stopping agents from cheating abstract when a principal hires two or more agents to work in a correlated environment each agent s reward will depend on the other s performance unfortunately with just the usual optimal incentive constrained contracts being offered the agents strictly prefer to play equilibrium strategies other than those desired by the principal they cheat however the principal can use a more subtle contractual mechanism to stop them from cheating at no extra cost this mechanism uses one agent to police the other and exploits certain properties of the optimal contracts

the expansion of modern agriculture and global biodiversity decline an integrated assessment the world is banking on a major increase in food production if the dietary needs and food preferences of an increasing and increasingly rich population are to be met this requires the further expansion of modern agriculture but modern agriculture rests on a small number of highly productive crops and its expansion has led to a significant loss of global biodiversity ecologists have shown that biodiversity loss results in lower plant productivity while agricultural economists have linked biodiversity loss on farms with increasing variability of crop yields and sometimes lower mean yields in this paper we consider the macro economic consequences of the continued expansion of particular forms of intensive modern agriculture with a focus on how the loss of biodiversity affects food production we employ a quantitative structurally estimated model of the global economy which jointly determines economic growth population and food demand agricultural innovations and land conversion we show that even small effects of agricultural expansion on productivity via biodiversity loss might be sufficient to warrant a moratorium on further land conversion

biofuel investment in tanzania omissions in implementation abstract increasing demand for biofuels as a component of climate change mitigation energy security and a fossil fuel alternative attracts investors to developing countries like tanzania ample unused land is critical for first generation biofuels production and an important feature to attract foreign direct investments that can contribute towards agricultural modernization and poverty reduction initiatives despite the economic justifications the existing institutional and infrastructural capacities dictate the impacts of biofuels market penetrations furthermore exogenous factors like global recessionary pressure depressed oil prices below the level at which biofuel production were profitable in 2007 making tanzania s competitiveness and potential benefits questionable this paper investigates the extent that first generation jatropha based biofuels industry development in tanzania observed during fieldwork in kisarawe and bahi may fulfill policy objectives this paper argues that without strong regulatory frameworks for land investment management and rural development biofuel industrialization could further exacerbate poverty and food insecurity in tanzania the paper concludes with policy recommendations for first generation biofuel development while keeping in mind implications of second generation production since the topic is broad and multifaceted a multidisciplinary approach is used that includes political institutional and agricultural economics to analyze and conceptualize biofuel industry development and food security

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

public attitudes toward political and technological options for biofuels abstract this paper explores detailed public attitudes regarding the expanding range of biofuels technologies and policy options subjects from 34 in depth focus groups in central indiana were fairly knowledgeable about biofuels technologies but uninformed about biofuels policies despite being from a state where biofuels are a salient political issue a narrow majority was supportive of biofuels in general but expressed greater enthusiasm about second generation biofuels subject beliefs about biofuels economic and environmental impacts were most important in shaping these opinions rather than concerns about energy independence or other issues in terms of policy options subjects were most supportive of an alternative fuels standard and least supportive of a fixed subsidy and a cap and trade policy in contrast to arguments about technologies participants primarily framed their attitudes toward policies in terms of fairness although discussion did not substantially change aggregate preferences for most policies it did increase support significantly for at least one policy proposal a variable subsidy for ethanol it is particularly noteworthy that subjects generally did not support the most common biofuel technology corn based ethanol or the most prominent biofuels policy option the fixed subsidy despite residing in a state hosting a strong corn industry and staunch political advocates for both positions

labeling renewable energies how the language surrounding biofuels can influence its public acceptance abstract despite growing interest and investments in biological fuels little is known of how the public form opinions toward this alternative fuel technology this study examines public opinion of biofuels by focusing on several factors that can be expected to influence citizens opinions about the issue first we tested the results of a framing experiment that was embedded within a public opinion survey this experiment explored how the public responded to the term biofuels as compared to the term ethanol our results suggest that overall respondents tended to react more favorably to the former as opposed to the latter term second we examined the impacts of sociodemographics on public attitudes toward biofuels we found that while sociodemographics did little to consistently explain attitudes toward biofuels there was clear evidence of ideological influences on attitudes with self identifying democrats showing more positive attitudes overall finally we explored the interaction between political partisanship and our experimental manipulation we found evidence that our wording manipulation differed based on the political party identification of our respondents with democrats fluctuating greatly in their assessments depending upon whether they were asked to evaluate biofuels or ethanol

