energy market liberalization and renewable energy policies in oecd countries abstract this paper investigates the effect of energy liberalization compared to other drivers on policies that support renewable energy in a long panel of oecd countries we estimate this effect by accounting for the endogeneity of liberalization related to joint decisions within a country s energy strategy using regulation in other industries as instruments we find that energy liberalization increases public support for renewable energy the effect of liberalization is the second largest after the effect of per capita income and is mostly driven by reductions in entry barriers while the effect of privatization is unclear this finding suggests that a reduction in the monopolistic power of state owned utilities has a positive effect on renewable energy policies when various types of actors are ensured access to the grid instead of it being provided to only a few large private firms

taxes and capital structure understanding firms savings abstract the u s non financial corporate sector became a net lender to the rest of the economy in the early 2000s with close to half of all publicly traded firms holding financial assets in excess of their debt liabilities we develop a simple dynamic model of debt and equity financing where firms strive to accumulate financial assets even though debt is fiscally advantageous relative to equity moreover firms find it optimal to fund additional financial asset holdings through equity revenues the calibrated model matches well the distribution of public firms balance sheets during the 2000s and correctly predicts which firms are net savers

common agency and coordination general theory and application to government policy making we develop a model of common agency with complete information and general preferences with nontransferable utility and we prove that the principals nash equilibrium in truthful strategies implements an efficient action we apply this theory to the construction of a positive model of public finance where organized special interests can lobby the government for consumer and producer taxes or subsidies and targeted lump sum taxes or transfers the lobbies use only the nondistorting transfers in their noncooperative equilibrium but their intergroup competition for transfers turns into a prisoners dilemma in which the government captures all the gain that is potentially available to the parties

waste performance of nuts 2 regions in the eu a conditional directional distance benefit of the doubt model abstract this paper attempts to benchmark the municipal solid waste msw management performance of the nuts 2 regions in the eu by constructing a composite indicator in order to account for commensurability weighting and aggregation issues of the performance indicators in regional waste and materials management this paper advocates a conditional directional distance version of the benefit of the doubt weighting technique in addition the waste management hierarchy defined by the eu is strongly embedded in the construction of our composite indicator the results reveal considerable differences in the aggregate performance of the regions even within member states in general waste sectors of the nuts 2 regions in austria belgium and germany generally do well in terms of msw management our results also reveal that some differences in the operating environment of the regions such as the number of tourist overnight stays are related to the aggregate performance of the regions however the observation that other conditions are not significantly related to the performance on a regional level is interesting as many policy makers frequently argue that the level of performance in their regions cannot be compared to that in other regions precisely due to this difference in operating conditions

the environmental kuznets curve and flow versus stock pollution the neglect of future damages in this paper we offer a possible explanation for the empirical finding that the pollution income relationship pir for flow pollutants is an environmental kuznets curve ekc i e inverted u shaped but that the pir for stock pollutants is monotonically rising we analyse an overlapping generations model with two pollutants the flow pollutant causes immediate damages but the stock pollutant harms the environment only in the future hence a succession of myopic governments lets stock pollution grow with income in contrast the flow pollutant follows an ekc whose downturn might be caused by the neglect of future damages and by ever rising stock pollution without the stock pollutant the pir for the flow pollutant can increase monotonically we also show that the turning point of the ekc for the flow pollutant lies at lower levels of income and of flow pollution if stock pollution is high and harmful this casts doubts on most empirical ekc studies because they assume that the turning point occurs at the same income level in all countries however it is consistent with recent empirical findings that the income level at the turning point of the ekc varies across countries

environmental governance in federal systems the effects of capital competition and lobby groups noel gaston we argue that centralized and decentralized environmental governance yield equivalent environmental regulations we model worker environmental and capital owner lobby groups that seek influence by offering political contributions worker lobbying in the decentralized case has an effect on environmental regulations identical to that of capital owner lobbying in the centralized case this is because the aggregate effects of environmental regulations on income are equivalent under the two institutional designs whereas workers carry the full burden in the decentralized case when capital competition occurs the burden is shared with the capital owners in the centralized case we present evidence consistent with our theory jel q28 f21 r38 d72 d78 i introduction as the demand for efficient environmental policies increases the ambit of political power in a federation must be determined cumberland 1981 suggests that uniform federal rules avoid the economic competition between jurisdictions in order to attract investment that may result in an excessively low environmental quality as discussed by burtraw and portney 1991 central decision making may be highly inefficient however because federal regulations fail to take into account the heterogeneity of local environments 1 this article develops a theory of decentralized and centralized environmental policy making in federal systems that incorporates the political forces determining the outcomes under the two alternative regulatory designs the empirical evidence on the effects of interjurisdictional capital competition on environmental policies is inconclusive and mainly anecdotal esty 1996 gives an overview of the available evidence and finds that rent seeking behavior undoubtedly affects national as well as state environmental policy making but there is no evidence that public decision making is systematically more distorted at the federal level than at state and local levels 2 in a study of packaging waste regulation in the european union eu paul 1994 95 describes how the move from decentralized to centralized regulation remains controversial some greens bitterly criticize the directive as a sellout to industry it is true that industry aggressively lobbied parliament to stop the efforts of the greens to tighten the directive and that i t is tempting to describe this debate as one more example in which the regulatory authority was captured by industry 3 evidently the move to centralized regulation stimulated industry lobbying the present paper provides an explanation for why industry lobbying may be stronger at the federal level and discusses the implications for environmental policy under decentralized and centralized environmental policy making 4 the current literature lacks a formal comparison of politically determined environmental regulations under the different institutional arrangements that may exist in federal systems 5 while we couch our argument in terms of environmental policy making that could be undertaken either at the national level or at lower levels in a federal structure we believe that the central ideas extend to regulatory policy carried out at both the highest and lowest levels of multi country federations such as the eu 6 extensions of our theory may apply more generally to several forms of regulation for example worker safety standards and product liability legislation as well as to firm taxation a key concern of environmental policy makers in federal systems is interjurisdictional capital mobility we model a decentralized system of regulation with a mobile capital stock consideration of the effects of environmental regulations on capital is important van beers and van den bergh 1997 find no significant negative effect of environmental regulation on export flows in polluting industries except when restricting their data to sectors with high capital mobility

