short run impacts of a severance tax change evidence from alaska energy states face a fundamental tradeoff when increasing severance tax rates potential gains in tax revenues versus potential losses in exploration development and production activity despite the significant implications of this tradeoff there is very little empirical evidence on the short run responsiveness of extraction related activities to changes in severance taxes we conduct a comparative case study to evaluate the short term impact of a severance tax increase on oil related activities and development in alaska in 2007 the introduction of alaska s clear and equitable share aces more than tripled the tax liability for much of the oil already under production in alaska we construct a synthetic alaska from a set of u s energy states with the purpose of estimating the counterfactual evolution of oil production exploration and development wells gross state product and employment in the absence of aces overall our results indicate that there is no discernible difference in the outcome variables of interest between alaska and its synthetic control after the implementation of aces suggesting that aces had a minimal effect on alaskan oil related activity and development in the short run

national price levels purchasing power parity and cointegration a test of four high inflation economies abstract the time series properties of exchange rates and wholesale prices from four high inflation countries show some evidence in support of purchasing power parity tests for stationarity of real exchange rates and cointegration among price and exchange rate variables are presented for argentina brazil chile and israel during the 1970s and 1980s error correction models describe the mechanism of adjustment to long run equilibrium

tax based mechanisms in urban regeneration dublin and chicago models the increasing interest in the potential use of fiscal incentives as a mechanism for stimulating urban renewal has been highlighted by a number of influential policy sources this paper assesses the application and outcomes of tax based incentives in urban regeneration with particular focus upon the differing models represented by dublin ireland and chicago usa issues considered include utilisation of tax incentives drawing down of benefits role of actor groups ability to lever private sector finance impact on property market performance and wider economic influences conclusions advance the case for tax based mechanisms as an instrument in the delivery of urban regeneration but stress the need for complementary structures to exploit fully the fiscal incentives

is hotelling s rule relevant to domestic oil production a model of oil supply from known reserves is developed to incorporate geological and engineering principles in the oil field operator s decision problem oil production from existing wells within an oil field is isolated from the drilling of new wells the geo engineering

competition in interregional taxation the case of western coal markets for many products are dominated by small group of states or countries with a natural advantage in the marketplace because of some initial endowment of resources favorable climate or location the purpose of this paper is to explore how such markets involving a few political jurisdictions interact noncooperatively we examine how such a market might be structured and operate and the extent of monopoly rent that can be extracted in the absence of collusion we answer these questions for an empirically estimated model of western u s coal in which two states montana and wyoming dominate production we demonstrate that in this market the amount of rent that can be extracted is greatly reduced through competition relative to a cartel nevertheless even with two producing states competing against each other significant rents can be captured significant enough to refute the contention that little rent can accrue without a cartel

tax expenditures and other programs to stimulate housing do we need more abstract discussions to aid the housing industry raise several questions first does stimulation of housing demand require new direct subsidy programs and second are any programs to increase demand worth their costs to society the results in this paper indicate that the answer to both questions is no the existing subsidy to homeownership in the tax code is when combined with mortgage instruments that offset cash flow problems fully capable of generating large increases in demand at the cost of significant tax expenditures and the social benefits of increased housing demand are shown to be worth only about 60 of their costs consequently increasing housing demand can be readily achieved but doing so will be costly to the government and inefficient for society

two crises inflationary inertia and credibility this paper provides a comparative analysis of the mexican currency crisis of 1994 and the chilean crisis of 1982 to assess to what extent exchange rate based stabilisation programmes are successful in reducing or even eliminating inflationary inertia the paper provides a brief overview of the chilean and mexican reform and stabilisation programmes a theoretical model that emphasises the role of credibility is developed to analyse the effects of exchange rate based stabilisation programmes on inflationary inertia according to the model less than credible stabilisations will not eliminate inertia and will generate major real exchange rate overvaluation detailed data are used to test the hypothesis

