the effect of using consumption taxes on foods to promote climate friendly diets the case of denmark abstract agriculture is responsible for 17 35 of global anthropogenic greenhouse gas emissions with livestock production contributing by approximately 18 22 of global emissions due to high monitoring costs and low technical potential for emission reductions a tax on consumption may be a more efficient policy instrument to decrease emissions from agriculture than a tax based directly on emissions from production in this study we look at the effect of internalising the social costs of greenhouse gas emissions through a tax based on co 2 equivalents for 23 different foods furthermore we compare the loss in consumer surplus and the changed dietary composition for different taxation scenarios in the most efficient scenario we find a decrease in the carbon footprint from foods for an average household of 2 3 8 8 at a cost of 0 15 1 73 dkk per kg co 2 equivalent whereas the most effective scenario led to a decrease in the carbon footprint of 10 4 19 4 but at a cost of 3 53 6 90 dkk per kg co 2 equivalent the derived consequences for health show that scenarios where consumers are not compensated for the increase in taxation level lead to a decrease in the total daily amount of kj consumed whereas scenarios where the consumers are compensated lead to an increase most scenarios lead to a decrease in the consumption of saturated fat compensated scenarios leads to an increase in the consumption of added sugar whereas uncompensated scenarios lead to almost no change or a decrease generally the results show a low cost potential for using consumption taxes to promote climate friendly diets

natural natural experiments in economics the recent literature exploiting natural events as natural experiment instruments is reviewed to assess to what extent it has advanced empirical knowledge a weakness of the studies that adopt this approach is that the necessary set of behavioral market and technological assumptions made by the authors in justifying their interpretations of the estimates is often absent the methodology and findings from twenty studies are summarized and simple economic models are used to elucidate the implicit assumptions made by the authors and to demonstrate the sensitivity of the interpretations of the findings to the relaxation of some of these assumptions

design of a climate tax on food consumption examples of tomatoes and beef in sweden abstract this study examined appropriate design of efficient climate taxes on consumption of food by constructing a simple theoretical model and exemplifying the results using the examples of tomatoes and beef in sweden the theoretical results showed that for the tax to be efficient i existing taxes on greenhouse gases ghgs should be considered when calculating the climate impact in order to avoid double taxation and ii taxes should be differentiated between ghg here carbon dioxide co2 methane ch4 and nitrous oxide n2o because of their differing climate impacts the calculations of climate taxes on tomatoes and beef in sweden indicated considerable differences in the tax level depending on whether conditions i and ii were considered or not the commonly applied approach in the literature on climate taxes on food i e taxing carbon dioxide equivalents co2e using global warming potential over 100 years gwp100 and neglecting existing taxes on ghg emissions results in a tax that is 1 4 2 8 times higher than the efficient tax for tomatoes and a tax that is between 30 lower and 20 higher than the efficient tax for beef despite the relatively low variations in the climate tax on beef estimated reduction in emissions from beef ranged between 23 and 35 depending on choice of tax the price increases on food due to a climate tax and associated effects on emissions can thus show large variation depending on the tax calculation method

opening the black box of carbon finance additionality the political economy of carbon finance effectiveness across tanzania uganda and moldova summary this paper identifies conditions under which the clean development mechanism and other carbon finance projects effectively generate genuine additional carbon credits relying on a systematic empirical investigation of afforestation reforestation and bioenergy carbon finance projects across tanzania uganda and moldova at low global carbon prices additionality was related to the interests of project developers and their resulting capacities and motivations for project implementation certain organizations with capacity for mitigation projects were curiously not involved with carbon finance a distinction between neo developmental tanzania and liberal neo developmental uganda and moldova political economy preferences explains variation in the presence or absence of effective project developers

weak separability and the estimation of elasticities in multistage demand systems the necessary conditions for multistage budgeting to be at least approximately justified are reviewed and the plausibility of these assumptions i e weak separability and low variability of price indices with utility level are discussed using no further assumptions simple relationships between expenditure and price elasticities in different budgeting levels are derived these results are applied to a three stage model for swedish food consumption and it is shown that the assumptions are not inappropriate restricting the analysis to the last stage of a multistage budgeting process is also shown to lead to considerable errors which could well have policy consequences

evaluation of land use based greenhouse gas abatement measures in germany abstract agricultural production contributes 11 to the total german greenhouse gas ghg emissions we compare the efficiency of three different land use based ghg abatement measures in combination and as separately applied measures the production of short rotation coppices of feedstocks for biomethane production and peatland restoration we evaluate these options with respect to the following criteria cost efficiency ghg abatement costs abatement potential and impact on agricultural production we use the regional supply model raumis to investigate the different abatement measures at the sector and regional level up to a reduction of ghg emission of 25 1012 g co2eq peatland restoration is the most cost efficient option short rotation coppice allow some cost efficient mitigation also only at limited scale energy maize is only an option if high abatement targets should be met the joint implementation of several abatement strategies allows meeting specified targets at lower costs the crowding out effect between the options is limited the spatial analysis indicates measure specific regional competitiveness and application e g short rotation coppice in eastern and southern germany peat restoration in northern germany and energy maize production in central germany

the use and abuse of meta analysis in environmental and natural resource economics an assessment motivated by the 2006 report of a work group appointed by the environmental protection agency epa this paper examines the present state of meta analysis in environmental economics and offers recommendations for its future use to this end we summarize and assess 140 meta analyses from 125 published and unpublished studies covering 17 topical categories in environmental and resource economics first we provide several generic meta analysis models as reference points and discuss major estimation issues five econometric issues are identified as part of a complete analysis 1 sample selection criteria 2 basic data summary 3 primary data heterogeneity 4 heteroskedasticity and 5 non independence of multiple observations from primary studies second a tabular summary is presented for the 140 meta analyses with respect to estimation methods third a narrative summary is presented for 19 meta analyses including the three value of statistical life studies examined by the epa work group and one analysis from each of 16 other categories fourth we offer a set of best practice guidelines for future meta analyses in this and other areas of economics last the paper comments on the use of meta analytic methods for benefit transfers of environmental values

