the impact of the german feed in tariff scheme on innovation evidence based on patent filings in renewable energy technologies abstract over the last two decades feed in tariffs have pushed the massive expansion of electricity from renewable energy sources in germany between 1991 and 1999 feed in tariffs were prescribed through the electricity feed in law the so called stromeinspeisungsgesetz seg at relatively moderate rates from 2000 onwards the seg was replaced by the renewable energy sources act the so called erneuerbare energien gesetz eeg with much higher subsidy rates the rise in subsidies to renewable power generation under the eeg came along with a substantial increase in electricity prices provoking an intense public debate on the benefits of renewable energy promotion in our regression analysis we assess one popular justification for feed in tariffs the demand side effect of induced innovation we find that the innovation impact of the german feed in tariff scheme over the last two decades supports the positive innovation hypothesis however the inducement effect of the feed in tariff scheme under the eeg is not significantly different from that of the seg given the drastic cost of the eeg we caution against the appraisal of the eeg feed in tariff scheme solely on the grounds of its impact on technological innovation

does environmental policy stringency foster innovation and productivity in oecd countries abstract in this paper we test the weak and strong versions of the porter hypothesis using data from 14 oecd countries over the period 1990 2011 our analysis makes two contributions to the literature on the topic first we use a newly released environmental policy stringency index eps provided by the oecd as an indicator for the stringency of environmental regulations which addresses the multi dimensionality of environmental regulations second as a suitable method to deal with asymmetric distributions of the dependent variables we use a panel quantile regression model which allow us to test whether or not the hypothesis holds for all quantiles of the distribution of the corresponding dependent variable the findings indicate that in the short term a more strict environmental policy is associated with an increase in the number of patent applications and in total factor productivity tfp for the highest quantiles of the distribution of patents and for all quantiles of tfp respectively moreover environmental stringency has a positive effect on research and development expenditures rd only in the lower quantiles 10 25 in the long term the eps is affecting rd patents and tfp in all quantiles and hence more stringent environmental regulations promote cleaner production processes that could help improving energy efficiency

technical change external economies and the porter hypothesis abstract michael porter introduces the idea that environmental regulations may benefit affected firms this paper derives results consistent with porter s hypothesis by employing a general equilibrium framework with a large number of agents external economies of scale in production and discrete changes in technology the model shows that endogenous technical change makes porter s hypothesis feasible however a policy that produces results consistent with porter s hypothesis is not necessarily optimal

environmental policy and international trade when governments and producers act strategically some environmentalists express concern that trade liberalization may damage the environment by giving governments incentives to relax environmental policies to give domestic producers a competitive advantage support for such concern may be given by models of imperfectly competitive trade where there may be rent shifting incentives for governments to relax environmental policies but there are also incentives for producers to act strategically e g through their investment in rd ii allowing governments to act strategically increases the incentive for producers to act strategically iii welfare is lower when both parties act strategically and iv strategic behavior by producers and governments is greater when governments use emission taxes than when they use emission standards

eco thermodynamics economics and the second law the laws of physics especially the first and second laws of thermodynamics have significant implications for economic theory the major implications of the first law conservation of mass energy are straightforward and have been discussed at length elsewhere in brief raw material inputs to economic processes are not consumed having been extracted from the environment in the first place they eventually return to the environment as wastes the economic implications of the second law entropy law are far more subtle there is considerable literature initiated by the work of georgescu roegen on the supposed constraints on economic growth imposed by the fact that economic processes utilize low entropy raw materials fossil fuels and high grade metal ores and discard high entropy wastes however as a practical matter the flux of available low entropy energy exergy from the sun is extremely large and certainly adequate to sustain economic activity in the solar system indefinitely even though fossil fuel and metal ore stocks may eventually be exhausted it is argued in this paper that the real economic significance of the second law lies in the fact that exergy is i not conserved and ii is a useful common measure of resource quality as well as quantity applicable to both materials and energy thus exergy can be used to measure and compare resource inputs and outputs including wastes and losses this is potentially important in itself moreover since exergy is not conserved it is truly consumed i e used up in economic processes hence exergy is no less a factor of production than labor or capital this fact has strong implications for economic growth theory especially with regard to assessing the role of technical progress