the impact of resource tax reform on china s coal industry abstract contributing to approximately two thirds of primary energy consumption coal usage is the focus of china s energy policies to regulate the resource taxation system and reduce the burden of coal enterprises the chinese government launched a reform of its resource tax system in 2014 for coal introducing the ad valorem system to replace the volume based system that had been in place for the preceding thirty years to assess the impact of the tax reform this paper constructs two stage dynamic game models by taking the coal and coal fired power industries as the players the market situations of shortage and oversupply are investigated separately empirical data are collected to estimate the model parameters for numerical simulations the model results suggest that the tax reform will reduce both coal prices and the coal industry profitability if the tax levied on each ton of coal is maintained at the same level as before the reform regardless of whether the market is in a shortage or an oversupply situation however the increased buyer s power will amplify the effect of the tax reform the numerical simulations also provide an estimation of the tax rate of the ad valorem system that maintains the profit of the coal industry considering the demand and supply situations in china s coal market policy recommendations are provided to guide further reform of china s resource tax system

adjustment and social costs in chile during the 1980s abstract traditional analysis of adjustment programs tends to underestimate the welfare costs because it assumes that a contraction of nontradable production will close the expenditure income gap while the resulting excess supply of tradables will automatically be exported in chile however tradable output contracted sharply falling almost two thirds as much as nontradable output the conventional analysis also ignores the effect of adjustment on unemployment rates and on real wages this paper argues that the adjustment measures of the 1980s were regressive even though the government was successful in targeting its expenditures toward the very poor during the period of fiscal retrenchment among the regressive adjustment measures were the subsidies to holders of dollar denominated debt provided by the central bank in addition policies to reduce expenditures raised the unemployment rate over 26 reduced real wages by 20 for almost five years and reduced health housing and education budgets by 20 per capita finally the required real devaluation raised the cost of living for the poor

taxation depletion and welfare a simulation study of the u s petroleum resource abstract exhaustible resources in the united states are subject to taxes on property value production and corporate income as applied in practice each tax can cause high grading the elimination of incentives to explore develop and produce marginal resources and each can tilt the time path of production toward the present or the future the potential for such tax induced distortions has been shown in the theoretical literature due to the dynamic nature of resource exploitation and the resulting complexity of models developed to study it however purely theoretical exercises have been unable to provide detailed results of a sort that could help guide tax policy the present paper develops a simulation model of the u s petroleum resource and uses it to study the effects of taxation on exploration and production the model is partial equilibrium in scope and views the industry as a present value maximizing representative firm given expectations on the future time path of price and a function that relates reserve additions to exploratory effort the industry chooses time paths for exploration and production parameters of relevant functions are estimated with data for u s petroleum operations in the onshore region of the lower 48 states the simulated outcomes indicate that property and production severance taxes cause substantial deadweight losses a tax on corporate income from extraction imposes a very small deadweight loss and the property tax significantly biases utilization of the resource away from the future and toward the present

inward looking policies institutions autocrats and economic growth in latin america an empirical exploration this paper explores the institutionaldeterminants of economic growth in latinamerica by taking advantage of recentempirical research that employs subjectiveand objective measures to test for apossible northian explanation that linksinstitutional quality and economic growth we explore a simple framework that may helpbetter understand the policymakers choicesand persistence regarding inward lookingpolicies that were pursued between the1930s and the 1980s by arguing that in thelatin american case olson s 1982 idea ofencompassing interest should be expanded tocover not only the economic stakes of powerholders but in particular their psychicincome which includes their politicalstakes along the lines of recent work byrobinson 1997 coyne 2002 andothers

us state and local oil and gas revenue sources and uses us state and local governments generate revenues from oil and gas production through a variety of mechanisms in this paper we quantify four leading sources 1 state taxes levied on the value or volume of oil and gas produced 2 local property taxes levied on the value of oil and gas property 3 oil and gas lease revenues from state lands and 4 oil and gas lease revenues from federal lands we measure these revenues against the total value of oil and gas produced in the top 16 oil and gas producing states using fiscal year 2013 as a benchmark on average state and local governments collect roughly 10 of oil and gas revenue ranging from a low of roughly 1 to a high of nearly 40 not including income taxes we also assess the use of these revenues finding that there is substantial variation among states the largest shares of revenue flow to state governments current expenditures and education followed by local governments some states also allocate a portion of oil and gas revenues to trust funds endowing future government operations and or education expenditures

