material flows vs natural capital what makes an economy sustainable abstract in the discourse about sustainable development constant natural capital is frequently referred to as a criterion for ecological sustainability but what is natural capital the concept will be analyzed by presenting arguments in favour of using the term and different versions of sustainability strong and weak subsequently a critique of the natural capital concept is brought forward from an ecological as well as from an economic perspective following this critique the use of material inputs and the material input per unit of service mips as a measure for the environmental impact potential is suggested dematerialisation is understood to be an alternative management rule for sustainability in conclusion a change of perspective is proposed due to the conceptual and measurement problems associated with the constant natural capital criterion which refers to a stock it seems more reasonable from a scientific as well as from a practical perspective to add flows i e material inputs to a decision criterion for whether a development is sustainable or not

the environmental economic impact of woodland a two stage hedonic price model of the amenity value of forestry in britain woodland is an important part of the environment providing economic benefits through its use in commercial timber production and through its value as an amenity as well as providing recreation for visitors woodland is also important to local residents for whom it provides leisure opportunities and a source of aesthetic enjoyment it is well known that the price of a house may reflect a household s willingness to pay to live near an environmental amenity such as a forest and to gain access to it the nature of this relationship may be examined by applying the hedonic price technique an econometric method which investigates house prices and the variation in structural and environment characteristics over space this study uses a two stage hedonic price model to explore the impact of forest type on house price and to estimate the demand for broadleaved woodland for a sample of houses adjacent to forestry commission land

multi directional efficiency analysis of efficiency patterns in chinese banks 1997 2008 dea type efficiency studies are often used to investigate levels of efficiencies differences in those levels between subgroups within a data set and possible determinants of such differences in the current paper we show how differences in the efficiency patterns between different subgroups within a data set can be investigated using the more recent mea methodology we specifically look at the case of joint stock banks and state owned banks in china and are able to empirically test hypotheses of whether there are differences not only in the levels but also in the patterns of inefficiencies between the two types of banks that is which variables the inefficiencies are located on we argue that certain differences are expected based on differences in objectives and constraints in the two types of banks and find empirical support for most of those expected patterns

the environmental social interface of sustainable development capabilities social capital institutions the social dimension has commonly been recognised as the weakest pillar of sustainable development notably when it comes to its analytical and theoretical underpinnings while increasing attention has lately been paid to social sustainability the interaction between the environmental and the social still remains a largely uncharted terrain nevertheless one can argue that the key challenges of sustainable development reside at the interfaces synergies and trade offs between its various dimensions this paper looks for preliminary ideas on frameworks for analysing the environmental social interface it first discusses the concept of sustainable development and the relations of the three dimensions of sustainability on the basis of the fundamental premises of neoinstitutional and ecological economics and briefly presents the bioeconomy model based on this conceptualisation of sustainable development it then goes on to analyse two popular ways of addressing the social dimension of sustainability namely the capability approach of amartya sen and the concept of social capital and discusses the potential of these as bases for the analysis of the environment social interaction the organisation for economic cooperation and development oecd environmental performance review epr programme is presented as an example of attempts to analyse the environmental social interface in practice the paper concludes by noting that a single framework for studying environmental social interface is neither feasible nor desirable it questions the usefulness of analysing only two dimensions of sustainability at a time and emphasises the need to situate the analysis in its context in particular it stresses the need to involve the potential users as well as to take into account the planned use of the analysis and the interactions between different levels of analysis and decision making capabilities and social capital can both be useful in structuring thoughts but are not as such directly applicable as suitable analytical frameworks in particular they do not provide adequate tools for examining the social preconditions for institutional change needed for environmentally sustainable development

the effects of development constraints on forest management at the urban forest interface this article develops a model of a forest owner operating in a small open city environment where the rent for developed land is increasing concave in nearby preserved open space and is rising over time reflecting an upward trend in households income within this framework we examine how changes in nearby preserved open space and alternative development constraints affect an individual private landowner s decisions regarding both regeneration harvests and conversion dates we also examine how such policies affect development density once conversion from forestry to residential use occurs we show that when residential rents change over time the nature of the timber problem at the urban forest interface changes because it forces us to allow for the possibility of changes in land use from timber to residential use as a result the traditional faustmann setup is not suitable to study forest management decisions at this interface we also find that in the presence of rising income increases in permanently preserved open space hasten regeneration and conversion cuts of a neighboring parcel currently under forest use and leads to lower density development once conversion takes place compared to the case where income is constant we also find that both a binding development moratorium and a binding minimum lot size policy can postpone regeneration and conversion cut dates and thus help to protect open space even if only temporarily however the policies do not have the same effects on development density of converted forestland while the former leads to high density development the latter encourages low density development

valuing english primary schools this paper provides the first empirical evidence for the uk on the effect of primary school performance on property prices we find that on average a one percentage point increase in the neighbourhood proportion of children reaching the government specified target grade pushes up neighbourhood property prices by 0 67 at 2000 property prices we calculate the social valuation of a sustained 1 improvement in primary school performance to be up to 90 per child per year our instrumental variable and semi parametric approach avoids the problems of school quality endogeneity and omitted neighbourhood variables that occur in typical property value models

towards a science of sustainability improving the way ecological economics understands human well being abstract ecological economics seeks to recognize what traditional economics often ignores that the economy is embedded in wider social and biophysical systems to date ecological economics has focused on the biophysical dimensions of these interactions yet achieving sustainable development will require difficult decisions regarding which environmental and other assets should be preserved and in what form this emphasizes the importance of understanding why particular environmental resources and services are important to human well being and how social and economic institutions may be structured to make the best use of these and other forms of capital the paper thus examines a variety of approaches to well being characterizing these as interpreting well being as a state of mind as a state of the world as human capability or as the satisfaction of underlying needs the literature surveyed is drawn largely from political philosophy and psychology and includes classical utilitarianism and self evaluative approaches descriptive utilitarianism and preference based approaches the basic needs approach functional approaches and underlying needs based and virtue based approaches particular authors include michalos scitovsky easterlin hirsch galbraith rawls sen maslow boyden and max neef the ideas examined are found to have significant implications for economic theory and policy especially regarding the social construction of preferences the treatment of distributional issues the identification of universal underlying needs and the relationship between the satisfaction of these needs and perceived well being these insights suggest that rising real incomes are unlikely to result in improved community well being calling into question the traditional economic view of progress they also offer a new path to sustainable development in which the primary focus is on the cultivation of appropriate institutions and attitudes rather than on the better management of resources the paper concludes that important aspects of social economic and environmental systems are codetermined and thus that achieving sustainable development will require an expansion of the scope of analysis to encompass a wider system dynamic the most promising approaches to well being in this context are those that identify universal underlying human needs thus avoiding the commodity fetishism of mainstream economics

