individual transferable quota markets under illegal fishing the use of individual transferable quotas in fisheries has been considered an opportunity to achieve a given total allowable catch with a maximum social benefit one of the assumptions used in obtaining that result is that the system is in perfect compliance the presence of violations and the need for enforcement of tradable property rights systems in fisheries has not received much attention in the literature the incidents of non compliance however may affect the performance of transferable property rights based fisheries in unexplored ways in this paper we adapt previous literature on enforcing emissions trading programs to analyze a positive model of fisherman behavior that operates under a perfectly competitive individual transferable quota system while recognizing the opportunities for violations of quota holdings given incomplete enforcement considering a poorly enforced individual transferable quota system we are able to obtain a number of implications for the current and future equilibrium of the quota market the time paths of the fishery and the proper design of a policy rule on total allowable catch tac

uncertainty in the theory of renewable resource markets the natural growth rate of most renewable resource stocks is in part stochastic this paper examines the implications of such ecological uncertainty for competitive equilibrium in a market with property rights we show that stochastic fluctuations add a risk premium to the rate of return required to keep a unit of stock in situ and we examine the effects of fluctuations on resource rent examples are used to show that extraction can increase decrease or be left unchanged as the variance of the fluctuations increases depending on the extent of market self correction regulatory implications are also discussed renewable resource economics has traditionally been concerned with the study of dynamically optimal harvesting policies given a deterministic function for the natural growth of the resource stock issues have included the existence and characteristics of steady state equilibria for the optimally managed resource the need for and design of regulatory policies to prevent over exploitation and conditions under which as a social optimum or otherwise the resource will be exploited to extinction 1 much of this work has been based on the assumption of a fixed and exogenous price for the harvested resource typically resulting in bang bang solutions for the harvesting policy however some recent papers make price endogenous and thereby describe how the extraction rate and the rate of return and asset value of the resource behave in a competitive market with property rights 2

the effect of utility time varying pricing and load control strategies on residential summer peak electricity use a review abstract peak demand for electricity in north america is expected to grow challenging electrical utilities to supply this demand in a cost effective reliable manner therefore there is growing interest in strategies to reduce peak demand by eliminating electricity use or shifting it to non peak times this strategy is commonly called demand response in households common strategies are time varying pricing which charge more for energy use on peak or direct load control which allows utilities to curtail certain loads during high demand periods we reviewed recent north american studies of these strategies the data suggest that the most effective strategy is a critical peak price cpp program with enabling technology to automatically curtail loads on event days there is little evidence that this causes substantial hardship for occupants particularly if they have input into which loads are controlled and how and have an override option in such cases a peak load reduction of at least 30 is a reasonable expectation it might be possible to attain such load reductions without enabling technology by focusing on household types more likely to respond and providing them with excellent support a simple time of use tou program can only expect to realise on peak reductions of 5

news sovereign debt maturity and default risk abstract leading into a debt crisis interest rate spreads on sovereign debt rise before the economy experiences a decline in productivity suggesting that news about future economic developments may play an important role in these episodes an empirical var estimation shows that a news shock has a larger contemporaneous impact on sovereign credit spreads than a comparable shock to labor productivity a quantitative model of news and sovereign debt default with endogenous maturity choice generates impulse responses and a variance decomposition similar to the empirical var estimates the dynamics of the economy after a bad news shock share some features of a productivity shock and some features of sudden stop events however unlike during sudden stop episodes long term debt does not shield the country from bad news shocks and it may even exacerbate default risk finally an increase in the precision of news allows the government to improve its debt maturity management especially during periods of high stress in credit markets and thus face lower yield spreads while increasing the amount of debt

long term industrial equilibrium in an itq managed fishery this paper discusses long term equilibrium in a fishery managed by individual transferable quotas rising prices or falling capital costs become capitalized in a higher value of quotas implying higher capital costs for holding quotas this may in fact reduce the size of each firm and lead to more firms existing in long term equilibrium resource rent taxation by letting firms lose a certain share of their quota holdings each year is discussed and shown to be neutral