unconventional energy taxation and interstate welfare an analysis of pennsylvania s severance tax policy abstract natural gas production from unconventional sources has increased over the past decade a significant portion of this increase has come from output in the marcellus region of pennsylvania this output has altered gas markets and repositioned pennsylvania as a major gas exporter it has also put pennsylvania at odds with other states as it is one of a few without a formal severance tax on extractive resources in this paper we combine results from a structural demand model with a two sector trade model to analyze the interstate welfare impacts of pennsylvania s current severance tax proposal our results demonstrate that most of the welfare losses from this proposed policy are likely to be shifted to residents in other states we also demonstrate how fluctuations in gas prices can substantially reduce tax revenue these findings have important implications for both pennsylvania and u s energy policy given the significant rise in energy production from new sources throughout the u s

the taxation of exhaustible resources the efficiency and equity effects of unit yield property and windfall profits taxes upon nonrenewable resources are compared the yield tax is the most efficient and unit and property taxes are the least efficient of current taxes if the base price of the windfall profits tax is set close to extraction cost the windfall profits tax can be even more efficient than the yield tax all the tax burdens fall primarily upon owners in fact with the property and windfall profits taxes consumers can even be made better off 4 references 7 tables

inflation risk taxes and the demand for owner occupied housing a bstract a portfolio choice model is formulated which focuses on the possibility of inflation hedging motives in housing demand in the 1970s an asset demand equation is used to estimate the capitalization of inflation expectations into house prices through tax mortgage and hedging effects the empirical results indicate that even after accounting for tax and mortgage effects the hedging motive was significant in bidding up house prices one implication is that the tax effects of inflation may have been overstated in previous research that ignored inflation risk

financial crises and balance of payments crises a simple model of the southern cone experience abstract this paper starts from a simple model of the domestic banking sector and develops the potentially destabilizing macroeconomic consequences of its role in intermediating foreign capital inflows both financial and balance of payments crises may result reminiscent of the southern cone experience

environmental and land use regulation in nonrenewable resource industries implications from the wyoming checkerboard this paper examines how the oil and soning that these effects should be similar gas industry responds to changes in environmental to those of production and property taxes and land use regulations pertaining to drilling by like stollery however they do not conexamining differences in regulatory practices on sider the situation where environmental federal and private land a simulation model for regulations directly affect explo ration and wyoming is used to estimate losses of oil and gas development output over the next 60 years because of higher activities in any case the drilling costs found on federal property the pres limited number of studies in this area and ent value of these losses comes to about 800 mil their narrow scope is surprising in light of lion a lso this case study is of interest because it the importance of environmental complishows that future production is more sensitive to ance costs to firms that produce from nonchanges in environmental regulations that apply to renewable resources and because of the drilling than to changes in severance taxes levied observation by jaffe et al 1995 that a on production