multidimensional incentive compatibility and mechanism design abstract incentive compatibility conditions are characterized in general for problems in which several goods are to be allocated and agents types are multidimensional two questions of monopoly pricing under multidimensional uncertainty are then analyzed first we find the optimal nonlinear pricing scheme when the monopolist knows only the distribution of an arbitrarily parameterized family of demand curves and second we solve for the optimal bundling policy for a multiproduct monopolist

incentive schemes with multiple agents and bankruptcy constraints abstract we explore the effects of bankruptcy constraints on incentive schemes when two risk neutral agents operate in correlated environments our focus is on the subgame equilibrium in which each agent is induced via a direct mechanism to truthfully reveal his private information as a nash response to truth telling by his counterpart we identify a class of examples in which in contrast to the case where the agents are risk averse the nash constraints induce a subgame dominant strategy equilibrium thus implementation via direct mechanisms is feasible for this class more generally however the truth telling nash equilibrium may be subgame dominated so the question of implementation via direct mechanisms remains a delicate one

community perspectives of wind energy in australia the application of a justice and community fairness framework to increase social acceptance decisions concerning the siting of infrastructure developments or the use of natural resources have the potential to damage a community s social well being if the outcomes are perceived to be unfair justice is accepted as central to the well functioning of society with fairness being an expectation in day to day interactions outcomes that are perceived to be unfair can result in protests damaged relationships and divided communities particularly when decisions are made which benefit some sections of the community at the perceived expense of others through empirical research using a wind farm pilot study community perceptions of a community consultation process are explored using procedural justice principles to evaluate fairness findings from the pilot study indicate that perceptions of fairness do influence how people perceive the legitimacy of the outcome and that a fairer process will increase acceptance of the outcome a key research finding was that different sections of a community are likely to be influenced by different aspects of justice namely by outcome fairness outcome favourability and process fairness based on this finding a community fairness framework was developed which has potential application in community consultation to increase social acceptance of the outcome

public acceptance of biofuels abstract the public acceptance of biofuels in greece is examined in this work the analysis of 571 face to face interviews shows that 90 7 of the respondents believe that climatic changes are related to fossil fuel consumption while only 23 8 know the difference between biodiesel and bioethanol 76 1 believe that energy saving should precede the use of an alternative source of energy only 27 3 believe that priority must be given to biofuels over other renewable energy sources only 49 9 think that the use of biofuels can be an effective solution against climatic changes and 53 9 believe that the use of biofuels can be an effective solution for the energy problem finally 80 9 of the car owners are willing to use biofuels 44 8 are willing to pay the supplementary amount of 0 06 l of the fuel market price while the average amount reported as willing to pay was 0 079 l on top of the fuel market price furthermore eight models correlating the eight main responses with several socioeconomic variables are developed and analyzed those findings heave important policy implications related to the use and promotion of biofuels

implementation of biofuels in malaysian transportation sector towards sustainable development a case study of international cooperation between malaysia and japan abstract modern transportation nowadays has evolved into an important economic activity for human civilisation even though various alternative energy solutions have been put forward to reduce the dependency on fossil fuels biofuels remain one of the few options which are capable of replacing the roles of fossil fuels in transportation sector without suffering from major economic losses malaysia with a huge supply of palm oil for biofuels production is intended to implement mandatory biodiesel blends in its transportation sector in 2011 in order to achieve its carbon reduction commitment towards a more sustainable development this implementation was originally targeted to start in 2009 but had to be postponed due to several obstacles such as expensive cost lack of sufficient infrastructure and low public demand on the other hand japan is also trying to fulfil its carbon reduction obligation as outlined under kyoto protocol with the usage of biofuels to replace fossil fuels in the transportation sector however it lacks sufficient biofuels supply to support its high transportation energy demand in this case study the mutual cooperation between malaysia and japan in the implementation of biofuels in transportation sector will be studied and analysed in order to overcome the challenges presented in both countries it is hope to ascertain potential cooperation opportunities amongst those two countries to promote biofuels energy as malaysia is rich in natural resources whilst japan has the relevant expertise and technology it is believed that the strengths from one country can help to cover for the weaknesses from the other and vice versa via closer bilateral partnership which will be extremely crucial when dealing with global energy issues ultimately it is hope that this case study will enable both malaysian and japanese government to achieve their renewable energy target in domestic transportation sector