support for renewable energy in china a survey experiment with internet users abstract mitigating climate change requires reductions of carbon dioxide emissions and other greenhouse gases because china is the world s largest emitter of greenhouse gases global efforts to stop climate change depend on china s policies while renewable energy can replace coal in power generation to reduce carbon pollution the perceptions of renewable energy among the chinese public have not been studied people s perceptions are important because although china is not a democracy existing studies have shown that the government s legitimacy depends on popular support this article reports results from an online survey experiment among 2086 chinese internet users this methodology allows the exploration of the responsiveness of chinese respondents to various frames of the benefits and costs of renewable energy the levels of support for renewable energy among the respondents were high there was a positive and statistically significant response to an energy security framing while neither the air pollution nor the climate change frames had a statistically significant effect on the levels of public support economic concerns are also salient to the respondents as a counter frame emphasizing the cost of renewables undermined the effectiveness of the energy security frame similar to studies from other countries the cost and security of energy generation are priorities for the respondents if these findings apply more broadly to the chinese public the government can create public support for renewables by emphasizing energy security in communication

inter vivos transfers and intergenerational exchange the surge of interest in intergenerational transfers in the past decade has sparked a debate over the motivation for them are transfers given out of altruism or part of an exchange while each motive is probably at work to some extent we know little about whether one motive predominates the question is relevant for issues concerning public income redistribution and inequality in the family but despite its importance empirical evidence about motives is scarce because of limited data we investigate a new data set the national survey of families and households which remedies many of the shortcomings of other data sets containing private transfer information we find that empirical patterns for inter vivos transfers i e transfers between living persons are more consistent with exchange than altruism

prices and quality effects in cross sectional demand analysis a conceptual clarification of the sources and meaning of cross sectional price variability is used to motivate a theoretical and econometric framework for the estimation of cross sectional demand functions quality effects are distinguished from supply related price variability to identify cross sectional demand for disaggregated food commodities an empirical application using data from the 1977 78 nationwide food consumption survey indicates that parameter differences resulting from a failure to adjust cross sectional prices for quality effects are likely to be small for relatively homogenous disaggregated food commodities in demand analysis with cross sectional household budget data it is usually assumed that prices are constant allen and bowley prais and houthakker george and king given this assumption engel functions are estimated where expenditure or quantity is regressed on income or total expenditures family size and other demographic characteristics the assumption that cross sectional price effects are absent or are captured adequately by spatial and temporal dummy variables has not been evaluated empirically whether cross sectional price effects can be treated in this manner has implications for the specification of cross sectional demand functions as well as the estimation of engel functions there is a considerable literature on estimating price elasticities with cross sectional data most of the applications utilize timeseries cross sectional data annual or quarterly household consumption surveys and

the value of children inter generational support fertility and human capital abstract this paper offers robust empirical evidence of a darwinian pro natalist mechanism parents can improve their old age support with an additional child using the incidence of first born twins as an instrument for fertility outcomes i find that chinese senior parents with more children receive more financial transfers and are more likely to co reside with an adult child they are also less likely to work past retirement age the estimated effects are large despite the evidence that adult children from larger families are less educated and earn significantly less interestingly the effect of an increase in the number of children on old age support does not depend on the child s gender

how well do children insure parents against low retirement income an analysis using survey data from urban china abstract as population aging becomes more pronounced in the developing world the uneven implementation of social safety nets raises important questions as to how well traditional family based mechanisms insure elderly incomes when pension systems fail using a unique dataset from a recent household survey conducted in urban china we find evidence that private transfers respond to low household income of retired workers when income falls below the poverty line this finding is consistent with an altruistic motive for transfers at low levels of household income at the same time however the transfer response to elderly pre transfer income is not sufficient to fully cover shortfalls that arise with severe pension arrears and low retirement income

pension coverage for parents and educational investment in children evidence from urban china when social security is established to provide pensions to parents their reliance upon children for future financial support decreases and their need to save for retirement also falls in this study the expansion of pension coverage from the state sector to the non state sector in urban china is used as a quasi experiment to analyze the intergenerational impact of social security on education investments in children in a difference in differences framework a significant increase in the total education expenditure is found to be attributable to pension expansion the results are unlikely to be driven by other observable trends they are robust to the inclusion of a large set of control variables and to different specifications including one based on the instrumental variable method

child labor and schooling responses to anticipated income in south africa abstract forward looking unconstrained households make child labor and schooling decisions considering their permanent income and weighing the relative returns to child time in various potential activities the timing of anticipated changes in income should have no effect on child labor and schooling in a setting where households can borrow against permanent income however this study documents large increases in schooling attendance and declines in total hours worked when black south african families become eligible for fully anticipatable social pension income as an explanation the data are most consistent with liquidity constraints for black elder males forcing rural families into less schooling for boys than they would choose absent the constraint perhaps because of schooling costs

the danish tax on saturated fat short run effects on consumption substitution patterns and consumer prices of fats abstract denmark introduced a tax on saturated fat in food products with effect from october 2011 the objective of this paper is to make an effect assessment of this tax for some of the product categories most significantly affected by the new tax namely fats such as butter butter blends margarine and oils this assessment is done by conducting an econometric analysis on weekly food purchase data from a large household panel dataset gfk panel services denmark spanning the period from january 2008 until july 2012 the econometric analysis suggest that the introduction of the tax on saturated fat in food products has had some effects on the market for the considered products in that the level of consumption of fats dropped by 10 15 furthermore the analysis points at shifts in demand from high price supermarkets towards low price discount stores at least for some types of oils and fats a shift that seems to have been utilised by discount chains to raise the prices of butter and margarine by more than the pure tax increase due to the relatively short data period with the tax being active interpretation of these findings from a long run perspective should be done with considerable care it is thus recommended to repeat and broaden the analysis at a later stage when data are available for a longer period after the introduction of the fat tax

r d intensity firm performance and the identification of the threshold fresh evidence from the panel threshold regression model this article tests whether there is an optimal level of research and development r d intensity at which point a firm is able to maximize its performance an advanced panel threshold regression model is employed to investigate the panel threshold effect of r d intensity on firm performance among publicly traded taiwan information technology and electronic firms the results confirm that a single threshold effect does exist and show an inverted u correlation between r d intensity and firm performance this article demonstrates that it is possible to identify the definitive level beyond which a further increase in r d expenditure does not yield proportional rewards some important policy implications emerge from the findings