exact consumer s surplus and deadweight loss consumer s surplus is a widely used tool in applied welfare economics both economic theorists and cost benefit analysis often use consumer s surplus despite its somewhat dubious reputation the basic idea is to evaluate the value to a consumer or his willingness to pay for a change in price of a good from say pricep to pricep because price changes affect consumer welfare an evaluation of this effect is often a key input to public policy decisions yet consumer s surplus is probably the most controversial of widely used economic concepts both paul samuelson and ian little conclude that the economics profession would be better off without it it is my feeling of the situation that substantial agreement exists on the correct quantities to be measured the amount the consumer would pay or would need to be paid to be just as well off after the price change as he was before the price change the quantities correspond to john hicks compensating variation measures an alternative measure which takes ex post price change utility as the basis of comparison is hicks equivalent variation the controversy arises in the measurement of these quantities the usual measurement procedure is to use the area to the left of the marshallian market demand curve between two price levels jules dupuit originated this measure of welfare change and alfred marshall and hicks derived appropriate conditions for its use the primary condition for the area to the left of the demand curve to correspond to the compensating variation is to have constant marginal utility of income marshall gave this condition and if it holds the same quantity will be derived as the area to the left of the compensated hicksian demand curve this area to the left of the compensated demand curve is exactly what the compensating variation and equivalent variation measure thus the constant marginal utility of income is a sufficient condition for marshallian consumer s surplus to be equal to hicks consumer s surplus in this case arnold harberger s plea to use the welfare triangle as one half times the product of the price change times the quantity change to measure deadweight loss corresponds to the correct theoretical amount of welfare change in a recent paper robert willig derives bounds for the percentage difference between the correct measure of either the compensating or equivalent variation and the marshallian measure derived form the market demand curve his bounds which depend on the income elasticity of demand for the single good in the region of price change being considered as well as the proportion of the consumer s income spent on the good demonstrate that the marshallian consumer s surplus is often a good approximation to hicks consumer s surplus the fact that the proportion of the consumer s income spent matters as well as the income elasticity was first pointed out by harold hotelling willig contends that the approximation error will be less than the errors involved in estimating the demand curve thus he hopes to remove the need for apology that applied economists often need to give to theorists who remark on the inappropriateness of using marshallian consumer s surplus to measure welfare change however in this paper i show that for the case primarily considered by willig of a single price change which is also the situation in which consumer s surplus is often used in applied work no approximation is necessary professor of economics massachusetts institute of technology and research associate national bureau of economic research i would like to thank peter diamond erwin diewert daniel mcfadden robert merton robert solow hal varian joel yellin and the referees for help and comments research support from the national science foundation is acknowledged the reason that we still have two rather than one of samuelson s six measures of consumer s surplus arises from an index number problem of the correct basis for the welfare comparison i will give both measures but plan to concentrate on the compensating variation

controlling private mineral exploitation firms using conditional license renewal schemes in the early 1980 s the governments of canada and newfoundland disagreed concerning jurisdiction over the hibernia oil field the dispute revealed the belief that the scope and kind of economic benefits generated by the development would depend on which level of government had control differences in objectives could have practical significance only if there exist control instruments with which to influence the pattern of resource exploitation we examine one such instrument here the government of a province or state can most strongly influence the form of the extraction program through direct management as it may be difficult for such a government to recruit the necessary expertise it might have no alternative but to import this by encouraging outside firms to extract in return for shares of the profits the local government is assumed to be interested in using the newly found revenues to finance a project such as a college or other training facility which will provide benefits after the deposit is exhausted such a project would require a near constant flow of funds over many periods an extraction firm maximizes the total discounted profit by extracting successively declining amounts each period unless the discount rate is zero and there are no stock effects on marginal extraction cost this implies that revenue from taxes on production or profit will also decline through time use of such taxes alone would force the government to save significant portions of the revenues from early periods to fund its new program later on this can create political problems for democratically elected officials since surpluses indicate to voters that their tax bills are excessive a forward looking government could earmark the newly found revenue to fund the new program effectively instituting a precommitment device see strotz 1955 56 its next task would be to find a way of altering the declining revenue flow so that tax collections over time are even or nearly so one simplistic solution would have the government require a fixed payment

a quantitative description of state level taxation of oil and gas production in the continental u s abstract we provide a quantitative description of state level taxation of oil and gas production in the continental u s for 2004 2013 aggregate revenues from production taxes nearly doubled in real terms over the period reaching 10 3 billion and accounting for 20 of tax receipts in the top ten revenue states the average state had a tax rate of 3 6 nationally the average dollar of production was taxed at 4 2 the oil specific rate estimated for the study period is 2 4 per barrel or 5 5 per ton of carbon lastly state level tax rates are two thirds higher in states excluding oil and gas wells from local property taxes suggesting that the policies are substitutes for one another

commodity price volatility with endogenous natural resources abstract natural resource reserves are exogenous in models of small commodity exporters changes in the stock of reserves play no role in the macroeconomy including in business cycle volatility trade dynamics or exchange rate volatility we consider richer supply dynamics and model exploration and depletion we show that an endogenous supply of reserves is important for capturing the stylised facts associated with commodity price shocks including a commodity currency the crowding out of non commodity activity dutch disease and a volatile business cycle we also consider how exploration and depletion affect the ranking of optimal monetary and taxation policies when natural resource reserves are held fixed monetary policy is an efficient tool for stabilising the effects of commodity price shocks however when exploration and depletion are accounted for using interest rates to stabilise the effects of commodity price changes becomes inefficient using taxes on the resource sector specifically an ad valorem royalty remains efficient