quota enforcement in resource industries self reporting and differentiated inspections quotas are frequently used in the management of renewable resources and emissions however in many industries there is concern about their basic effectiveness due to non compliance we develop an enforcement model of a quota regulated resource and focus on a situation with significant non compliance and exogenous constraints on fines and enforcement budget we propose a new enforcement system based on self reporting of excess extraction and explicit differentiation of inspection rates depending on compliance history we use differentiated inspections to induce firms to self report excess extraction this system increases the effectiveness of the quota by allowing the regulator to implement a wider range of aggregate extraction targets than under traditional enforcement while ensuring an efficient allocation of extraction in addition inspection costs can be reduced without reductions in welfare

itqs firm dynamics and wealth distribution does full tradability increase inequality concerns over the re distributive effects of individual transferable quotas itq s have led to restrictions on their tradability we consider a general equilibrium model with firm dynamics to evaluate the redistributive impact of changing the tradability of itqs a change in tradability would happen for example if permits are allowed to be traded as a separate asset from ownership of an active firm if the property right is associated with ownership of an active firm the permit can be leased in each period but it is not possible to exit the industry and keep the right however allowing the permits to be traded as a separate asset has two effects first it leads to a greater concentration of production in the industry second it directly converts a non tradable asset into a tradable one and this is equivalent to giving a lump sum transfer to all firms the first effect implies a concentration in revenues while the second implies a redistribution of wealth we calibrate our model to match the observed increase in revenue inequality in the northeast multispecies groundfish u s fishery we show that although observed revenue inequality measured by the gini coefficient increases by 12 wealth inequality is reduced by 40

technical and economical assessment of distributed electrochemical storages for load shifting applications an italian case study abstract time of use tou energy cost management involves the use of energy storage systems esss by customers to reduce their electricity bills the ess is charged during off peak time periods when electricity energy prices are low and discharged during times when on peak energy prices are applied this article addresses the question whether it is economically viable to install medium scale distributed esss designed to lower the electricity cost for a customer side application assuming flexible electricity tariffs the technical economical evaluation is carried out referring to lithium ion li ion sodium sulfur nas and vanadium redox battery vrb technologies performing a parametric analysis by changing the capital cost of the batteries and the difference between the maximum and minimum electricity price a case study is performed to show the advantages disadvantages of the proposed approach the analysis reveals that at the current costs of esss the use of batteries for tou applications is economically advantageous for a public institution facility in italy only if there is a significant difference between the maximum and the minimum electricity price the decrease in the cost of storage stimulated by the implementation of support policies will make ess even more convenient for load shifting applications

property rights in a fishery regulatory change and firm performance a new method is introduced and applied to the british columbia halibut fishery to analyze changes in productivity of firms harvesting a natural capital stock the index number technique decomposes the contributions of output prices variable input prices fixed inputs and productivity to firm profits adjusted for changes in the natural capital stock an application of the method is given using micro level data from a common pool resource the indexes provide a ready made comparison of all firms to the most profitable firm per unit of resource stock benchmarking with the decompositions also allows firms and regulators to improve overall industry performance by allowing them to analyze what components are contributing most to relative economic profits

private property and economic efficiency a study of a common pool resource abstract the british columbia halibut fishery provides a natural experiment of the effects of privatizing the commons using firm level data from the fishery 2 years before private harvesting rights were introduced the year they were implemented and 3 years afterward a stochastic frontier is estimated to test for changes in technical allocative and economic efficiency the study indicates that 1 the short run efficiency gains from privatization may take several years to materialize and can be compromised by restrictions on transferability duration and divisibility of the property right 2 substantial long run gains in efficiency can be jeopardized by preexisting regulations and the bundling of the property right to the capital stock and 3 the gains from privatization are not just in terms of cost efficiency but include important benefits in revenue and product form