foreign bank entry deregulation and bank efficiency lessons from the australian experience abstract this study considers the impact of foreign bank entry on banking efficiency in australia during the post deregulation period 1988 2001 using data envelopment analysis malmquist indices and stochastic frontier analysis we find foreign banks more efficient than domestic banks which however did not result in superior profits major australian banks have used size as a barrier to entry to new entrants furthermore bank efficiency has increased post deregulation and the competition resulting from diversity in bank types was important to prompt efficiency improvements finally the recession of the early 1990s resulted in a distinct shift in the process of efficiency changes

sustainability as a fair bequest an evaluation challenge abstract in contrast to conventional approaches the conceptualisation of sustainability as fair bequest makes it possible to consider a finite time horizon valuation is necessary to determine whether the bequest package that is passed on from one generation to the next is fair acknowledging the merits as well as the limitations of economic price theory this paper differentiates between three classes of valuables the essential the useful and the unique it is argued that a fair bequest package should contain items from each of the classes because the three classes are incommensurable fairness of the bequest cannot be expressed by a single figure like a non declining total value of the package we then discuss which methods are appropriate for describing a bequest package with respect to its fairness

natural capital and quality of life a model for evaluating the sustainability of alternative regional development paths abstract natural capital contributes to the quality of life of a region in two complementary ways first by directly providing environmental services that cannot be imported and second by supplying the natural resources that through a human controlled production process become valuable to humans the evolution of the combination of these two components of the quality of life determines the path of development a region takes environmental services also determine the ability of natural capital to regenerate itself ecosystems and other components of the regional natural capital produce environmental services that provide life support functions necessary for natural capital reproduction the destruction of this critical natural capital impairs the internal sources of improvement of the quality of life of a region leading to a non sustainable path of development this article describes a model of the relationship between natural capital and quality of life that provides a stricter definition of sustainable development through explicit characterization and classification of natural capital according to its ability to produce life supporting environmental services by its substitutability and by its possible reconstruction application of this model then shows that there are 51 possible regional development paths only 32 of which are sustainable and only 14 of which are sustainable while also providing improvements in quality of life only six of these 14 sustainable development paths are attained with economic growth however while the other eight paths increase quality of life by increasing the production of environmental services the model could help in the development of institutional interventions that would promote regional development paths that are sustainable

strong sustainability critical natural capital and the capability approach this article is an attempt to conceptually improve the notion of strong sustainability by creating a rapprochement between its core concept critical natural capital and the capability approach we first demonstrate that the capability approach constitutes a relevant framework for analysing the multiple links between human well being and critical natural capital second we demonstrate that the rapprochement between critical natural capital and the capability approach can form both the normative basis and the informational basis for a deliberative approach to human development which embraces a strong sustainability perspective this conceptual rapprochement as illustrated in our case study opens up avenues of research towards the practical implementation of human development projects from a strong sustainability perspective

accounting technologies and sustainability assessment models abstract within ecological economics there is recognition of the need for new approaches to decision making to support sustainable development initiatives there is an increasing acknowledgement of the limitations of cost benefit analysis approaches as a measure of the un sustainability of organizational activities these are viewed as particularly inappropriate within the participatory settings that sustainable development proponents seek to foster they also fail to deal with the highly contested nature of sustainable development discourse in contemporary pluralist democracies while advances have been made in the field of multi criteria decision making there is still a relative dearth of versatile models that accommodate monetization in a way that recognizes the limits of calculative technologies this article introduces readers to developments within the accounting discipline designed to support sustainable development decision making and evaluation in particular it proposes sustainability assessment models as a viable alternative to cost benefit analysis sustainability assessment models are based on an inter disciplinary approach that recognizes the need for accountings that facilitate more participatory forms of decision making and accountability as such they address many of the weaknesses in current approaches to cost benefit analysis the authors first experiences with sustainability assessment models were with bp and the united kingdom oil and gas sector where models were developed as a means of making previously external costs more central to organizational decision making later work has included exploration of a range of decision making situations in private and public sector organizations in both the united kingdom and new zealand this has involved more explicit attention to plural values and issues of participation dialogue and democracy

rethinking ecosystem services to better address and navigate cultural values ecosystem service approaches have become a prominent basis for planning and management cultural services and non use values are included in all major typologies and present some of the most compelling reasons for conserving ecosystems though many barriers exist to their explicit characterization the values that conform least well to economic assumptions variously lumped together with as cultural services have proven elusive in part because valuation is complicated by the properties of intangibility and incommensurability which has in turn led to their exclusion from economic valuation we argue that the effectiveness of the ecosystem services framework in decision making is thwarted by i conflation of services values and benefits and ii failure to appropriately treat diverse kinds of values we address this challenge by 1 distinguishing eight dimensions of values which have implications for appropriate valuation and decision making 2 demonstrating the interconnected nature of benefits and services and so the ubiquity of intangible values 3 discussing the implications of these propositions for ecosystem services research and 4 outlining briefly a research agenda to enable decision making that is ecologically appropriate and socially just because many ecosystem services co produce cultural benefits full characterization of services must address non material values through methods from diverse social sciences

valuing school quality using boundary discontinuities abstract existing research shows that house prices respond to local school quality as measured by average test scores however higher test scores could signal higher academic value added or higher ability more sought after intakes in our research we show that both school value added and student prior achievement linked to the background of children in schools affect households demand for education in order to identify these effects we improve the boundary discontinuity regression methodology by matching identical properties across admissions authority boundaries by allowing for boundary effects and spatial trends by re weighting our data towards transactions that are closest to district boundaries by eliminating boundaries that coincide with major geographical features and by submitting our estimates to a number of novel falsification tests our results survive this battery of tests and show that a one standard deviation change in either school average value added or prior achievement raises prices by around 3