inter vivos transfers and intended bequests abstract empirical work on intergenerational transfers has focused on distinguishing between altruistic and exchange motivated behavior however these two models are unable to explain the strong tendency for inter vivos transfers to be negatively related to the income of the recipient while bequests bear no relationship to income this paper presents a new framework for analyzing transfers from parents to children that is more consistent with observed behavior than are the altruistic and exchange models alone in particular the model developed here predicts differing behavior with respect to inter vivos transfers and bequests due to liquidity constraints and uncertainty about the recipient s permanent income the empirical work uses data from the health and retirement study and the asset and health dynamics study the patterns observed in these data are consistent with earlier findings that inter vivos transfers go disproportionately to less well off children while bequests are divided equally across children further the results support the predictions of the model in that differences in inter vivos transfers arise from differences in current income while differences in bequests result when indicators of the children s permanent incomes differ

the dynamic effects of aggregate demand and supply disturbances we interpret fluctuations in gnp and unemployment as due to two types of disturbances disturbances that have a permanent effect on output and disturbances that do not we interpret the first as supply disturbances the second as demand disturbances demand disturbances have a hump shaped mirror image effect on output and unemployment the effect of supply disturbances on output increases steadily over time peaking after two years and reaching a plateau after five years

does ecological economics have a future contradiction and reinvention in the age of climate change abstract this paper addresses the role of neoclassical methodologies in ecological economics and the contradictions these methodologies pose to the field s critical founding principles we first consider robert costanza s treatment of nicholas stern s global deal and then survey climate change related articles published in this journal over the past five years this survey reveals how mainstream neoclassical methodologies dominate discourse and do so by marginalizing more critical political economy analyses this situation imperils the field s founding vision of a no growth steady state it also fails to address the related growth dynamics of capitalism without such a critical treatment the field s formal embrace of methodological pluralism actually entails an ideological empiricism that renders ecological economics theoretically incoherent this situation undermines the field s historical promise as an alternative economic paradigm ecological economics now faces a problematic future its survival in a form faithful to its founding vision will require an explicit choice to address its internal contradictions and reinvent itself in ways relevant to our contemporary context without such a choice ecological economics will likely succumb to an implicit acceptance of the hegemony of mainstream economic methodologies and their pro growth imperatives

how income transfer programs affect work savings and the income distribution a critical review for helpful comments on earlier drafts we thank without implicating moses abramovitz yves balcer john bishop alan blinder richard burkhauser michael darby irwin garfinkel alan gustman daniel hamermesh martin holmer george jakubson robert lampman paul menchik robert moffitt michael murray joseph quinn timothy smeeding eugene smolensky barbara wolfe and two anonymous referees

monetary transfers from children and the labour supply of elderly parents evidence from vietnam in the absence of a broad based pension scheme the elderly in developing countries may rely on monetary transfers made by their children and on their own labour supply this article examines whether monetary transfers from children help to reduce elderly parents need to work taking the possible endogeneity of children s transfers in the parents labour supply into account and using maximum likelihood methods and vietnamese data we find that monetary transfers help the elderly cope with risks associated with old age or illness at the same time however monetary transfers are not sufficient to fully substitute for parents labour supply

on price indices in the almost ideal demand system a number of papers have discussed the relationship between the almost ideal demand system aids and its linear approximation la aids in this paper it is shown that if the prices in the system are normalized to one the aids and la aids representations are identical at the point of normalization also at the point of normalization the expressions for price and expenditure elasticities from both systems are identical

impacts of urbanization on renewable energy consumption in china abstract in this paper we used the logarithmic mean divisia index method to investigate the impact of urbanization on renewable energy consumption growth recg the growth in renewable energy consumption is attributed to the urbanization effect energy mix effect energy intensity effect economic effect and population effect recg can be roughly divided into the slow growth stage the fluctuant growth stage and the accelerated growth stage the results showed that the energy mix effect economic effect and population effect positively affected recg however a significantly negative relationship was found between energy intensity and recg furthermore the contribution of urbanization differed in recg stages and urbanization contributed more to the total energy consumption growth than to recg this study would thus provide policymakers with insights about the link between urbanization and renewable energy consumption

marginal abatement costs of greenhouse gas emissions from european agriculture cost effectiveness and the eu non ets burden sharing agreement abstract we propose a quantitative assessment of the marginal abatement costs mac of greenhouse gas emissions from european agriculture and analyze the implications of the non ets burden sharing agreement bsa for this sector this assessment is based on mac reduced forms the generic specification of which enables simple parameterization and numerical computations such mac curves are parameterized for each member state using the outputs of a detailed model of the european agricultural supply they are then used to compute total and marginal abatement costs involved by the bsa targets as well as the cost effective effort sharing the corresponding emission price and abatement costs the main findings are i flexibility mechanisms such as a cap and trade system for agricultural emissions could reduce the total costs of meeting the 10 eu abatement target by a factor two to three relative to the strict implementation of each country s target ii the corresponding equilibrium emission price is found to be 32 42 tco2eq depending on the assumption regarding business as usual emissions and iii a cap and trade system with allowances based on the bsa targets would involve substantial transfers from eu 15 countries to new member states an important share of which being made of hot air

index number issues in the consumer price index he boskin commission has ful lled a useful purpose there is now un precedented public interest in price measurement issues and an increasedawareness on the part of academics about the dif cult problems involvedin measuring price change in a dynamic economy there is also increased coop eration between economists and statisticians in attempting to solve these problems this comment offers some perspectives on the magnitude of the differences be tween the xed base laspeyres price index that statistical agencies produce and atheoretical cost of living index along with some thoughts about what can be doneto reduce these differences or biases

carbon leakage and limited efficiency of greenhouse gas taxes on food products abstract greenhouse gas emission ghge taxes on food products have recently been proposed as means to help reduce agricultural emissions numerous authors have calculated potential ghge reductions in case such a tax was implemented in certain countries or regions they did however assume a reduced production of ghge intense foods equal to the decline in demand induced by the tax this omits however possible increases of net exports that might offset such a demand reduction herein the market dynamic behind this so called emission leakage is explained and its effect quantified for a greenhouse gas tax in the european union we use the european forest and agricultural sector optimization model for the quantitative analysis and simulate a greenhouse gas tax on all food products based on their individual emission levels the partial equilibrium model covers all world regions and hence the tax s effects on international trade of agricultural commodities can be examined it was found that 43 of the greenhouse gas reduction indicted by a domestic consumption reduction is lost through emission leakage this already includes the mitigating effects of a production shift from inefficient to efficient producers that is another consequence of increased exports from the european union a greenhouse gas emission tax on food products is hence much less efficient than previously proposed if it is not introduced globally or trade is not restricted

