environmental regulation and u s economic growth in this article we quantify the costs of pollution controls by reporting the results of simulations of the growth of the u s economy with and without regulation for this purpose we have constructed a detailed model of the economy that includes the determinants of long term growth we have also analyzed the interaction between industries in order to capture the full repercussions of environmental regulations however we have not attempted to assess the benefits resulting from a cleaner environment we find that pollution abatement has emerged as a major claimant on the resources of the u s economy the cost of emission controls is more than 10 of the total cost of government purchases of goods and services

emission standards and stochastic waste load empirical work regarding the impact of environmental regulations on firm behavior has been developed under the assumption that emissions of pollutants are deterministic the implication is that the regulation is effective only when the constraint is exactly satisfied in real life however it is seldom the case that emission constraints are exactly satisfied the purpose of this paper is to find out whether regulation schemes are ineffective or whether the structure is an optimal reaction to random fluctuations in emissions the swedish pulp and paper industry is used as an empirical illustration

the effects of oil price uncertainty on global real economic activity this paper investigates the effect of oil price uncertainty on global real economic activity using a quarterly vector autoregressive model with stochastic volatility in mean stochastic volatility allows oil price uncertainty to vary separately from changes in the level of oil prices and allows one to incorporate an extraneous indicator of oil price uncertainty such as realized volatility that greatly improves the precision of the estimated uncertainty series the estimation results show that an oil price uncertainty shock has negative effects on world industrial production all else equal for example it is shown that a doubling of oil price volatility is associated with a cumulative decline as high as 0 3 percentage points in world industrial production

taxation within cournot oligopoly abstract when the production of output causes pollution we often consider taxation as a means to reduce it this paper examines various forms of taxation to control pollution within cournot oligopoly it shows that two commonly used forms can actually increase pollution in contrast both of these forms unambiguously reduce pollution within the competitive model the paper provides conditions in terms of demand and technology that make taxation effective in the cournot oligopoly case another implication of the analysis is that outside the price taking framework asymmetry of cost functions is particularly important and deserves careful attention when we examine the effect of taxation

environmental regulations and productivity growth the case of fossil fueled electric power generation this paper measures and analyzes the effect of sulfur dioxide emission restrictions on the rate of productivity growth in the electric power industry over the 1973 79 business cycle a firm specific measure of regulatory intensity is developed which depends on the severity of the emission standard the extent of enforcement and the unconstrained emission rate relevant to each utility the results indicate that emission regulations result in significantly higher generating costs primarily from the increased use of low sulfur fuels the average rate of productivity growth was reduced by 0 59 percentage points per year for constrained utilities

the impact of pollution abatement investment on productivity change anempirical comparison of the u s germany and canada since environmental quality became an important focus of government regulations in most industrialized countries in the early 1970s many researchers have assessed the impact of these regulations on economic performance for example leontief and ford 11 and pasurka 15 investigated the impact that environmental protection costs had on prices in the u s walter 24 calculated the effect of pollution abatement expenditures on u s trade and robinson 19 measured the distributional impact of the burden of industrial pollution abatement a related issue involves the productivity consequences of environmental regulations in this paper we address this issue by considering the impact of pollution abatement investment on productivity growth

measuring oligopsony power with shadow prices u s markets for pulpwood and sawlogs empirical estimation of input market power hindered by problems in measuring an input s value of marginal product vmp by estimating a variable profit function system however one can infer a factor s vmp through its shadow price this technique is used here to specify a structural equation system which is estimated using time series data for the u s sawmilling and paper industries to empirically measure the degree of oligopsony power for sawlog and pulpwood inputs respectively results evaluated at sample means indicate that pulpwood markets are more oligopsonistic than sawlog markets though both perform closer to perfect competition than monopsony time trends for market power differ for each product and perfect competition cannot be rejected for sawlogs in later years copyright 1995 by mit press

the contribution of environmental regulations to the slowdown in productivity growth abstract the radical slowdown in productivity growth since 1965 is often attributed to environmental regulations several studies varying widely in method have attempted to assess this contribution here these analyses are reviewed and critiqued and a summary appraisal of the likely contribution of environmental regulations to the observed decrease in productivity growth is offered

the effect of environmental regulation on optimal plant size and factor shares the method for measuring the effects of environmental regulation on the size distribution of industrial plants and the distribution of factor shares described in this paper focuses on the 20 industries with highest per unit pollution abatement costs and the 20 with the lowest costs the study finds that compliance with environmental laws has not only reduced the number of plants in the affected industries but has placed a greater burden on small rather than on large plants besides redistributing within industry market shares environmental regulation has increased the use of capital relative to labor although the disproportionate burden placed on small plants in the high abatement cost industries may have been unintended it is likely that large firms will be less vocal opponents of environmental regulation than are small firms 22 references 12 tables