the amenity value of english nature a hedonic price approach using a hedonic property price approach we estimate the amenity value associated with proximity to habitats designated areas domestic gardens and other natural amenities in england there is a long tradition of studies looking at the effect of environmental amenities and disamenities on property prices but to our knowledge this is the first nationwide study of the value of proximity to a large number of natural amenities in england we analysed 1 million housing transactions over 1996 2008 and considered a large number of environmental characteristics results reveal that the effects of many of these environmental variables are highly statistically significant and are quite large in economic magnitude gardens green space and areas of water within the census ward all attract a considerable positive price premium there is also a strong positive effect from freshwater and flood plain locations broadleaved woodland coniferous woodland and enclosed farmland increasing distance to natural amenities such as rivers national parks and national trust sites is unambiguously associated with a fall in house prices our preferred regression specifications control for unobserved labour market and other geographical factors using travel to work area fixed effects and the estimates are fairly insensitive to changes in specification and sample this provides some reassurance that the hedonic price results provide a useful representation of the values attached to proximity to environmental amenities in england overall we conclude that the housing market in england reveals substantial amenity value attached to a number of habitats designations private gardens and local environmental amenities

is what you see what you get the value of natural landscape views views of natural areas and green space may have value quite apart from access to those lands using 25 years of home sales data from st louis county missouri and modern geographic information system tools to measure views we estimate a hedonic property fixed effects model that captures the effects of changing land cover on house sale prices unlike previous studies our approach minimizes bias from omitted variables and uniquely captures changes over time we find that forest views negatively affect home prices whereas farmland views have positive effects changes in relative scarcity of these land types over time may explain the findings

critical natural capital a socio cultural perspective abstract critical natural capital cnc is commonly defined as that part of the natural environment which performs important and irreplaceable functions so far the challenge to determine the criticality of natural capital nc has mainly been taken up by the natural sciences and the critical functions of nature mainly associated with its life support and ecological services little attention has been paid to the socio cultural functions of nc and to their values for the health and well being of human societies the aim of this paper is to encourage a more complete accounting of the critical functions of nc and its associated values by highlighting the importance of the information functions health recreation amenity education heritage etc for the quality and sustainability of human life it is argued that despite their immaterial and often intangible nature these functions provide many socio economic benefits which might be assessed through both qualitative and quantitative valuation methodologies integration of ecology sociology and economics is essential to operationalize the concept of cnc as a tool for more balanced environmental planning and decision making

dynamic multi directional inefficiency analysis of european dairy manufacturing firms abstract this paper extends the method of multi directional inefficiency analysis to account for dynamics of firms production decisions the resulting approach dynamic multi directional inefficiency analysis measures variable input and investment specific inefficiency using data envelopment analysis the empirical application focuses on panel data of large dairy manufacturing firms over the period 2005 2012 in three european regions eastern southern and western the results show that investments are the most inefficient factor for firms in all european regions followed by labour and materials however the findings also suggest a high dispersion of investment specific inefficiency scores within the sample the paper also finds that the median dynamic inefficiency is changing rapidly in the years after the beginning of the financial crisis

spatial scale and product mix economies in u s banking with simultaneous spillover regimes the literature on bank scale economies focuses on the familiar type of returns to scale that are internal to the firm using a spatial approach we analyze returns to scale for banks that are made up of external i e spillover economies we extend ray scale economies rse expansion path scale economies epse and expansion path subadditivity epsu to the spatial case this involves introducing direct and composite and decomposed indirect rse epse and epsu these direct and indirect measures relate to the cost implications for a firm from a change in i the firm s output levels that are as is standard under its control and ii the composite decomposed spillover effect on the firm s output levels which is primarily but not entirely outside its control we include an application to u s banks 1998 2015 that allows a bank to simultaneously belong to a number of spatial networks which is typically what we observe for firms for large banks we find constant direct rse and epse and zero composite indirect rse and constant composite indirect epse these composite indirect results do not counteract any policy suggestions from the direct rse and epse concerning the debate on whether there should be size caps on very large u s banks the direct rse and epse for large banks suggest that these banks use society s resources efficiently to provide their services size caps on very large banks would place downward pressure on these direct rse and epse results which could lead to large banks using society s resources inefficiently

estimating the demand for protecting freshwater lakes from eutrophication in any discussion of the valuation of public goods particularly environmental amenities contingent valuation travel cost and hedonics are commonly cited as methods for estimating hicksian or marshallian welfare freeman while contingent valuation and travel cost are widely employed we know of very few applications where hedonic demand functions have been estimated palmquist 1984 and parsons estimated second stage hedonic demands for characteristics of housing units both used the approach of estimating separate hedonic price functions for different real estate markets to identify demand parameters for housing characteristics the research reported here is the first to use separate real estate markets to identify demand parameters for an environmental amenity the specific application is water clarity in selected lakes in maine reduced water

accounting for heterogeneity of public lands in hedonic property models open space lands national forests in particular are usually treated as homogeneous entities in hedonic price studies failure to account for the heterogeneous nature of public open spaces may result in inappropriate inferences about the benefits of proximate location to such lands in this study the hedonic price method is used to estimate the marginal values for proximity to the pike national forest the results indicate that specifying the forest as homogeneous overstates the benefits for homes within two miles relative to specifying the forest based on land use characteristics because the significant negative effect from noise intensive activities is omitted jel h41 q51

the time varying nairu and its implications for economic policy the nairu the unemployment rate consistent with a constant rate of inflation is estimated in this paper as a parameter allowed to vary over time value is determined in an econometric model where the inflation rate depends on its past values demand and supply shocks the nairu estimated for the gdp deflator varies over the past forty years within 5 4 to 6 5 percent its estimated value for the most recent quarter 1996 q2 is 5 6 percent the nairu has declined in recent years in response to global competition immigration other factors weakening labor s bargaining position and the rapidly declining prices of computers and other electronics

estimating the demand for tree canopy a second stage hedonic price analysis in portland oregon the benefits of large patches of tree canopy are estimated by applying a hedonic price model to the sale of single family residential properties in portland oregon the first stage analysis provides evidence of diminishing returns from increasing tree canopy past a certain level the second stage analysis uses a survey of property owners preferences and socioeconomic characteristics to overcome the problem of endogeneity average benefit estimates for the mean canopy cover within mile of properties in the study area using the second stage model are between 0 75 and 2 52 of the mean sale price