causality analysis and multivariate autoregressive modelling with an application to supermarket sales analysis abstract this paper describes a modelling methodology for multivariate stochastic processes the concept of multiple causality is discussed and a procedure to detect multiple causality is suggested the data of a major canadian supermarket is analyzed and a multivariate autoregressive model for this supermarket is constructed and estimated several empirical findings are reported

the distributional effects of carbon based food taxes abstract mitigation policies have focused mainly on the energy and transport sectors but recent studies suggest that food related measures can also deliver cost effective emission reductions this paper evaluates the implications of levying consumption taxes on food products in spain based on their carbon footprint specific elasticities are estimated for the food demand system based on a dataset of around 20 000 households using a demand system model the results show that this policy can reduce emissions and at the same time help to change consumption patterns towards healthier diets for the first time in the related literature this paper also explores the distributional implications the results show that carbon based food taxation tends to be slightly regressive and can have more effect on specific social groups however that effect can be ameliorated if exemptions on some basic food products are introduced

feebates for dealing with trade offs on fertilizer subsidies a conceptual framework for environmental management abstract approximately half of today s annual worldwide crop yields can be attributed to the application of mineral fertilizers globally we rely and depend on additional yields as a cornerstone of present and future global food security in areas with very low nutrient loads subsidies for appropriate and responsible fertilizer use may help farmers to increase their yields and improve soil fertility in many countries of the world fertilizer subsidies are applied as direct payments however they have also become an environmental risk factor we deliberate in what way s maximizing the farmer s economic yield conflicts with maximizing societal interests we show mathematically that from the perspective of a single farmer under the assumption that crop yields increase monotonically with the application of fertilizers any fertilizer subsidy provides an economic incentive to increase the application of fertilizer independent of the amount that has already been applied we suggest feebate systems i e fee and rebate based mechanisms like penalty taxes and subsidies based on a specific reference point or borderline as an economic strategy for regulating both over and under fertilization this acknowledges the various roles that subsidies have played historically ranging from agricultural systems that have generally over fertilized such as urban agriculture in china vietnam or indonesia to countries where fertilizer subsidies are provided to compensate for significant land degradation in order to connect feebates to fertilization based on a sustainable reference or borderline we provide a conceptual multilevel environmental and sustainability assessment that is linked to conventional and market based economic means such as farm specific feebates or cap and trade

efficiency effectiveness and implementation feasibility of energy efficiency rebates the renove plan in spain abstract state sponsored incentive policies frequently include subsidies or rebates for the purchase of more efficient appliances however more research is required into the effects of this tool in isolation a case in point is the so called renove plan in spain first the inefficiency losses dead weight losses associated with energy efficiency rebates must be taken into account such a policy may also encourage the large scale purchasing of energy efficient appliances which may finally result in an increase in electricity consumption rebound effect furthermore although a subsidy is more widely accepted than other tools from social and political viewpoints especially than taxes the fiscal consolidation challenge faced by many countries reduces the scope for environmental policy measures on the expenditure side of the budget and strengthens the need to use taxes to meet the agreed policy objectives this paper shows that the current application of the spanish renove plan with rebates on the dishwasher market for energy efficient appliances generates some welfare losses a rebound effect and a considerable deficit in public budgets the paper examines and assesses the effect of different combinations of taxes and rebates in the case of dishwashers in spain based on their performance in terms of economic efficiency environmental effectiveness and implementation feasibility

lag length selection in vector autoregressive models symmetric and asymmetric lags this study used monte carlo simulations to study the performance of alternative lag selection criterion for symmetric lag and asymmetric lag vector autoregressive models lag models with short lags and with long lags were considered the alternative criteria considered were the aic sic phillips posterior information criterion and keating s modification of the aic and sic the alternative criteria were evaluated by computing the frequency distribution of lags selected by computing the out of sample forecasting performance of models with lags selected using each criterion and by comparing the ability of models with lags selected using each criterion to mimic the true impulse response functions for the lag model

agricultural pollution and regulation how to subsidize agriculture agricultural pollution is extremely serious in china and agricultural output quantity subsidy makes it even worse this paper captures the impacts of agricultural subsidy including quantity subsidy and innovation subsidy on agricultural pollution agriculture output quantity total pollution or emission equilibrium price consumer and producer surplus government budget and social welfare are all addressed in this study the results show that emission reducing innovation subsidy is better than quantity subsidy because it reduces the pollution from agriculture and profits for the agricultural firm are higher under innovation subsidy than under quantity subsidy more importantly output quantity and consumer surplus under innovation subsidy are also larger than those under quantity subsidy if the subsidy rate is not too high this study finds that the importance of the environment to the consumer marginal emission and pollution tax will decrease output quantity consumer and producer surplus and social welfare however agricultural subsidy increases them furthermore this study indicates that innovation subsidy can alleviate the food quantity safety and quality of environment dilemma in agriculture

meta regression analysis a quantitative method of literature surveys abstract pedagogically literature reviews are instrumental they summarize the large literature written on a particular topic give coherence to the complex often disparate views expressed about an issue and serve as a springboard for new ideas however literature surveys rarely establish anything approximating unanimous consensus ironically this is just as true for the empirical economic literature to harmonize this dissonance we offer a quantitative methodology for reviewing the empirical economic literature meta regression analysis mra is the regression analysis of regression analyses mra tends to objectify the review process it studies the processes that produce empirical economic results as though they were any other social scientific phenomenon mra provides a framework for replication and offers a sensitivity analysis for model specification in this brief essay we propose a new method of reviewing economic literature mra and discuss its potential

autoregressive modelling and money income causality detection abstract a step wise procedure based on granger s concept of causality and abaike s final prediction error criterion is suggested as a practical means to identify the order of lags of each variable in a multivariate autoregressive process the model seems useful because it can serve as a reduced form formulation to avoid imposing often spurious or false restrictions of the model it also provides a reasonably powerful test of causality the idea is applied to u s postwar money and income data it is found that between m1 and gnp a bivariate feedback model fits the data best between m2 and gnp a one way causal model from money to income performs better diagnostic checks applied to our model seem to indicate the adequacy of our approach