the most popular tax in europe lessons from the irish plastic bags levy there have been occasional ad hoc efforts to influence consumer behaviour by the imposition of product taxes that reflect external costs imposed by such products that are not initially included in their price in the spirit of this idea in 2002 ireland introduced a 15 euro cent tax on plastic shopping bags previously provided free of charge to customers at points of sale the effect of the tax on the use of plastic bags in retail outlets has been dramatic a reduction in use in the order of 90 and an associated gain in the form of reduced littering and negative landscape effects costs of administration have been very low amounting to about 3 of revenues because it was possible to integrate reporting and collection into existing value added tax reporting systems response from the main stakeholders the public and the retail industry has been overwhelmingly positive central to this acceptance has been a policy of extensive consultation with these stakeholders the fact that a product tax can influence consumer behaviour significantly will be of interest to many policymakers in this area this paper analyses the plastic bag levy success story and provides insights and general guidelines for other jurisdictions planning similar proposals

inflation and welfare in a monetary economy it is in everyone s private interest to try to get someone else to hold non interest bearing cash and reserves but someone has to hold it all so these efforts must simply cancel out all of us spend several hours per year in this effort and employ thousands of talented and highly trained people to help us these person hours are simply thrown away wasted on a task that should not have to be performed at all

generation of household solid waste in oecd countries an empirical analysis using macroeconomic data while there are numerous studies that use household level and community level data to examine the determinants of household solid waste generation rates little empirical work has been previously undertaken using macroeconomic data using a cross sectional time series database of solid waste in countries that are part of the organisation for economic co operation and development oecd we provide evidence on the economic and demographic determinants of generation rates of household solid waste with respect to economic activity and population density the results are largely consistent with results found in previous studies however additional insights are gained on the effects of factors such as household size and composition as well as the degree of urbanization

political internalization of economic externalities and environmental policy abstract this paper derives the characteristics of endogenous environmental policy in a common agency model of politics and proceeds to show that competition between lobby groups is an important source of internalization of economic externalities our analysis generalizes bhagwati s principle of targeting to the case of distorted political markets moreover we show that the politically optimal structure of environmental taxes incorporates a pigouvian adjustment however since lobby groups care about the distribution of income as well as about efficiency the equilibrium structure of taxes differs considerably from the pigouvian rule

bureaucrats or politicians comment alesina and tabellini 2007 investigate the normative criteria for allocating policy tasks to bureaucrats versus politicians while they establish criteria with respect to a number of parameters they do not give a criterion with respect to the degree of imperfect monitoring we establish an unambiguous criterion about imperfect monitoring jel d72 d73

environmental kuznets curves real progress or passing the buck abstract recent research has examined the hypothesis of an environmental kuznets curve ekc the notion that environmental impact increases in the early stages of development followed by declines in the later stages these studies have focused on the relationship between per capita income and a variety of environmental indicators results imply that ekcs may exist for a number of cases however the measures of environmental impact used generally focus on production processes and reflect environmental impacts that are local in nature and for which abatement is relatively inexpensive in terms of monetary costs and or lifestyle changes significantly more consumption based measures such co2 emissions and municipal waste for which impacts are relatively easy to externalize or costly to control show no tendency to decline with increasing per capita income by considering consumption and trade patterns the author re examines the concept of the ekc and proposes the use of alternative consumption based measures of environmental impact the author speculates that what appear to be improvements in environmental quality may in reality be indicators of increased ability of consumers in wealthy nations to distance themselves from the environmental degradation associated with their consumption

siting noxious facilities are markets efficient abstract this paper explores the economics and politics of the siting of noxious facilities in the base case facilities are sited by markets subject to majority agreement in the host jurisdiction by contrast with the existing market siting literature which assumes that all the disamenities of a facility will be contained in the host jurisdiction and fully reflected in the jurisdiction s willingness to accept here facilities impose disamenities on individuals as a function of distance and the process of majority agreement is explicitly modeled the principal finding is that when voters are uniformly distributed within a jurisdiction an individual who is median distance from a facility suffers less than average mean disamenity therefore a majority would be willing to serve as facility host for a price host fee that is strictly less than the aggregate disamenity that the facility imposes on the jurisdiction further by threatening the equilibrium host with a site just across its border a firm can induce majority acceptance of a nontrivial facility at zero host fee even when this threat site strategy is infeasible though market determined host fees will not signal efficient sites thus markets will produce an excessive number of noxious facilities and place them in the wrong sites these results are robust to alternative specifications of bargaining power and market structure if however host majority agreement is subject to the veto of a higher jurisdiction e g in response to cries of nimby then efficiency may be either improved or reduced