severance taxes and market structure in an exhaustible resource industry abstract this paper compares the effects of a severance tax on profit maximizing competitive and monopolistic firms which explore and produce an exhaustible resource the producers response to the tax are studied and the deadweight losses from the tax are calculated time paths of exploratory effort extraction and price are computed severance taxes lead both producers to reduce production and exploration and cause a shift in the time path for prices the deadweight losses from the tax are low especially in competition the losses in the monopoly case are relatively higher with the tax burden falling mainly on the monopolistic producer

valuation of expectations a hedonic study of shale gas development and new york s moratorium abstract this paper examines the local impacts of shale gas development sgd we use a hedonic framework and exploit a discrete change in expectations about sgd caused by the new york state moratorium on hydraulic fracturing our research design combines difference in differences and border discontinuity as well as underlying shale geology on properties in pennsylvania and new york results suggest that new york properties that were most likely to experience both the financial benefits and environmental consequences of sgd dropped in value 23 as a result of the moratorium which under certain assumptions indicates a large and positive net valuation of sgd

banks and macroeconomic disturbances under predetermined exchange rates abstract as the recent mexican crisis vividly illustrates latin american countries often go through boom bust cycles caused by both domestic policies and external shocks such cycles are typically magnified by weak banking systems which intermediate large capital inflows this paper develops a simple optimizing model to analyze how the banking sector affects the propagation of shocks in particular we show how the world business cycle and shocks to the banking system affect output and employment through fluctuations in bank credit we also analyze the countercyclical use of reserve requirements econometric evidence for chile and mexico supports the main predictions of the model

testing capital account liberalization without forward rates another look at chile 1979 1982 abstract the paper offers a way to test the impact of capital account liberalization on domestic interest rates when proxies for expectations of depreciation are unavailable the model is tested on the well understood japanese experience in 1979 1980 and then applied to the chilean liberalization from 1979 1982 the evidence points to chilean monetary authorities retaining significant control over interest rates across the period and offers support to an evolving interpretation of the period that stresses the excessive optimism about the reforms rather than their lack of credibility as the source of their ultimate collapse

domestic currency appreciation and foreign capital inflows what comes first chile 1977 1982 abstract the purpose of this paper is to find granger causality relations between the real exchange rate the inflow of foreign capital interest rate arbitrage and the terms of trade in a representative indebted developing country chile this is done for a time period in which chile went from an unprecedented expansion 1977 1981 to a severe recession 1982 the paper confronts two competing hypotheses that purport to explain such behavior hypothesis one claims that causality went from the real exchange rate affected by nominal exchange rate policy to capital inflows in what could be termed a current account deficit induced demand for foreign funds hypothesis two posits a causality that ran the other way from capital inflows to the real exchange rate in which case the exogenous inflows of foreign money implied a current account deficit special attention is paid to the role played by two other related factors interest rate arbitrage and terms of trade variations by applying innovation accounting techniques based on estimated vector autoregressions support is found for the second of these hypotheses thus the real issue in chile and in many other currently indebted latin american countries should be the timing and extent of the capital account liberalization process carried out during the period

the pricing of manufactured goods during trade liberalization evidence from chile israel and korea this paper is an investigation of price setting behavior in chile israel and korea when each of these countries moved from a fairly closed to a more open international trade regime in some cases the intensification of the opening resulted from real appreciation rather than from a formal adjustment in tariff rates as in chile 1980 82 and israel 1983 84 the central thesis of this paper is that the structural price equation for import competing manufactured goods changes with the degree of openness to trade when the economy is fairly closed the main weight is commanded by domestic cost variables and excess demand and foreign prices only affect pricing through their effects on imported material prices during trade liberalization the rate of change of prices of an increasing proportion of manufacturing goods begins to be influenced by the landed cost of similar imports but domestic variables still have a role because selected domestic manufactured goods are considered imperfect substitutes for internationally traded products empirical results from time varying parameter estimation show that domestic currency prices of imports become progressively more important during the liberalization processes in the three countries