do private transfers displace the benefits of public transfers evidence from south africa abstract this paper investigates whether government transfer programs displace or crowd out private support focusing on a large increase in state old age pensions in south africa using data spanning the period of the expansion we find that each rand of public pension income to the elderly leads to a 0 25 0 30 rand reduction in private transfers from children living away from home however despite the large increase in income there were no significant changes in migration labor supply or household composition we also show that evaluations of the distributional effects of the pension are overstated when crowding out is ignored

the costs of carbon sequestration a revealed preference approach increased concem by policy makers with the threat of global climate change has brought with it considerable attention to the possibility of encouraging the growth of forests as a means of sequestering carbon dioxide national academy of sciences nas 1992 james p bruce et al 1996 1 the kyoto protocol to the united nations framework convention on climate change 1997 which establishes emission reduction targets for the united states and other industrialized nations states that carbon sequestration can be used by participating nations to achieve their targets moreover even before the kyoto agreement this approach had become an explicit element of both u s and intemational climate policies u s department of energy 1991 united nations general assembly 1992 william j clinton and albert gore 1993 this high level of interest has been due in part to suggestions that sufficient lands are available to use the approach to mitigate a substantial share of annual carbon dioxide c02 emissions greg marland 1988 daniel a lashof and dennis a tirpak 1989 mark c trexler 1991 and claims that growing trees to sequester carbon is a relatively inexpensive means of combating climate change roger a sedjo and allen m solomon 1989 daniel j dudek and alice leblanc 1990 nas 1992 in other words the serious attention given by policy makers to carbon sequestration can partly be explained by implicit assertions about respective marginal cost functions i develop and demonstrate a method by which the costs of carbon sequestration can be estimated on the basis of evidence from landowners behavior when confronted with the opportunity costs of alternative land uses the simplest of previous economic analyses derived single point estimates of average costs associated with particular sequestration levels marland 1988 sedjo and solomon 1989 dudek and leblanc 1990 edwin s rubin et al 1992 omar masera et al 1995 often it has been assumed that land opportunity costs are zero g van kooten et al 1992 j k winjum et al 1992 new york state energy office 1993 robert k dixon et al 1994 another set of studies essentially engineering costing models has constructed marginal cost schedules by using information on revenues and costs of production for altemative uses on representative types or locations of land and then sorting these in ascending order of cost robert j moulton and kenneth r richards 1990 richards et al 1993 simulation models include a model of the lost profits due to removing land from agricultural production peter j parks and ian w hardie 1995 a mathematical programming model of the agricultural sector and the timber market richard m adams et al 1993 a related model incorporating the effects of agricultural price support programs j m callaway and bruce mccarl 1996 and a dynamic simulation model of forestry susan swinehart 1996 lastly an analysis by andrew j plantinga 1995 adopts land use elasticities from an econometric study to estimate sequestration costs we draw on some of the best features of the previous studies including the carbon levelization method of moulton and richards john f kennedy school of government harvard university 79 john f kennedy street cambridge ma 02138 and resources for the future richard newell supplied excellent research assistance and valuable comments on a previous version were provided by lawrence goulder william nordhaus andrew plantinga kenneth richards two anonymous referees participants in seminars at the universities of california at los angeles and santa barbara the university of maryland the university of michigan the university of texas harvard university stanford university yale university resources for the future and the national bureau of economic research the author alone is resdonsible for any errors 1 after fossil fuel combustion deforestation is the second largest source of carbon dioxide emissions estimates of annual global emissions from deforestation range from 0 6 to 2 8 billion tons compared with slightly less than 6 0 billion tons annually from fossil fuel combustion cement manufacturing and natural gas flaring combined r a houghton 1991 t m smith et al 1993

price premium for high efficiency refrigerators and calculation of price elasticities for close substitutes a methodology using hedonic pricing and demand systems this article uses the hedonic pricing method to estimate the price premium paid for the highest energy efficiency label a in the refrigerators market of the basque autonomous community spain the estimated figure is 8 9 of the final price or about 60 euro which represents one third of the energy savings that a consumer gets during the lifetime of a refrigerator with the highest energy efficiency label this figure is then combined with the linear version of the almost ideal demand system la aids to obtain own and cross price elasticities of demand the information presented here is useful for policy design and analysis the results indicate that the demand for refrigerators with the highest energy efficiency label is highly sensitive to price variations

comparison of energy efficiency subsidies under market power abstract energy efficiency subsidies are very popular all over the world for energy conservation and emission reduction by using a game theory model this article captures the differences of two important types of subsidies fixed subsides and output subsidies some interesting conclusions are achieved and some social phenomena are rationally explained firstly increasing total subsidies increases the number of subsidized firms moreover fiercer competition produces more firms to be subsidized thus the number of subsidized firms depends on the competition in this industry secondly output subsidies achieve a higher consumer surplus and a lower producer surplus than do fixed subsidies therefore consumers like output subsidies while firms like fixed subsidies finally output subsidies achieve a more favorable environmental impact and subsidize more firms than do fixed subsidies that is the environmental effects of output subsidies dominate those of fixed subsidies in summary based on both the effects on the environment and the consumer surplus this article supports output subsidies and explains the advantages of output subsidies

do subsidies work better in low income than in high income families survey on domestic energy efficient and renewable energy equipment purchase in china abstract domestic energy efficient and renewable energy eere equipment shows a great energy saving potential in household energy consumption two rounds of large scale financial subsidy programs have been developed in china since 2010 to promote the adoption of green equipment however how these subsidies attract chinese families of different income levels is not fully explored given this knowledge gap we conducted a self completion questionnaire survey in 2012 to ask 526 respondents about their purchase of domestic eere equipment we explored the effects of subsidy incentives and family incomes on the purchase attitudes and intentions of individuals toward the seven categories of eere equipment we find that family income positively moderates the relationship between eere equipment purchase attitude and behavioral intention and subsidy incentives positively affect the moderating effect of family income in other words a higher family income and better familiarization with subsidy incentives can promote the transformation of green attitudes into eere equipment purchasing intention the results may indicate that the subsidized prices are still high in the view of the low income families this study contributes to the understanding of the effects of chinese subsidy incentives and of the economic concerns of people about the purchase of domestic eere equipment

