environmental policy vs public pressure innovation and diffusion of alternative bleaching technologies in the pulp industry abstract in the late 1980s and early 1990s concern over dioxin in both paper products and wastewater led to the development of techniques that reduced the use of chlorine in the pulp industry both regulatory and consumer pressure motivated this change unlike previous studies we use patent data to examine the evolution of two competing bleaching technologies in five major paper producing countries both of which reduce the use of chlorine in the pulping process the use of patent data allows us to focus on the invention stage however adoption data are also presented and by the end of the 1990s nearly all pulp production in these countries used one of these technologies while previous studies emphasize the importance of regulation for inducing innovation here we find substantial innovation occurring before regulations were in place instead pressure from consumers and the public at large to reduce the chlorine content of paper drove invention prior to the introduction of environmental policies in any of the countries concerned

proxies in the new political economy caveat emptor i introduction today proxies for cultural political and institutional variables abound in econometric studies and strong policy recommendations are based on results obtained with them unlike the traditional data of economists they are neither market generated nor the fruit of large official or semi official statistical projects the main providers are ideological or public interest organizations such as transparency international and freedom house supplemented by scholars corporations and miscellaneous organizations the diverse and perhaps suspect origins of these data are reasons to use them cautiously yet even the prudent robert barro 1999 takes freedom house s ratings of international political and civil liberty on faith in his recent study of the determinants of democracy the trust standard what i shall call the correlation test is a common way to assess multiple proxies for an intangible variable which also breeds complacency because it often is used as a substitute for direct appraisal of them alberto alesina and beatrice weder 1999 p 10 use it in a study of corruption s relation to foreign aid claiming that these relatively high correlations among proxies for corruption provide some confidence in the measures of corruption since most of them were compiled by different institutions using very different methodologies the same spirit infuses what i shall call the mutual corroboration test for regression results it is considered probative that different proxies for the same intangible variable produce similar or at least mutually compatible regression estimates the correlation and corroboration tests also appear in a recent world bank study kaufman et al 2000 p 11 utilizing measures of the quality of governance the authors write that if the data were not informative we would not expect to see the strong agreement across sources about the quality of governance particularly striking is the broad consensus that emerges among many diverse raters they acknowledge the conceptual differences among the literally hundreds of measures used in their study all qualitative but omit none from their composite indicators finally a pioneer in the new data gerald scully 1992 constructs eight economic freedom indexes plus an average of them to be the economic freedom variable in one of his projects he cites high rank correlations among them approvingly these tests use mutual resemblance or consistency as substitutes for directly assessing the suitability of proxies for a particular project one by one evaluation is to be sure a laborious and inconvenient task but ease and convenience are not tests of the validity of evaluation procedures correlation among the proxies or results obtained with them must not be confused with aptness of the proxies or results the correlation and corroboration tests assume for instance that only measurement error differentiates proxies from one another yet political institutional variables normally are defined differently from one another good governance is already a subjective judgment broad consensus allows differences of opinion identical policy conclusions cannot follow from regressions based on measures having different meanings so the quotation from alesina and weder is an indictment of their study not a defense of it the main purpose of this article is to show that the trust standard and the correlation and corroboration tests are pseudo criteria for judging the quality of proxies and results based on them because they are capable of supporting fallacious statistical estimates these tests i show endorse statistical nonsense in an interesting familiar case the nonsense is attributable in part to the inapposite use of proxy regressors in estimations of a simple and well known model specifically bivariate regressions often cited in support of the strict free market school of thought

international migration non traded goods and economic welfare in the source country abstract this paper examines the economic effects of emigration in a source country producing both traded and non traded commodities it is shown that even if the economy faces fixed terms of trade emigration can still affect the welfare of the non migrants and the direction of the effect in this context will always be negative

interprovincial migration and the stringency of energy policy in china the authors thank eni s p a icf international shell international limited and the french development agency afd founding sponsors of the china energy and climate project we also gratefully acknowledge the support of the energy information administration at the u s department of energy we are also thankful for support provided by the ministry of science and technology of china the national development and reform commission and rio tinto china we further gratefully acknowledge the financial suppo rt for this work provided by the mit joint program on the science and policy of global change through a consortium of industrial sponsors and federal grants this work is also supported by the doe integrated assessment grant de fg02 94er61937

emigration and welfare in an economy with foreign capital abstract this paper examines the effects of emigration on welfare of the remaining residents r in an economy producing traded t and non traded n goods with the aid of foreign and domestic capital while the existing literature has established that emigration reduces the welfare of those left behind when foreign capital is not present in the economy the analysis below suggests that with foreign capital the effect on welfare may well be reversed the paper also compares the welfare implications of remittance flows back to the source country when they are used to finance consumption and when they are used to finance capital accumulation