trade environment and development the issues in perspective abstract this special issue on trade and the environment brings together a number of papers that are constructively critical of the conventional economic wisdom on the topic we think that this criticism is warranted because of the decidely uncritical way in which free trade has been advocated in much of the literature and especially in policy the papers analyse the validity of the underlying assumptions on which the conventional wisdom is based and provide suggestions for ways to facilitate trade that is also adequately protective of the environment sustainability and other social values in this introductory piece we discuss trade the environment and sustainability summarizing arguments in the papers included in this issue and adding a few additional points not covered by them

financial innovation and the transactions demand for cash we document cash management patterns for households that are at odds with the predictions of deterministic inventory models that abstract from precautionary motives we extend the baumol tobin cash inventory model to a dynamic environment that allows for the possibility of withdrawing cash at random times at a low cost this modification introduces a precautionary motive for holding cash and naturally captures developments in withdrawal technology such as the increasing diffusion of bank branches and atm terminals we characterize the solution of the model which qualitatively reproduces several empirical patterns we estimate the structural parameters using micro data and show that quantitatively the model captures important economic patterns the estimates are used to quantify the expenditure and interest rate elasticity of money demand the impact of financial innovation on money demand the welfare cost of inflation and the benefit of atm ownership

does centralization increase the size of government abstract are fiscal programs larger or smaller if they are run centrally rather than locally in a prospective federation we abstract completely from well understood economic issues and focus instead on the political effects of centralization for fiscal programs with benefits broadly spread in the population such as redistributive transfer schemes social insurance and general government consumption centralization changes the coalition of voters who favor a large program in a direction that depends on the nature of the redistributive instrument for fiscal programs with localized benefits such as provision of local public goods centralization creates opportunities for rent seeking which increases the size of government

does european union environmental policy pass a costâ benefit test most european union countries are committed to some form of regulatory impact assessment and in some cases these assessments involve the formal use of cost benefit analysis the european treaty of union also calls for a comparison of costs and benefits for all european regulations despite this only a limited number of regulations have been subject to cost benefit analysis using a variety of sources this paper investigates whether or not a selection of major environmental regulations would pass a cost benefit test the general answer is that while some do most do not this finding has major implications for the efficiency of european environmental legislation and reflects on the willingness of member states to sign up to inefficient regulation

stoking the fires co2 emissions and economic growth abstract we examine the relationship between economic development and carbon dioxide emissions a greenhouse gas central to global warming predictions estimates derived from global panel data suggest a diminishing marginal propensity to emit mpe carbon dioxide as gdp per capita rises despite this global carbon dioxide emissions growth will continue at 1 8 percent per annum for the foreseeable future a result that is not sensitive to average output growth instead emissions growth continues because output and population will grow most rapidly in lower income nations with high mpes this latter feature emphasizes the distributional consequences of policies to reduce emissions

a sealed bid auction mechanism for siting noxious facilities this paper proposes a sealed bid mechanism for facilitating the siting process of noxious facilities such as prisons trash disposal plants and incinerators for hazardous waste these facilities have created such opposition by communities that the acronyms nimby not in my backyard or lulu local undesirable land use are now in common usage to describe the public s reaction to them the noxious facility siting problem arises because there are economies of scale associated with having only one plant to serve the needs of a wide region the community that hosts the plant absorbs all of the environmental costs while the rest of the region enjoys the benefits of the facility one reason that these facilities have been so strongly opposed by communities is that they generate relatively little new employment and provide limited additional taxes in relation to their perceived negative impact d morell and c magorian 1982 some compensation arrangement is thus needed to share the gains from the winners to the potential loser this paper discusses a sealed bid auction mechanism for selecting a location for the facility so that all communities feel they are better off than under the status quo

a post consumer waste management model for determining optimal levels of recycling and landfilling the present study examines the optimal recycling rate for municipal solid waste first an optimal control model is developed to account for the physical costs of recycling the social costs of landfilling and consumers environmental preferences second an optimal solution is simulated using waste disposal data from the helsinki region in finland the benefits from recycling are included in the simulation using the results of a recent contingent valuation study the results of the present research suggest that mandates for achieving 50 recycling in municipalities are not far fetched and are both economically and environmentally justified

the demand for money financial innovation and the welfare cost of inflation an analysis with household data we use microeconomic data on households to estimate the parameters of the demand for currency derived from a generalized baumol tobin model our data set contains information on average currency deposits and other interest bearing assets the number of trips to the bank the size of withdrawals and ownership and use of atm cards we model the demand for currency accounting for adoption of new transaction technologies and the decision to hold interest bearing assets the interest rate and expenditure flow elasticities of the demand for currency are close to the theoretical values implied by standard inventory models however we find significant differences between individuals with an atm card and those without the estimates of the demand for currency allow us to calculate a measure of the welfare cost of inflation analogous to bailey s triangle but based on a rigorous microeconometric framework the welfare cost of inflation varies considerably within the population but never turns out to be very lar

property rights protest and the siting of hazardous waste facilities ture since that time no major hwf has been sited anywhere in the united states the epa had anticipated that local opposition would make finding these sites an exceptionally difficult task their pessimism was well founded and if anything understated according to the hazardous waste counsultant s latest state by state review the outlook for siting hwfs in the future is even more bleak than in the past due in large part to what they term a worsening of the emotional atmosphere surrounding siting efforts this failure to site any new hwf has come about in spite of assurances by government and company officials that new facilities built according to the present standards would pose negligible risks to the local residents attempts have been made to break the deadlock by instituting extensive public participation procedures establishing state siting boards with the power to overrule local decision makers and requiring facility owners to compensate local governments for safety services the latter provided in this paper we argue that the ambiguous nature of the present property rights governing the siting of hwfs is an important cause of the stalemate we offer a new approach to siting which recognizes the de facto property rights assumed by local communities we propose a political market via a referendum

