governments cannot fall back on hierarchical command and control policies to support it as such it is complementary with the increasing popularity of public policies known as new governance policies where the government is engaged in a horizontal inter organizational network of societal actors and where public policy is both formed and executed by the interacting and voluntary efforts from a multitude of stakeholders however such policies are known to generate substantive uncertainty about the content of csr and its related issues strategic uncertainty regarding the behavior of the actors involved and institutional uncertainty related to the interaction process involved in the institutional change we explore new governance policy instruments to address these uncertainties in the context csr and discuss the experiences with these methods in the european union

current issues in the economics of groundwater resource management the issue of groundwater management remains a practical concern in many regions throughout the world while water managers continue to grapple with the question of how to manage this resource in this article we attempt to bring the most advanced and appropriate tools to bear on the issue of resource allocation involving groundwater our objective is to demonstrate the state of the art in the literature on ways to think about this complex resource and to deal with the important economic issues emanating from its complexity we present the conceptual framework within which economists examine the elements interacting in the management of groundwater resources indicate why the role of the market is limited with respect to the price of this very complex resource and point to the mechanisms that can pull competitive groundwater price and quality graded quantity of groundwater in line with their equilibrium levels in particular we critically review economic models of groundwater use examine the potential for groundwater management discuss the difficulties encountered in the estimation of the relevant control variables of such models and identify the advantages and limitations of the instruments devised for the efficient use allocation of this resource finally we argue that devised regulatory schemes usually ignore the information and knowledge needed for their implementation and we suggest a core of conditions necessary for successful groundwater management reforms

famine in north korea causes and cures in this paper we start from incomplete data ridden with gross measurement errors to construct the underlying data base for a computable general equilibrium model cge of the north korean economy using cross entropy estimation techniques this model incorporates fragmentary information in a rigorous way and allows us to examine the implications of a number of alternative scenarios first we model a production oriented recovery program as the restoration of flood affected lands we then model an external assistance program as the acquisition of all food aid necessary to attain the united nations organizations estimates of minimum human needs the trade oriented recovery program is modeled as a relaxation of agricultural import quotas and the importation of food on commercial terms finally we model a systemic reform program as the elimination of quantitative restrictions on all external trade

cash versus direct food relief abstract the usual method of providing relief to a famine region is to import food and distribute it to the needy direct food relief if there are markets for food in the region however a relief agency could just as easily distribute money to the needy and let them purchase food in the market cash relief this alternative has been much discussed in the famine literature recently the purpose of this paper is to clarify the conditions under which cash relief will be more or less effective than direct food relief by analyzing the relative effectiveness of the two policies in a formal model

self regulation taxation and public voluntary environmental agreements an increasingly popular instrument for solving environmental problems is the public voluntary agreement va in which government offers technical assistance and positive publicity to firms that reach certain environmental goals prior papers treat such agreements as a superior low cost instrument that can be used to preempt a threat of traditional inefficient regulation we present a more general model in which public vas may instead be weak tools used when political opposition makes environmental taxes infeasible we explore the conditions under which taxes public vas and unilateral industry actions are to be expected and the welfare implications of the various instruments notably we also show that welfare may be reduced by the introduction of public vas 2002 elsevier b v all rights reserved

voluntary pollution reductions and the enforcement of environmental law an empirical study of the 33 50 program abstract this paper studies determinants and effects of firms participation in the 33 50 program which is a voluntary pollution reduction vpr program initiated by government regulators we examine a wide range of explanations for voluntary corporate environmentalism and find evidence in support of an enforcement theory that predicts that 1 vpr participation is rewarded by relaxed regulatory scrutiny 2 the anticipation of this reward spurs firms to participate in the program and 3 the program rewards regulators with reduced pollution we also find that 33 50 participation was more likely for firms operating in states with larger environmentalist constituencies

efficiency gains within firms under voluntary environmental initiatives this paper focuses on efficiency gains that voluntary environmental initiatives may achieve within the firm current debate concerning the extent and significance of inefficiencies within firms is critically important to the progress of energy and environmental policies several recent lines of inquiry in microeconomics help explain the persistence of inefficiencies within firms in addition two of the most prominent new approaches in the field of business strategy resource based strategy and the capabilities perspective focus on the heterogeneity among firms and the resulting pockets of inefficiency within firms they suggest at least three generic strategies for voluntary environmental initiatives challenging outdated organizational routines creating opportunities for differentiation or complementing firms resource investment trajectories these generic approaches suggest that there is considerable scope for further experimentation with voluntary environmental initiatives

