price determination in the eu ets market theory and econometric analysis with market fundamentals abstract we investigate the price determination of the european union emission allowance eua of the european union emissions trading scheme eu ets we postulate an uncertain permit price and risk averse firms which have the possibility to hedge in the forward market the firms produce final goods abate their emissions and trade permits in the permit market the dependence of the equilibrium permit price on exogenous variables is studied in a permit market model we test our theoretical findings with empirical data from 2005 to 2010 in the eu ets market we use daily forward prices of eua as our dependent variable we use several econometric models with multiple stationary time series to discover that there is a strong relationship between the fundamentals such as german electricity prices and gas and coal prices with the price of eua we find that the eua forward price depends on fundamentals especially on the price of electricity as well as on the gas coal difference in a statistically significant way

commodity price shocks and civil conflict evidence from colombia how do income shocks aect armed con ict theory suggests two op posite eects if labor is used to appropriate resources violently higher wages may lower con ict by reducing labor supplied to appropriation this is the opportunity cost eect alternatively a rise in contestable income may increase violence by raising gains from appropriation this is the rapacity eect our paper exploits exogenous price shocks in inter national commodity markets and a rich dataset on civil war in colombia to assess how dierent income shocks aect con ict we examine changes in the price of agricultural goods which are labor intensive and natural resources which are capital intensive we focus on coee and oil the two largest exports we nd that a sharp fall in coee prices in the 1990s increased violence dierentially in regions growing more coee by lower ing wages and the opportunity cost of joining armed groups in contrast a rise in oil prices increased violence dierentially in the oil region by in creasing municipal revenue siphoned through rapacity this pattern holds in several other agricultural and natural resource sectors providing robust evidence that price shocks aect con ict in opposite directions depending on the factor intensity of the commodity

the value of cooperatives in rural electrification the electricity sectors of many developing countries underwent substantial reforms during the 1980s and 1990s driven by global agendas of privatization and liberalization however rural electrification offered little by way of market incentives for profit seeking private companies and was often neglected as a consequence delivery models for rural electrification need to change this paper will review the experiences of various rural electrification delivery models that have been established in developing countries including concessionary models dealership approaches and the strengthening of small and medium sized energy businesses it will use examples from the usa bangladesh and nepal together with a detailed case study of a nepali rural electric cooperative to explore the role that local cooperatives can play in extending electricity access it is shown that although there is no magic bullet solution to deliver rural electrification if offered appropriate financial and institutional support socially orientated cooperative businesses can be a willing efficient and effective means of extending and managing rural electricity services it is expected that this paper will be of particular value to policy makers donors project planners and implementers currently working in the field of rural electrification

the brazilian experience of rural electrification in the amazon with decentralized generation the need to change the paradigm from electrification to development abstract there are at least 607 thousand households in the brazilian amazon that need to be attended with some form of regular electricity service these households are not attended by the electricity sector through its electricity distribution companies and most of them have some form of precarious decentralized electricity generation that is not registered or regulated in the institutional framework diverse initiatives were taken by brazilian government to attend these household through alternatives that relied on locally available renewable energy this paper accesses this initiatives of rural electrification in the brazilian amazon first an overview of the problems of rural electricity are discussed and its specificities in the brazilian amazon then the brazilian institutional framework that organizes the decentralized electricity generation is described with its various limitations the diverse initiatives undertaken to attend the rural communities in the amazon since the 1990s are described as well as how these initiatives are linked to the policies for rural electrification the results shows that it can be inferred that sole market mechanisms are not sufficient to guarantee economic sustainability of these projects this can be one of the reasons why traditional electricity distribution companies showed the lack of interest in promoting rural electrification with other means than grid extension the most successful projects had financed efforts to integrate the generation of electricity into local development initiatives in order to guarantee sustainability and used substantial part of funding for local mobilization and organization it needs a paradigm chance by treating these initiatives as local development initiatives and promoting alternative ways for its implementation through partnership between local new actors in the electricity sector and government and implementing policy on a local municipal level

from maize to haze agricultural shocks and the growth of the mexican drug sector understanding how economic incentives affect illegal drug production is essential for crafting policies in response to the international drug trade policymakers typically face a choice between two strategies targetingcriminalgroupsvialawenforcement andofferingproducersincentivestoengage in alternate activities yet little is known about how the returns to alternate legal activities affect drug supply we contribute to this literature by examining how shocks to legal commodity prices affect the drug trade in mexico our analysis exploits exogenous movements in the mexican maize price stemming from weather conditions in u s maize growing regions as well as exports of other major maize producers using data on over 2200 municipios spanning 1990 2010 we show that lower prices differentially increased the cultivation of both marijuana and opium poppies in municipios

transactions in the european carbon market a bubble of compliance in a whirlpool of speculation the european union emissions trading scheme eu ets is supposed to help regulated installations to cover their co2 emissions by trading in allowances in practice the eu ets is mainly a financial market used for hedging and speculation this financial feature is regarded as a solution hedging and liquidity to a problem the price risk and volatility imposed on installations which the market has actually created itself this paper provides an estimation of the real underpinning of the scheme i e the needs of installations for allowances transfers to achieve compliance in the two first exchange periods this estimation which was singularly lacking in the literature shows that compliance transactions become more and more marginal as market activity grows and that they are drowned in a whirlpool of speculation this challenges the role of the carbon price whose financial and self referential evaluation can obviously not reveal installations marginal abatement costs the condition of cost effectiveness expected from carbon trading

rain and the democratic window of opportunity according to the economic approach to political transitions negative transitory economic shocks can give rise to a window of opportunity for democratic change we examine this hypothesis using yearly rainfall variation over the 1980 2004 period in 41 sub saharan african countries we find that a 25 drop in rainfall increases the probability of a transition to democracy during the following two years by around 3 percentage points a 5 fall in income due to low rainfall raises the probability of democratization by around 7 percentage points we also find that rainfall does not affect transitions from democracy to autocracy

satisfying the rural residential demand in liberia with decentralized renewable energy schemes abstract with the lowest access to electricity in the world the country of liberia west africa has efforts underway for electrification through a fossil based centralized scheme around its capital city and possible connections to the larger western africa power pool network these plans leave a large part of the rural population with no access to electricity this work analyzes the potential of decentralized generation to provide electricity to the rural liberian population the suppressed demand of the rural population is calculated at 235 gwh yr there is sufficient renewable energy potential to supply this demand the capital costs and electricity prices of decentralized generation with different fuels are calculated and compared to the ability and willingness to pay of rural liberians small diesel units have the lowest capital cost but photovoltaic small hydropower and small biomass projects provide lower electricity prices biomass and small hydro electricity are affordable for liberians at 0 08 kwh and 0 11 kwh respectively diesel and photovoltaic with levelized cost of electricity of 0 62 kwh and 0 33 kwh respectively exceed liberians willingness to pay centralized and decentralized electricity developments are not mutually exclusive both may be used within a comprehensive electrification plan decentralized generation with emphasis on rural areas can complement the existing plans to achieve the government of liberia s goal of universal access to electricity providing social equity and economic progress in order to become a reality rural decentralized electrification will need policy support and focused funding