a consumption based theory of the environmental kuznets curve abstract most theories about the inverted u relationship between pollution and income termed the environmental kuznets curve ekc are production side theories emphasizing pollution and abatement technologies production side theories are implicitly based on the assumption of low factor mobility and the absence of pollution as a variable in the utility function both assumptions are called into question by the empirical evidence of ekcs for i pollutants that are long lived and not easily shiftable and ii regional cross sections with free labor mobility hazardous waste sites are a prime example this paper develops a stylized model of the ekc based on perfect mobility of households and labor it represents the first attempt at developing a consumption side model of the ekc

an econometric analysis of global waste paper recovery and utilization the main purpose of this paper is to provide aneconometric analysis of the most importantdeterminants of inter country differences inwaste paper recovery and utilization rates byemploying pooled t

testing the environmental kuznets curve hypothesis for e waste in the eu28 2 countries abstract this paper investigates the kuznets curve hypothesis for e waste using a balanced panel of 30 european countries eu28 2 over the period 2000 2016 to account for the dynamic and the time invariant characteristics we employed the generalized method of moments gmm estimator as a core method and used the 2sls estimator and cross section method to analyze the robustness of results we found that the environmental kuznets curve ekc hypothesis is well supported for e waste generated in the eu28 2 area in addition this relationship is robust and is not sensitive to the choice of control variables and the estimation methods all three methods evidenced ekc in e waste for the studied european area this reveals that e waste generation increases with an increasing gdp up to a certain gdp level turning point but thereafter decreases despite further economic growth while this suggests that e waste generation and the related adverse environmental impacts will decline at elevated gdp levels the results of this study highlight that the turning point occurs at rather exceptionally high levels of gdp the evidence of ekc in e waste contributes to better understanding the interlinkage between economic growth and e waste generation but it does not diminish the urgent need to implement effective e waste collection and valorization schemes

are there economies of scale in the demand for money by firms some panel data estimates abstract we estimate elasticities of scale in the demand for money by firms using firm level panel data from spain the uk and the us this elasticity is one for spain and the uk but smaller for the us we find that the errors in the money demand equations contain two terms that are correlated with sales firstly a permanent firm effect that captures differences in technological sophistication secondly a measurement error in sales which becomes relevant when relying on changes in sales to account for fixed effects failure to control for these correlated unobservable terms results in important biases in the estimated sales elasticities

the demand for solid waste disposal in this paper we estimate the elasticity of demand for landfill disposal of municipal solid waste using data from the portland oregon metropolitan area efficiency losses associated with deviations from marginal cost pricing of disposal services are then derived the efficiency losses of small deviations from long run marginal disposal costs are not large however many municipalities finance solid waste services from general tax revenues in which case waste generators effectively face zero marginal costs here the efficiency losses are much larger indicating that communities would benefit from introducing volume or weight based pricing

collateral taxes and leverage we quantify the importance of collateral versus taxes for firms capital structures we estimate a dynamic model in which a taxable firm seeks financing for investment and a dynamic contracting environment motivates endogenous collateral constraints optimal leverage stays a safe distance from the constraint balancing the tax benefit of debt with the cost of lost financial flexibility we estimate this flexibility cost to be 7 2 of firm assets a percentage that is comparable to the tax benefit models with different tax rates fit the data equally well and leverage responds to the tax rate only when taxes are low

explaining the variation in household recycling rates across the uk household waste recycling rates vary significantly both across and within regions of the uk this paper attempts to explain the variation by using a new data set of waste recycling rates and policy determinants for all of the uk s 434 local authorities over the period 2006q2 to 2008q4 our results suggest that the method of recycling collection chosen by policy makers is an important factor influencing the recycling rate we also find an inverse relationship between the frequency of the residual waste collection and the recycling rate

embedding landfill diversion in economic geographical and policy settings we analyse the process of landfill diversion embedding the dynamics in a frame where economic geographical and policy variables enter the arena we aim at investigating in depth what main drivers may be responsible for such a phenomenon we exploit a rich panel dataset covering all the 103 italian provinces the case study on italy is worth being considered provided that italy is a main country in the eu thus offering important pieces of information on the evaluation of policies evidence shows that the observed decoupling between economic growth and landfilling is driven by a mix of structural factors as population density and waste management strategies if on the one hand the landfill tax is not arising as a significant driver of the phenomenon other waste management instruments are associated with high significant negative effect on landfilled waste in association to the features of the tariff system we also underline the key role played by the share of separated collection in driving down land

the siting of hazardous waste facilities in federal systems the political economy of nimby this paper offers a new political economy explanation for thepervasive problem of siting hazardous waste treatment facilitiesin federal system we first show that a decentralized systemyields the first best waste treatment capacity level and that acentralized structure gives rise to free riding behavior amonglocal jurisdictions in our model each community seeks toinfluence the central government through political contributions this leads to suboptimal levels of treatment capacity thecapacity is increasing in the compensation level if the marginalbenefit of treatment capacity is sufficiently large and in thegovernment s weight on aggregate social welfare relative tolobbying activities the centralized system can replicate thedecentralized system with a sufficiently high compensation level since compensation has proved difficult a centralized systemfaces greater obstacles than a decentralized system