subsidies in carbon finance for promoting renewable energy development abstract faced with decreasing exhaustible nonrenewable resources and climate change resulting from the use of fossil energy it is urgent to accelerate the development of renewable energy but the development of renewable energy requires abundant financial support both from banks and governments this article considers bank loans to develop renewable energy and highlights the effects of government subsidies by using a microeconomic model and taking all stakeholders including the government banks and shareholders of the firm into consideration this study finds that government subsidies raise outputs and debt levels of renewable energy firms and improve shareholder value as well more importantly financial debts stimulate firms outputs but decrease the net profit per unit of debt due to the limited liability effects finally subsidy policy plays a critical role in renewable energy development because environmental efficiencies of subsidies decrease with the subsidy degree other valuable conclusions would be achieved if principal agent problem and other corporate governance factors are employed

marginal abatement costs of greenhouse gas emissions a meta analysis in this paper we carry out a meta analysis of recent studies into the costs of greenhouse gas mitigation policies that aim at the long term stabilisation of these gases in the atmosphere we find the cost estimates of the studies to be sensitive to the stringency of the stabilisation target the assumed emissions baseline the way in which the time profile of emissions is determined in the model the choice of control variable co2 only versus multigas the number of regions and energy sources in the model and to a lesser degree the scientific forum in which the study was developed we find that marginal abatement costs of the stringent long term targets that are currently considered by the european commission are still very uncertain but might exceed the costs that have been suggested by recent policy assessments

economic growth sustainable development and food consumption evidence across different income groups of countries abstract considering that high population and income growths will lead the coming decades an increase in global food demand is expected livestock products such as meat are closely related to this trend but also associated with impacts on the environment and public health from land and water depletion to greenhouse gases emissions and higher risks of non communicable diseases this trend raises doubts about the sustainability of the food industry and thus a solution is needed for the problem how to feed the world population without compromising present and future generations the literature suggests that meat consumption should be reduced for the sake of the environment and global population however without considering the effects that such reduction would have on the economy inspired by these facts this paper empirically analyses the interactions between food consumption economic growth and sustainable development measured by the index of sustainable economic welfare more specifically the paper assesses the effect that food consumption has on the economy the econometric analysis applies the autoregressive distributed lag model for 77 countries further distinguished by their income group from 1995 to 2013 the findings support that meat consumption has different impacts on economic growth and sustainable development considering different income groups however there is an evident dilemma between economic growth and sustainable development since meat consumption has contradictory effects on each thus it is crucial to understand how to promote sustainability i e reducing the environmental externalities and chronic health diseases without compromising economic growth

unconditional elasticities in two stage demand systems an approximate solution two stage budgeting postulates that the consumer s utility maximization decision can be decomposed into two steps in the first stage total expenditure is allocated over broad groups of goods in the second stage group expenditures are allocated over elementary commodities in this article we assume that the current weighted true cost of living price indices defined for each broad group of elementary commodities vary only very slightly with sub utility levels hence it is possible to approximate the first stage of a two stage budgeting structure by a maximization problem involving a single price index and a single quantity index for each of the broad groups relationships between conditional and unconditional expenditure and price elasticities are derived within this context

nonparametric regression techniques in economics this introduction to nonparametric regression emphasizes techniques that might be most accessible and useful to the applied economist the paper begins with a brief overview of the class of models under study and central theoretical issues such as the curse of dimensionality the bias variance trade off and rates of convergence the paper then focuses on kernel and nonparametric least squares estimation of the nonparametric regression model and optimal differencing estimation of the partial linear model constrained estimation and hypothesis testing is also discussed empirical examples include returns to scale in electricity distribution and hedonic pricing of housing attributes

why is income inequality so low in china compared to other countries the effect of household survey methods many studies suggest that income inequality in china is comparatively low but if income inequality in urban china was measured using monthly income as in many other countries it would be from 17 to 69 higher depending on the inequality measure used 2001 elsevier science b v all rights reserved

economic potential of biomass based fuels for greenhouse gas emission mitigation use of biofuels diminishes fossil fuelcombustion thereby also reducing net greenhousegas emissions however subsidies are neededto make agricultural biofuel productioneconomically feasible to explore the economicpotential of biofuels in a greenhouse gasmitigation market we incorporate data onproduction and biofuel processing for thedesignated energy crops switchgrass hybridpoplar and willow in an u s agriculturalsector model along with data on traditionalcrop livestock production and processing andafforestation of cropland net emissioncoefficients on all included agriculturalpractices are estimated through crop growthsimulation models or taken from the literature potential emission mitigation policies ormarkets are simulated via hypothetical carbonprices at each carbon price level theagricultural sector model computes the newmarket equilibrium revealing agriculturalcommodity prices regionally specificproduction input use and welfare levels environmental impacts and adoption ofalternative management practices such asbiofuel production results indicate no rolefor biofuels below carbon prices of 40 perton of carbon equivalent at these incentivelevels emission reductions via reduced soiltillage and afforestation are more costefficient for carbon prices above 70 biofuels dominate all other agriculturalmitigation strategies

do equity index industry groups improve forecasts of inflation and production a us analysis this study develops a new financial market indicator which may be a useful addition to analysing real activity in the us by taking the ratio of the price return of equity industry groups of the s p 500 over a benchmark industry group in this case taken to be the utilities industry group an indicator is created which represents the price return performance specific to each individual industry we then perform recursive pseudo out of sample bivariate forecasts of future changes in the industrial production index ipi and the consumer price index cpi at 3 month 6 month and 12 month horizons using each of the indicators and compare results against an ar forecast the results of the bivariate forecasts using a number of the indicators produce better forecasts of changes in the ipi and are also significant for causality both for the full sample period and when tested recursively bivariate forecasts of changes to the cpi however do not improve upon the ar forecasts

the life cycle model of consumption and saving a central implication of life cycle models is that agents smooth consumption we review the empirical evidence on smoothing at frequencies from within the year up to across a lifetime we find that life cycle models particular those which incorporate realistic features of markets and goods have more empirical successes than failures we also show that some apparent deviations from theoretical predictions imply very small welfare losses for agents finally we emphasize that the coherence of life cycle models imposes an important discipline when incorporating new features into models