ex ante and ex post labor supply response to risk in a low income area abstract this paper tests for ex ante and ex post labor supply responses to weather risk for rural indian farm households the analysis uses panel data on 2115 households spanning 13 states in rural india merged with a 22 year series of district level rainfall data ex ante households facing riskier distributions of rainfall are more likely to participate in the labor market ex post unexpectedly bad weather and low rainfall increase labor force participation

fiscal federalism at work central responses to internal migration in india summary internal migration is thought to have substantial benefits for migrants and for the development of migrant sending and migrant receiving areas in order to facilitate such migration central governments may need to use fiscal transfers to ensure services to migrants address infrastructure shortfalls and ameliorate labor market displacement of natives in fact an extensive mostly normative fiscal federalism literature has argued that central governments ought to use transfers to reduce interjurisdictional externalities such as those due to population displacements we extend this literature empirically by examining the degree to which exogenous longterm migration prompts the redirection of central fiscal resources in india following the literature on distributive politics we argue that transfers in decentralized systems addressing the costs of population movements are influenced by partisan politics using monsoon shocks to migration we show that increases in migration are met with greater central transfers but that these flows are at least 50 greater if the state level executive is in the prime minister s political party consistent with the theory the influence of politics is greatest on parts of the budget subject to greater executive control this politicization may explain why indian states maintain barriers to internal migration despite the development costs of doing so

rainfall and conflict a cautionary tale abstract there is evidence that in some contexts income shocks cause conflict the literature demonstrating this relationship uses rainfall shocks to instrument for income shocks arguing that in agriculturally dependent regions negative rain shocks lower income which incites violence this identification strategy relies on the assumption that rainfall shocks affect conflict only through their impacts on income this paper evaluates this exclusion restriction in the context of religious conflict in india using data on dam construction i identify districts that are downstream from irrigation dams and show that income in these areas is much less sensitive to rainfall fluctuations however rain shocks remain equally strong predictors of riot incidence in these districts i explore other channels through which rainfall might affect conflict

does industrialization build or destroy social networks abstract this article estimates the relationship between changes in industrialization and changes in social networks measures in indonesia during 1985 97 using repeated cross sections of nationally representative surveys we analyze a rich set of social interaction measures including various measures of voluntary associational activity levels of trust and informal cooperation districts that experienced rapid industrialization showed significant increases in most measures of social interaction however districts that neighbor rapidly industrializing areas exhibited high rates of out migration significantly fewer community credit cooperatives and a reduction in mutual cooperation as assessed by village elders manufacturing growth can be thought of as a proxy for income growth here the findings are contrary to several recent claims regarding the role of social capital in economic development

economic determinants of land invasions this study estimates the effect of economic conditions on redistributive conflict we examine land invasions in brazil using a panel data set with over 50 000 municipality year observations adverse eco nomic shocks instrumented by rainfall cause the rural poor to invade and occupy large landholdings this effect exhibits substantial heterogeneity by land inequality and land tenure systems but not by other observable variables in highly unequal municipalities negative income shocks cause twice as many land invasions as in municipalities with average land inequality cross sectional estimates using fine within region variation also suggest the importance of land inequality in explaining redistributive conflict i introduction c onflict over land is endemic to many rural econo mies in environments marked by a highly skewed distribution of property incomplete land and credit markets poorly or unevenly enforced property rights and weak political institutions agents often resort to extralegal means to improve their economic positions the poor frequently invade private properties and occupy them until either forcibly expelled or granted official titles land conflict which is prevalent in many countries such as brazil south africa uganda and venezuela may distort the allocation of resources in the agricultural sector away from productive uses and thereby contribute to the persistence of rural poverty how do economic conditions affect this redistrib utive conflict this paper explores this question using a rich municipal level data set of 5 299 land invasions from 1988 to 2004 in brazil we follow miguel satyanath and sergenti 2004 by using rainfall as a source of exogenous variation to study the relationship between income and conflict and we find that adverse economic shocks cause the rural poor to invade large landholdings this effect exhibits considerable het erogeneity by land inequality and land tenure systems in highly unequal municipalities negative income shocks cause twice as many land invasions as in municipalities with average land inequality the effect of income shocks is even stronger in highly polarized municipalities as measured by the degree of bimodality in the land distribution cross sectional estimates using fine within region variation also suggest the importance of land inequality in explaining redistributive conflict we also find that income shocks cause significantly more land invasions in municipalities with a greater proportion of land under fixed rent contracts by contrast we find no evidence of heterogeneity on a range of other political and socioeconomic variables including political competition sharecropping police expenditures and social welfare spending recent microeconometric studies have examined two

income distribution political instability and investment abstract this paper successfully tests on a sample of 71 countries for the period 1960 85 the following hypotheses income inequality by fuelling social discontent increases sociopolitical instability the latter by creating uncertainty in the politico economic environment reduces investment as a consequence income inequality and investment are inversely related since investment is a primary engine of growth this paper identifies a channel for an inverse relationship between income inequality and growth we measure socio political instability with indices which capture the occurrence of more or less violent phenomena of political unrest and we test our hypotheses by estimating a two equation model in which the endogenous variables are investment and an index of socio political instability our results are robust to sensitivity analysis on the specification of the model and the measure of political instability and are unchanged when the model is estimated using robust regression techniques

climate change weather shocks and violent conflict a critical look at the evidence we use cross country data to explore whether temperature and rainfall shocks trigger violent conflict or not we include a wide range of country and time samples and explore whether the impact of weather shocks is conditional on income or political regimes our overall conclusion is sobering notwithstanding the attention this topic has attracted from the media and policy makers we find little robust evidence linking weather shocks to the onset of conflict

a theory of political transitions we develop a theory of political transitions inspired by the experiences of western europe and latin america nondemocratic societies are controlled by a rich elite the initially disenfranchised poor can contest power by threatening revolution especially when the opportunity cost is low for example during recessions the threat of revolution may force the elite to democratize democracy may not consolidate because it is redistributive and so gives the elite an incentive to mount a coup highly unequal societies are less likely to consolidate democracy and may end up oscillating between regimes and suffer substantial fiscal volatility