the deterrent effect of capital punishment evidence from a judicial experiment i introduction the contemporary debate over capital punishment involves a number of important arguments based on either moral principles or social welfare considerations the primary social welfare issue viewed as the most important single consideration for both sides in the death penalty controversy is whether capital punishment deters capital crimes see for example zimring and hawkins 1986 this issue is also of great interest to several states that are currently considering a change in their death penalty laws 1 psychologists and criminologists studied the death penalty initially and reported no deterrent effect see for example sellin 1959 and eysenck 1970 economists joined the debate later with ehrlich s 1975 and 1977 studies that report a significant deterrent effect applying regression analysis to u s aggregate data for 1933 69 and state level data for 1940 and 1950 ensuing studies use either ehrlich s data with different regression specifications different regressors functional form or endogenous variables or postmoratorium data with a variant of ehrlich s regression model results range from a substantial deterrent effect to no effect or a small adverse effect 2 this study uses a new approach to advance the deterrence literature we exploit an important characteristic that other studies have not considered the experimental nature of the moratorium that the supreme court imposed on executions during the 1970s the moratorium can be viewed as an exogenously imposed judicial experiment the experiment s effect on murder rates provides evidence about the deterrent effect of capital punishment we compare the murder rate for each state immediately before and after it suspended or reinstated the death penalty many factors that affect crime for example law enforcement judicial demographic and economic variables change only slightly over a short period of time therefore changes in a state s murder rate quickly following a change in its death penalty law can be attributed to the legal change also there are considerable cross state variations in the timing and duration of the moratorium that began and ended in different years in different states ranging from four to thirty years see tables 1 and 2 3 these variations can strengthen our comparison based inference because observing similar changes in murder rates immediately after the same legal change in different years and in various states provides compelling evidence of the moratorium s effect on murder moreover our analysis benefits from the experiences of the states that suspended and reinstated their death penalty statutes several times 4 for states that experience similar murder rate changes after suspensions or reinstatements in different crime economic and demographic environments the contribution of the legal change to murder is paramount we supplement the before and after comparisons with time series and panel data regression analyses unlike most existing studies we use both pre and postmoratorium data the regressions disentangle the effect of having death penalty laws on murder from the effect of actual executions on murder basing our inference on two different approaches allows us to corroborate our findings and also detract from the modeling concerns voiced at previous studies that use only regression analysis we also apply a battery of tests to examine the robustness of the findings these include regression sensitivity checks with 89 additional regression equations that differ from our base models in regressors functional form data and estimation method in addition we test whether the moratorium has an effect on property crimes that are not punishable by death if the relationship between the moratorium and these crimes is similar to the relationship between the moratorium and murder then we should suspect that murder rate changes are the result of broader trends in criminal behavior affecting all crimes

using im perfect markets to catch criminals abstract we extend the use of rational choice models of criminal activity to examine the use of sting operations these operations are modeled as technological innovations in law enforcement that influence the probability of detection conviction of criminal activities we ask do all sting operations have the same impact on the supply of criminal activity we find that such impacts are sensitive to the type of sting used and the competitiveness of the criminal market in which the sting is used

taxing variable cost environmental regulation as industrial policy abstract conventional wisdom has it that a country that enacts strict environmental regulations will place its firms at a competitive disadvantage this view has been challenged recently some commentators argue that stricter regulation will enhance domestic competitiveness strict regulations induce innovation we evaluate this argument in a strategic trade model in very special cases a strengthening of regulation may result in a shift of profits from foreign to domestic firms this is not a general result however environmental regulation should of course be imposed to control externalities but it is unlikely that it will serve to generate industrial advantage

the effect of clean water regulation on profitability testing the porter hypothesis previous theoretical research provides opposing arguments regarding the effect of environmental regulation on profitability this study provides empirical evidence on this debated effect by testing the strong version of the porter hypothesis we employ panel data analysis to examine the effect of water regulation as measured by permitted wastewater discharge limits on the profitability of publicly held firms operating within the chemical manufacturing industries we find that tighter water regulation meaningfully lowers profitability by reinterpreting profitability in terms of sales and costs the results demonstrate that tighter water regulation increases costs conditioned on a given level of sales

the environmental responsibility of business is to increase its profits by creating value within the bounds of private property rights proponents of corporate social responsibility csr typically consider business as usual unsustainable building on historical evidence that long predates the modern environmental movement the contrary case is made that the interplay of voluntary exchange private property rights and self interest has generally resulted in the so called triple bottom line economic social and environmental through more efficient use of materials and the continual creation of higher quality resources however because market processes continually eliminate less competitive firms and tend to concentrate business activities geographically political pressure brought to bear by adversely affected vested interests often results in the creation of policies that cause greater environmental harm than would otherwise be evident environmental csr proponents often misinterpret these government failures as market failures and characteristically advocate policies that further distract firms from their core objective and resulting triple bottom line the article concludes by arguing that the most promising path toward truly sustainable development lies in the unwavering pursuit of profitability within the bounds of well defined and enforced private property rights copyright 2010 the author 2010 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

dead man walking an empirical reassessment of the deterrent effect of capital punishment using the bounds testing approach to cointegration this paper empirically estimates a murder supply equation for the united states from 1965 to 2001 within a cointegration and error correction framework our findings suggest that any support for the deterrence hypothesis is sensitive to the inclusion of variables for the effects of guns and other crimes in the long run we find that real income and the conditional probability of receiving the death sentence are the main factors explaining variations in the homicide rate in the short run the aggravated assault rate and robbery rate are the most important determinants of the homicide rate

did the invisible hand need a regulatory glove to develop a green thumb some historical perspective on market incentives win win innovations and the porter hypothesis the idea that properly designed environmental regulations can improve a firm s competitiveness while simultaneously contributing to a cleaner environment through the development of so called win win innovations i e that reduce environmental damage while simultaneously increasing profits is usually credited to porter 1991 numerous studies have since attempted to assess the validity of the concept with mixed results this paper contributes to this debate by surveying a nearly forgotten body of literature written in the late nineteenth and early twentieth century that discussed the impact of market incentives on the development of valuable by products out of industrial waste based on the opinions held by several industrial chemists engineers technical journalists and economists the development of win win manufacturing practices seems to have been primarily the result of the profit motive although actual or potential legal actions based on private property rights and or government regulations occasionally triggered this process after reviewing some important historical writings on the latter issue a suggestion is made that perhaps the best way to craft well designed environmental regulations is to return to a private property rights approach to mitigating pollution problems whenever possible