supply and demand factors of cleaner technologies some empirical evidence this article identifies and analyzes factors that affect the willingness of firms and consumers to develop and adopt cleaner technologies cleaner technologies is used as a general term for pollution abatement technologies re use systems and environmentally sound consumer products and materials the article also contains the findings of three case studies on cleaner technologies cfc substitutes low solvent paints and coatings and membrane technology in which the importance of the identified factors is investigated from the case studies some general conclusions are drawn about these factors and the way in which policy instruments can be used to stimulate innovation in and diffusion of cleaner technologies no single policy instrument is considered to be optimal instead a policy mix is needed involving a much wider use of economic instruments

international migration income taxes and transfers a welfare analysis abstract an important issue in public policy debates is the effect of international migration on welfare in source and host countries we address this issue by constructing a general equilibrium model of a two class source or host country each country produces many traded and non traded goods uses income taxes and distributes the tax receipts equally to all individuals the analysis examines the effects of permanent migration on class and national welfare we show among other things that marginal immigration hurts people already in the country regardless of whether or not non traded goods exist the presence of international capital mobility however may reverse the above result

dynamic incentives of environmental regulations the effects of alternative policy instruments on technology diffusion abstract we develop a framework for comparing empirically the effects of alternative environmental policy instruments on the diffusion of new technology market based and command and control approaches can he quantitatively compared by estimating the economic penalty that firms through their actions reveal to be associated with violation of standards in the context of concerns about global climate change we empirically examine the likely effects of pigouvian taxes technology adoption subsidies and technology standards we employ state level data on the diffusion of thermal insulation in new home construction comparing the effects of energy prices insulation cost and building codes

decentralized income redistribution and immigration abstract we analyze the welfare and other effects of immigration on a system of jurisdictions with a common labor market mobile capital and redistributive tax transfer policies comparative statics analysis of a model of nash non cooperative equilibria in tax transfer policies shows that the welfare effect of immigration depends on whether immigrants are net fiscal contributors or burdens any one jurisdiction s redistribution and immigration policies generate fiscal externalities for others in the system which a central government can internalize by appropriate taxes and subsidies

why do rich countries prefer free trade over free migration the role of the modern welfare state abstract according to traditional trade theory heckscher ohlin free trade and free migration are equivalent measures of economic integration leading both to an equalization of factor prices this prediction is in sharp opposition to the observed preference of rich countries for free trade over free migration we provide an explanation for this inconsistency the redistribution policies in the countries social welfare in countries with a relatively small number of low skilled native workers is higher with free trade than with free migration due to redistribution of income towards immigrating workers

technology adoption in the presence of an exhaustible resource the case of groundwater extraction in this paper we integrate technology diffusion within hotelling s exhaustible resource model the modern technology is a conservation technology such as drip irrigation used with groundwater resource quality heterogeneity and rising water prices are responsible for the gradual adoption of the modern technology and under reasonable conditions the diffusion curve is an s shaped function of time without intervention the diffusion process will be slower than is socially optimal and optimal resource use tax will accelerate the diffusion of the conservation technology and slow down excessive resource depletion caused by market failure due to open access conditions

institutions investment and growth new cross country and panel data evidence this paper outlines the alternative channels through which institutions affect growth and studies the empirical relationship between institutions investment and growth the empirical results indicate that i free market institutions have a positive effect on growth ii economic freedom affects growth through both a direct effect on total factor productivity and an indirect effect on investment iii political and civil liberties may stimulate investment iv an important interaction exists between freedom and human capital investment v milton friedman s conjectures on the relation between political and economic freedom are correct vi promoting economic freedom is an effective policy toward facilitating growth and other types of freedom jel o17 o40 p51

a diffusion model incorporating product benefits price income and information we start by assuming that a major benefit of many new durable products such as dishwashers and microwave ovens is time savings others such as vcrs also enhance the value of our leisure time using a household production framework we demonstrate that a utility maximizing individual will have a reservation price for the product which is a function of the product benefits and his wage rate by assuming that the wage rate has an extreme value distribution across the population we are able to derive for the aggregate process an income price dependent logistic adoption equation we then allow for the possibility that certain eligible consumers may delay their purchase of the product because they are unaware that it exists are suspicious of its quality or expect its price to fall unawareness uncertainty and hope for further price declines are assumed to decrease with the increase in the number of previous adopters the resulting diffusion model has the property that the product life cycle phenomenon can be explained jointly or separately by the income price process and the awareness uncertainty expectations process using data on household income on durable penetration within different income classes and on first purchase sales the aggregate diffusion model and its premises are tested and supported it is found that both the income price and awareness uncertainty expectations processes are at work however the dependence of the awareness uncertainty expectations delay process on the number of previous adopters e g word of mouth type effect exists only in certain product categories and is usually relatively weak it is demonstrated that if the word of mouth type effects are weak a price skimming strategy is optimal for a monopolist and also is likely to be implemented by oligopolists the sales forecasting implications of the model also are pursued