a framework for the practical application of the concepts of critical natural capital and strong sustainability this paper develops a methodology for identifying that natural capital called critical natural capital cnc the maintenance of which is essential for environmental sustainability by consideration of the characteristics of natural capital of the environmental functions that these characteristics enable natural capital to perform and of the importance of these functions to humans and the biosphere it shows how sustainability standards in respect of these environmental functions may be derived the difference between the current situation and these standards is termed the sustainability gap the methodology that emerges from bringing these ideas together into a single analytical framework enables policy makers to identify the extent of current unsustainability the principal causes of it the elements and processes of natural capital the cnc which need to be maintained or restored to close the sustainability gap and the costs of so doing the framework should therefore be of use in identifying priorities and policies for moving towards environmental sustainability

combining revealed and stated preference methods to value environmental amenities at residential locations this paper combines an established revealed preference method discrete choice he donic analysis and a relatively new stated refer ence method choice based conjoint analysis in order to estimate more accurately the aesthetic benefits generated by the presence and quality of environmental amenities associated with residen tial locations it applies the combined approach to the housing market of fairfield connecticut which contains several environmental amenities and is experiencing an improvement in the quality of its coastal wetlands due to active restoration efforts jel q26

externalities in urban sustainability environmental versus localization type agglomeration externalities in a general spatial equilibrium model of a single sector monocentric industrial city abstract this paper studies urban sustainability from the perspective of externalities we develop a general spatial equilibrium model of a monocentric city in which two types of externalities occur on the one hand pollution in the industrial center leads to a spatially differentiated deterioration of the environmental quality in the residential area on the other hand the existence of the city is explained by agglomeration economies represented as simple marshallian external benefits in production we investigate free market versus first best and second best optimal spatial equilibria and conclude that the pursuit of environmental goals may sometimes come at the expense of reduced agglomeration economies but may actually sometimes also stimulate these economies

spatial approach to sustainable development challenges of equity and efficacy zuindeau b 2006 spatial approach to sustainable development challenges of equity and efficacy regional studies 40 459 470 examining sustainable development by favouring a spatial approach leads one to modify the definition of the challenges relating to this issue the present paper considers the two challenges of equity and efficacy and it tries to specify the variables that influence each of them in a spatial approach in order to do this it draws on the existing literature highlighting the differences in treatment depending on the approach and also stressing the weaknesses overall it is believed that the spatial dimension exacerbates the contradictions that arise from the implementation of sustainable development in particular the contradictions that are likely to appear between a logic of sustainability and a logic of competitiveness the paper concludes by examining the question of governance zuindeau b 2006 approche spatiale du developpement durable enjeux d equite et d efficacite

unbundling negative and positive externalities of nature in cities the influence of wild animals on housing prices proximity to nature is highly valued by urbanites who demonstrate higher willingness to pay for housing at locations near open and green spaces however nature in cities can generate negative ext

indicators of sustainable development some lessons from capital theory abstract interest in sustainable development has prompted a search for suitable indicators that might complement or supplant the traditional measures of economic success although there is no agreement about the precise meaning of sustainable development one idea which is increasingly in good currency is that sustainable development requires that the stock of capital that one generation passes on to the next be maintained or enhanced further this stock of capital is seen by some to comprise two elements manufactured capital and natural capital the extent to which these are believed to be substitutes or complements is one factor which separates the neoclassical school from some of its critics a premise of this paper is that if capital theory is relevant to sustainable development then it should also be helpful in developing indicators however even within the normal confines of economics capital theory is not a homogeneous body of analysis therefore an exploration of capital theory and its relevance to sustainable development can be expected to generate various perspectives on those measures most useful for gauging the sustainability of economic activity it is these linkages between capital theory in various schools of thought and possible indicators of sustainable development that are the subject of this paper

neoclassical natural capital theory and weak indicators for sustainability we appraise neoclassical theory of growth with natural capital for the estimation of indicators for sustainability relationships between four theoretically distinct measures are clarified hicksian change in capital stock value the hartwick net savings which excludes capital gains sustainable national income sni and environmentally adjusted net national product gnnp an overlapping generations olg general equilibrium model with depletable natural capital demonstrates the significance of model parameters determining technical feasibility and intertemporal distribution of consumption irremediable uncertainties in model specification and empirical measurement mean that the neoclassical theory is not robust for defining or estimating indicators for sustainability

wta estimates using the method of paired comparison tests of robustness the method of paired comparison is modified to allow choices between two alternative gains so as to estimate willingness to accept wta without loss aversion the robustness of wta values for two public goods is tested with respect to sensitivity of the wta measure to the context of the bundle of goods used in the paired comparison exercise and to the scope scale of the public good project there was no statistical difference in wta measures for open space based on independent treatments with different contexts one treatment involved valuing open space within a set of goods with similar value the other treatment involved valuing open space within a choice set of goods which had lower dollar values than open space there was a statistical difference in wta between a permanent expansion in the bus system and a temporary expansion in the bus system we conclude the method of paired comparison appears to be a very promising approach to elicit measures of wta

hedonic amenity valuation and functional form specification this paper uses gis data to develop variables representing the physical extent and visibility of surrounding land use cover features in a hedonic model of a rural suburban residential housing market three equations are estimated to determine if views

a dynamic stochastic frontier model to evaluate regional financial efficiency evidence from chinese county level panel data abstract studies have widely used stochastic frontier models to assess financial efficiency however traditional static approaches do not take dynamic characteristics of financial systems into account this article develops a dynamic stochastic frontier model to evaluate regional financial efficiency and provides an empirical test of the model by using panel data of 62 chinese counties during the 2001 2010 period the model measures the dynamic impact of the input output variables and environmental variables on financial efficiency and allows for the separation of technical change from the change in technical efficiency the results show that the dynamic model provides a better fit to the data than the static model in addition a gradient difference emerges in the regional financial efficiency among the six major regions of china the results offer practical implications for the development of regional financial services in china as well as other developing countries and emerging economies