conspicuous conservation the prius halo and willingness to pay for environmental bona fides abstract this paper develops a theory of conspicuous conservation a phenomenon related to conspicuous consumption in which individuals seek status through displays of austerity amid growing concern about environmental protection we identify a statistically and economically significant conspicuous conservation effect in vehicle purchase decisions and estimate a mean willingness to pay for the green signal provided by the distinctively designed toyota prius in the range of 430 4200 depending upon the owner s location results are related to the growing literature on green markets and suggest that policy should target less conspicuous conservation investments that will be under provided relative to those that confer a status benefit

protecting the environment when costs and benefits are privately known in this survey i analyze different approaches for protecting the environment when stakeholders are privately informed about the costs and benefits of pollution reduction the presence of asymmetric information calls for some important departures from the textbook prescriptions of marketable permits and emission taxes for controlling pollution for instance it may no longer be optimal to equate the social marginal benefits to the marginal cost of cleanup in determining appropriate abatement levels i conclude this review with some suggestions for future research in this area

voluntary conservation of endangered species when does no regulatory assurance mean no conservation abstract voluntary conservation agreements are becoming increasingly important in implementing the endangered species act on private land we analyze when such agreements arise and what level of conservation they generate in the presence of uncertainty about future conservation benefits and irreversibility of habitat loss and species extinction our results suggest that the likelihood of an agreement and the resulting conservation levels depend on the background threat of regulation the cost advantage offered by voluntary agreements and the availability of assurances regarding future regulation under conditions likely to hold in practice conservation agreements that offer assurances may generate higher levels of conservation and higher net social benefits than agreements that do not offer assurances however the resulting level of conservation will not be optimal and may be lower than that attainable under regulation

competitive investment in clean technology and uninformed green consumers abstract in a market where consumers and the regulatory authorities are not fully informed about the actual production technology or environmental performance of firms that engage in strategic competition i study the effect of environmental consciousness of consumers on firms incentive to invest in cleaner technology firms compete in prices and may signal their environmental performance to uninformed consumers through prices i also analyze the effect of an expected liability on firms in this setting compared to full information incomplete information generates higher strategic incentive to invest in cleaner technology particularly when consciousness and or expected liability are not too high requiring mandatory disclosure of technology or environmental performance may discourage such investment even though consumers and the regulator are uninformed competition has a positive effect relative to monopoly on the incentive to invest

contract design for the purchase of environmental goods from agriculture an environmental stewardship program whereby farmers are paid directly for the environmental goods they provide is developed by combining the microparameter distribution model with mechanism design principles the program overcomes the information asymmetry between farmers and governments and accounts for the deadweight losses from distortionary taxes the characteristics of optimal input and payment schedules of the program are derived these optimal schedules are determined by the tradeoffs between farming profits environmental benefits and deadweight losses from taxes and are second best except under restrictive conditions on deadweight losses from taxes and on the marginal product of inputs and marginal pollution costs

exploring new ways of assessing the effect of regulation on environmental management abstract studies indicate that while a variety of factors positively influence voluntary environmental management regulatory pressures are among the most important however most research examines samples representing large manufacturers or single industries essentially assuming a level of regulatory constraint using a sample of heterogeneous facilities this study finds that facilities can be classified according to the level of regulatory constraint and that group membership impacts the choice of environmental management strategy when assessed within a utility maximization framework more extensively regulated facilities implement more individual environmental management practices but participate in fewer formal voluntary environmental programs veps compared to other facilities

rigorous speculation the collapse and revival of the north korean economy abstract in this paper we use cross entropy estimation techniques to construct the underlying data base for a computable general equilibrium model cge of the north korean economy starting from incomplete data ridden with gross measurement errors the cross entropy estimation approach is powerful and flexible allowing us to make full use of what information we have in whatever form cge modeling forces internal consistency the end product is a model that incorporates fragmentary information in a rigorous way and allows us to examine the implications of a number of alternative scenarios including rehabilitation of flood affected lands liberalization of the international trade regime and military demobilization north korea has been experiencing a famine its economy is characterized by systemic distortions and comparative disadvantage in the production of grains as a consequence the potential payoffs to economy wide reforms even defined narrowly in terms of domestic food availability dwarf more targeted attempts to raise agricultural productivity to many this finding that a famine might be better addressed by the export of manufactures than the recovery of flood damaged lands is a striking and counterintuitive result moreover we find that if reforms were to be undertaken the country could generate a significant additional peace dividend by partially demobilizing its enormous military