how costly is mitigation of non co2 greenhouse gas emissions from agriculture a meta analysis this text reviews the assessments of marginal abatement costs of methane and nitrous oxide emissions from agriculture we use agricultural emissions and the corresponding prices collected from 21 studies that have assessed abatement potentials and costs using various modeling approaches and assumptions we first highlight the implications of the modeling approach for marginal abatement costs harmonized abatement rates for three emission prices 10 20 and 50 2005 tco2eq are regressed on variables that reflect various modeling assumptions and study characteristics in a second step the emission price is introduced as an explanatory variable when controlling for a few key characteristics of the studies the models explain an important share of the observed variability in abatement rates the type of modeling approach is found to have a significant effect in particular we find that equilibrium models lead to higher abatement rates for a given price the flexibility in nitrogen use and its effect on crop yields also plays a significant role in lowering marginal abatement costs the results of the second step indicate that the price elasticity of the abatement rate is about 0 6 this estimate is found to be robust to several specifications and consistent with previous assessments covering other economic sectors

motives for private income transfers private income transfers are becoming increasingly recognized as a key aspect of the u s economy the majority of private income transfers occur inter vivos i e between living persons but very little is known about this type of transfer behavior this paper tests alternative hypotheses concerning motivation for inter vivos transfers two motives are considered altruism and exchange evidence presented here casts doubt on the altruistic model of transfer behavior observed patterns for inter vivos transfers are more consistent with exchange related motives this finding has important implications for the effects of public transfer programs on the distribution of economic well being

how responsive are private transfers to income evidence from a laissez faire economy abstract in recent years there has been burgeoning interest in how private transfers respond to household income or transfer derivatives much of it is fueled by the specter of crowding out the more responsive are private transfers the more likely they could be supplanted by expansions in public transfers weakening or destroying the latter s distributive impact yet there is also an emerging consensus that actual transfer derivatives are trivial at least for the united states suggesting that crowding out might loom larger in the minds of some economists than in the data but perhaps crowding out is a fait accompli in the united states accordingly we focus on the philippines which has a much smaller public sector we also pursue a novel theoretical angle which generates a sharp non linear relationship between private transfer receipts and income in the form of a spline our empirical work applies recently developed estimation techniques that treat the spline s threshold as an unknown parameter and they uncover transfer derivatives much larger than conventional methods reveal notably private transfers patterns are consistent with altruistic preferences effective risk sharing or both in accord with theoretical predictions however strong transfer derivatives prevail only among low income households our findings suggest that attempts to aid the poor could be thwarted by private responses which leak benefits to richer households in the form of lighter burdens of support for less fortunate kin so the problems that operative private transfers create for public redistribution policy first pointed out by becker and barro over 25 years ago do indeed matter empirically

how widespread are nonlinear crowding out effects the response of private transfers to income in four developing countries this article investigates the relationship between household income and private transfers received in developing countries if private transfers are unresponsive to household income there is less likelihood of expansions in public social security crowding out private transfers most literature finds that private transfers are unresponsive but this may be because responses have been obscured by the methods that ignore nonlinearities threshold regression techniques find such nonlinearity in the philippines and scope for serious crowding out with 30 80 of private transfers potentially displaced for low income households cox et al 2004 to see if these nonlinear effects occur more widely semiparametric and threshold regression methods are used to model private transfers in four developing countries china indonesia papua new guinea and vietnam the results reported in this article suggest that nonlinear crowding out effects are not important features of transfer behaviour in these countries the

volatility volume causality across single stock spot futures markets in india abstractthis study examines the causal relationships between volatility and volume across spot and futures market for the 50 constituent stocks of the cnx nifty index granger non causality tests implemented using vector autoregression var and asymmetric var models indicate the presence of significant causal relations from both the spot and futures volume to both the spot and futures volatility bidirectional causal relationships between spot and futures volume were observed for almost all stocks but few stocks displayed a similar relationship between volatilities the results highlight the importance of volume in absorbing information and its behaviour as the conduit of information

elasticities in aids models in the literature a variety of approaches have been used to calculate demand elasticities in almost ideal demand system aids models of demand it is common to estimate the linear approximate almost ideal demand system la aids instead of the aids when the la aids is estimated all of the previously reported approaches to compute elasticities are theoretically incorrect this paper presents correct formulas for la aids elasticities and illustrates the potential errors from using incorrect computing the almost ideal demand system aids of deaton and muellbauer 1980a b has become popular in recent years anderson and blundell blanciforti and green 1983a b blanciforti green and king chalfant eales and unnevehr fujii khaled and mak fulponi heien and willett murray parsons ray a variety of approaches to computing elasticities has been used and some of the approaches may lead to significant errors this paper clarifies the differences between alternative approaches to estimating demand elasticities in aids models

public goods hidden income and tax evasion some nonstandard results from the warm glow model abstract a large literature explores crowd out in situations where public goods are jointly provided work in this area typically depicts a tax system where individuals take taxes as given but in some settings such as those in developing economies efforts to evade or avoid taxes may be widespread using the canonical warm glow model this paper considers joint public good provision in a setting where individuals can evade taxes by hiding their income the model s implications change significantly in this setting with hidden income stronger warm glow will lead to greater crowd out not less using research on crowd out and inter family transfers i present suggestive evidence that the model s results may help to reconcile divergent estimates of crowd out in the literature

using food taxes and subsidies to achieve emission reduction targets in norway food production contributes considerably to global greenhouse gas ghg emissions animal products particularly meat from ruminants generally have higher ghg emissions than plant products over the last few decades the global per capita consumption of animal products has increased this has a negative impact on climate change land and water availability and human health we are faced with the two fold challenge of reducing ghg emissions while still producing enough food for our growing population part of the solution could be for consumers to change towards a more sustainable diet in this paper we take norway as a case study for estimating optimal taxes and subsidies on different food items which can change consumption patterns in order to reduce the ghg emissions derived from the average norwegian diet in the estimate we ensure that the average calorie intake with the new diet remains the same as with the current diet and factor in other health considerations our findings suggest that limited but useful emission reduction targets can be set with only a few changes in diets the methodology presented in this paper may be used to estimate optimal climate taxes and subsidies under different emission quantities taxes subsidies and health constraints

rising inequalities in income and health in china who is left behind during the last decades china has experienced double digit economic growth rates and rising inequality this paper implements a new decomposition on the china health and nutrition panel survey 1991 2006 to examine the extent to which changes in level and distribution of incomes and in income mobility are related to health disparities between rich and poor we find that health disparities in china relate to rising income inequality and in particular to the adverse health and income experience of older wo men but not to the growth rate of average incomes over the last decades these findings suggest that replacement incomes and pensions at older ages may be one of the most important policy levers in combating health disparities between rich and poor chinese