regulating a monopolist with unknown costs we consider the problem of how to regulate a monopolistic firm whose costs are unknown to the regulator the regulator s objective is to maximize a linear social welfare function of the consumers surplus and the firm s profit in the optimal regulatory policy prices and subsidies are designed as functions of the firm s cost report so that expected social welfare is maximized subject to the constraints that the firm has nonnegative profit and has no incentive to misrepresent its costs we explicitly derive the optimal policy and analyze its properties in their classic papers dupuit 2 and hotelling 5 considered pricing policies for a bridge that had a fixed cost of construction and zero marginal cost they demonstrated that the pricing policy that maximizes consumer well being is to set price equal to marginal cost and to provide a subsidy to the supplier equal to the fixed cost so that a firm would be willing to provide the bridge this first best solution is based on a number of informational assumptions first the demand function is assumed to be known to both the regulator and to the firm while the assumption of complete information may be too strong the assumption that information about demand is as available to the regulator as it is to the firm does not seem unnatural a second informational assumption is that the regulator has complete information about the cost of the firm or at least has the same information about cost as does the firm this assumption is unlikely to be met in reality since the firm would be expected to have better information about costs than would the regulator as weitzman has stated an essential feature of the regulatory environment i am trying to describe is uncertainty about the exact specification of each firm s cost function in most cases even the managers and engineers most closely associated with production will be unable to precisely specify beforehand the cheapest way to generate various hypothetical output levels because they are yet removed from the production process the regulators are likely to be vaguer still about a firm s cost function 12 p 684 as this observation suggests it is natural to expect that a firm would have better information regarding its costs than would a regulator the purpose of this paper is to develop an optimal regulatory policy for the case in which the regulator does not know the costs of the firm one strategy that a regulator could use in the absence of full information about costs is to give the firm the title to the total social surplus and to delegate the pricing decision to the firm in pursuing its own interests which would then be to maximize the total social surplus the firm would adopt the same marginal cost pricing strategy that the regulator would have imposed if the regulator had

conceptualizing the acceptance of wind and solar electricity drawing from research interviews and the academic literature this article conceptualizes the conditions that promote investor confidence and the social acceptance of wind and solar sources of electricity it explores the factors influencing the acceptance of commercial wind turbines in denmark and india and residential solar panels in germany and the united states the article begins by justifying its selection of case studies and explaining the methodology behind its research interviews and field visits it then summarizes some of the key findings in recent surveys of public attitudes and market acceptance concerning renewable energy with a focus on why some investors and communities reject wind and solar systems whereas others rapidly approve and adopt them the article proposes that acceptance has multiple dimensions socio political community and market that must be met holistically in order for investors and users to embrace renewable energy the article argues that acceptance hinges upon the prevalence of nine factors the lack of such factors creates environments where they are rejected the theory is tested against four case studies that explore the forces driving renewable energy in denmark germany india and the united states

external governance and the eu policy for sustainable biofuels the case of mozambique growing demand for transport biofuels in the eu is driving an expansion of the industry in developing countries large scale production of energy crops for biofuel if mismanaged could cause detrimental environmental and social impacts the aim of this study is to examine whether the newly adopted eu directive 2009 28 ec and its sustainability certification system can effectively ensure sustainable production of biofuels outside the eu mozambique a least developed country with biofuels ambitions is selected as empirical case the effectiveness of the eu policy in analysed employing ideal models of external governance hierarchical market and network governance as analytical framework the findings show that the eu attempts to impose its rules and values on sustainable biofuels using its leverage through trade the market approach adopted by the eu is expected to produce only unstable subject to abrupt changes of market prices and demand and thin limited to climate and biodiversity issues policy results stronger emphasis on a network oriented approach based on substantial involvement of foreign actors and on international policy legitimacy is suggested as a way forward

the development of the renewable energy power industry under feed in tariff and renewable portfolio standard a case study of china s wind power industry abstract among the regulatory policies feed in tariffs fit and renewable portfolio standards rps are the most popular to promote the development of renewable energy power industry this paper uses system dynamics sd to establish models of long term development of the renewable energy power industry under fit and rps schemes and provides a case study of china s wind power industry by using scenario analysis method the model on the one hand not only clearly shows the complex logical relationship between the factors but also reveals the process of coordination between the two policy tools in the development of the renewable energy power industry on the other hand it provides a reference for scholars to study similar problems in different countries thereby facilitating an understanding of the renewable energy power s long term sustainable development pattern under fit and rps schemes and helping to provide references for policy making institutions the results show that the integrate implementation of fit and rps can promote long term and rapid development of china s wind power industry given the constraints and actions of the mechanisms of rps quota proportion the tradable green certificates tgc valid period and fines in addition in the period of the construction of the tgc market rps quota growth rate and fine have a no significant effect on industrial development however with tgc market game becoming more and more fierce both of them have a significant positive impact on the long term development of the industry tgc valid period has little effect on industrial development in our study at the end of the paper policy implications are offered as references for the government