critical natural capital revisited ecological resilience and sustainable development abstract the maintenance of critical natural capital is an important objective of sustainable development critical natural capital represents a multidimensional concept as it mirrors the different frameworks of various scientific disciplines and social groups in valuing nature this article revisits the concept of critical natural capital and examines its relation to the concept of ecological resilience i propose that ecological resilience can help a great deal in specifying the ecological criticality of specific renewable parts of the natural capital more specifically i suggest that the degree of ecological resilience is inversely related to the degree of threat ecosystems are prone to the concept of ecological resilience may complement other measures such as integrity or vulnerability in estimating the degree of threat specific ecosystems are exposed to the empirical estimates of ecological resilience add a further criterion in order to build a comprehensive and clear conception of critical natural capital

the welfare economics of land use planning abstract this paper presents an empirical methodology for the evaluation of the benefits and costs of land use planning the technique is applied in the context of the town and country planning system of the uk and examines the gross and net benefits of land use regulation and their distribution across income groups the results show that the welfare and distributional impacts can be large

measuring heterogeneous preferences for preserving farmland and open space abstract public preferences for environmental policies often vary among individual citizens according to their socio economic characteristics and attitudes toward environmental programs most researchers account for socio economic characteristics when conducting public preference surveys but do not account for differences in preferences that transcend socio economic categories identifying the public s attitudes regarding environmental programs and the role they play in shaping individuals preferences for policy alternatives can assist policy makers in developing programs that are consistent with public expectations this paper uses factor analysis and a discrete choice model to describe differences in public preferences that result from different attitudes regarding the goals of programs designed to preserve farmland and open space results describe policy implications that are not apparent when using models that address socio economic characteristics alone

towards sustainable city policy an economy environment technology nexus abstract environmental problems have become a worldwide concern for economists as is witnessed by the development of many theories and policies aimed at driving the economy towards a sustainable economy the problem becomes even greater if we discuss cities as recognised in many studies a high percentage of the world population lives in cities where quality of life and environmental concerns undermine all advantages associated with agglomeration economies the vast experience in terms of theoretical and empirical substance which has been built up around the theme of sustainable economy has only partially helped to generate a framework for an urban sustainable development the city is in fact by definition an artifact environment where well established concepts of environmental economics such as natural capital stock natural environment can hardly be transferred and applied in the way they are theoretically formulated the first scope of the paper is to offer an analytical framework for urban sustainable development to present the main economic concepts that are hidden under this label in particular different environments co exist in a city the natural the artifact and the social environment each of them generates positive and negative externalities for the city since each of them represents use advantages and use costs for a city if this is true then it is a plausible assumption that the integration of these three environments has to be supported with specific intervention policies the main aim of this paper is to highlight the possible intervention policies which may be developed to achieve a balanced sustainable development in terms of new policy principles that should govern the sustainable city

discursive ethics in ecosystems valuation and environmental policy abstract discursive ethics has its origin in the frankfurt school of critical theory as an applied ethic it is also associated with practical philosophy in this paper discursive ethics is discussed as a conceptual and practical framework for ecosystems valuation and environmental policy the discussion focuses on three main strengths of discursive ethics 1 it offers an integrated process for ecosystems valuation 2 it offers a decision making framework for responding to uncertainty and risk and the reality of action in indeterminacy 3 it offers a process for deconstructing common valuation concepts and identifying conditions for their critical reconstruction the theoretical discussion is followed by a case study example which illustrates the usefulness of discursive ethics in identifying valuation biases hidden behind disciplinary assumptions and conceptual norms these include cultural norms of rationality information biases which consider hard facts over soft values and disciplinary valuation biases which distinguish between hard and soft expert contributions as the case study illustrates a successful application of discursive ethics in ecosystems valuation and environmental policy demands sensitivity to such underlying biases beyond its policy relevance discursive ethics may also offer a framework for an extended peer discourse through which new foci in research and education can be identified

mixed monetary and non monetary valuation of attractive urban green space a case study using amsterdam house prices abstract this paper offers new insight into the monetary value of green space at the intra urban level to this end an established monetary valuation method hedonic price analysis is integrated with a relatively novel non monetary valuation method in specific online value mapping based survey data n 723 are used to inform hedonic models of the preferences that potential home buyers may have for nearby attractive green spaces the estimation uses data on 35 298 home transactions in the amsterdam agglomeration s urban core homes nearby attractive green space are found to sell at a price premium which decays with distance and becomes negligible after one kilometer the estimated price effect varies from 7 1 9 3 for houses within 0 25 km from the nearest attractive green space to 1 7 2 3 for houses located at 0 75 1 0 km away depending on the scale at which omitted spatial variables are controlled for adding to the discussion of spatial controls in this type of analysis the controls are evaluated at multiple scales and a metric that simplifies the interpretation of the scale of spatial controls the mean equalized diameter is introduced this study s findings may inform policymakers who seek to maximize the well being of urban citizens through public investments in attractive amenities

measuring incoordination adjusted sustainability performance during the urbanization process spatial dimensional perspectives abstract urbanization sustainability is intrinsically against incoordination in two distinct forms incoordination across sustainability dimensions and geographical spaces in sustainability performance however the rapid urbanization particularly in those developing countries such as china has been bringing along the problems of dimensional incoordination and spatial incoordination to date existing studies do not address these two forms of incoordination while assessing the sustainable urbanization this paper therefore introduces a measurement model to evaluate the incoordination adjusted sustainability performance during the urbanization process the proposed model is established based on the examinations of the weak strong sustainability perspective and the principle of spatial justice theory the atkinson measure is employed to develop the model a case study of the chongqing city is conducted to illustrate the process of applying the proposed model the outcomes from the case study reveal that the model proposed is effective in gauging and monitoring the status and trajectories of sustainability incoordination during the urbanization process

clarifying protected and utilitarian values of critical capital abstract sustainable development may be defined as a non declining value of capital stocks social natural built and human over time the ability for substitution between and within each stock over time has been widely debated resulting in the identification and then preservation of critical capital stocks we propose that critical can be defined from two ethical perspectives teleological or consequentialist goal or ends based and deontological moral duty and rule based the consequential ethic ensures critical capitals are utilitarian in value and they generate goods and services for the maintenance of human wellbeing whilst deontologically critical capital depends on culturally and psychologically protected values which may vary locally or at least as for e g biodiversity be open to conflicting opinions this separation in the basis for defining critical capital stocks leads to awareness that some tradeoffs between critical capital stocks may be irreconcilable or likely to lead to outrage a framework is developed to guide practitioners as to how to identify critical capital stocks using both protected and utilitarian values examples show that protected values are likely to be specific to community ethnic religious cultural etc and require different methods for resolving substitutability of capital stocks to achieve sustainable development