a parsimonious model of tax avoidance and distortions in petroleum exploration and development abstract we present a simple model of petroleum exploration and development that can be applied to study the performance of alternative tax systems and identify potential distortions although the model is highly simplified it incorporates many factors and some of the key tradeoffs that would influence an investor s investment behavior the model recognizes the role of enhanced oil recovery and treats the impact of taxation on exploration and development in an integrated manner consistent with an investor s joint optimization of investments at both stages of the process the model is simple and user friendly which facilitates application to a broad range of problems

jurisdictional tax competition and the division of nonrenewable resource rents this paper presents a model of nonrenewable resource extraction across multiple jurisdictions which engage in strategic tax competition the model incorporates rents due to both resource scarcity and capital scarcity as well as intra region ricardian rents regions set taxes on nonrenewable resource production strategically to balance tax revenues and local benefits from investment conditional on other regions tax rates a representative extraction firm then allocates production capital across regions and time to maximize the present value of profits generally we find that the division of resource rent between firms and regional governments ultimately depends on the relative scarcity of natural and production capital relative costs across space and the value regional governments place on economic activity this theoretical result provides policymakers with information on the determinants of optimal tax rates and motivates future empirical research on the factors influencing the division of resource rent in practice

oil production responses to price changes an empirical application of the competitive model to opec and non opec countries abstract falling oil prices over the last decade accompanied by over production by some opec members and the growth of non opec supply warrant further empirical investigation of the competitive model to ascertain production behavior a supply function based on a modification of griffin s model is estimated using data from 1973 1997 the sample period unlike griffin s however includes phases of price increase 1970s and price decrease 1980s 1990s thus providing a better framework for examining production behavior using the competitive model the opec results do not support the competitive hypothesis instead a negative and significant price elasticity of supply is obtained this result offers partial support for the target revenue theory for most of the non opec members the estimates support the competitive model opec s loss of market share and the drop in the share of oil based energy should signal adjustments in price and quantity based on a competitive world market for crude oil

strategy and market structure in western coal taxation this paper analyzes the potential market power of western states in setting coal severance taxes and the emphasis placed by these states on the development of their coal resources vs obtaining tax revenues three market structures are analyzed one involves a western regional cartel setting taxes collectively the other cases are noncooperative tax equilibria with montana and wyoming competing against each other we conclude that the western states seem to be primarily concerned with revenue collection and are very efficient extractors of economic rent

optimal taxation of exhaustible resource under monopoly abstract this paper deals with the problem of using taxes or subsidies to correct the inefficient resource allocation under monopoly in this paper the question raised is what would be the optimal tax on resource extraction under monopoly ultimately it is shown that taxes may be devised to generate price and extraction paths under monopoly that are identical to those under the competitive equilibrium tax policy can thus be used as an instrument for changing the distortionary resource allocation generated by the monopolist

exploration information and regulation in an exhaustible mineral industry abstract the paper presents a model of exploration and production in an uncertain environment exploration provides a by product of information that helps predict future finds more accurately when this information is not equally valued at the margin by society and industry socially inefficient levels of exploration are chosen by industry in this event government intervention may be warranted a regulator could control future prices to encourage industry to select socially preferred levels of production and exploration alternatively by making public varying amounts of exploration information incentives to industry could be adjusted conditions where such regulation might yield sufficient gains to society to offset regulatory costs are considered

tax policy can change the production path a model of optimal oil extraction in alaska we model the economically optimal dynamic oil production decisions for seven production units fields on alaska s north slope we use adjustment cost and discount rate to calibrate the model against historical production data and use the calibrated model to simulate the impact of tax policy on production rate we construct field specific cost functions from average cost data and an estimated inverse production function which incorporates engineering aspects of oil production into our economic modeling producers appear to have approximated dynamic optimality consistent with prior research we find that changing the tax rate alone does not change the economically optimal oil production path except for marginal fields that may cease production contrary to prior research we find that the structure of tax policy can be designed to affect the economically optimal production path but at a cost in net social benefit