social acceptance of renewable energy innovation an introduction to the concept this paper introduces the special issue on social acceptance of renewable energy innovation it is a collection of best papers presented at an international research conference held in tramelan switzerland in february 2006 while there are ambitious government targets to increase the share of renewable energy in many countries it is increasingly recognized that social acceptance may be a constraining factor in achieving this target this is particularly apparent in the case of wind energy which has become a subject of contested debates in several countries largely due to its visual impact on landscapes this paper introduces three dimensions of social acceptance namely socio political community and market acceptance factors influencing socio political and community acceptance are increasingly recognized as being important for understanding the apparent contradictions between general public support for renewable energy innovation and the difficult realization of specific projects the third dimension market acceptance has received less attention so far and provides opportunities for further research particularly from management scholars

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

a theory of yardstick competition in the typical regulatory scheme a franchised monopoly has little incentive to reduce costs this article proposes a mechanism in which the price the regulatedfirm receives depends on the costs of identical firms in equilibrium each firm chooses a socially efficient level of cost reduction the mechanism generalizes to cover heterogeneous firms with observable differences medicare s prospective reimbursement of hospitals by using diagnostically related groups is a scheme very similar to the one outlined here

social impacts of community renewable energy projects findings from a woodfuel case study there is much current interest in the potential of community based renewable energy projects to contribute to transition towards low carbon energy systems as well as displacing fossil fuel consumption by increasing renewable energy generation projects are expected to have a range of social impacts which may result in additional positive sustainability outcomes these include potential to increase acceptance of renewable energy developments awareness of renewable and sustainable energy technologies and issues uptake of low carbon technologies and sustainable pro environmental behaviours to date however there has been little investigation of whether and how these impacts occur this paper presents results from qualitative research investigating the social impacts of a community woodfuel project as experienced by project participants and other local stakeholders findings show projects can raise awareness of renewable energy technologies and increase uptake of renewables overall the case study project successfully changed the local social context for development of woodfuel heating reducing risk for all involved in the future development of this sector particularly in the immediate locality there was some evidence of increased engagement with wider sustainability issues but this was limited to direct participants suggesting local projects need to be supported by wider systemic change to maximise impacts

consumer choice between ethanol and gasoline lessons from brazil and sweden the introduction of flex fuel vehicles since 2003 has made possible for brazilian drivers to choose between high ethanol blends or gasoline depending on relative prices and fuel economies in sweden flex fuel fleets were introduced in 2005 prices and demand data were examined for both brazil and sweden bioethanol has been generally the most cost efficient fuel in brazil but not for all states in any case consumers in brazil have opted for ethanol even when this was not the optimal economic choice in sweden a different behavior was observed when falling gasoline prices made e85 uneconomical in late 2008 in a context of international biofuels expansion the example of e85 in sweden indicates that new markets could experience different consumer behavior than brazil demand falls rapidly with reduced price differences between ethanol and gasoline at the same time rising ethanol demand and lack of an international market with multiple biofuel producers could lead to higher domestic prices in brazil once the limit curve is crossed the consumer might react by shifting back to the usage of gasoline

using cost observation to regulate firms the paper emphasizes the use of accounting data in regulatory or procurement contracts when the supplier 1 has superior information about the cost of the project and 2 invests in cost reduction the main result states that under risk neutrality the supplier announces an expected cost and is given an incentive contract linear in cost overruns this optimal contract moves toward a fixed price contract as the announced cost decreases an investment choice is then introduced and the use of a rate of return regulation is studied

multi firm regulation without lump sum taxes abstract this paper considers a problem of multi firm regulation where the regulator cannot make monetary transfers to or from firms otherwise the set up is standard two firms charging two part tariffs sell in separate markets and marginal costs are private information without transfers the regulator faces an additional consumer participation constraint that the representative consumer must wish to participate in the market in all states the paper studies the second best optimal regulatory scheme that respects this constraint and shows that it has some surprising properties i the regulator may wish to drive informational rents down to zero even at the cost of some price distortion ii consumer surplus may be zero in some states and iii the price that one firm charges is decreasing in the other s cost