on the welfare cost of inflation and the recent behavior of money demand post 1980 u s data trace out a stable long run money demand relationship of cagan s semi log form between the m1 income ratio and the nominal interest rate with an interest semi elasticity of 1 79 integrating under this money demand curve yields estimates of the welfare cost of modest departures from friedman s zero nominal interest rate rule for the optimum quantity of money that are quite small the results suggest that the federal reserve s current policy which generates low but still positive rates of inflation provides an adequate approximation in welfare terms to the alternative of moving all the way to the friedman rule jel e31 e41 e52

money and asset prices in a cash in advance economy an asset pricing model with money introduced via a cash in advance constraint is presented the monetary velocity is variable hence money demand does not obey the trivial quantity equation the effects of disturbances in output and money growth on real balances the price level and interest rates are examined monetary policy has effects on real asset prices the fisher relation and the premium on nominal bonds are discussed the precise role of the timing of information and transactions for properties of price levels and interest rates are clarified

trade wars and trade talks when governments meet in the international arena their actions reflect the political situations at home previous studies of trade relations have focused on governments that are immune from political pressures and that act as benevolent servants of the public interest here we introduce domestic politics into the analysis of international economic relations we study the interactions between national leaders who are concerned both with providing a high standard of living to the general electorate and collecting campaign contributions from special interest groups our analysis sheds light on the determinants of the structure of protection in non cooperative and cooperative policy equilibria

extensive margins and the demand for money at low interest rates we argue that the relevant monetary decision for the majority of u s households is not the fraction of assets to be held in interest bearing form but whether to hold any such assets at all we call this the decision to adopt the financial technology we show that the key variable governing the adoption decision is the product of the interest rate times the total amount of assets this implies that the interest elasticity of household money demand at low interest rates can be estimated from the variation in asset holdings in a cross section of households rather than historical interest rate variations we do so with the 1989 survey of consumer finances we find that a the elasticity of money demand is very small when the interest rate is small b the probability that a household holds any amount of interest bearing assets is positively related to the level of financial assets and c the cost of adopting financial technologies is negatively related to participation in a pension program at intere

voluntary auctions for noxious facilities incentives to participate and the efficiency of siting decisions abstract this paper explores the efficiency properties of a voluntary auction under which the city submitting the low bid hosts the region s noxious facility and receives the high bid as compensation in the nash equilibrium of the auction game the auction mechanism is individually rational participation is rational for all values of the local environmental costs of the facility incentive compatible the facility is located in the low cost city and revenue neutral if the compensation of the host city distorts location choices participation in the auction is rational for all values of local environmental costs if the scale economies associated with the noxious facility are large relative to the average local environmental cost and the distortionary cost per dollar of compensation

scale economies the value of time and the demand for money longitudinal evidence from firms compustat data on 12 000 firms for the years 1961 92 indicate that large firms hold less cash as a percentage of sale than small ones whether comparisons are made within or across industries the clasticity of cash balance with respect to sales is about 0 8 firms headquartered in counties with high wages hold more money for a given level of sales a finding consistent with the idea that time can substitute for mony in the provision of transactions services the estimates are consistent with both scale economies in the holding of money and secular declines in velocity

high frequency identification of monetary non neutrality the information effect we present estimates of monetary non neutrality based on evidence from high frequency responses of real interest rates expected inflation and expected output growth our identifying assumption is that unexpected changes in interest rates in a 30 minute window surrounding scheduled federal reserve announcements arise from news about monetary policy in response to an interest rate hike nominal and real interest rates increase roughly one for one several years out into the term structure while the response of expected inflation is small at the same time forecasts about output growth also increase the opposite of what standard models imply about a monetary tightening to explain these facts we build a model in which fed announcements affect beliefs not only about monetary policy but also about other economic fundamentals our model implies that these information effects play an important role in the overall causal effect of monetary policy shocks on output

the deposits channel of monetary policy we propose and test a new channel for the transmission of monetary policy we show that when the fed funds rate increases banks widen the interest spreads they charge on deposits and deposits ow out of the banking system we present a model in which imperfect competition among banks gives rise to these relationships an increase in the nominal interest rate increases banks market power inducing them to increase deposit spreads and hence restrict deposit supply households respond to the increase in deposit prices by substituting from deposits into less liquid but higheryielding assets consequently changes in the nominal interest rate aect banks cost of capital and lending using branch level data on the universe of u s banks we show that following an increase in the fed funds rate deposit spreads increase by more and supply falls more in areas with less deposit competition we control for changes in banks lending opportunities by comparing branches of the same bank we control for changes in macroeconomic conditions by showing that deposit spreads widen immediately after a rate change and even if this change is fully anticipated our results imply that monetary policy has a signicant impact on how the nancial system is funded on the quantity of safe and liquid assets it produces and on its provision of loans to the real economy

trade and the environment a partial synthesis there is an emerging consensus in the environmentalist community opposing free trade while some economists view this as simply another outlet for protectionism recent work has begun to move beyond the rhetoric to probe more deeply into the theoretical and empirical relationships between international trade and environmental quality the purpose of the present paper is twofold we first integrate some of the existing literature by using the simple concepts of general equilibrium pollution supply and demand our survey of the trade and environment literature is more

managing municipal solid waste with unit based pricing policy effects and responsiveness to pricing many municipalities across the united states have turned to unit based pricing also known as pay as you throw payt as a vehicle for reducing municipal solid waste generation increasing recycling and promoting equity in paying for the service in this paper we reevaluate the standard analytical methods used to examine the impact of payt in the literature and illustrate that econometric shortcomings may have led to underestimation of policy effects a two tier analytical approach to examining payt program effects is proposed and is demonstrated in a case study of new hampshire municipalities