itq s in chile measuring the economic benefits of reform in 2001 an individual operationally transferable quota system was introduced for all the most important industrial fisheries in chile this system was put in place after years of declining stocks and over investment in this paper we describe this reform and estimate related allocative efficiency benefits for the most important industrial fishery in the country the southern pelagic fishery benefits were estimated using a bioeconomic model estimated using data for the 1985 2004 period the estimated model was then used to generate simulated scenarios of the evolution of this fishery in a 20 year horizon with and without the itq system in place the benefits of the reform can then be estimated by comparing the fishery s costs in the scenarios with and without itqs this approach allows benefits to be estimated using more realistic counterfactual scenarios than just comparing the fishery before and after the reform estimated discounted net benefits reach us 166 million in the period 2001 2020 fleet size fell from 149 active boats in 2000 to 57 in 2004 as a direct consequence of the reform among the interesting features of the chilean experience is the way the political economy of the reform was facilitated by the prior introduction of de facto individual quotas within the framework of fishery experimental activities when the authorities closed the southern pelagic fishery because of biological problems between 1997 and 2000 they organized experimental fishing expeditions in which participant boats were given the right to fish a certain amount of resources per expedition this pseudo quota system allowed fishermen to experience directly the benefits of individual quotas and that was instrumental to the political agreement leading to the reform it is important to note that the chilean southern industrial pelagic fishery has average catches of over 1 4 million tons a year making it one of the largest fisheries in the world to be regulated by individual quotas

resource rights and markets in a general equilibrium model of production rights to a free resource lead to distributional deadweight losses in partial equilibrium the present paper examines related distortions in a general equilibrium model of production with output prices constant for the small open economy the free resource can result in lower output than a market with weak substitution in the other sector the free resource also leads to a convex production frontier implying a price increase lowers output in the sector regarding policy an import tariff export subsidy or price support would lower sector output these general equilibrium distortions increase the incentives to favor resource markets over rights

the optimal distribution of pollution rights in the presence of political distortions a critical issue in designing a system of tradable emission permits concerns the distribution of the initial pollution rights the purpose of this paper is to investigate how the initial rights should be optimally set when the determination of the number of tradable permits is subject to the influence of interest groups according to the coase theorem in the case where there are low transaction costs the assignment of the initial rights does not affect the efficiency of the final resource allocation in the presence of political pressure we show that the distribution of the initial rights has a significant effect on social welfare in contrast to the conventional results we find that grandfathered permits may be more efficient than auctioned permits even after taking into consideration the revenue recycling effect

firm dynamics with tradable output permits we study firm dynamics firm value equilibrium permit prices and market efficiency in a natural resource industry that is managed with tradable output permits new firms must purchase capital and output permits before they enter active firms must consider the economic cost of capital and the cost of owning the permit when contemplating exit the value of the capital used in the production process has nonseparable effects on permit prices and market efficiency costly investment reversibility in the firm s productive capital and uncertainty reduce permit prices and prolong the abandonment of unproductive capital policies to improve economic performance are identified copyright 2002 oxford university press

the political economy of market based environmental policy the u s acid rain program the u s acid rain program enacted in 1990 gave valuable tradable sulfur dioxide emissions permits called allowances to electric utilities we examine the political economy of this allocation though no senate or house votes were ever taken hypothetical votes suggest that the actual allocation would have beaten plausible alternatives while rent seeking behavior is apparent statistical analysis of differences between actual and benchmark allocations indicates that the legislative process was more complex than simple models suggest the coalition of states that produced and burned high sulfur coal both failed to block acid rain legislation in 1990 and received fewer allowances than in plausible benchmark allocations some of these states may have received additional allowances to cover 1995 99 emissions by giving up allowances in later years and some major coal producing states seem to have focused on benefits for miners and on sustaining demand for high sulfur coal

trade of permits for greenhouse gas emissions bilateral trade need not be the answer the kyoto protocol sets national quotas on ghg emissions and allows international trade of these quotas taking terms of trade effects into account we argue that this trade is characterized by asymmetric identity dependent externalities and show that bilateral trade of permits may not be sufficient for an efficient allocation of emissions we derive conditions under which bilateral trade does improve the allocation of permits the conditions are strong in this sense we argue that for emissions permits market design matters