how to achieve full electrification lessons from latin america electricity coverage in latin america has increased substantially in recent decades rising from 50 of the population in 1970 to more than 95 in 2015 growth however slowed in the 1990s as many countries experienced difficulties in extending their networks further in particular to serve those living in isolated and rural areas in spite of this the process of electrification was not interrupted and at the beginning of the 2010s decade most countries in the region were able to provide access to electricity to almost all of their populations in this paper we examine the main strategies used in latin america to increase coverage and argue that only a combination of policy efforts has made it possible to achieve the current situation we also examine the remaining obstacles at policy and institutional levels to achieving full coverage

a comparative analysis of the costs of onshore wind energy is there a case for community specific policy support abstract there is growing policy interest in increasing the share of community owned renewable energy generation this study explores why and how the costs of community owned projects differ from commercially owned projects by examining the case of onshore wind in the uk based on cross sectoral literature on the challenges of community ownership cost differences are attributed to six facets of an organisation or project internal processes internal knowledge and skills perceived local legitimacy of the project perceived external legitimacy of the organisation investor motivation and expectations and finally project scale these facets impact not only development costs but also project development times and the probability that projects pass certain critical stages in the development process using survey based and secondary cost data on community and commercial projects in the uk a model is developed to show the overall impact of cost time and risk differences on the value of a hypothetical 500 kw onshore wind project the results show that the main factors accounting for differences are higher pre planning costs and additional risks born by community projects and suggest that policy interventions may be required to place community owned projects on a level playing field with commercial projects

higher order expectations in asset pricing we examine formally keynes idea that higher order beliefs can drive a wedge between an asset price and its fundamental value based on expected future payoffs we call this the higher order wedge which depends on the difference between higher and first order expectations of future payoffs we analyze the determinants of this wedge and its impact on the equilibrium price in the context of a dynamic noisy rational expectations model we show that the wedge reduces asset price volatility and disconnects the price from the present value of future payoffs the impact of the higher order wedge on the equilibrium price can be quantitatively large

theories of share tenancy a critical survey for the past 2 decades the problems of agricultural tenancy have attracted a great deal of attention not only from agricultural economists but also from economists in general as a typical example of agencyprincipal contract relations despite the prolific growth of literature both theoretical and empirical there has been little convergence in opinions on tenancy contracts the divergence has been especially great on the understanding of the causes and the effects of sharecropping tenancy much confusion underlying the widely divergent perspectives has stemmed from partial treatments of contractual choice which unduly limit the optimizing behavior of contracting parties and the options of contract forms this essay aims at clarifying the sources of the confusion by reviewing the past literature in light of the more general theory of agency principal relations the agency theory in order to examine the problems of various theoretical models in a unified framework in section ii we first develop the basic framework of a general model of tenancy contract in section iii we clarify in terms of the general model contradictions latent in the traditional marshallian theory which asserts that share tenancy is inefficient because of the disincentive effect of cropsharing on the tenant s work effort in section iv we attempt to show that recent efforts to reconstruct the theory based on the traditional assumption have not yet been quite successful section v draws implications and testable hypotheses from more general theories incorporating the aspects of risk and uncertainty section vi tests allocational and distributional implications of those alternative hypotheses based on the summary of evidence col

exogenous degradation in the commons field experimental evidence abstract this article presents the results from framed field economic experiments in rural colombia that aim to explore the behavioral responses of resource users to exogenous changes in the availability of a common pool resource in the first 10 rounds of the experiment all subjects played at a baseline with the same initial resource availability in the subsequent rounds the experimenters exogenously changed the resource size including mild and strong reductions in the resource size and rebounds to original size results show that subjects react to strong reductions in resource availability by increasing appropriation from the resource this behavior holds for intense and persistent as well as for progressive reductions in resource availability in addition subjects that experience a reduction in the resource availability followed by a rebound to the initial resource size appropriate more than those subjects who did not experience any change in the resource availability

do political protests matter evidence from the tea party movement can protests cause political change or are they merely symptoms of underlying shifts in policy preferences this paper studies the effect of the tea party movement in the united states which rose to prominence through a series of rallies across the country on april 15 tax day 2009 to identify the causal effect of protests we use an instrumental variables approach that exploits variation in rainfall on the day of the coordinated rallies weather on tax day robustly predicts rally attendance and the subsequent local strength of the movement as measured by donations media coverage social networking activity and later events we show that larger rallies cause an increase in turnout in favor of the republicans in the 2010 congressional elections and increase the likelihood that incumbent democratic representatives retire incumbent policymaking is affected as well representatives respond to large protests in their district by voting more conservatively in congress finally the estimates imply significant multiplier effects for every protester republican votes increase by seven to fourteen votes together our results show that protests can build political movements that ultimately affect policy and they suggest that it is unlikely that these effects arise solely through the standard channel of private information revelation

can workfare programs moderate conflict evidence from india can public interventions persistently reduce conflict adverse weather shocks through their impact on incomes have been identified as robust drivers of conflict in many contexts an effective social insurance system moderates the impact of adverse shocks on household incomes and hence could attenuate the link between these shocks and conflict this paper shows that a public employment program in india by providing an alternative source of income through a guarantee of 100 days of employment at minimum wages effectively provides insurance this has an indirect pacifying effect by weakening the link between productivity shocks and incomes the program uncouples productivity shocks from conflict leading persistently lower conflict levels

the political consequences of income shocks explaining the consolidation of democracy in france abstract this study analyzes the circumstances that enabled france to become in the late nineteenth century the first stable parliamentary democracy with universal male suffrage in europe it establishes a causal relationship between short term variations in local income and the electoral support for the coalition of republican parties that represented the newly established regime the results suggest the republican coalition won the parliamentary elections because most french regions did not suffer from transitory negative income shocks stemming from heavy precipitations they thus raise questions about the rationality of voters and ultimately the actual causes of the consolidation of democracy in france

the european union s emissions trading system this paper investigates the european union s emissions trading system eu ets which is often presented as the cornerstone of the eu s strategy for fighting climate change the paper analyses the basic design of the scheme its workings during the first trading period 2005 07 the adjustments made for the second trading period 2008 12 and its performance during the years 2008 and 2009 it also discusses the european commission s ec proposal to revise the eu ets for the period 2013 20 and the agreement reached the paper offers a critical assessment of the eu ets from a value theoretic and class based standpoint challenging mainstream accounts following the consultation and co decision processes that preceded the adoption of the eu ets directive and its amendment one reaches the conclusion that the eu ets has become the flagship of the european climate change programme because it is more conducive to the dominant eu industrial capitals that compete with non eu capitals under strenuous international market conditions the limited environmental effectiveness the windfall profits and distributional injustice that characterise the scheme from its start are pitfalls generated from the embeddedness of the scheme in the eu capitalist economies