on the life cycle metaphor where ecology and economics diverge abstract there is an attractive analogy between nature and industry based on the similarity of natural functions and certain industrial activities for instance animals ingest eat and digest food finally there are metabolic wastes firms are analogous to organisms in several respects insofar as they consume material resources process digest them and produce output products and excrete wastes firms like organisms also compete with each other for resources curiously enough one of the apparent differences between natural and man made systems is actually not one like the industrial system the natural system does not recycle everything however there are at least four real and important differences between the biosphere ecology and the technosphere economy first there is no primary producer in the economic system analogous to what photosynthesizers play in the biosphere inputs to the economy are mostly natural resources capital services and labor second in the economic system output is a heterogeneous mix of manufactured products and services labor in economics is an input but not an output the economic system recycles much less than the ecological system but utilizes a far greater suite of elements in the biosphere there are no products as such growth is tantamount to accumulation of embodied solar exergy in the form of cellulose sugars lipids and proteins the biosphere produces only wastes and more of itself plus dead matter third in the biosphere there are no markets there is no medium of exchange like money and there is nothing analogous to paid labor exchanges are involuntary i e by predation parasitism or theft fourth evolution in nature is driven by differentiation by random mutations of the genome and darwinian selection based on reproductive success in economics differentiation is based on discovery invention and innovation by intelligent economic agents and selection is based on competition at the individual or firm level either way the economic system is not closely analogous to an ecosystem attempts to use ecological concepts in an economic context are often misleading and unjustified the paper discusses the implications of the eco eco mismatch for resource accounting and life cycle analysis

responding to rivals and complements how market concentration shapes generational product innovation strategy this study examines how competitive market conditions shape the responsiveness with which businesses release generational product innovations gpis following the introduction of gpis by either competitors or complementary firms gpis are substantial technical advances in the performance of products within technology regimes prior studies of innovation timing in the organizational strategy literature emphasize internally driven strategies of gpi although internally driven strategies may predominate when businesses face diffuse competition for their product lines the literature largely overlooks the point that businesses need to be increasingly responsive to external events as market concentration increases this study which examines businesses competing in the u s packaged software industry in the 1990s shows that increasing industry concentration raises the stakes surrounding market positions and leads to greater interdependence of innovation strategies in an industry including interactions both with competitors and with other players in a larger system of complementary products as concentration increases therefore organizations are less driven by historical patterns of innovation and become increasingly responsive to innovations by both types of external actors

china s nuclear export drive trojan horse or marshall plan abstract china s civil nuclear industry expanded strongly from 2008 onwards and nearly half of reactor construction starts worldwide since then are accounted for by the chinese home market increasingly china is turning its attention to the export market using its own designs which it claims emulate the safety standards of the latest designs of the established nuclear reactor vendors its export efforts would be greatly strengthened if it were to win an order from an established user of nuclear power and its best opportunity appears to be the uk where it is at the early stages of negotiating the construction of nuclear reactors the financial collapse of the french nuclear company areva gives it the opportunity to take a stake in the rescued companies giving it access to important fuel cycle technologies and perhaps the large french reactor service market its other export prospects in europe are in romania and turkey there are a number of issues european governments need to examine before committing to allow in chinese nuclear companies these include national security concerns about dependence on china for key infrastructure issues of quality control and regulatory competence and the lack of construction experience with china s modern reactor designs

the concept of joint production and ecological economics joint production is suggested as one of the conceptual foundations of ecological economics the notion of joint production springs immediately from the application of thermodynamics and has a long history in economic analysis considerations of joint production give rise to philosophical concerns relating to responsibility and knowledge the concept of joint production is easily comprehensible and is also constitutive and supportive of a range of concepts current in ecological economic thought 2001 elsevier science b v all rights reserved

environmental policy and competitiveness the porter hypothesis and the composition of capital abstract the porter hypothesis suggests a win win situation in the sense that environmental policy improves both environment and competitiveness the suggestion received strong criticism from economists driven by the idea that if opportunities exist firms do not have to be triggered by an extra cost in this paper a model is developed which confirms this point but which also draws attention to some general mechanisms that relax the trade off considerably downsizing and modernization of firms subject to environmental policy will increase average productivity and will have positive effects on the marginal decrease of profits and environmental damage

tightening environmental standards the benefit cost or the no cost paradigm ms ff ichael porter and claas van der linde have written a paper that is interesting and to us at least somewhat astonishing it is a defense of environmental regulation indeed an invitation to more stringent regulation that makes essentially no reference to the social benefits of such regulation this approach contrasts starkly with the methods that economists and other policy analysts have traditionally used when assessing environmental or other regulatory programs the traditional approach consists of comparing the beneficial effects of regulation with the costs that must be borne to secure these benefits for environmental regulation the social benefits include the reductions in morbidity or premature mortality that can accompany cleaner air the enhanced recreational opportunities that can result from water quality improvements the increased land values that might attend the cleanup of a hazardous waste site the enhanced vitality of aquatic ecosystems that might follow reductions in agricultural pesticide use or any of the other potentially significant benefits associated with tighter standards from this benefit cost approach emerges the standard tradeoff discussed in virtually every economics textbook porter and van der linde deny the validity of this approach to the analysis of environmental regulation claiming it to be an artifact of what they see as a static mindset in their view economists have failed to appreciate the capacity of