on the influence of jurisdiction on the profitability of residential photovoltaic storage systems a multi national case study policy makers in many jurisdictions have implemented incentive schemes such as feed in tariffs fit and upfront purchase subsidies to encourage consumers to self generate parts of their power requirements by solar energy we quantitatively study the impact of jurisdiction specific solar radiation profile the typical residential loads the cost of system components the price of grid electricity and incentive programs on photovoltaic pv and storage system profitability in germany ontario and austin texas in each jurisdiction for a range of pv and storage system sizes we compute the optimal use of the system and hence the best possible profitability of that system in that jurisdiction over a 20 year life span this methodology allows us to quantitatively estimate the influence of a jurisdiction on the best possible profitability of pv storage systems we find that the choice of jurisdiction has significant impact on the profitability of pv storage systems we also find that policy makers can use the price of grid electricity as well as upfront subsidies to influence profitability and therefore adoption

fishing revenue productivity and product choice in the alaskan pollock fishery a key element in evaluating fishery management strategies is examining their effects on the economic performance of fishery participants yet nearly all empirical studies of fisheries focus exclusively on the amount of fish harvested the economic benefits derived from fish stocks involve the amount of revenue generated from fish processing which is linked to both the way fish are harvested and the products produced from the fish in this study we econometrically estimate a flexible revenue function for catcher processor vessels operating in the alaskan pollock fishery recognizing potential endogeneity and a variety of fishing inputs and conditions we find significant own price supply responses and product substitutability and enhanced revenues from increased fishing days and tow duration after a regulatory change introduced property rights through a new fishing cooperative we also find significant growth in economic productivity or higher revenues over time after controlling for observed productive factors and price changes which exceeds that attributable to increased harvest these patterns suggest that the move to rights based management has contributed significantly to economic performance in the pollock fishery

evaluating tradable property rights for natural resources the role of strategic entry and exit this paper presents an econometric approach to the evaluation of environmental regulation using tradable property rights existing empirical research on this issue which compares overall industry efficiency before and after the introduction of new regulations conflates two distinct phenomena efficiency changes due to exit of excess capital and changes in the efficiency of individual firms because the regulatory process induces firms of different types to enter and exit the industry at different rates the true efficiency and equity effects of tradable property rights cannot be assessed without correcting for these changes in sample composition this paper examines the impact of regulatory change in the mid atlantic surf clam fishery using an econometric model that separates its effects on industry structure and vessel efficiency the analysis finds that contrary to widely held belief tradable property rights did not disproportionately benefit either large fishing firms or highly integrated firms

using history dependence to design a dynamic tradeable quota system under market imperfections a transferable quota system is analysed in a two period model with market power so far the management mechanisms presented in the literature to remedy market power have either not succeeded in securing efficiency in the distribution of quota within and across time periods or have resulted in only one of the two inefficiencies being eliminated in this paper a new mechanism is introduced where allocation of quota is made dependent upon historic quota acquisitions this opens for a trade off between distributional and time efficiency or under specific circumstances securing overall efficiency

employment flows capital mobility and policy analysis this article extends hopenhayn and rogerson s analysis of firing taxes by introducing a flexible form of capital and considering transitionary dynamics the article finds that capital is not important for understanding the long run and welfare effects of firing taxes however capital is crucial for determining the short run consequences of eliminating this type of policy

fishing technology and optimal distribution of harvest rates this paper examines the problem of the optimal management of a joint ownership fishing exploitation where agents use different fishing gears we consider a model in which the fishing activity may affect resource growth not only through the harvest function but also through the natural growth rate of the resource this allows us to capture the fact that some fishing gears alter the natural growth rate of the resource we find that when the natural growth of the resource is altered by the fishing technology the optimal stock is not independent of how harvest quotas are distribute among the agents as a result a fishing policy that firstly determines the optimum stock and secondly decides how to distribute the harvest among the different agents will not be efficient we also analyze the joint determination of optimal stock and harvest quotas and show that positive harvest quotas will only be optimal when countries are characterized by certain asymmetries