rural electricity access in south asia is grid extension the remedy a critical review abstract despite the historical priority to grid based electrification in south asia two out of every five people in the region still live without access to electricity due to various limitations of conventional grid based rural electrification as brought out by a number of studies and reports demand for alternative models such as renewable energy based off grid and distributed generation solutions are gaining increasing attention globally however due to the absence of any study that could juxtapose these two modes in terms of their merits and demerits it is difficult to infer on their relative superiority or inferiority in view of that this paper makes an attempt to connect the dots by carrying out an extensive review of the literature to analyse the role of grid and off grid options in facilitating rural electrification and come out with a comparative assessment of their costs and impacts on the south asian countries the paper infers that instead of considering each of the modes of electrification in a standalone manner and perceiving them as mutually exclusive or competing with one another as usually perceived in the policy sphere off grid electrification can actually be considered as a complementary mode and should ideally be integrated with grid expansion to serve the bigger cause of ensuring universal and sustainable rural electrification in south asia

the role for low carbon electrification technologies in poverty reduction and climate change strategies a focus on renewable energy mini grids with case studies in nepal peru and kenya abstract as a potential poverty reduction and climate change strategy this paper considers the advantages and disadvantages of using renewable energy technologies for rural electrification in developing countries although each case must be considered independently given a reliable fuel source renewable energy mini grids powered by biomass gasifiers or micro hydro plants appear to be the favoured option due to their lower levelised costs provision of ac power potential to provide a 24 h service and ability to host larger capacity systems that can power a wide range of electricity uses sustainability indicators are applied to three case studies in order to explore the extent to which sustainable welfare benefits can be created by renewable energy mini grids policy work should focus on raising awareness about renewable energy mini grids improving institutional technical and regulatory frameworks and developing innovative financing mechanisms to encourage private sector investments establishing joint technology and community engagement training centres should also be encouraged

estimating the effects of climate shocks on collective violence ardl evidence from india this paper examines the causal relationship between climate shocks and collective violence in india using annual data over the period 1954 2006 we use the ardl bounds testing approach to deal with

property rights and the political organization of agriculture we propose a general equilibrium model where the economic organization of agriculture and the political equilibrium determining the security of property rights are jointly determined in particular because the form of organization may affect the probability and distribution of benefits from future property challenges it may be shaped in anticipation of this impact property rights security may then be secured at the expense of economic efficiency the model provides a framework for understanding why in some contexts land is redistributed primarily via land sales and tenancy markets but via politics and conflict in others we test some implications of the theory using a five decade panel dataset that traces changes in the extent of tenancy and tenancy reform across 15 indian states

taking stock of the local impacts of community owned renewable energy a review and research agenda abstract a growing literature suggests that community owned renewable energy cre projects have the potential to deliver a range of environmental and local socio economic benefits there is relatively little empirical evidence to substantiate this with few systematic efforts to assess social and environmental impacts or to understand the context in which given impacts arise in this paper we review and conceptualise the local impacts commonly cited in the literature and dissect the empirical evidence currently available to support their occurrence having assessed the quality of evidence and pinpointed knowledge gaps we draw on methodological literature to identify approaches necessary to improve our understanding of the local impacts of cre and explore their patterns of occurrence we find a lack of robust survey and statistical evidence across all the seven impact categories identified of the impacts identified empowerment and access to affordable energy are found to be the least studied in addition several impacts are associated only with specific types of community energy projects we argue that the paucity of consistent evidence for direct impacts associated with the development processes and direct outcomes of projects suggests that the most substantial local impacts result from medium to long term indirect project outcomes and the investment of project revenues in the local community as such collective funding pools and negotiation processes around their distribution towards private versus public goods play a crucial role in determining transformative local impacts of cre

weather shocks agriculture and crime evidence from india we use detailed crime agriculture and weather data from india during the years 1971 2000 to conduct a systematic analysis of the relationship between weather shocks and multiple categories of crime we find that drought and heat exert a strong impact on virtually all types of crimes that the impact on property crimes is larger than for violent crimes and that this relationship has been relatively stable over three decades of economic development we then use seasonal and geographical disaggregations of weather and agricultural cultivation to examine the prevailing hypothesis that agricultural income shocks drive the weather crime relationship in developing countries the patterns we find are consistent with this hypothesis in the case of rainfall shocks but suggest additional mechanisms may play an important role in driving the heat crime relationship consistent with evidence from industrialized countries

polarization politics and property rights links between inequality and growth most efforts to trace the effects of income inequality on growth have focused on redistribution however empirical investigation has not substantiated either the positive association of income inequality with redistribution or the negative association of redistribution with economic growth the authors analyze the effects of inequality in the broader context of social polarization they argue that social polarization whether rooted in income inequality or in ethnic tension makes large changes in current policies including those guaranteeing the security of contract and property rights more likely under a wide range of institutional arrangements the resulting uncertainties in the policy and contractual environment hinder growth they find strong empirical support for both parts of this argument the policy implications of their argument are quite distinct from those of arguments that inequality reduces growth by increasing pressures for redistribution if redistributive policies per se were to blame for the low growth resulting from inequality governments that seek to mitigate income inequality must inevitably confront a tradeoff between equity and growth if on the other hand the insecurity of property rights slows growth in unequal or otherwise polarized societies governments that commit over the long run to particular redistributive policies incur less risk of slowing economic growth fiscal redistribution that reduces inequality may actually increase growth by reducing the risks of political uncertainty

an emerging equilibrium in the eu emissions trading scheme abstract the european union s emissions trading scheme ets is the key policy instrument of the european commission s climate change program aimed at reducing greenhouse gas emissions to eight percent below 1990 levels by 2012 a critically important element of the eu ets is the establishment of a market determined price for eu allowances this article examines the extent to which several theoretically founded factors including economic growth energy prices and weather conditions determine the expected prices of the european union co 2 allowances during the 2005 through to the 2009 period the novel aspect of our study is that we examine heavily traded futures instruments that have an expiry date in phase 2 of the eu ets our study adopts both static and recursive versions of the johansen multivariate cointegration likelihood ratio test as well as a variation on this test with a view to controlling for time varying volatility effects our results are indicative of a new pricing regime emerging in phase 2 and point to a maturing market driven by the fundamentals these results are valuable both for traders of eu allowances and for those policy makers seeking to improve the design of the european union ets