clean and productive empirical evidence from the german manufacturing industry abstract in view of the controversial policy debate on green growth and corresponding stimulus packages we empirically investigate the production effects of environmental investment as well as of environmental and energy expenditures using a panel dataset of german manufacturing sectors our econometric analysis identifies a positive impact of environmental investment on production growth in contrast our estimation results cannot support the hypothesis of positive production impacts induced by environmental or energy expenditures we thus conclude that environmental regulation should in particular stimulate environmental investment in order to be compatible with the pursuit of production growth

toward a new conception of the environment competitiveness relationship accepting a fixed trade off between environmental regulation and competitiveness unnecessarily raises costs and slows down environmental progress studies finding high environmental compliance costs have traditionally focused on static cost impacts ignoring any offsetting productivity benefits from innovation they typically overestimated compliance costs neglected innovation offsets and disregarded the affected industry s initial competitiveness rather than simply adding to cost properly crafted environmental standards can trigger innovation offsets allowing companies to improve their resource productivity shifting the debate from pollution control to pollution prevention was a step forward it is now necessary to make the next step and focus on resource productivity

the hinkley point decision an analysis of the policy process in 2006 the british government launched a policy to build nuclear power reactors based on a claim that the power produced would be competitive with fossil fuel and would require no public subsidy a decade later it is not clear how many if any orders will be placed and the claims on costs and subsidies have proved false despite this failure to deliver the policy is still being pursued with undiminished determination the finance model that is now proposed is seen as a model other european countries can follow so the success or otherwise of the british nuclear programme will have implications outside the uk this paper contends that the checks and balances that should weed out misguided policies have failed it argues that the most serious failure is with the civil service and its inability to provide politicians with high quality advice truth to power it concludes that the failure is likely to be due to the unwillingness of politicians to listen to opinions that conflict with their beliefs other weaknesses include the lack of energy expertise in the media the unwillingness of the public to engage in the policy process and the impotence of parliamentary committees

corporate governance environmental regulations and technological change abstract this paper investigates the relationship between environmental regulations and innovation by focusing on the automobile industry in a cross country setting we provide empirical evidence that the presence of agency problems mitigates the negative effects of environmental regulations on overall r d activity which leads to full compensation when the degree of agency problems is sufficiently high guiding our empirical analysis we provide a general model consistent with the structure of existing ownership data specifically we model ownership structure as a combination of two extreme corporate governance types on the one extreme there are profit maximizers and on the other extreme there are managers who are only concerned with their private benefits the model leads to a simple country level ownership indicator and shows that if an economy is dominated by firms with higher agency problems then pollution tax might even increase overall r d while reducing pollution according to our estimations such an outcome is possible only for out of sample values of the ownership indicator where the degree of agency problems is extremely high

attributing responsibility for energy justice a case study of the hinkley point nuclear complex since 2006 as part of the transition to low carbon technologies uk energy policy has moved towards incentivising new nuclear power production as a result the uk has developed a now delayed strategy to deliver around 16gw of new nuclear power by 2030 this policy context provides an opportunity to reflect not only on the material infrastructure needed to meet transition targets but also on who is responsible for the energy justice implications of these decisions using data collected from 26 semi structured interviews with ngo and policy representatives this paper presents a case study of energy justice concerns surrounding the hinkley point nuclear complex in somerset focusing particularly on the highly controversial hinkley point c developments the results emphasise the importance of considering not only instances of energy justice or injustice but of attributing responsibility for them a concept that has been largely overlooked in the energy justice literature ngos government and business allocate responsibility differently in nuclear energy decision making we find that perceptions of responsibility are highly dependent upon the level of transparency in decision making this article is part of a virtual special issue entitled exploring the energy justice nexus