landfill construction and capacity expansion we study the optimal capacity and lifetime of landfills taking into account their sequential nature such an optimal capacity is characterized by the so called optimal capacity condition particular versions of this condition are obtained for two alternative settings first if all the landfills are to have the same capacity and second if each of them is allowed to have a different capacity in the second case we obtain an optimal control problem with mixed elements of both continuous and discrete time the resulting optimization problems involve dividing a time horizon of planning into several subintervals of endogenously decided length the results obtained may be useful to address other economic problems such as private and public investments consumption decisions on durable goods etc

adopting a unit pricing system for municipal solid waste policy and socio economic determinants concerns about the environmental and aesthetic damages of municipal solid waste pollution have triggered policy reform at all levels of government as part of this effort public officials are integrating market based policy instruments such as unit pricing into their solid waste plans despite the economic advantages of unit pricing constituency response has been mixed and hence adoption rates have been below expectations if the associated gains are to be realized public officials must identify the key factors that influence this decision to that end this research empirically estimates the determinants of unit pricing adoption at the community level of analysis based on data for all cities and towns in massachusetts the results indicate that demographics socio economic attributes fiscal capacity and policy instruments influence this decision

the economic benefits of reducing the environmental effects of landfills heterogeneous distance decay effects this paper estimates the economic benefits of different alternative policies considered for reducing the external effects caused by the utilization of landfills in solid waste management the preferences of the local population in the surrounding areas of a landfill are evaluated utilizing a discrete choice experiment in which subjects are presented with alternative policy decisions that involve reducing the material processed through the landfill various models were employed in order to capture heterogeneous preferences resulting in a mixture of normals modelling approach mn mnl outperforming other alternative models of heterogeneity the results show that the policy of moving the landfill away from the population does not provide the most benefits when compared to a policy of increasing recycling in the household the economic benefits of the waste management policies are heterogeneous across the population surrounding the landfill and so the distance decay functions thus the economic benefits for most waste management policies can increase or decrease the further away the subject lives from the landfill depending on the preferences of his her segment and the type of policy employed

bureaucrats or politicians part i a single policy task this paper investigates the normative criteria that guide the allocation of a policy task to an elected politician versus an independent bureaucrat the bureaucrat is preferable for technical tasks for which ability is more important than effort or if there is great uncertainty about whether the policymaker has the required abilities the optimal allocation of redistributive tasks is ambiguous and depends on how the bureaucrat can be instructed but irrespective of the normative conclusion the politician prefers not to delegate redistributive policies

environmental regulation of households an empirical review of economic and psychological factors abstract the literature on sustainable consumption and environmental regulation of household behavior is dominated by conceptual and normative approaches as a result many suggestions lack a firm empirical basis to overcome this deficiency econometric studies in three areas of environmentally relevant activities of households are reviewed residential use of energy generation of solid waste and recycling and residential use of water next to price and income elasticities attention is devoted to individual socio economic features and psychological factors such as attitudes knowledge perceptions and values potential psychological determinants and related insights are further examined by discussing a range of representative and illustrative statistical psychological studies of environmental behavior one important general finding is that there are very few empirical studies that systematically combine socio economic and psychological determinants a range of insights for environmental policy is derived and research recommendations are offered

the corporate propensity to save why do corporations accumulate liquid assets we show theoretically that intertemporal trade offs between interest income taxation and the cost of external finance determine optimal savings intriguingly we find that controlling for tobin s q saving and cash flow are negatively related because firms lower cash reserves to invest after receiving positive cash flow shocks and vice versa consistent with theory we estimate negative propensities to save out of cash flow we also find that income uncertainty affects saving more than do external finance constraints therefore contrary to previous evidence saving propensities reflect too many forces to be used to measure external finance constraints

landfilling versus backstop recycling when income is growing the paper considers a dynamic model in which an income stream growing over time is optimally divided into consumption andexpenditures on waste disposal the latter being optimally dividedbetween recycling and landfilling recycling is thoughtof as a backstop waste disposal technology it does notrequire landfill space but is a relatively expensive method ofwaste disposal landfilling uses up scarce landfill capacity while conserving landfill space is the major reason themunicipality recycles another motive for recycling might be thatrecycling itself generates utility our analysis suggests thatthe optimal recycling program varies considerably with bothlandfill capacity and initial income for example richermunicipalities are likely to introduce recycling much earlier inthe planning period than poorer municipalities thus whenlegislating recycling national or regional governments must besensitive to the differences between municipalities

the political economy of trade liberalization and environmental policy a pressure group model where environmental and industry lobby groups offer political support in return for favorable pollution tax policies is used to explain and predict the equilibrium pollution tax in sectors protected by tariffs the political economy effects of trade liberalization are investigated the pollution tax is shown to decrease if the lobbying effort by the environmental lobby decreases more rapidly than by the industry lobby ceteris paribus the level of political conflict falls with trade liberalization pollution may increase because of a reduction of the pollution tax and tax revenues may fall simultaneously as pollution increases the global trading system is currently undergoing another round of multilateral trade liberalization and regional economic integration is occurring in several parts of the world the trade environment link has become an important part of trade liberalization talks it is commonplace for industry representatives to argue that less stringent environmental regulations give less developed countries ldcs a comparative advantage in pollution intensive goods and that industries with high abatement costs will migrate to ldcs environmentalists argue that international differences in environmental laws and regulations may be reduced to their lowest common denominator through political pressure this is not a fear of trade liberalization itself but of the effects of lower trade barriers on the political determination of environmental regulation