the diffusion of clean technologies a review with suggestions for future diffusion analysis abstract this article gives an overview of the literature on clean technology diffusion followed by suggestions for future analysis findings from diffusion analysis are presented in the form of 10 stylised facts helping the reader to see the forest for the trees the overall conclusion is that the diffusion of clean technology same as the diffusion of normal innovations is governed by endogenous mechanism epidemic learning and learning economies and by exogenous mechanisms policy is important for clean technology diffusion but other factors are important too the characteristics of the clean technology absorptive capacities of potential adopters and the age structure of capital it is often overlooked that companies have a choice they can choose between an end of pipe solution a process change adaptation and a change of process substitution this means that the diffusion and evolution of one clean technology will be at the expense of the diffusion of another clean technology something overlooked in studies on clean technology diffusion further research is needed on the influence of public policy on clean technology choice expectations about learning economies and prices adjustment costs network externalities and complementary innovations on clean technology adoption choices

income inequality and economic freedom in the u s states this paper examines the impact of economic freedom on income inequality using cross sectional data for u s states while previous research has explored this relationship internationally the results have been conflicting in addition while it seems obvious that the large institutional differences across countries will impact income inequality it isn t so obvious that the smaller variation in policies among u s states can have a measurable impact can improvements in income inequality be used as a justification for marginal pro market policy reforms at the state level or is this argument applicable only to national level institutional reforms

on generalizing the economic analysis of international migration a note the author critically examines an article by kar yui wong concerning two important well known propositions on international factor movements namely first finite international factor movements are beneficial to the nationals of the destination country but detrimental to those who are left behind in the source country and second marginal movements do not have such welfare implications the present paper by utilizing the indirect trade utility function derives results in a manner that is both direct and at once intuitively transparent

economic freedom and migration flows between u s states a modified gravity model is estimated using a cross section of data drawn from the u s census bureau survey of 2000 in order to analyze the impact of economic freedom on gross migration flows among the lower 48 states spatial econometric methods are utilized in order to capture spatial effects not detected by distance in addition the economic freedom of north america index is decomposed to determine the individual impact of various policies results show that states with higher relative economic freedom experience greater migration inflow through its direct impact on income and employment growth in aggregate the findings indicate that individuals migrate toward states with relatively higher government consumption expenditures relatively lower tax burdens and states with more freedom with respect to labor decisions in the form of less restrictive minimum wages less concentration of unions and less dependence on public employment

proxies for economic freedom a critique of the hanson critique economic freedom indicators have become quite popular recently as a useful tool to quantify the relationship between a country s institutions and its prosperity in a recent article hanson 2003 criticizes these types of studies for i failing to adequately distinguish between different proxies for economic freedom ii not considering the potential for endogeneity and iii accepting significance of economic freedom s ability to promote prosperity even though regression analysis generates nonsensical results closer inspection reveals that most of his arguments are questionable do not apply to much of the literature or are not original and that he is guilty of misinterpreting his own econometric evidence relating freedom to the level of gdp

innovation in pollution control comparisons of the various institutional arrangements for controlling pollutant emissions from individual sources effluent fees effluent control subsidies marketable permits and direct command and control regulation have usually focused on their static efficiency properties and institutional feasibility e g dales 1968 zerbe 1970 baumol and oates 1975 kneese and schultze 1975 marin 1978 mills and white 1978 spence and weitzman 1978 russell 1979 a relatively neglected area has been the study of how each arrangement influences innovation in pollution control a few studies e g kneese and schultze 1975 marin 1978 mills and white 1978 russell 1979 have casually claimed that the control methods that rely on economic incentives provide superior incentives for innovation but there have been few systematic studies of the question this paper provides a simple model of pollution control innovation by a profitmaximizing polluter who is subject to the various control methods the consequences of the methods will be explored in three major contexts first we assume that the polluter and the innovation is a small enough part of the overall pollution problem so that none of the important marginal conditions are changed by the innovation second we assume that the polluter and the innovation are important enough so that marginal conditions are changed by the innovations but that the governmental authority determining pollution control incentives or levels fails to make the appropriate adjustments third we again assume that the innovation causes marginal conditions to change but in this case the governmental authority makes the appropriate adjustments we use the term ratcheting to describe this last phenomenon in all cases we assume that the innovating polluter correctly predicts the reactions of the governmental authority and bases his innovation decisions on that prediction a profit maximizing entrepreneur would normally be expected to adopt any innovation that promised gains present discounted value to him in excess of initial