a framework to compare environmental policies 1 introduction to analyze environmental policy proposals it is important to determine the conditions under which some policies might work better than others when will a pollution tax work better than the sale of permits or some other alternative which is easier to administer or to enforce does one policy apply better to some kinds of pollutants than to others which policy has a greater chance of getting enacted this paper provides a framework to compare alternative policies for each pollutant in each context one policy may be more efficient while others better account for competing objectives like administrative efficiency political feasibility and fairness using this framework the paper will analyze and compare eight types of policies clearly no single policy instrument will work best in all cases under some circumstances command and control cac instruments might be necessary in either of two forms i emission restrictions sometimes called performance standards or ii technology restrictions that might be called design standards if emissions are difficult or impossible to measure for example then the authorities can at least enforce rules that require the proper installation of the required pollution control equipment such as a flue gas desulfurization unit scrubber on every electric power plant or a catalytic converter on every automobile in other cases that are important to identify these cac instruments can be replaced by incentive instruments such as taxes subsidies or permits as suggested by pigou 1932 the pollution problem could be addressed by i taxes on the pollution or ii subsidies to abatement a pigouvian tax applies to the pollutant itself rather than to output at a rate equal to the pollutant s marginal environmental damages med the term incentive instruments includes both the pigouvian tax and the subsidy to abatement and it includes two other policies that involve permits such as those traded by electric utilities under the clean air act amendments of 1990 those permits could be i grandfathered or handed out to existing firms in proportion to past emissions or ii sold at auction by the government a simple analytical model is used below to demonstrate conditions under which the pigouvian tax is equivalent to a government sale of permits much of the environmental economics literature finds that the use of incentives is more cost effective than cac restrictions with imperfect information the regulatory authorities may or may not know what is the cheapest form of abatement technology thus cac regulations may require technology that is more expensive than necessary with a tax or a price per unit of emissions however each firm has incentives to find and to undertake any form of abatement that is cheaper than buying a permit since only the cheapest forms of abatement are undertaken these incentive policies can minimize the total cost of achieving any given level of pollution protection so far this cost effectiveness argument does not distinguish between taxes subsidies permits that are handed out or permits sold at auction yet the handout of permits does not raise any revenue thus a new literature in environmental economics concentrates on a distinction between policies that raise revenue like a tax on pollution or the sale of permits as opposed to polices that do not raise revenue like the handout of permits or a cac restriction on emissions 2 the model below will be used to reflect on this distinction as well so far i have listed two cac policies two pigouvian solutions and two versions of a permit policy yet in some cases with well defined property rights even with pollution coase 1960 shows how the private market can still achieve economic efficiency on its own government does not need to intervene at all except perhaps to help enforce property rights through a court system

towards an ecological economics of sustainability abstract persistent disagreement both as to the interpretation to be given to sustainability and as to the relation between ecological and economic sustainability has hindered the development of an ecological economics of sustainable resource use this paper identifies the main concepts of sustainability deriving from the two disciplines in order to explore the difference implied by an ecological approach to the problem it is argued that present economic and ecological approaches are largely disjoint and that they address basically different phenomena by combining the efficiency requirements of what is usually thought of as economic sustainability with the stability requirements of an ecological approach it is shown that an intertemporally efficient allocation of resources that satisfies the conditions for constant levels of consumption is not necessary to assure ecological sustainability ecological sustainability requires that the allocation of economic resources should not result in the instability of the economy environment system as a whole

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

environmental regulation and technology transfers this paper analyzes the situation in which a national government introduces environmental regulations within the framework of an international duopoly with environmental regulations an environmental tax imposed by the government in the home country can induce a foreign firm with advanced abatement technology to license it to a domestic firm without this technology furthermore when the domestic firm s production technology is less efficient than that of the foreign firm the foreign firm may freely reveal its technology to the domestic firm these improvements through the voluntary transfer of technology imply that environmental regulations have positive impacts on innovation resume reglementation environnementale et transferts de technologie ce texte analyse le cas d un gouvernement national qui etablit des reglementations environnementales dans le cadre d un duopole international avec reglementations environnementales le gouvernement national impose une taxe environnementale au plan domestique qui peut induire une firme etrangere qui dispose d une technologie avancee qui reduit l impact environnemental a vendre une licence permettant d utiliser cette technologie a une firme domestique qui ne l a pas de plus quand la technologie de production de la firme domestique est moins efficace que celle de la firme etrangere la firme etrangere peut reveler sa technologie a la firme domestique ces ameliorations a travers les transferts volontaires de technologie impliquent que les reglementations environnementales ont des impacts positifs sur l innovation

environmental policy and the equilibrium rate of unemployment abstract this paper integrates environmental policy instruments with the theory of equilibrium unemployment we investigate the question of whether a low equilibrium rate of unemployment and a high quality of the environment are complementary policy goals or must be traded off it turns out that an interval exists for a tax on emissions where the two goals are indeed complementary the tax stimulates the emergence of an abatement sector which provides pollution control and vacancies for the job seekers for constrained efficiency the policy maker operates five instruments to internalize the environmental and the search externalities a tax on emissions employment subsidies and recruiting allowances for the polluting industries are sufficient to implement the first best the optimal emission tax is an increasing function of the workers bargaining strength for labor markets where workers have a strong bargaining position the optimal pollution tax may easily exceed the pigouvian tax

does the porter hypothesis explain expected future financial performance the effect of clean water regulation on chemical manufacturing firms previous research provides opposing theoretical arguments regarding the effect of environmental regulation on financial performance as one important argument the porter hypothesis claims that tighter regulation improves financial performance this study provides empirical evidence on this debated effect in particular we employ panel data analysis to examine the effect of clean water act regulation as measured by permitted wastewater discharge limits on expected future financial performance as measured by tobin s q for publicly owned firms in the chemical manufacturing industries we find that tighter permitted discharge limits lower tobin s q i e more stringent clean water act regulation undermines expected future financial performance by decomposing tobin s q into its constituent components market value and replacement costs and estimating each component separately we find that tighter permitted discharge limits lower both components with a larger impact on market value which implies that investors revise their expectations of the discounted present value of future profits in response to changes in clean water act regulation