spatially variable taxation and resource extraction the impact of state oil taxes on drilling in the us abstract we estimate the responsiveness of nonrenewable resource firms to taxes on output using spatially explicit data from the oil sector in the united states using a model of resource firm capital allocation over space we show that responses to spatially varying taxes differ from responses to equivalent changes in the common output price a larger response to tax rates occurs because the tax change only affects the returns to drilling in a single state whereas a price change affects both the returns to drilling in a state and the opportunity cost of not drilling in other states econometrically we estimate the effect of severance taxes on oil drilling we find that the response to a one dollar increase in tax per unit of production has an effect at least eight times as large as the effect of an equivalent decrease in output price the tax response is inelastic implying that an increase in state tax rate would increase revenue we do not find evidence of spillovers between states in the local areas near state borders

leakage in regional environmental policy the case of the regional greenhouse gas initiative abstract subglobal and subnational greenhouse gas policies are often thought to be less effective than comprehensive policies as production and emissions of trade exposed industries may move from the regulated to the unregulated regions a process referred to as leakage leakage negates some emission reductions from the regulated regions we use detailed electricity generation and transmission data to show that this is the case for the regional greenhouse gas initiative rggi a co2 cap and trade program for the electricity sector in select northeastern u s states more specifically our results indicate that rggi induced a reduction in coal fired generation in rggi states and an increase in ngcc generation in rggi surrounding regions this finding suggests that the pollution haven hypothesis holds for state level variation in environmental policy even when compliance costs are low

government programs can improve local labor markets evidence from state enterprise zones federal empowerment zones and federal enterprise communities 1 abstract federal and state governments spend well over a billion dollars a year on programs that encourage employment development in disadvantaged labor markets through the use of subsidies and tax credits in this paper we use an estimation approach that is valid under relatively weak assumptions to measure the impact of state enterprise zones entzs federal empowerment zones empzs and federal enterprise community entc programs on local labor markets we find that all three programs have positive statistically significant impacts on local labor markets in terms of the unemployment rate the poverty rate the fraction with wage and salary income and employment further the effects of empz and entc designation are considerably larger than the impact of entz designation we find that our estimates are robust to allowing for a regression to the mean effect we also find that there are positive but statistically insignificant spillover effects to neighboring census tracts of each of these programs thus our positive estimates of these program impacts do not simply represent a transfer from the nearest non treated census tract to the treated census tract our results are noteworthy for several reasons first our study is the first to jointly look at these three programs thus allowing policy makers to compare the impacts of these programs second our paper along with a concurrent study by neumark and kolko 2008 is the first to carry out the estimation accounting for overlap between the programs third our estimation strategy is valid under weaker assumptions than those made in many previous studies we consider three comparison groups and let the data determine the appropriate group fourth in spite of our conservative estimation strategy by looking at national effects with disaggregated data we show that entz designation generally has a positive effect on the local labor market while most previous research on entzs much of which used more geographically aggregated data to look at state specific effects did not find any significant impacts fifth we note that there is little or no previous work on entcs overall our results strongly support the efficacy of these labor market interventions

a model of the operation and development of a national oil company we present a model of the exploration and development activities of a national oil company noc which uses similar technology to a private firm to extract a depletable resource however unlike the private firm the noc may have a wider range of objectives than maximizing the present value of profits specifically we assume an objective function that balances firm profitability against a political desire to favor domestic consumer surplus and domestic employment we find that the non commercial objectives faced by a noc tend to reinforce each other in their effects on profitability the timing of cash flows and employment

the political economy of oil production in latin america 1990s witnessed a significant increase in investments in the oil and gas sector in latin america in most countries private investment took the lead after the privatization and liberalization of the sector in argentina bolivia brazil ecuador and venezuela private oil investment or some form of privatization or both generated significant increases in hydrocarbon production and reserves in the last five years however the region has experienced a new wave of resource nationalism with increases in the government s take and state control oil taxes have risen significantly in argentina bolivia ecuador and venezuela in addition bolivia and venezuela have partially nationalized oil projects we argue that the recent trend is largely the outcome of the rise in the international oil price furthermore we show how the likelihood of expropriation increased after a period of successful investment in exploration and production at the same time the timing of these changes and direction in which the sector has evolved varies considerably across the region in contrast to most other countries in the region brazil colombia and peru have generally strengthened the institutional framework and the property rights of private oil producers this paper provides a political economy rationale for the divergent evolution