the phillips curve regime switching and the nairu abstract this paper explores the impact of nonlinearities in the phillips curve and its representation by means of a regime switching model on the meaning and the usefulness of the nairu by implementing a regime switching model that can endogenously generate fluctuations in inflation and in the rate of unemployment we conclude that the nairu is not necessarily a single value is not necessarily reachable and is very difficult to measure the model yields a neutral rate which is more an interval of values than a precise number furthermore by postulating dynamic interdependence between real and monetary aspects the model weakens the theoretical basis of the nairu concept itself

wages rents and the quality of life this study focuses on the role of wages and rents in allocating workers to locations with various quantities of amenities the theory demonstrates that if the amenity is also productive then the sign of the wage gradient is unclear while the rent gradient is positive the theory is extended to include the housing market and nontraded goods these extensions require little modification of the conclusion the empirical work on wages shows that the regional wage differences can be explained largely by these local attributes with the use of site price data implicit prices are estimated and quality of life rankings for the cities are computed

sustainability and wellbeing a scientometric and bibliometric review of the literature interdisciplinary research on measuring the progress towards sustainability and well being saw from different perspectives and in various contexts has developed dramatically over recent decades this growth in the literature has not only added an enormous number of dimensions to the saw debate but the sheer scale of the expansion has challenged researchers to be able to conduct a comprehensive analysis of the available saw indicators in this work we have proposed a hybrid method comprised of sophisticated scientometric analysis to summarise scientific developments in the massive text corpus of the saw literature in conjunction with a more traditional literature review to categorise the fuzzy details that remain scientometric analysis highlights that the developed oecd countries play a vital role in the development and applications of saw indicators and we describe key developments in this regard via a range of graphical approaches using an extensive collection of existing saw indicators the analysis is then summarised in a matrix of ranked indicators which serve as a powerful tool to compare contrast filter and select indicators for saw assessment with minimum redundancies between indicators the approach undertaken in this study is intended to be flexible and can be extended and applied to other fields of research

weak sustainability and viable technologies abstract the context of the concept of weak sustainability is examined using a three tier hierarchy of value we argue that weak sustainability is relevant only in the context of market exchange at a particular point in time it offers an inadequate guide to the sustainability of social institutions and of the natural world on the other hand georgescu roegen s concept of a viable technology recognizes that the integrity of the social and environmental systems surrounding market activity must be maintained if the human species is to persist through time the concept of viability recognizes that market activity depends not only upon the sustaining functions of the environment but also upon the social sustaining functions of human institutions

testing the nairu model for the united states this paper tests using u s data the dynamics implied by the nairu view of the relationship between inflation and the unemployment rate the results are somewhat sensitive to the measure of inflation used but they generally reject the dynamics an alternative way of thinking about the relationship between inflation and the unemployment rate is suggested

using contingent pricing analysis to value open space and its duration at residential locations to estimate benefits from open space adjacent to residences this paper blends contingent valuation and conjoint analysis within a housing market context the resulting framework contingent pricing analysis represents the stated preference counterpart to hedonic pricing analysis by asking individuals to state prices for hypothetical housing locations which include an environmental amenity then it asks individuals to state their willingness to pay for a better and longer lasting environmental amenity as an advantage over hedonic pricing analysis it directly isolates willingness to pay results indicate that potentially short lasting open space adds no value while preserved open space adds 5 066 or 5 to housing value

efficiency dynamics in indian banking a conditional directional distance approach abstract the paper contributes to the contemporary research on bank efficiency in india we analyze the efficiency dynamics of the indian banking industry from 2004 to 2012 based on the recent methodological developments of the conditional and unconditional directional distances introduced by daraio and simar 2014 we apply a conditional directional distance estimator in order to analyze the dynamic effects of industry s performance levels the results indicate that foreign banks perform better compared to national and domestic private banks there is also evidence of technological change at the period before the global financial crisis however during and after the global financial crisis these gains diminished the evidence suggests that national banks fail to sustain their high performance levels gained after the industry s restructuring period finally the findings support the view that ownership structure affects banks technical efficiency levels

an embarrassment of riches confronting omitted variable bias and multiscale capitalization in hedonic price models abstract many researchers have addressed concerns of omitted variable bias in hedonic price models through the use of spatial fixed effects we argue that this approach does not consider the biases introduced by effects that overlap the zone of capitalization for nonmarket goods we show this bias can dominate the usual omitted variable bias using data on developer provided open space we control for multiscale capitalization and omitted variables simultaneously by extending the hausman taylor estimator where the panel component of the estimator is defined over repeated transactions within neighborhoods rather than the traditional definition following a unique cross sectional unit through time

semiparametric hedonic price models assessing the effects of agricultural nonpoint source pollution in the area of environmental analysis using hedonic price models we investigate the performance of various nonparametric and semiparametric specifications the proposed model specifications are made up of two parts a linear component for house characteristics and a non semi parametric component representing the nonlinear influence of environmental indicators on house prices we adopt a general to specific search procedure based on recent specification tests comparing the proposed specifications with a fully nonparametric benchmark model to select the best model specification an application of these semiparametric models to rural districts indicates that pollution resulting from intensive livestock farming has a significant nonlinear impact on house prices copyright 2008 john wiley sons ltd

floodplain price impacts by property type in boulder county colorado condominiums versus standalone properties studies find various and often small or negligible impacts of floodplain designation on home sales prices in the united states calling into question the u s s national flood insurance program s nfip effectiveness at internalizing flood risk into the residential property market however studies also tend to focus only on standalone homes although a substantial portion of the u s housing market particularly within designated floodplains consists of condominiums single unit residences that are bundled with an ownership share in common property this study investigates the price impact of floodplain designation for condominiums and for standalone properties in boulder county colorado u s and finds a strong impact for condominiums but none for standalone properties results are consistent across hedonic price estimation and non parametric matching estimation numerous factors may contribute to this difference including differences in the pre transaction provision of flood insurance cost information and whether maintaining ongoing flood insurance is compulsory these results have implications for the nfip and offer insights for policy interventions for internalizing risks more generally they also caution against generalizing from the experience of the nfip without detailed consideration of the contexts and specific conditions in which it is applied