municipal waste kuznets curves evidence on socio economic drivers and policy effectiveness from the eu waste generation and waste disposal are becoming increasingly prominent in the environmental arena from a policy perspective and in the context of delinking analysis in general waste generation is still increasing proportionally with income and economic and environmental costs associated to landfilling are also increasing this paper provides a comprehensive analysis of waste generation incineration and landfill dynamics based on panel data for the eu25 to assess the effects of different drivers economic structural policy and the eventual differences between western and eastern eu countries we show that for waste generation there is still no waste kuznets curve wkc trend although elasticity to income drivers appears lower than in the past landfill and other policy effects do not seem to provide backward incentives for waste prevention and in terms of landfill and incineration as expected they are respectively decreasing and increasing with policy acting as a strong driver eastern countries appear to be performing generally quite well thus benefiting from eu membership and related policies in terms of environmental performance we can conclude that although absolute delinking is far from being achieved for waste generation there are some first positive signs of an increasing relative delinking for waste generation and robust landfill diversion and varying evidence of a significant role of the eu waste policies implemented in the late 1990s and early 2000s our evidence suggests that if while landfill diversion is currently associated to a delinking partly explained by eu policies waste prevention must be the next objective of waste regulation efforts

electoral competition and special interest politics have fixed positions on some issues but vary their positions on others in order to attract votes and campaign contributions in this context we examine whether special interest groups are governed by an electoral motive or an influence in their campaign giving and how their contributions affect the equilibrium platforms we show that each party is induced to behave as if it were maximizing a weighted sum of the aggregate welfares of informed voters and members of special interest groups the party that is expected to win a majority of seats caters more to the special interests

on the stability of money demand abstract we show that regulatory changes that occurred in the banking sector in the early 1980s that considerably weakened regulation q can explain the apparent instability of money demand starting in the same period we evaluate the effects of the regulatory changes using a model that goes beyond aggregates as m1 and treats currency and different deposit types as alternative means of payments we use the model to construct a new monetary aggregate that performs remarkably well for all the period 1915 2012

using choice question formats to determine compensable values the case of a landfill siting process abstract siting noxious facilities such as community landfills is a challenging problem for local planners who recognize the importance of economic efficiency and equity political acceptance and meeting federal regulatory standards meeting these criteria requires technical and socio economic analyses in conjunction with public input planners may also recognize that political acceptance requires compensation for the host community either in the form of monetary or in kind transfers following breffle and rowe breffle w s rowe r d 2002 comparing choice question formats for evaluating natural resource tradeoffs land econ 78 2 298 314 we use a resource to resource paired comparison survey method to estimate compensatory values associated with an in county landfill for both the host and non host communities our results indicate that while a host community household s minimum willingness to accept payment for hosting a landfill may exceed a non host community household s maximum willingness to pay a large difference in population sizes between the two communities enables the landfill to pass a kaldor potential compensation test

the political economy of pollution taxes in a small open economy abstract this paper develops a positive theory explaining pollution tax policy outcomes in a small open economy the equilibrium tax rate depends on lobby group membership the relative importance of lobbying activities and the tax elasticity of pollution the equilibrium properties are investigated the model is extended to incorporate pollution abatement and a pollution abatement subsidy we show that total pollution may be increasing in the pollution abatement subsidy rate this effect arises because the equilibrium pollution tax rate may be decreasing in the subsidy rate due to altered political influence of the lobby groups in the political equilibrium

effects of environmental regulation on separate waste collection dynamics empirical evidence from italy abstract this paper aims to evaluate the extent to which current italian legislation has been able to achieve the goals set for separate waste collection within the context of the ongoing revision of european union eu policy in italy waste management is regulated by legislative decree 152 2006 which has set the main regulatory pillars the responsibilities among the actors at different territorial levels regions provinces and municipalities the waste tariff structure penalties and incentives such as the landfill tax and green certificates to promote energy recovery focussing on separate collection of municipal waste the italian law set three targets to achieve 35 by 2006 45 2008 and 65 by 2012 we propose a two step analysis focussing on 103 italian provinces using the longitudinal data provided by the italian national institute of statistics istat for the period 1999 2011 first using the transition probability matrix we analyse the transition probabilities among three different separate waste collection states low medium and high second by using a generalised ordered probit model we verify the magnitude and significance of the parameter associated to the legislative decree 152 2006 and of some other selected variables in allowing provinces to move from a low separate collection state to a higher one our results show that the legislative decree has had the positive effect of driving italy s provinces towards higher separate waste collection rates but has not proved effective in lowering the gap among provinces those in southern italy remain the least dynamic finally we show that citizen participation in ecological associations and voluntary activities has a positive effect on separate collection rates

corporate cash holdings and credit line usage we investigate the factors driving the unprecedented rise in corporate liquidities since the 1970s we find that an economy wide reduction in the cost of holding liquidities and an increase in risk best explain the rise in cash holdings and the widespread use of credit lines the structural estimation results shed light on two widely acknowledged motives for holding cash the precautionary motive and the liquidity motive translate risk exposure into cash holdings our results however do not suggest that firms have become more prudent over time it is higher liquidity needs that has forced firms to hold more cash and use more credit lines abstract from author