demand pull instruments and the development of wind power in europe a counterfactual analysis renewable energy technologies are called to play a crucial role in the reduction of greenhouse gas emissions since most of these technologies did not yet reach grid parity public policies have been implemented in order to foster their deployment the approach that has been privileged in europe is the demand pull approach that aims at creating a demand for these new technologies and at stimulating their diffusion this paper examines the effect of demand pull policies on the diffusion of onshore wind power technology in six european countries denmark france germany italy portugal and spain in a first step a micro founded model of diffusion is calibrated in order to replicate the observed diffusion of wind power in these six countries in a second step a counterfactual analysis is conducted by investigating several scenarios by taking into account the complex self sustained dynamics of diffusion and the learning spillovers that operate in the wind power sector we can derive several insights about demand pull policies first the impact of a demand pull policy on the diffusion of wind power is determined by the stage at which it comes to support it the effect seems to be stronger at the beginning of the diffusion second international spillovers do operate in the wind power sector these international spillovers however are not strong enough to foster the diffusion of wind power in a country having no demand pull support we can derive from these two statements that a strategy consisting in not implementing any demand pull policy with the expectation that international spillovers will reduce the cost of wind power and foster the diffusion of the technology that then shall become competitive is not a good option for a country targeting a high share of wind power in its energy mix

the diffusion of biological waste water treatment plants in the dutch food and beverage industry this article develops an economic model of environmental technology adoption decisions the model is applied econometrically to the diffusion of biological waste water treatment plants in the dutch food and beverage industry it shows that it is possible to explain the overall diffusion pattern of biological waste water treatment plants in terms of a rational choice model in which prospective adopters trade off the costs of effluent treatment against the savings on effluent tax payments effluent charges are shown to be a significant positive factor in the timing of adoption of biological effluent treatment plants this result is brought out by both the rational choice and the epidemic models none of the models however can explain year to year changes in the ownership of biological waste water treatment plants during the 1974 91 period which suggests that there are other factors not included in the model that affect the timing of adoption

the economic analysis of international migration a generalization this note examines and extends the following two propositions that finite international factor movements are beneficial to the nationals of the destination country but detrimental to those left behind in the source country and that marginal movements do not have such welfare effects using some newly developed techniques the propositions are found to be valid irrespective of the number of goods and factors if the economy starts from the autarky position when only one factor can flow the gain of the nationals loss of those left behind will be positively dependent upon the amount of inflow outflow however if goods trade and or factor flow are initially present the propositions are in general not true summary in fre excerpt

are entrepreneurship and cognitive skills related some international evidence do national differences in cognitive skills cs predict a nation s likelihood of generating high quality entrepreneurs who create and expand high value businesses we answer this question by estimating cross country regressions that use the acs and szerb global entrepreneurship development index gedi and a measure of national cs after including conventional controls we find for a sample of 60 countries that our measure of cs robustly predicts the gedi unconditional correlation 0 65 standardized beta 0 42 an index that gives weight to both entrepreneurial attitudes within a nation and the institutional and economic prerequisites for creating high value high growth firms we find that this result also holds for an alternative measure of entrepreneurship

diffusion paths for micro cogeneration using hydrogen in the netherlands we estimate the diffusion of micro cogeneration systems micogen using hydrogen produced from natural gas in the netherlands for the 2000 2050 period on the basis of economical factors the diffusion is important for the transition to a hydrogen economy based on renewables with natural gas paving the way for hydrogen from renewables for three scenarios full diffusion takes place in the period 2020 2050 the most important factors behind the diffusion are 1 growing energy demand resulting in lower hydrogen costs and higher energy costs in the reference case and 2 lower costs of micogen stemming from learning economies the model is advanced by considering all costs components for heterogeneous users which have been calculated for the entire diffusion period it is the first threshold diffusion model that is being applied to the diffusion of technological clusters involving new or adapted infrastructures 2007 elsevier ltd all rights reserved

resisting migration wage rigidity and income distribution like any trade activity migration tends to generate gains to all parties involved the migrants as well as the native born population with a mal functioning labour market however migration will exacerbate the imperfections in the market consequently it may lead to losses to the native born population which are typically quite sizeable another economic problem raised by migration is the additional toll imposed on the welfare state income distribution institutions being unable to exclude migrants from the various entitlement programmes and public services the modern welfare state can find migration rather costly these two economic considerations may help explain the resistance to migration despite the pure gains from trade benefits created by it immigration could be more beneficial to the native born population when labour markets are better functioning and the welfare programmes are less comprehensive this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item