multidirectional conditional convergence in european banking abstract the paper examines the behavioural patterns arising from the analysis of productivity and convergence in european banking using a sample of commercial banks regulated by the single supervisory mechanism during 2011 to 2017 productivity change and its decompositions is measured for each input and output dimension separately using a variant of the multidirectional productivity analysis framework we introduce a novel approach for testing for convergence in productivity efficiency and technology as well as in each dimension considered we find strong evidence of absolute convergence during the period of study suggesting that bank operations move towards a common frontier rather than local equilibria prior to the creation of the single supervisory mechanism in 2013 conditional convergence is confirmed in many instances with respect to liquidity and capital adequacy although few cases remain significant in the subsequent period we conclude that regulatory controls have facilitated integration though there are important implications arising that policymakers need to consider when designing policies

weak comparability of values as a foundation for ecological economics the main argument of this paper is that weak comparability of values should be seen as one characteristic feature of ecological economics the formal properties of the concepts of strong comparability implying strong or weak commensurability and weak comparability implying incommensurability will be clarified multicriteria evaluation offers the methodological and mathematical tools to operationalize the concept of incommensurability at both macro and micro levels of analysis the concept of incommensurability of values already has a long tradition in economics moreover we will show that analytic philosophy theories of complexity post normal science and the recent theories of rationality lead with different trajectories to a non algorithmic approach which in our view could be implemented by some forms of multicriteria evaluation 1998 elsevier science b v all rights reserved

the spatial extent of water quality benefits in urban housing markets water quality regulation continues to be controversial as demonstrated by recent litigation between the u s environmental protection agency and the state of florida over nutrient standards while the costs of standards are usually known benefits may be diverse and difficult to identify this study investigates the effects of enhanced water quality on both waterfront and nonwaterfront property prices using hedonic models within an urban market findings indicate 1 the value of increased water quality depends upon the property s location and proximity to waterfront and the surface area of the water body and 2 aggregate benefits to nonwaterfront homes may dominate those realized by waterfront homeowners

degradacao ambiental e teoria economica algumas reflexoes sobre uma economia dos ecossistemas there are few consistent theoretical reflections on the suitability of economic instruments per se in facing the issue of natural capital degradation this paper presents some considerations about the relationship between environmental degradation and economic theory in a critical perspective the guiding assumption of the arguments is that the treatment given so far to the environment is largely reductionist which must necessarily be overcome by a transdisciplinary approach the sequencing of the ideas outlined converges to the need of building this new framework referred to here as economics of ecosystems

landscape amenities and local development a review of migration regional economic and hedonic pricing studies abstract with rapid urban expansion and loss of open space attractive local landscapes will continue to gain importance in location decisions and on political agendas the present study reviews the evidence on the local economic role of landscape amenities from two major strands of empirical research migration and regional economic models and hedonic pricing models following common amenity definitions we identify 71 relevant peer reviewed studies and systematically assess the reported effects of the landscape amenity variables the migration and regional economic studies suggest that migrants are attracted by amenities nearly as often as by low taxes reported effects of amenities on income and employment are less consistent the hedonic studies suggest that nature reserves and land cover diversity have mostly open space and forest often and agricultural land rarely positive effects on housing prices studies at larger geographic scales and studies involving urban areas were more likely to identify significant amenity effects some limitations of the evidence may be overcome with better datasets and modeling approaches however in line with other recent work the limitations also highlight the need for complementary information from the analysis of political preferences for land use management

an efficiency comparison of the non life insurance industry in the bric countries abstract we analyze the efficiency of non life insurance companies in four of the fastest growing markets in the world the bric brazil russia india china countries an innovative feature of this paper is its incorporation of uncontrollable variables in the efficiency analysis using multi stage data envelopment analysis dea this approach captures cross country differences such as the political and economic environment and allows distinguishing between managerial inefficiency and inefficiency due to environmental conditions we find that the environment affects the efficiency of non life insurers operating in the bric countries furthermore in a regression of firm characteristics on efficiency scores we identify four drives of efficiency size profitability solvency and ownership form the results further our understanding of the insurance industry in the bric countries in regard to its efficiency and the environment in which it operates

values in the wind a hedonic analysis of wind power facilities the siting of wind facilities is extremely controversial this paper uses data on 11 331 property transactions over nine years in northern new york state to explore the effects of new wind facilities on property values we use a fixed effects framework to control for omitted variables and endogeneity biases we find that nearby wind facilities significantly reduce property values in two of the three counties studied these results indicate that existing compensation to local homeowners communities may not be sufficient to prevent a loss of property values jel q51 q53

the role of amenities and quality of life in rural economic growth a structural model of regional economic growth is estimated using data for 2243 rural u s counties five indices designed to capture specific amenity and quality of life characteristics are constructed using fifty four separate indicators results suggest that amenity characteristics can be organized into consistent and meaningful empirical measures that move beyond ad hoc descriptions of amenities in addition to insights into the influence of local characteristics ranging from tax burdens to income distribution on regional economic growth results suggest that predictable relationships between amenities quality of life and local economic performance exist

evidence of the effects of water quality on residential land prices we use hedonic techniques to show that water quality has a significant effect on property values along the chesapeake bay we calculate the potential benefits from an illustrative but limited water quality improvement and we calculate an upper bound to the benefits from a more widespread improvement many environmental hedonic studies have almost entirely ignored the potential for omitted variables bias the possibility that pollution sources in addition to emitting undesirable substances are likely to be unpleasant neighbors we discuss the implications of this oversight and we provide an application that addresses this potential problem o 2000 acadcmic prcss

the effect of natural space on nearby property prices accounting for perceived attractiveness this paper estimates the effect of attractive natural space on dutch residential property prices we operationalize attractive natural spaces by combining land use data with unique data on the perceived attractiveness of natural spaces in our main results the effect of attractive natural space on property prices falls from 16 0 for properties within 0 5 km to 1 6 for properties up to 7 km away our findings advance existing hedonic studies by verifying that economic benefits of living near natural space extend over a larger distance this has important implications for public policy regarding investment in natural space near residential areas jel h41 q51