incentives for wetland creation abstract when information about soil quality is complete wetland creation with a take it or leave it contract which specifies wetland size and transfer yields higher social benefits than if a uniform contract which offers a payment proportional to the wetland size had been used this result points to a paradox because uniform contracts have been used a lot in practice this article concentrates on the presence of asymmetric information about soil quality as a possible explanation for this paradox it shows that the choice of instrument for wetland creation has welfare implications different contracts typically yield quite different social welfare surpluses and distribution between interest groups it is not obvious which of four contracts studied dominates when a farm characteristic affecting costs is unknown to the social planner the probability distribution of the characteristic the size of the excess burden the elasticity of costs and benefits to wetland size and the cost of acquiring missing information influence the outcome

why doesn t capital flow from rich to poor countries an empirical investigation we examine the empirical role of difierent explanations for the lack of ows of capital from rich to poor countries the lucas paradox the theoretical explanations include difierences in fundamentals across countries and capital market imperfections we show that during 1970i2000 low institutional quality is the leading explanation for example improving peru s institutional quality to australia s level implies a quadrupling of foreign investment recent studies emphasize the role of institutions for achieving higher levels of income but remain silent on the speciflc mechanisms our results indicate that foreign investment might be a channel through which institutions afiect long run development

the economics of a public fund for environmental amenities a study of crp contracts the problem of targeting crp purchases to buy environmental amenities under productivity and environmental heterogeneity is considered gini coefficients and lorenz curves are used to measure the effectiveness of spending under alternative targeting criteria the environmental benefits considered are water erosion wind erosion surface water quality and wildlife habitat the three alternative targeting criteria examined include purchasing land according to i the benefit to cost ratio ii the level of benefits and iii the level of cost results indicate that the degree of variability and correlation determine the extent to which suboptimal targeting achieves a significant portion of available environmental benefits

a signaling model of environmental overcompliance abstract we present a theory of unilateral regulatory overcompliance as a signaling device firms that have a competitive advantage in the use of a cleaner but more costly technology overcomply in order to signal to an imperfectly informed benevolent government that compliance costs are low thereby triggering tougher regulation we identify the conditions under which such an overcompliance signaling equilibrium arises showing that there may be over overcompliance in that firms may overcomply even when tougher regulation is not socially desirable we also discuss the differential implications of the signaling theory as compared to other theories of unilateral regulatory overcompliance

voluntary export restraints antidumping procedure and domestic politics a voluntary export restraint ver is preferred to a tariff by a government concerned about electoral returns when the influence of industry profits is large relative to the losses to consumers from higher prices if the foreign firm is uncertain of these pressures the antidumping code facilitates the complete transfer of the relevant information and generates a ver rather than a tariff in equilibrium the choice across instruments is determined by the political attributes domestic and foreign profits rise with the antidumping generated ver and the ver lowers the volume of trade by more than the expected duty copyright 1996 by american economic association

incentive payments to encourage farmer adoption of water quality protection practices farmers can be encouraged to voluntarily adopt environmentally sound management practices through the use of incentive payments this paper uses both a bivariate probit with sample selection model and a double hurdle model on data from a survey of farmers to predict farmer adoption of the practices as a function of the payment offer the five management practices addressed here are integrated pest management legume crediting manure testing split applications of nitrogen and soil moisture testing also estimated are models that predict the acreage on which these practices would be applied given the decision to accept the incentive payments estimated

motivations for self regulation the clean air action plan in the fall of 2006 the ports of long beach and los angeles announced the clean air action plan caap its intent was to greatly accelerate emissions reductions from port activities the caap was unprecedented in several ways it was a voluntary agreement between two competing ports it was achieved with the cooperation of local state and federal agencies it promised large particulate emissions reductions along with continued port growth and it had a price tag of 2 1 billion what explains the ports decision to implement the caap we conduct a case study to explore alternative explanations for the caap using data from interviews media and the history of events leading up to the caap we find that the caap was a strategic response to social and political pressures that had built up over the previous decade its intent was to respond to local concerns and reduce opposition to port growth the caap represents an example of the potential of voluntary efforts to solve environmental problems