tax avoidance and business location in a state border model abstract previous studies have struggled to demonstrate that higher taxes deter business activity we revisit this issue by estimating the effect of changes over time in cross border differences in state tax conditions on the tendency for new establishments to favor one side of a state border over the other identification is enhanced by taking account of previously overlooked reciprocal agreements that require workers to pay income tax to their state of residence as opposed to their state of employment when reciprocal agreements are in force higher personal income tax rates lure companies from across the border while corporate income tax and sales tax rates have the opposite effect where reciprocal agreements are not in place the results are largely reversed these patterns are amplified in heavily developed locations and differ in anticipated ways by industry and corporate non corporate status of the establishment overall results strengthen the view that state level tax policies do affect the location decisions of entrepreneurs and new business activity but not in a way that lends itself to a one size fits all summary

hotelling under pressure we show that oil production from existing wells in texas does not respond to oil prices while drilling activity and costs respond strongly to explain these facts we reformulate hotelling s class

resource taxation with heterogeneous quality and endogenous reserves abstract this paper analyzes the impact of mining taxation on the intertemporal extraction profile for a heterogeneous ore body the extraction profile specifies both quantities and qualities extracted in each period total extraction is thus endogenously determined the taxes explicitly considered are severance taxes ad valorem or per unit on metal or on ore property taxes and profits taxes with depletion allowance the intertemporal framework integrates economic and geological factors generating new results on extraction distortions and providing qualification or reconciliation of previous diverse results in this area

targeted business incentives and local labor markets this paper uses a regression discontinuity design to examine the effects of geographically targeted business incentives on local labor markets unlike elsewhere in the united states enterprise zone ez designations in texas are determined in part by a cutoff rule based on census block group poverty rates exploiting this discontinuity as a source of quasi experimental variation in investment and hiring incentives across areas i find that ez designation has a positive effect on resident employment increasing opportunities mainly in lower paying industries while business sitings spurred by the program are more geographically diffuse ez designation is associated with increases in home values

minimum wage shocks employment flows and labor market frictions we provide the first estimates of the effects of minimum wages on employment flows in the u s labor market identifying the impact using policy discontinuities at state borders we find that minimum wages have a sizable negative effect on employment flows but not stocks separations and accessions fall among affected workers we interpret our findings using a job ladder model in which minimum wage increases can reduce job to job transitions we find that a standard calibration of the model generates predicted relative magnitudes of the employment stock and flow elasticities that are very close to our reduced form estimates

what drives climate policy adoption in the u s states abstract climate advocates increasingly view state policy as a crucial tool to reduce greenhouse gas emissions in the u s however the literature lacks systematic empirical analysis of which when and why states adopt policies mitigating climate change while traditional climate federalism highlights the co benefits to climate policies in driving subnational policy decisions more recent work emphasizes the powerful role of partisan control of office i collect and analyze panel data measuring the strength of state policy from 2007 to 2014 in four areas renewable portfolio standards distributed generation energy efficiency and severance taxes on oil and gas extraction while renewable portfolio standards and distributed generation policies were driven primarily by democratic partisanship in state electorates energy efficiency policies were less responsive to democratic partisanship but marginally responsive to unified democratic control of state government finally these political factors did not measurably influence state severance taxes

the distribution of housing tax expenditures and subsidies in an urban area this paper examines the distribution of housing tax expenditures and subsidies among households in the owner occupied and public rented sectors in the birmingham area uk subsidies to tenants are defined as the difference between market rents and the rents actually set tax expenditures to owner occupiers are defined as the absence of tax on imputed rental income and capital gains the results presented indicate that tax expenditures tend to be more regressively distributed than subsidies to tenants arising from non market pricing the benefits from the latter are more dependent on a household s location and property type than on income the paper concludes that efficiency and equity objectives are not met by the current housing finance system