modeling co2 emission allowance prices and derivatives evidence from the european trading scheme this paper studies the three main markets for emission allowances within the european union emissions trading scheme eu ets powernext nord pool and european climate exchange ecx the analysis suggests that the prohibition of banking of emission allowances between distinct phases of the eu ets has significant implications in terms of futures pricing motivated by these findings we develop an empirically and theoretically valid framework for the pricing and hedging of intra phase and inter phase futures and options on futures respectively

can access to health care mitigate the effects of temperature on mortality abstract understanding the sources of heterogeneity in the health effects of environmental exposure is critical for optimal policy design differential access to health care is commonly cited as a potential source of such heterogeneity we test this hypothesis in a causal framework by combining random year to year fluctuations in local temperatures with variation in access to primary care services resulting from the idiosyncratic roll out of community health centers chcs across us counties in the 1960s and 1970s we find that the improved access to primary care services provided by chcs moderates the heat mortality relationship by 14 2 but we find little evidence that chc access mitigates the harmful effects of cold in a supplementary analysis we find evidence that acute care in contrast to primary care may be especially effective at mitigating the cold mortality relationship our results suggest that differential access to health care does contribute to observed heterogeneity in environmental health damages and that improving access to primary care may be a useful means of mitigating harm from a warming climate

income shocks and hiv in africa we examine how variation in local economic conditions has shaped the aids epidemic in africa using data from over 200 000 individuals across 19 countries we match biomarker data on individuals serostatus to information on local rainfall shocks a large source of income variation for rural households we estimate infection rates in hiv endemic rural areas increase by 11 for every recent drought an effect that is statistically and economically significant income shocks explain up to 20 of variation in hiv prevalence across african countries suggesting existing approaches to hiv prevention could be bolstered by helping households manage income risk better the relationship between income and health has long been of interest to economists and a lengthy literature documents strong linkages between economic conditions and many important health outcomes currie 2009 there has been much less progress however in understanding the economic foundations of the hiv aids epidemic one of the most important global health challenges such an understanding might yield particular dividends in sub saharan africa ssa where over a million people continue to become newly infected with the disease each year unaids 2010 in this article we explore the role of negative income shocks in shaping the

multiple bubbles in the european union emission trading scheme abstract the european union emission trading scheme eu ets is the first large scale co 2 emission trading system in the world carbon allowances are financial assets potentially vulnerable to the behavior of traders and investors in fact the carbon price has been quite volatile since the inception of the market and it has recently hit very low values however to date no work exists to evaluate whether volatility and price spikes are due to episodes of speculation and price bubbles our paper fills this gap we use the recent approaches developed by phillips and yu 2010 phillips et al 2011 and phillips et al 2015a 2015b who propose a recursive right sided unit root approaches to detect and date stamp mildly explosive behaviors and carbon market exuberance we complement this methodology by using the wild bootstrap procedure by goncalves and kilian 2004 to control for the heteroschedasticity of carbon price data analyzing the eu ets front month contract price from 2005 to 2014 we find different episodes of price bubbles these episodes are not explained by similar behavior of the fundamentals but seem related to energy and environmental policy announcements our results can provide insightful policy implications in the context of the actual carbon market reform as well as the implementation of stricter financial regulations rules to co 2 trading

a new data set measuring income inequality this article presents a new data set on inequality in the distribution of income the authors explain the criteria they applied in selecting data on gini coefficients and on individual quintile groups income shares comparison of the new data set with existing compilations reveals that the data assembled here represent an improvement in quality and a significant expansion in coverage although differences in the definition of the underlying data might still affect inter temporal and international comparability based on this new data set the authors do not find a systematic link between growth and changes in aggregate inequality they do find a strong positive relationship between growth and reduction of poverty

growth and violence argument for a per capita measure of civil war the economics literature typically uses counts of casualties as a measure of conflict intensity despite the fact that the units of observation vary considerably in population size when analysing the impact of conflict on economic growth the use of counts relies on the assumption that a given number of casualties affects large and small populations in the same way using within and between country evidence this paper demonstrates that this standard assumption can be rejected a per capita model of conflict intensity that captures local effects of violence provides a more consistent empirical framework for both between country and within country studies

conflict and distribution abstract we develop a behavioral model that links the level and pattern of social conflict to the societywide distribution of individual characteristics the model can be applied to groups that differ in characteristics such as wealth ethnicity religion and political ideology we settle questions of existence and uniqueness of conflict equilibrium conflict is seen to be closely connected with the bimodality of the underlying distribution of characteristics however in general the conflict distribution relationship is nonlinear and surprisingly complex our results on conflict patterns also throw light on the phenomena of extremism and moderation journal of economic literature classification numbers d63 d72 d74

allowance price drivers in the first phase of the eu ets abstract in the first phase of the eu emissions trading scheme eu ets the price per ton of co 2 initially rose to over 30 the price then collapsed to essentially zero by mid 2007 by deriving a structural model of the allowance price under the assumption of efficient markets i examine the extent to which this variation in price can be explained by marginal abatement costs i then gradually relax the model by allowing for delayed adjustment of price to fundamentals as well as by introducing lagged lhs variables the pattern of results suggests that while prices were not initially driven by marginal abatement costs this inefficiency was largely corrected after the accounting of 2005 emissions in april 2006

climate instability urbanisation and international migration abstractthis paper focuses on climate induced migration we construct a simple theoretical model where in a first step climate shocks accelerate the transition from the traditional to the modern sector leading rural workers to move to urban centres within national borders while in a second step downward pressures on wages due to the greater labour supply in cities push people to engage in international migration to test this hypothesis we exploit a rich panel dataset displaying a representative picture of bilateral migration flows and climatic data across 222 countries for the period 1960 2000 findings suggest that in the next few years the climate induced growth rate of migrant stocks might be in a range between 8 6 per cent and 12 8 per cent especially from developing countries where the level of rural employment is more likely to be affected by climatic shocks

the political economy of government responsiveness theory and evidence from india the determinants of government responsiveness to its citizens is a key issue in political economy here we develop a model based on the solution of political agency problems having a more informed an politically active electorate strengthens incentives for governments to be responsive this suggests that there is a role both for democratic institutions and the mass media in ensuring that the preferences of citizens are reflected in policy the ideas behind the model are tested on panel data from india we show that public food distribution and calamity relief expenditure are greater controlling for shocks where governments face greater electoral accountability and where newspaper circulation is highest