oil price shocks and the dispersion hypothesis recent research by david lilien shows that a significant fraction of aggregate unemployment can be explained by the dispersion of employment growth across industries this paper presents two new results in this area first it is shown that a significant fraction of the variation in lilien s dispersion index is due to the differential impact of oil shocks across industries second and more important it is shown that once the dispersion in employment growth due to oil shocks is accounted for the residual dispersion has no explanatory power for unemployment

relationships between oil price shocks and stock market an empirical analysis from china this paper investigates the interactive relationships between oil price shocks and chinese stock market using multivariate vector auto regression oil price shocks do not show statistically significant impact on the real stock returns of most chinese stock market indices except for manufacturing index and some oil companies some important oil price shocks depress oil company stock prices increase in oil volatility may increase the speculations in mining index and petrochemicals index which raise their stock returns both the world oil price shocks and china oil price shocks can explain much more than interest rates for manufacturing index

capabilities economic development sustainability the capability concept is commonly used in analyses of firms however as this paper shows it may also be used at the level of nations factor analysis is used on a broad set of relevant indicators to derive composite measures of national technological and social capabilities the data covers 114 countries worldwide on different levels of development for the period 1995 2013 the paper then analyzes the relationships between these capability measures and economic development defined in various ways and controlling for other relevant factors the results suggest that improving national technological and social capability is a must for achieving sustainable economic development and improving living conditions

an astructural analysis of national forest policy and employment linkages between sector specific policy and sector employment are explored using a nonstationary markov chain analysis when parameterization of transition probabilities between employment sectors includes policy variables hypothesis tests can determine policy impact relative to other variables this astructural approach eliminates bias inherent in structural models application of this technique to oregon s forestry sector and national forest policy demonstrates that macroeconomic forces have statistically important effects on employment while national forest policy measured as timber sold or timber cut does not this result raises questions about forest policy impact analysis and assumptions inherent in national forest policy implementation

a neoclassical model of unemployment and the business cycle this paper investigates a general equilibrium model of unemployment and the business cycle in which specialization of labor plays a key role a rational expectations equilibrium with fully flexible wages and prices can exhibit unemployment in which the marginal product of employed workers exceeds the reservation wage of those who are without jobs workers are unemployed either because they are in the process of relocating for a better job or because they are waiting for conditions in the depressed sector to improve moreover seemingly small disruptions in the supplies of primary commodities such as energy could be the source of fluctuations in aggregate employment and can exert surprisingly large effects on real output

what happened to the oil price macroeconomy relationship abstract strong evidence is found that oil prices no longer granger cause many u s macroeconomic indicator variables in data after 1973 a number of potential explanations are explored that sample stability issues are responsible that oil prices are now endogenous and that linear and symmetric specifications misrepresent the form of the oil price interaction none of these hypotheses are supported by the data the opec price increases do appear to have had significant impacts while the effects of the price declines of the 1980s are smaller and harder to characterize these results have potentially important implications for the large body of research which utilizes oil prices as an instrumental or explanatory variable

issue in pollution control interplant cost differences and economies of scale debate on interplant pollution control cost differences focuses on the question of whether a system of taxes or transferable discharge permits should require those plants with low treatment costs to control a higher share of effluents another issue under debate is whether those industries with a large minimum size may be effectively barred by pollution control requirements evidence of the inefficiency of present institutional arrangements is shown by studying production function estimations of 30 pulp and paper mills in wisconsin and michigan a more efficient reallocation of pollution control resources could be effected with more market oriented regimes 58 references 6 tables dck

environmental regulation cost and industry structure changes nonstationary markov analyses are used to investigate impacts of environmental regulatory costs associated with compliance on changes in market structure in pulp and paper industries results show environmental regulation expenditures have statistically significant effects on the probabilities of capacity moving to a larger company size category so industry structure is affected by environmental regulation however counter to expectations results further show consolidation occurs with higher probability when environmental costs are falling rather than when they are rising policy analyses that presume immediate policy responses to cost changes or that industry structure is unchanged may yield time inconsistent policy conclusions