the applicability of marginal abatement cost approach a comprehensive review abstract the marginal abatement cost mac methodology is widely used in climate change policies policy makers rely on mac to assess feasible strategies and related costs to achieve emission reduction goals this paper introduces a variety of mac methodologies aiming at solving diverse problems which utilizes various calculable logic thus producing different results and implications this study applies a mind mapping method to capture differentiation of mac methods and systematically classify mac methodologies the applicability path analysis was proposed based on principles such as stakeholder type decision making objectives cost concept strategy mode and information scope our goal is to assess the applicability of different methodologies to reduce misuse by policy makers and to serve as a guide for subsequent research which might prompt and lead to the derivation of more consequential results in future studies the results of this study suggest that the complex method is not always better than the simplified method because policy makers are required to select the appropriate method according to the type of information needed it may even be suggested that mac could be reliable by ranking relative value of options compared with baseline rather than focusing on the absolute value of individual measures

social norms and gift behavior theory and evidence from romania in many developing and transitional countries with limited public income redistribution inter household transfers in general and gifts in particular are sizable and very important we use unique romanian survey data that enables us to isolate pure gifts from other private transfers we explicitly focus on the importance of community wide social norms and find that they indeed play a major role for both the occurrence and the values of gifts more exactly our results suggest that the overall predominant gift motive among romanian households is a norm of reciprocity moreover this norm seems to be dominating for gifts to middle and high income households even though poor households receive to the same extent norms of both impure altruism and reciprocity tend to be important hence although the poor may not reciprocate gifts to the same extent as the rich they still receive since there is a social norm to give especially to the poor

a critical review of distance function based economic research on china s marginal abatement cost of carbon dioxide emissions abstract the last few years have witnessed a rapidly emerging literature estimating the marginal abatement cost or the shadow price of carbon dioxide co2 emissions in china using parametric or non parametric distance function approaches this is largely driven by the fact that china has become the world s largest carbon emitter and thus faced mounting domestic and international pressure to mitigate emissions there is an urgent policy need to model and predict the cost burdens of various mitigation scenarios consistent information about the marginal abatement cost of co2 emissions plays a crucial role in addressing this need however the existing literature has suffered from various issues that have severely weakened the scientific support that these studies could potentially provide for sound policy making this paper provides a thorough and critical review of this rapidly emerging literature and identifies important research directions that need the most attention from scholars

monetary vs credit aggregates an evaluation of monetary policy targets the past decade was characterized by increased emphasis upon monetary aggregates as intermediate targets for monetary policy although growth rate ranges were specified for both narrow and broad monetary aggegates as well as for bank credit the primary focus of the federal reserve was on the growth rate of narrow money however some policy makers 19 have recently expressed doubt about the viability of using narrow money as an intermediate target in particular it has been argued that recent financial innovations such as the introduction of the various now accounts the proliferation of money market mutual funds and the adoption of cash management techniques by both firms and consumers to name a few have distorted the ml1 gnp relationship thereby raising the question of whether broader monetary aggegates or even credit aggregates might bear a closer relationship to income furthermore the federal reserve has recently announced growth rate target ranges for a broad credit aggregate in addition to growth rate ranges for ml and m2 2 friedman 7 8 provides a general discussion of these issues while modiglianipapademos 18 provide a theoretical analysis of the conditions under which a credit aggregate is preferred to a monetary aggregate as an intermediate target however nothing conclusive can be said at the theoretical level since the choice between money and credit aggregates depends upon the true underlying structure of the macroeconomy hence the choice among money and credit aggregates is an empirical issue the aim of this paper is to provide evidence on the issue of credit aggregates versus monetary aggregates as intermediate targets for monetary policy the paper evaluates the characteristics of several monetary and credit aggregates in terms of two attributes of a

transitions to sustainable consumption and production in cities this special volume focuses on sustainable production and consumption and especially on transformation processes in the built environment more than 50 and rising of the world population is now living in cities that are both centers of technological and social innovations in sustainable life styles and carriers of unsustainable lifestyles in this special volume contributions can be found on grassroots innovations sharing food energy and waste systems associated with cities the role of corporations in realizing transitions towards sustainable living consumer activism behavioral change and consumer values in driving change and on governance and indicators for measuring all such transformations many of the papers were presented at the second conference of the global research forum on sustainable production and consumption grf spac in shanghai in june 2014 and thus a substantial number of them report on research on sustainable production and consumption in cities in china the authorship also reflects growing collaboration between researchers from developing and industrialized countries the great diversity of contributions on the topic reflects the wealth of insights generated on the topic in recent years but also the need for a better understanding of change processes at the intersection of social and physical systems and at multiple levels of action

adjusting vat rates to promote healthier diets in norway a censored quantile regression approach the effects of health related taxes and subsidies on food and beverages have mainly been investigated using models that assume identical price responses among high and low consuming households diet related health problems are however more likely among households with high intakes of unhealthy foods or low intakes of healthy foods than in households with average intakes in this article we focus on purchases of healthy and unhealthy foods among low median and high purchasing households the effects of an increase in the norwegian value added tax vat on some unhealthy foods and a removal of the vat on some healthy foods are investigated using censored quantile regressions we reject equality of the own price elasticities for eight of nine food and beverage groups we find that a vat increase is more effective in reducing purchases of unhealthy foods among high purchasing households than a vat removal is in increasing the purchases of healthy foods among low purchasing households

carbon sequestration or abatement the effect of rising carbon prices on the optimal portfolio of greenhouse gas mitigation strategies abstract existing projections of the optimal share of carbon sequestration in an overall portfolio of greenhouse gas mitigation strategies almost all assume the carbon price to be constant over time this paper shows analytically that if the price instead increases over time consistent with projections from integrated assessment models it becomes optimal to delay certain sequestration projects whereas the optimal timing of energy based abatement projects remains unchanged as a result the optimal share of sequestration falls and significantly so calibrating our analytical model we find that a modest 3 rate of price increase results in about a 60 reduction in the optimal sequestration share relative to constant price projections numerical simulations based on predicted carbon price paths from nordhaus rice01 model indicate quantitatively similar reductions under an economically efficient scenario and much larger reductions 80 100 for up to 80 years under a scenario that aims to limit the atmospheric co 2 concentration to double its pre industrial level