the need for competition between decentralized governance approaches for data exchange in smart electricity grids fiscal federalism vs polycentric governance abstract the institutional framework of the electricity sector is challenged by digitalization with smart metering data on energy consumption and production becomes available information management shall secure the efficient exchange of this data e g from smart metering in smart grids currently national as well as regional governance approaches for information management systems are being developed we discuss how the scale and scope of an information management system has an influence on the level of innovation in the process of the data exchange we define information management as a club good and apply the insights from the theory of fiscal federalism we conclude that neither of the extremes of national central and decentralized governance approaches for information management will be optimal rather we identify the need of polycentric governance approaches that compete with each other to define the optimal degree of decentralization

causes of the eu ets price drop recession cdm renewable policies or a bit of everything new evidence the price of eu allowances euas in the eu emissions trading scheme eu ets fell from almost 30 tco2 in mid 2008 to less than 5 tco2 in mid 2013 the sharp and persistent price decline has sparked intense debates both in academia and among policy makers about the decisive allowance price drivers in this paper we examine whether and to what extent the eua price drop can be justified by three commonly identified explanatory factors the economic recession renewable policies and the use of international credits capitalizing on marginal abatement cost theory and a broadly extended data set we find that only variations in economic activity and the growth of wind and solar electricity production are robustly explaining eua price dynamics contrary to simulation based analyses our results point to moderate interaction effects between the overlapping eu ets and renewable policies the bottom line however is that 90 of the variations of eua price changes remains unexplained by the abatement related fundamentals together our findings do not support the widely held view that negative demand shocks are the main cause of the weak carbon price signal in view of the new evidence we evaluate the eu ets reform options which are currently discussed

carbon price drivers phase i versus phase ii equilibrium abstract the aim of this paper is to investigate the determinants of the carbon price during the two phases of the european union emission trading scheme eu ets more specifically relying on daily eu allowance futures contracts we test whether the carbon price drivers identified for phase i still hold for phase ii and evolve toward a long run relationship using cointegration techniques and accounting for the 2006 structural break in the carbon market we show that while a cointegrating relationship exists for both phases of the eu ets the nature of this equilibrium relationship is different across the two subperiods with an increasing role of fundamentals in phase ii deriving equilibrium values we show that the carbon price tends to be undervalued since the end of 2009

roles and potentials of renewable energy in less developed economies the case of nepal increasing the share of renewable energy in the national energy mix remains one of the major energy policy goals across many economies this paper assesses the roles and potentials of renewable energy sources in less developed economies while citing nepal as an example renewable energy has a significant role to play in the electrification of rural areas in developing economies and contribute towards sustainable development realizing full potentials of renewable however requires addressing both the associated demand side and supply side constraints innovative subsidies and tax incentives adequate entrepreneurial support strengthening institutional arrangement and promoting local community based organizations such as the cooperatives are the necessary factors in promoting the green technologies in countries like nepal international factors such as large scale investment and adequate technology transfer are equally crucial to create a rapid spread and increase affordability of decentralized renewable energy technologies in less developed economies

the effects of weather induced migration on sons of the soil riots in india migration is thought to cause sons of the soil conflict particularly if natives tend to be unemployed using data from india the authors investigate the causal effect of domestic migration on riots by instrumenting for migration using weather shocks in migrants places of origin they find a direct effect of migration on riots but do not find that this effect is larger in places with more native unemployment they argue and find evidence that migration is less likely to cause rioting where the host population is politically aligned with the central government politically privileged host populations can appease nativists and reduce migration through means that are less costly than rioting without these political resources hosts resort to violence beyond furthering the sons of the soil literature the authors detail a political mechanism linking natural disasters and possibly climate change and environmental degradation to riots and demonstrate a widely applicable strategy for recovering the causal effect of migration on violence

collective action and the group size paradox according to the olson paradox larger groups may be less successful than smaller groups in furthering their interests we address the issue in a model with three distinctive features explicit intergroup interaction collective prizes with a varying mix of public and private characteristics and nonlinear lobbying costs the interplay of these features leads to new results when the cost of lobbying has the elasticity of a quadratic function or higher larger groups are more effective no matter how private the prize with smaller elasticities a threshold degree of publicness is enough to overturn the olson argument and this threshold tends to zero as the elasticity approaches the value for a quadratic function we also demonstrate that these results are true irrespective of whether we examine group sizes over the cross section in some given equilibrium or changes in the size of a given group over different equilibria

world bank gef solar home systems projects experiences and lessons learned 1993 2000 abstract twelve projects provide energy services to off grid rural households in developing countries by enhancing markets for solar home systems and by removing barriers to their dissemination project approaches are reviewed along with early implementation experience and lessons suggested by experience most projects incorporate the following features pilot private sector and ngo delivery models pilot consumer credit delivery mechanisms pay first cost subsidies and offer affordable system sizes support policy development and capacity develop codes and standards and establish certification testing and enforcement institutions and conduct consumer awareness and marketing programs most projects are just beginning implementation a few are almost completed lessons from early experience suggest that solar home system delivery firms face a myriad of difficulties operating in rural areas credit risk is a serious concern of both financiers and dealers and makes credit sales particularly challenging technical performance of systems is becoming well proven customers desire a range of component options and service levels and can benefit from even small systems projects must recognize the link between rural electric grid extension and solar home system demand and marketing campaigns can be extremely costly and time consuming in rural areas challenges are to demonstrate sustainable and replicable business models develop regulatory models for energy service concessions and integrate rural electrification policy with solar home system delivery

using weather variability to estimate the response of savings to transitory income in thailand this paper measures the extent to which farmers are able to use savings and dissavings to smooth consumption in response to unexpected shocks to income time series information on regional rainfall is used to construct estimates of transitory income due to rainfall shocks the relationship between these measures of transitory income and savings indicates that farm households save a significantly higher fraction of transitory income than nontransitory income jel d91 016 the incomes of farm households in developing countries are notorious for being both low and uncertain policies that increase the incomes of farmers may well be different