the effect of within sector upstream and downstream energy taxes on innovation and productivity the aim of this paper is to investigate the effect of environmental regulatory stringency on innovation and productivity using a panel of 8 european countries for 13 manufacturing sectors over the years 2001 2007 this research topic falls under the heading of the porter hypothesis ph of which different versions have been tested we consider both the strong and the weak versions of the ph while also adding some peculiar features to the analysis firstly we assess the role played by environmental taxes that is an instrument rarely tested as a factor which can support the ph secondly we analyse not only the effect of environmental taxes within a given sector within sector but also the role played by environmental taxes in upstream and downstream sectors in terms of input output relationships thirdly we test these relationships also indirectly by verifying whether innovation is one of the channels through which higher sectoral productivity can be achieved by imposing tighter environmental regulations our main findings suggest that downstream stringency is the most relevant driver of innovation and productivity while within sector regulations only affect productivity but not innovation moreover the effect of regulations on productivity is mostly direct while the part of the effect mediated by induced innovations as measured by patents is relevant only for what concerns downstream regulations

the division of labor need not imply regional specialization the regional specialization of economic activities is generally deemed desirable for three reasons 1 the law of comparative advantage 2 localized economies of scale and 3 knowledge spillovers taking a methodological individualist perspective we claim that 1 the law of comparative advantage while valid for individuals and firms does not necessarily imply regional specialization when regions are viewed as consisting of heterogeneous individuals 2 localized economies of scale are seldom specific to one industry and external in all but the regional level and 3 the study of knowledge spillovers is inconclusive and would benefit from a more disaggregated perspective

distribution of environmental costs and benefits additional distortions and the porter hypothesis the porter hypothesis argues that environmental regulations benefit firms by fostering innovation we discuss four examples consistent with this idea highlighting either the distribution of benefits or costs or the presence of some additional distortion other than pollution examples are organized according to the list of market failures adding any one market failure creates the possibility that firms benefit from regulations while each example can be fully consistent with the porter hypothesis it is also possible that regulations benefit firms even without fostering innovation a result that would be empirically difficult to distinguish from the porter hypothesis

why environmental management may yield no regret pollution abatement options empirical evidence supports the existence of pollution abatement possibilities at negative costs the so called no regret options we provide a microeconomic rationale for the existence of such potential at the firm level an econometric application confirms that pollution abatement cost curves with no regret options are compatible with a standard production function as stated in our theoretical model c 2008 elsevier b v all rights reserved

four factors that explain both the rise and fall of us crime 1970 2003 previous research has failed to explain the rise and fall of us crime since 1970 this study uses cointegration error correction and common long memory components analyses to demonstrate that four basic crime factors explaining both the increases in us violent and property crime between 1970 and 1991 and the dramatic declines in crime after 1991 the four factors include arrest rates income per capita the proportion of criminal justice resources devoted to drug crime and alcohol consumption error correction models and common long memory factors show an especially close link between crime rates and the percentage of prison resources devoted to drug offenders similar factors result in cointegrated models for murder rape robbery assault and larceny additional modelling shows that effective abortion rates computed along the lines of donohue and levitt 2001 do not help in explaining the rise and fall of us crime

integrated environmental product innovation in the region of munich and its impact on company competitiveness abstract this paper examines the impact of environmental innovations on company competitiveness of both the environment industry and related sectors in the region of munich the focus is on the drivers of these innovations and their respective effects on innovating companies not only innovations in the area of end of pipe technologies but also the development of integrated products and production methods are examined in a regional case study approach a sample of 14 manufacturing and service companies in munich southern germany was interviewed essentially environmental innovation is driven by a mixture of factors internal and external to the firm not only regulatory pressure but also cost pressure competitive advantages technological lead and customer pressure are important drivers regulatory pushed innovations contribute to the competitive performance of sample companies in a similar way as environmental innovations which are carried out voluntarily that would yield proof for the so called porter hypothesis which assumes that environmental legislation stimulates innovation and leads to win win opportunities where simultaneously pollution is reduced and productivity increased

industrial ecology and the rediscovery of inter firm recycling linkages historical evidence and policy implications industrial ecology is one of the most influential perspectives to have emerged in recent years in the wider discourse on sustainable development the vast majority of industrial ecologists believe that past economic development was characterized by a linear system of extraction use and disposal one of their main goals is therefore to find ways to make modern industrial economies mimic ecosystems by transforming the waste of one firm into the valuable input of another historical evidence presented in this article however demonstrates that inter firm recycling linkages were a dominant characteristic of past economic development if this was the case why do most writers on sustainability believe otherwise i suggest two broad categories of explanation a lack of research into the spontaneous formation of inter firm recycling linkages and the progressive and cumulative implementation of market distortions and regulatory barriers to resource recovery over the last century one implication of these findings is that the most important task facing industrial ecologists is probably not the technical challenge of planning resource recovery between firms but the development of an institutional framework that forces firms to internalize their externalities while leaving them the necessary freedom to develop new and profitable uses for by products copyright 2002 oxford university press