oil price shocks and u s economic activity abstract our understanding of the sources of oil price fluctuations and their effects on the u s economy has undergone important transformations in the last decades first several studies have demonstrated the importance of identifying the causes of oil price fluctuations whether they are driven by demand or supply shocks instead of assuming that oil price changes are exogenous to the evolution of the world s economic activity second new methodologies have allowed researchers to re evaluate the functional form of the relationship between oil prices and u s gdp its components and job flows third significant advances have been made in understanding the relationship between oil price uncertainty news economic policy uncertainty and aggregate economic activity finally investigations into the time varying nature of oil price macroeconomy relationship have provided important insights into the reasons why unexpected increases in oil prices appear to shock less now than in the 1970s this paper reviews the studies that have contributed to these different aspects of the literature

how sensitive are consumer expenditures to retail energy prices abstract there is growing evidence that the primary effect of energy price shocks on the u s economy involves a reduction in consumer spending we quantify the direct effect on real consumption of unanticipated changes in discretionary income shifts in precautionary savings and changes in the operating cost of energy using durables the possibility of asymmetries in the response of real consumption to energy price shocks is also considered we demonstrate that linear models are consistent with the symmetric behavior of real consumption in 1979 when energy prices increased sharply and in 1986 when they fell sharply it is shown that historically energy price shocks have been an important factor in explaining u s real consumption growth but by no means the dominant factor

oil price shocks in a data rich environment abstract this paper examines the impact of different types of oil price shocks on the u s economy using a factor augmented var favar approach the results indicate that when examining the effects of oil price shocks it is important to account for the interaction between the oil market and the macroeconomy i find that oil demand shocks are more important than oil supply shocks in driving several macroeconomic variables and that the origin of demand shocks matters specifically the u s economy and monetary policy respond differently to global demand shocks that have the effect of raising the price of oil and to oil specific demand shocks

the effect of emission taxes and abatement subsidies on market structure comment abstract conrad and wang 1993 international journal of industrial organization 11 499 518 determine that a tax on emissions decreases the total output of a polluting industry but if demand is sufficiently inelastic can increase the number of firms in that industry this follows from their proposition that the tax reduces the scale of the polluting firm in contrast the scale of the polluting firm in the present model increases when there are increasing returns to scale in abatement whereas conrad and wang extend their results to cases of monopolistic competition the present paper is confined to perfect competition but extends the analysis to the pollution damaged industry

price margins and capital adjustment canadian mill products and pulp and paper industries abstract the purpose of this paper is to estimate a model incorporating non competitive behaviour in product and factor markets in addition capital accumulation is subject to adjustment costs so that firms are not constrained to be in long run equilibrium the model is applied to two major canadian manufacturing industries pulp and paper and mill products the results show for both industries in each of three product markets and the wood input market that there is competitive behaviour in addition the industries are not in long run equilibrium as marginal adjustment costs cause marginal profit to exceed the rental rate on capital with the industries exhibiting short run competitive behaviour in product and factor markets new estimates are derived for scale economies and rates of technological change unlike the results from other studies both industries exhibit small scale economies and positive rates of technological change

environmental policy when market structure and plant locations are endogenous abstract a two region two firm model is developed in which firms choose the number and the regional locations of their plants both firms pollute and market structure is endogenous to environmental policy there are increasing returns at the plant level imperfect competition between the home and the foreign firm and transport costs between the two markets at critical levels of environmental policy variables small policy changes cause large discrete jumps in a region s pollution and welfare as a firm closes or opens a plant or shifts production to from a foreign branch plant the implications for optimal environmental policy differ significantly from those suggested by traditional pigouvian marginal analysis

the effect of emission taxes and abatement subsidies on market structure abstract emission taxes and abatement subsidies are considered to be efficient measures for environment protection the purpose of this paper is to quantify their effects on industry output firm output and on the number of firms in the industry three types of market structure are under discussion perfect competition oligopoly and a dominant firm with a competitive fringe it turns out that emission taxes and abatement subsidies affect the structure of the polluting industry in opposite ways while the effects on industry s emissions are similar in direction but different

the impact of environmental regulations on industry productivity direct and indirect effects abstract the paper develops an approach to measuring the impact of environmental regulations on total factor productivity growth which is less restrictive than a simple growth accounting approach environmental regulations have a direct impact on productivity growth due to the diversion of resources toward required abatement capital there can be a further indirect effect however as conventional inputs and production processes are changed in response to requirements to purchase abatement capital we estimate this indirect effect using a flexible functional form cost function total factor productivity and the direct and indirect productivity effects of environmental regulations are presented for five polluting industries we find that the indirect effect can be either positive or negative and in all industries is energy using the net impact of environmental regulations on total factor productivity growth is fairly small given that these are the most polluting industries they account for about 10 30 of the productivity decline of the 1970s in these industries