the asymmetric relationships between pollution energy use and oil prices in vietnam some behavioural implications for energy policy making abstract with rapidly expanding real gdp in vietnam it is anticipated that the vietnamese energy production will increase to meet its rising energy consumption an important corollary is that pollution will also rise since the energy sector is considered a big polluter in the developing world this paper brings two important insights to this literature first and foremost this paper seeks to establish if any behavioural biases of policy makers have clouded the decision to adopt suitable energy technologies and policies in vietnam with far reaching consequences for sustainability in the region secondly in order to detect behavioural biases it considers the asymmetric effects of increases vis a vis decreases in regressors by using the non linear autoregressive distributed lags nardl models to examine how such increases or decreases really impact on pollution in vietnam using annual data from 1982 to 2015 the analysis finds that the long run relationships between pollution energy use and oil prices have been characterised by non linear and asymmetric interlinkages to indicate hidden cointegration we further argue that such hidden cointegration can signal important behavioural biases in energy policy making

the implementation of decentralised biogas plants in assam ne india the impact and effectiveness of the national biogas and manure management programme abstract the indian government s national biogas and manure management programme nbmmp seeks to deliver renewable energy services to households across the country by facilitating the deployment of family sized 3 anaerobic biogas digesters nbmmp policy is implemented at three levels from government and state nodal agency via private contractors to households creating multiple institutional arrangements we analysed the scheme in assam north east india focusing on how policy was implemented across two districts and interviewing stakeholders in rural households state and non state institutions the top down supply side approach to policy enables government to set targets and require individual states to deploy the scheme which benefits households who can afford to participate nbmmp delivered improved energy service outcomes to a majority of households although the level of knowledge and understanding of the technology amongst users was limited training and education of householders and particularly women is needed in relation to the maintenance of digesters feedstock suitability and the environmental and potential livelihood benefits of digestate a revised bottom up approach to policy which highlights the contextual and demand side issues around adopting the technology may deliver monetary benefits from market competition and enable development of community focused microfinance schemes to improve the affordability of biogas systems

aviation lock in and emissions trading mainstream economists tend to take a positive view of the role that markets play in solving environmental problems for them environmental problems arise because of missing markets and require the generation of new markets internalising externalities and allowing agents preferences to be registered properly in or through the market this paper provides an illustration of how misguided this basic approach to environmental problems can be specifically the focus of the paper is upon the problem of aviation emissions and the policy solution most prominently advocated to mitigate them emissions trading adopting this focus shows the limitations of a pivotal though largely unacknowledged assumption of mainstream perspectives on environmental problems namely that all emissions and indeed costs are assumed to be equivalent in other words it does not matter how particular emissions come about or what the long term structural conditions are that are faced by any particular emitter however once a focus upon dynamic interdependencies and trajectories of systems is adopted rather than the usual preoccupation with short term maximisation behaviour it becomes clear that in the case of aviation at least emissions trading is most likely to exacerbate an already worrying problem copyright oxford university press

what causes violent crime this study uses panel data of intentional homicide and robbery rates for a sample of developed and developing countries for the period 1970 1994 based on information from the united nations world crime surveys to analyze the determinants of national crime rates both across countries and over time a simple model of the incentives to commit crimes is proposed which explicitly considers possible causes of the persistence of crime over time criminal inertia a panel data based gmm methodology is used to estimate a dynamic model of national crime rates this estimator controls for unobserved country speci ce ects the joint endogeneity of some of the explanatory variables and the existence of some types of measurement errors a icting the crime data the results showthat increases in income inequality raise crime rates crime tends to be countercyclical and criminal inertia is signi cant 2002 elsevier science b v all rights reserved

carbon markets 15 years after kyoto lessons learned new challenges abstract carbon markets are substantial and they are expanding there are many lessons from market experiences over the past eight years there should be fewer free allowances better management of market sensitive information and a recognition that trading systems require adjustments that have consequences for market participants and market confidence moreover the emerging market architecture features separate emissions trading systems serving distinct jurisdictions and a variety of other types of policies exist alongside the carbon markets this situation is in sharp contrast to the top down integrated global trading architecture envisioned 15 years ago by the designers of the kyoto protocol and raises a suite of new questions in this new architecture jurisdictions with emissions trading have to decide how whether and when to link with one another stakeholders and policymakers must confront how to measure the comparability of efforts among markets as well as relative to a variety of other polic

access to electricity in small island developing states of the pacific issues and challenges abstract energy poverty is widespread in small island developing states sids of the pacific it is estimated that 70 percent of pacific islander households do not have access to electricity which is equivalent to access rates in sub saharan africa and slightly below the average for low income countries pacific sids face unique challenges in expanding access to electricity given that their populations are spread across tens of thousands of islands governments and development partners in pacific sids continue to prioritise development of electricity grids as is evident in ongoing subsidisation of grid based power consumption and the establishment of ambitious grid based renewable energy targets this paper argues that traditional approaches to rural electrification which prioritise grid extension are not suited to the pacific islands region increased funding should be directed by both governments and development partners towards rural electrification especially in off grid areas where isolated systems are more appropriate institutional reform is also important regulatory reform is needed for power utilities to extend electricity grids into rural areas institutional arrangements that facilitate the sustainable operation and maintenance of off grid systems also need to be established past donor and government funded off grid rural electrification projects have rarely been sustainable alternative approaches involving payment of output based subsidies to energy service companies are worth exploring although will only succeed where sound regulatory arrangements are in place

rural electrification policy and institutional linkages some of the problems that have besieged rural electrification in most developing countries include inadequate policies weak institutional frameworks and limited financing in the last two decades governments in developing countries have been making various efforts both at the policy level and in financing to facilitate increased levels of rural electrification however the introduction of market based reforms in the power sector in the last decade has affected the institutional and financing arrangements for rural electrification the reforms have also affected the rate of electrification and affordability of electricity there is need therefore to establish the extent to which the reforms have affected access and affordability of electricity in rural areas and to develop appropriate policy and the supporting institutional structures to align rural electrification with reformed power sectors it is cardinal to establish how privatised and commercialised power companies in a reformed power sector could contribute to rural electrification and the role of governments and government agents in facilitating expanded access to electricity in rural areas

implications of an economic theory of conflict hindu muslim violence in india we model intergroup conflict driven by economic changes within groups we show that if group incomes are low increasing group incomes raises violence against that group and lowers violence generated by it we then apply the model to data on hindu muslim violence in india our main result is that an increase in per capita muslim expenditures generates a large and significant increase in future religious conflict an increase in hindu expenditures has a negative or no effect these findings speak to the origins of hindu muslim violence in post independence india

risk financial markets and human capital in a developing country this paper explores the link between financial market incompleteness and human capital accumulation we examine how child school attendance responds to seasonal fluctuations in the income of agrarian households using panel data from rural india to pinpoint market imperfections we study responses to aggregate and idiosyncratic as well as to anticipated and unanticipated income shocks our main finding is that seasonal fluctuations in school attendance are a form of self insurance but one which does not result in a substantial loss of human capital on average