the economic costs of conserving genetic resources at the cgiar centres abstract the 11 genebanks of the consultative group on international agriculture cgiar have grown considerably in size over the past few decades currently holding about 666 000 accessions of germplasm conserving germplasm is a very long run if not in perpetuity proposition the mismatch between the mainly annual funding support for this conservation effort and its very long term nature and intent is a serious concern using the results of five cgiar genebank case studies accounting for 87 of the total cgiar genebank holdings we estimate the size of an endowment or trust fund that would be required to assure a funding stream to conserve this genetic material for future generations the annual cost in year 2000 us of conserving and distributing the genetic material presently held in all 11 cgiar genebanks is estimated to be 5 7 million us mus which could be maintained for all future generations by setting aside a fund of 149 mus invested at a real rate of interest of 4 per annum this would be sufficient to underwrite the costs for the cgiar s current conservation activities in perpetuity estimated to be 61 mus as well as the cost of maintaining the distribution activities 88 mus that provide germplasm to breeders scientists farmers and others world wide

regulation competition and asymmetric information abstract this article studies a model of regulation under asymmetric information when there exists a competitive fringe of unregulated alternative producers the correlation between the unknown cost parameters of the fringe and of the regulated firm allows the regulator to use the threat of entry by the fringe to reduce the informational cost of regulation the presence of the fringe is welfare enhancing the allocative distortions can be larger or smaller than those in the no fringe case and the optimal contract sometimes allows inefficient entry the optimal contract can exhibit non standard bunching phenomena and discontinuities

optimal incentive contracts with multiple agents abstract a setting in which a single principal contracts with two agents who possess perfect private information about their own productivity is considered with correlated productivities each agent s private information also provides a signal about the other agent s productivity in contrast to the setting in which there is only one agent it is shown that such private information may be of no value to the agents it is only if the agents are risk averse that their private information may allow them to command rents moreover when the agents are constrained only to reveal their private information truthfully as a nash equilibrium the pareto optimal incentive scheme may induce the agents to adopt strategies other than truth telling this leads to the consideration of truth telling equilibria that are not pareto dominated in the subgame played by the agents among all such equilibria the one preferred by the principal restricts one agent to tell the truth as a dominant strategy and the other as a nash response to truth

farmers subjective valuation of subsistence crops the case of traditional maize in mexico shadow prices guide farmers resource allocations but for subsistence farmers growing traditional crops shadow prices may bear little relationship with market prices we econometrically estimate shadow prices of maize using data from a nationally representative survey of rural households in mexico shadow prices are significantly higher than the market price for traditional but not improved maize varieties they are particularly high in the indigenous areas of southern and southeastern mexico indicating large de facto incentives to maintain traditional maize there

issues of social acceptance on biofuel development alongside with biofuel development social acceptance issues have been underestimated while social acceptance can emerge as powerful barrier for biofuel development this article provides discussion on social acceptance in biofuel context an acceptance framework based on life cycle biofuel production had been referred for a better understanding on social acceptance issues malaysia has been referred for the discussion as the country has faced with acceptance issue in their biofuel program the discussion point out different societal groups will demand specific consideration for either support or oppose biofuel this paper concludes that biofuel development will be constraint if social acceptance issues remain neglect

malaysian biofuels industry experience a socio political analysis of the commercial environment this study examines the jatropha adoption process in sarawak malaysia a land rich in biological and ethnic diversity but highly impoverished attempts to alleviate poverty through oil palm plantation development resulted in internationally condemned destruction of peat lands sarawak subsequently turned to the inedible low input exportable biodiesel feedstock jatropha this case study argues that jatropha is unlikely to make more significant socio economic contributions than oil palm or other cash crops the analysis suggests that companies use social capital to aggressively expand their jatropha business among the native population in order to gain access to native customary lands which are often underproductive peat lands global biofuels sector development dynamics are examined through the lenses of political economics and social agricultural and energy studies the research finds that farmers 39 decisions to participate in the biofuels global value chain may result in negative income effects household food security reduction and biodiversity loss from peat land destruction the paper concludes with a proposal for an alternative approach to evaluate both social and financial drivers in order to prevent the negative effects of biofuel based agribusiness on human and environmental systems c 2012 elsevier ltd all rights reserved

renewable energy policy and public perceptions of renewable energy a cultural theory approach abstract public opposition to the siting of renewable energy re facilities and public reluctance to invest in re remain key obstacles to the expansion of the renewables sector in the uk and a number of other european countries although there is a growing body of qualitative research on factors that inform public attitudes towards re the majority of studies have tended to be quantitative and to view the public and public opinion as homogeneous wholes this study uses a cultural theory framework and focus groups conducted in the south west uk to develop deeper understandings of how individuals worldviews can inform opinions and behaviour in relation to re these findings are used to explore ways in which government policies on re might be tailored to engender greater public support and participation issues discussed include the provision of economic incentives information on climate change and re linking renewables to overall energy behaviour and landscape aesthetics