the influence of spatial effects on wind power revenues under direct marketing rules abstract in many countries investments in renewable technologies have been accelerated by fixed feed in tariffs for electricity from renewable energy sources res while fixed tariffs accomplish this purpose they lack incentives to align the res production with price signals today the intermittency of most res increases the volatility of electricity prices and makes balancing supply and demand more complicated therefore support schemes for res have to be modified recently germany launched a scheme which gives wind power operators the monthly choice to either receive a fixed tariff or to risk a subsidized access to the wholesale electricity market this paper quantifies revenues of wind turbines under this new subsidy and analyzes whether when and where producers may profit we find that the position of the wind turbine within the country significantly influences revenues in terms of eur mwh the results are important for wind farm operators deciding whether electricity should be sold in the fixed feed in tariff or in the wholesale market however no location is persistently i e in every calendar month of the year above the average this limits the effect of the new subsidy scheme on investment locations and long term improvements in the aggregated wind feed in profile

entry exit and diffusion with learning by doing early entry has the advantage of higher revenues per unit of output early on late entry has the benefit of learning from the experience of earlier entrants and hence lower production costs the advantages are balanced off in a continuous time perfect foresight equilibrium competition generates s shaped diffusion and staggered entry and exit a monopolist will innovate less than a competitive industry but the innovation that he does do he will do sooner copyright 1989 by american economic association

energy tax changes and competitiveness the role of adaptive capacity this paper estimates the effect of energy tax and price changes on total factor productivity tfp and net trade at the industry level using a panel of industries from european countries covering the period 1990 2003 we investigate the hypothesis that industries with high adaptive capacity measured by their relative level of labor compensation are able to mitigate the adverse effects of energy tax rises better than others we identify the pro adaptation effect by interacting wage levels a proxy for human capital with energy taxes we find that the negative marginal effect of higher energy taxes on tfp and net trade is significantly reduced for industries with stronger human capital and even turns to an overall positive effect in at least two cases up to three low wage sectors display an overall negative effect this suggests that human capital is key to adaptation to higher energy costs and climate policy in some cases making it a win win

linking induced technological change and environmental regulation evidence from patenting in the u s auto industry a b s t r a c t this article uses a carefully screened patent database in automobile emission control technologies and a detailed regulatory action analysis to examine firms innovation in response to u s technology forcing auto emissions standards enacted between 1970 and 1998 the study finds that under the performance based technology forcing pbtf auto emissions regulations both automakers and compo nent suppliers innovated and introduced more advanced emission control technologies for automobile applications the study also shows that stringent pbtf regulation temporarily induced domestic u s firms to become more innovative than foreign firms that operated in the local u s market during the early phase of the regulatory regime findings of this research strongly imply that government intervention in the form of technology forcing regulation can drive firms to invest in technological innovation

strategic quality competition and the porter hypothesis abstract this paper offers new support for the porter hypothesis within the context of a quality competition framework we use a duopoly model of vertical product differentiation in which two firms simultaneously choose to produce either a high environmentally friendly quality or low standard quality variant of a good before engaging in price competition in this simple setting we show that a nash equilibrium of the game featuring the low quality good can be pareto dominated by a different strategy profile in which both firms opt in favour of the green product our analysis demonstrates that in such a case both firms stand to profit from the introduction of a rule penalizing any firm refusing to produce the environmentally friendly product we also find that consumers themselves may benefit from such regulations this is always the case when shifting from low quality to high quality production brings about a cost efficiency improvement

a tale of two market failures technology and environmental policy abstract market failures associated with environmental pollution interact with market failures associated with the innovation and diffusion of new technologies these combined market failures provide a strong rationale for a portfolio of public policies that foster emissions reduction as well as the development and adoption of environmentally beneficial technology both theory and empirical evidence suggest that the rate and direction of technological advance is influenced by market and regulatory incentives and can be cost effectively harnessed through the use of economic incentive based policy in the presence of weak or nonexistent environmental policies investments in the development and diffusion of new environmentally beneficial technologies are very likely to be less than would be socially desirable positive knowledge and adoption spillovers and information problems can further weaken innovation incentives while environmental technology policy is fraught with difficulties a long term view suggests a strategy of experimenting with policy approaches and systematically evaluating their success

estimations of the economic model of crime using aggregate and individual level data much has happened in the economics of crime since becker s 1 seminal paper of two decades ago the theory has been refined by among others ehrlich 10 11 12 block and lind 4 5 block and heinke 3 and schmidt and witte 30 attempts to test the model empirically began immediately the most cited including ehrlich 10 11 12 sjoquist 31 carr hill and stern 7 phillips and votey 26 witte 38 and myers 22 23 interest continues with recent work including layson 19 sandelin and skogh 29 ehrlich and brower 13 cover and thistle 9 viscusi 36 and tauchen witte and griesinger 33 there has been some controversy however concerning the type of data more suitable to the estimation of the economic model of crime most of the work has used aggregate data in which the unit of observation is a political jurisdiction but the use of aggregate data has been sharply criticized the alternative is individual data few attempts have been made to use individual data probably because an ideally constructed data set representative of a general population would be far too costly for most research budgets most of the studies that have been done have used data on releasees from prison or other criminal justice programs they are in effect recidivism studies based on the economic model of crime