beauty contests and iterated expectations in asset markets in a financial market where traders are risk averse and short lived and prices are noisy asset prices today depend on the average expectation today of tomorrow s price thus iterating this relationship the date 1 price equals the date 1 average expectation of the date 2 average expectation of the date 3 price this will not in general equal the date 1 average expectation of the date 3 price we show how this failure of the law of iterated expectations for average belief can help understand the role of higher order beliefs in a fully rational asset pricing model and explain over reaction to noisy public information

the economics of water scarcity and variability does the availability or variability of water matter for the economy does it meaningfully impact the growth and development trajectory of a country it may seem surprising that answers to these most basic of questions remain elusive the aim of this paper is to summarize recent work on the economic impacts of water scarcity and variability the paper finds that there is strong evidence that variations in rainfall and water availability have significant impacts on particular sectors such as agriculture human capital and even conflict but paradoxically evidence of impacts on economic growth and other measures of aggregate economic activity remains ambiguous the paper explains reasons for this anomaly and explores the pathways through which water impacts the economy the paper provides a synthesis of key developments in the literature identifies methodological gaps and suggests policy solutions

selling labor low wage responses to productivity shocks in developing countries productivity risk is pervasive in underdeveloped countries this paper highlights a way in which underdevelopment exacerbates productivity risk productivity shocks cause larger changes in the wage when workers are poorer less able to migrate and more credit constrained because of such workers inelastic labor supply this equilibrium wage effect hurts workers in contrast it acts as insurance for landowners agricultural wage data for 257 districts in india for 1956 87 are used to test the predictions with rainfall as an instrument for agricultural productivity in districts with fewer banks or higher migration costs the wage is much more responsive to fluctuations in productivity

an integrated framework for rural electrification adopting a user centric approach to business model development rural electrification re has gained prominence over the past two decades as an effective means for improving living conditions this growth has largely been driven by socio economic and political imperatives to improve rural livelihood and by technological innovation based on a content analysis of 232 scholarly articles the literature is categorized into four focal lenses technology institutional viability and user centric we find that the first two dominate the re debate the viability lens has been used less frequently whilst the user centric lens began to engage scholars as late as 2007 we provide an overview of the technological institutional and viability lenses and elaborate upon the user centric lens in greater detail for energy policy and practice we combine the four lenses to develop a business model framework that policy makers practitioners and investors could use to assess re projects or to design future rural electrification strategies

take what you can property rights contestability and conflict weak property rights are strongly associated with underdevelopment low state capacity and civil conflict in economic models of conflict outbreaks of violence require a prize that is both valuable and contestable this paper exploits spatial and temporal variation in the availability of land with title that is contestable by private actors to explore the relationship between in secure property rights and civil conflict in the brazilian amazon the results suggest that resolving this contestability of title at the local level could eliminate substantively all local land related violence but might increase conflict in areas where title remained contestable

distributive politics and economic growth a crude distinction between economics and politics would be that economics is concerned with expanding the pie while politics is about distributing it in this paper we analyze the relationship between the two we focus on how an economy s initial configuration of resources shapes the political struggle for income and wealth distribution and how that in turn affects long run growth our main conclusion is that inequality is conducive to the adoption of growth retarding policies we derive this result from a simple political economy model of growth and present cross country evidence consistent with it the key feature of our model is that individuals differ in their relative factor endowments we distinguish between two types of factors an accumulated factor called capital and a nonaccumulated factor called labor growth is driven by the expansion of the capital stock which is in turn determined by individual saving decisions long run growth is endogenous as the aggregate production function is taken to be linearly homogeneous in capital and productive government services taken together the provision of government services is financed by a tax on capital because government services are productive a small tax on

swords or plowshares a theory of the security of claims to property this paper develops a general equilibrium model of the allocation of resources among appropriative and productive activities the model emphasizes the distinction between offensive weapons which are the instruments of predation and fortifications which provide defense against predation the analysis of this model shows how the equilibrium security of claims to property is determined the analysis focuses on the possibility of a nonaggressive equilibrium in which no resources are allocated to offensive weapons and claims to property are fully secure we also analyze the complex relation between economic welfare and the security of claims to property we find for example that a relatively poor agent could be better off in an equilibrium with less secure claims to property

rural electrification under liberal reforms the case of peru abstract liberal reform programmes in developing countries were not designed with the need to extend electricity supplies to rural areas this paper focuses on the peruvian experience examining the impact of electricity reform policies on the characteristics of rural electrification in rural areas electrification levels have traditionally been the lowest in the country making them less or non profitable for private firms only in 2002 did the government introduce a specific rural electrification law which was intended to promote electrification within the context of a liberalised market this paper draws upon an analysis of both this piece of legislation and stakeholder interviews indicating that there exists a need to look further into the evolving relationship between the private and public sectors and how it affects the rural poor this study forms part of the resurl international research project on renewable energy for sustainable rural livelihoods in developing countries funded by the uk government s department for international development dfid

land inequality and conflict intensity this paper investigates the impact of land inequality on conflict intensity a fundamental distinction with the existing literature lies in the nature of inequality under consideration we investigate how land inequality across landlords only influences the intensity of the fight against a rebel group comprised of landless individuals we show that conflict intensity is non monotonic in land inequality in particular the most severe conflicts occur for intermediate land inequality levels moreover a pareto improving and thus voluntary transfer of land from the smaller to the larger landlord may exist

economic shocks and crime evidence from the crash of ponzi schemes abstract in november 2008 colombian authorities dismantled a network of ponzi schemes making hundreds of thousands of investors lose tens of millions of dollars throughout the country using original data on the geographical incidence of the ponzi schemes this paper estimates the impact of their breakdown on crime we find that the crash of ponzi schemes differentially exacerbated crime in affected districts confirming the intuition of the standard economic model of crime this effect is only present in places with relatively weak judicial and law enforcement institutions and with little access to consumption smoothing mechanisms such as microcredit in addition we show that with the exception of economically motivated felonies such as robbery violent crime is not affected by the negative shock

poverty and crime in 19th century germany we estimate the impact of poverty on crime in 19th century bavaria germany rainfall is used as an instrumental variable for grain rye prices to address econometric identification problems in the existing literature the rye price was a major determinant of living standards during this period the rye price has a positive effect on property crime a one standard deviation increased property crime by 8 ols estimates are twice as large as instrumental variable estimates highlighting the value of our empirical approach higher rye prices lead to significantly less violent crime though and we argue that higher beer prices caused by the higher rye prices are a likely explanation