does the nairu have the right dynamics the nairu view of the relationship between inflation and the unemployment rate is that there is a value of the unemployment rate the nairu below which the price level forever accelerates and above which the price level forever decelerates this view imposes two important restrictions on the dynamics of the price process this can be seen by examining a simple version of the nairu equation

willingness to pay for environmental improvements in a large city evidence from the spike model and from a non parametric approach in this paper the contingent valuation method cvm is applied in order toestimate the social benefits of a set of environmental and urbanimprovements planned for the waterfront of the city of valencia spain asa consequence of the expansion and restructuring of its trading port asthe data show a high rate of zero responses we applied the spike model one of the most recent models in cvm literature since traditional models logit and probit are not suitable given the characteristics of our data the non parametric approach is also applied in order to test the validity ofthe spike model the results show certain similarities between the spikemodel and the non parametric approach

the bouchereau woodland and the transmission of socio ecological economic value abstract this paper reports on an empirical study that investigated the value or significance attributed to a rural woodland and the social mechanisms by which this value may be transmitted or lost through time a survey interview enquiry was conducted which combined a data questionnaire with in depth interview procedures centred around i the transaction price for the privately owned plots of trees and ii the disposition of wood lot owners towards eventual sale of their plots and the circumstances under which they would envisage such transactions the forest value needs to be understood in patrimonial perspective as a collective investment the woodland as a whole and the plots individually are carriers of meaning elements of family and communal heritage proudly inherited from the previous generations and destined to be passed on to future generations the case study illustrates a more general proposition that evaluation of alternative uses of environmental resources and their benefits and costs is inseparable from the question of the distinct communities of interest to be or not to be sustained

valuing the barmah millewa forest and in stream river flows a spatial heteroskedasticity and autocorrelation consistent shac approach this paper uses spatial heteroskedasticity and autocorrelation consistent shac hedonic property price analysis of house sales during 2000 2011 to estimate the marginal value of in stream flows and proximity to an iconic freshwater ecosystem the barmah millewa forest bmf in australia s murray darling basin we establish 1 that proximity to the bmf is a statistically significant and positive determinant of nearby house prices in victoria and new south wales i e for an average property worth 199 000 that is 10 km away from the bmf moving 1 km closer will increase sales price by 2000 and 2 a non linear relationship between in stream flow and sales price which is suggestive of homebuyer preferences for flow that is neither low i e drought flows nor high i e flood flows the results provide estimates of the benefits of in stream flow that could be used to inform freshwater ecosystem restoration policy in the basin and are suggestive of regional benefits that accrue to homeowners living near key freshwater dependent ecosystems in the basin

real wages real interest rates and the phillips curve this article argues that any analysis of a phillips curve should include the real interest rate in addition to inflation and real wages as any changes in the interest rate changes the labour capital input mix in the production process leading to a change in the level of employment in the economy to justify this argument a phillips curve model is developed which includes the real interest rate in addition to inflation and real wages after the diagnosis of the time series properties of the data an error correction model is developed and estimated using a set of us annual data from 1948 to 1996 the estimated parameters of the model do suggest that one should really take into consideration of the real interest rate while analysing the phillips curve a non nested test f test also suggests that the phillips curve model with real interest rate as an additional variable performs better than the conventional method that does not include the real interest rate

one and multi directional conditional efficiency measurement efficiency in lithuanian family farms abstract this paper analyses farming efficiency by the means of the partial frontiers and multi directional efficiency analysis mea in particular we apply the idea of the conditional efficiency framework to the mea approach to ensure that observations are compared to their homogeneous counterparts moreover this paper shows that combining the traditional one directional and multi directional efficiency framework yields valuable insights it allows one to identify what factors matter in terms of output production and input consumption the application deals with lithuanian family farms for which we have a rich dataset the results indicate that the output efficiency positively correlates to a time trend and negatively to the subsidy share in the total output the mea based analysis further suggests that the time trend has been positively affecting the productive efficiency due to increase in the labour use efficiency meanwhile the increasing subsidy rate has a negative influence upon mea efficiencies associated with all the inputs

hedonic pricing of agriculture and forestry externalities in this study the hedonic price method was used toidentify and monetarize some of the external effectsof agricultural and sylvicultural activities weexamined the renting price of ruralself catering cottages or gites intensivelivestock farming caused the renting price ofgites to decrease whereas permanent grassland hadthe opposite effect

on the price of land and the value of amenities a house represents not only a bundle of structural characteristics but also a set of location specific characteristics adding locational coordinates and site area to other house characteristics makes it possible to estimate a land rent surface as well as thle hedonic prices attached to local patterns of land use and other neighbourhood characteristics one can then estimate how the value of such location specific characteristics are capitalized into land prices this analysis illustrated with estimates based on data from two british towns has a number of wider implications it generates a more parsimonious method of estimating amenity values it also reveals likely systematic biases produced by conventional hedonic studies which exclude land and location finally it clarifies the conceptual definition of land and suggests that monocentric models can perform well despite recent criticism

globalization countries cities and multinationals mccann p and acs z j globalization countries cities and multinationals regional studies this paper explores the relationship between the size of a country the size of its cities and the importance of economies of scale in the modern era of globalization in order to do this it integrates three different literatures namely the literature on the optimal size of a country the literature on historical processes of urbanization and the performance of cities and the literature on the role of multinational firms in the global economy using an economic geography perspective but looking at these issues through the lens of economic history it is demonstrated that the importance of agglomeration effects and in particular relationship between city size and the prosperity of the nation state has changed over the different eras of globalization in earlier eras of globalization the importance of agglomeration was represented by a fairly simple relationship between the scale of the city and the scale

the nairu unemployment and monetary policy this paper examines the precision of conventional estimates of the nairu and the role of the nairu and unemployment in forecasting inflation the authors find that although there is a clear empirical phillips relation the nairu is imprecisely estimated forecasts of inflation are insensitive to the nairu and there are other leading indicators of inflation that are at least as good as unemployment this suggests deemphasizing the nairu in public discourse about monetary policy and instead drawing on a richer variety of leading indicators of inflation