wasted waste an evolutionary perspective on industrial by products abstract every production process gives rise to unintended outputs we argue that whether an output is desired or undesired is not given per se but depends on the economic circumstances which change over time as a result by products of one industry first perceived as non marketable wastes may become desired inputs into other production processes by adopting an evolutionary perspective on economic dynamics in particular by exploiting the concept of niche exclusion we identify favorable circumstances for undesired outputs to become marketable to cope with the pace and unpredictability of economic evolution we argue for a flexible policy system which favors outcome over process oriented waste management policies and balances the responsibility between consumers and producers on the one side and the society as a whole on the other side

industrial symbiosis the case for market coordination abstract despite the fact that all successful documented cases of industrial symbiosis to this day have been self organizing some authors and development officials have suggested that increased public planning might deliver better results in this respect than spontaneously evolved market coordination this paper takes an historical approach to suggest that comprehensive planning is unlikely to live up to the expectations of its proponents the essay is structured as follows the first section provides short case studies of industrial symbiosis in highly different economic and institutional settings the essentially free market regime of victorian england and communist hungary 1948 1989 the available evidence suggests that market coordination proved much more favorable to the emergence of industrial symbiosis despite the elaboration of a comprehensive policy to that effect in hungary insights derived from the so called austrian critique of central planning are then used to explain this paradox the analysis presented suggests that the hungarian planners failure was not so much the result of the bad implementation of sound policies but the logical outcome of a top down approach s shortcomings policy implications for the public planning of industrial symbiosis in a mixed economy are then derived and the case for self organization is found more compelling the creation of more innovative institutions that will force firms to internalize their externalities while leaving them the necessary freedom to innovate is viewed as an urgently needed and promising path towards increased sustainable reuse of industrial by products

time series homicide and the deterrent effect of capital punishment erlich 5 6 presents regression results showing that the u s time series data supports the deterrent effect of capital punishment the deterrence hypothesis other researchers 9 10 16 criticize erlich s findings on a number of grounds including the possibility of simultaneity bias and the sensitivity of the results to the choice of sample period control variables and functional form layson 11 extends erlich s u s sample to the 1936 1977 period and taking account of these criticisms concludes that the u s time series evidence provides robust support for the deterrence hypothesis this paper contributes to the debate on the deterrence hypothesis by analyzing the time series properties of the homicide rate the u s homicide rate is a nonstationary time series it is well known that the use of nonstationary series in regression analysis leads to inconsistent coefficient estimators biases estimators of coefficient standard errors toward zero and invalidates standard statistical inference procedures 2 8 13 14 15 17 18 nonstationarity may be due to a linear trend trend nonstationarity or may be a property of the underlying stochastic process difference nonstationarity if the time series is difference nonstationary then use of a linear trend does not correct these problems and may be misleading 13 14 15 we explicitly test for the source of the nonstationarity of the homicide rate difference or trend nonstationarity using the tests recently developed by dickey and fuller 3 4 7 we find that the homicide rate is difference nonstationary this implies that the data must be first differenced to achieve stationarity and that use of a linear trend as in 5 6 9 10 11 16 is inappropriate the regression results obtained using the first differenced stationary data do not provide robust support for a deterrence effect of capital punishment

environmental innovations and firm profitability unmasking the porter hypothesis we examine impacts of different types of environmental innovations on firm profits following porter s sci am 264 4 168 1991 hypothesis that environmental regulation can improve firms competitiveness we distinguish between regulation induced and voluntary environmental innovations we find that innovations which do not improve firms resource efficiency do not provide positive returns to profitability however innovations that increase a firm s resource efficiency in terms of material or energy consumption per unit of output have a positive impact on profitability this positive result holds for both regulation induced and voluntary innovations although the effect is greater for regulation driven innovation we conclude that the porter hypothesis does not hold in general for its strong version but depends on the type of environmental innovation our findings rest on firm level data from the german part of the community innovation survey 2008 cis 2008

from microscopic to macroscopic theories entropic aspects of ecological and economic processes abstract the paper discusses the relevance of thermodynamics and related theories to ecological economics it is argued that it is not useful to apply the entropy term directly to economic processes physical entropy terms defined on a microscopic level for isolated systems are quite far from economic and ecological reality only theories that deal with the development of open systems far from thermodynamics equilibrium provide the important link between entropy and evolution towards higher complexity major new impulses for ecological economics come especially from evolutionary ecological theories these quite recent theoretical approaches incorporate the knowledge of far from equilibrium thermodynamics and explain dynamic changes in ecosystems on a macroscopic level from a thermodynamic perspective thermodynamic approaches provide a heuristic base for the analysis of economy environment interactions important implications of these approaches concern time irreversibility ecological efficiency and the interdependencies of environmental problems and evolution

from the econometrics of capital punishment to the capital punishment of econometrics on the use and abuse of sensitivity analysis the academic debate over the deterrent effect of capital punishment has intensified again with a major policy outcome at stake about two dozen empirical studies have recently emerged that explore the issue donohue and wolfers 2005 claim to have examined the recent studies and shown the evidence not to be robust to specification changes we argue that the narrow scope of their study does not warrant this claim moreover focusing on our two studies that they have examined we show the deterrence findings to be robust while their work has serious flaws and their reporting appears to be selective the selectivity is biased towards showing no deterrence