effects of unit based garbage pricing a differences in differences approach using a unique 10 year dataset of all 458 dutch municipalities we apply a differences in differences approach to estimate the effect of unit based pricing on household waste quantities and recycling community level studies of unit based pricing typically do not include fixed effects at the local level we find that failure to do so may substantially inflate the estimated price effect we also find that unit based pricing may be endogenous and use instrumental variables to account for this our analysis shows that user fees depend on user fees in neighboring jurisdictions policy interaction our estimate of the garbage reduction per 1 user fee is lower than any previous estimate bar one the price effect depends on the pricing system weight based systems reduce garbage quantities more than volume based systems user fees increase recycling especially of paper but not nearly as much as they reduce garbage quantities we find no evidence for waste tourism or illegal dumping

on impatience economic growth and the environmental kuznets curve a dynamic analysis of resource management the paper presents a dynamic analysis of natural resource management and investigates some key factors that affect optimal management and resource conservation using a recursive specification of time preferences we show how endogenous discounting and impatience can affect the motivation for both capital investments and environmental preservation we examine the relationships between economic growth and environmental quality endogenous discounting provides new insights in the economic dynamics underlying the environmental kuznets curve by treating growth as endogenous we examine how externalities and economic growth interact with each other we investigate how economic development can contribute to an increased demand for environmental preservation as an important new result we also show how poverty can contribute to environmental degradation

the environmental kuznets curve does one size fit all abstract this paper uses a new panel data set on state level sulfur dioxide and nitrogen oxide emissions from 1929 1994 to test the appropriateness of the one size fits all reduced form regression approach commonly used in the environmental kuznets curve literature empirical results provide initial evidence that an inverted u shape characterizes the relationship between per capita emissions and per capita incomes at the state level parameter estimates suggest however that previous studies which restrict cross sections to undergo identical experiences over time may be presenting statistically biased results

tracking environmental innovations and policy regulations in japan case studies on dioxin emissions and electric home appliances recycling taking dioxin emissions from incineration and the recycling of home electric appliances in japan as two case studies this paper aims to clarify the impact of environmental policy on technological innovation for our case studies relevant japanese patent data were gathered and analyzed for the period 1990 2008 to demonstrate that environmental regulations induce technology innovation we conducted statistical analysis to compare the number of patents related to each regulation between the period under regulation and period outside the regulation the results show that after the regulations were introduced new technological developments occurred for most technological types and the total number of related patent applications was larger even when controlling for other exogenous and endogenous factors such as business cycles and expenditures in research and development r d we finally argue that while a possible weakness in these types of direct regulations is the lack of incentives for further innovations they can still induce innovation if they are flexible and with specific targets

is environmental innovation embedded within high performance organisational changes the role of human resource management and complementarity in green business strategies abstract this paper investigates whether firms joint implementation of organisational innovation and training may foster their adoption of environmental innovation ei and if this correlation falls within porter hypothesis ph framework we study the relationship of complementarity between strategies of high performance work practices hpwp and human resource management hrm when ei adoption is the firms objective using an original dataset on 555 italian industrial firms regarding ei hpwp and hrm coherent with the last cis2006 2008 survey results show that sector specificity matter the only case in which strict complementarity is observed in organisational change concerns co 2 abatement a relatively complex type of ei but this is true only when the sample is restricted to more polluting and regulated sectors this evidence is coherent with the porter hypothesis complementarity related adoption of ei is an element of organisational change in firms that are subject to more stringent environmental regulations nevertheless the fact that strict complementarity is not a diffuse factor behind the adoption of all environmental innovation indeed does not come as a surprise at this stage in the development of green strategies the share of eco firms is still limited even in advanced countries that are seeking tools for a new competitiveness the full integration of eis within the internal capabilities and firm s own assets is far from being reached even in advanced and competitive industrial settings

the costs of bankruptcy chapter 7 liquidation versus chapter 11 reorganization our paper explores a comprehensive sample of small and large corporate bankruptcies in arizona and new york from 1995 to 2001 bankruptcy costs are very heterogeneous and sensitive to the measurement method used we find that chapter 7 liquidations appear to be no faster or cheaper in terms of direct expense than chapter 11 reorganizations however chapter 11 seems to preserve assets better thereby allowing creditors to recover relatively more our paper also provides a large number of further empirical regularities our paper analyzes the largest sample of corporate bankruptcies to date we research approximately 300 cases from the arizona and new york federal bankruptcy courts from 1995 to 2001 these cases consist of 1 both publicly traded and privately held corporations and 2 both chapter 7 liquidations and chapter 11 reorganizations this sample is practically the entire population of unique corporate bankruptcies in these courts our paper s primary objective is to measure how the two available bankruptcy procedures differ especially but not only in terms of cost we explore four variables namely the change in the estate s value during bankruptcy a measure of indirect costs the time spent in bankruptcy another and more common measure of indirect costs the expenses submitted to and approved by the bankruptcy court a measure of direct costs and the recovery rates for creditors and apr violations our most important findings are that chapter 7 liquidations are not cheaper than chapter 11 reorganizations particularly after we control for endogenous self selection of firms into bankruptcy procedure bankruptcy professionals attorneys accountants trustees regularly end up with most of the post bankruptcy firm s value in chapter 7 arturo bris is at imd yale school of management and ecgi ivo welch is at brown uni

an economic analysis of household waste management abstract this paper provides a comprehensive model of household waste management policy incorporating the possibility of waste reduction effort by the firm and the household and of illegal waste disposal by the household when household waste reduction effort is insignificant the first best optimum can be achieved using various combinations of environmental tax on the firm and waste collection charge on the household however when household waste reduction effort is significant the first best optimum is not achievable and explicit monitoring of illegal waste disposal is needed rendering a simple pigouvian tax sub optimal this paper solves for the second best optimal policy and provides some comparative statics of the optimal policy