on the electrification of road transport learning rates and price forecasts for hybrid electric and battery electric vehicles abstract hybrid electric vehicles hevs and battery electric vehicles bevs are currently more expensive than conventional passenger cars but may become cheaper due to technological learning here we obtain insight into the prospects of future price decline by establishing ex post learning rates for hevs and ex ante price forecasts for hevs and bevs since 1997 hevs have shown a robust decline in their price and price differential at learning rates of 7 2 and 23 5 respectively by 2010 hevs were only 31 22 2010 kw 1 more expensive than conventional cars mass produced bevs are currently introduced into the market at prices of 479 171 2010 kw 1 which is 285 213 2010 kw 1 and 316 209 2010 kw 1 more expensive than hevs and conventional cars our forecast suggests that price breakeven with these vehicles may only be achieved by 2026 and 2032 when 50 and 80 million bevs respectively would have been produced worldwide we estimate that bevs may require until then global learning investments of 100 150 billion which is less than the global subsidies for fossil fuel consumption paid in 2009 these findings suggest that hevs including plug in hevs could become the dominant vehicle technology in the next two decades while bevs may require long term policy support

is the troika bad for the environment an analysis of eu countries environmental performance in times of economic downturn and austerity memoranda abstract in this paper we examine the effect of the current economic crisis on the environmental performance of the eu countries by employing hierarchical linear multilevel hlm modeling we find that for the period 2000 2015 a drop in the national gdp a recession effect as well as endorsing a memorandum of understanding mou for receiving a imf eu ecb financial rescue package a troika effect have non significant to positive impacts on a number of national environmental quality and policy indicators over and above other economic political and governance predictors for eurozone and non eurozone countries alike nevertheless this changes drastically if we examine these two factors interaction experiencing a recession while being a recipient of a troika sponsored rescue package has detrimental effects on an eu country s national environment

testing for the presence of some features of increasing returns to adoption factors in energy system dynamics an analysis via the learning curve approach the purpose of this paper is to explain the sources of energy system lock in it presents a comparative analysis of the respective contributions of some features of increasing returns to adoption factors i e learning by doing learning by searching and returns to scale effects in explaining the technological change dynamics in the energy system the paper is technically based on a critical analysis of the learning curve approach econometric estimation of learning and scale effects inherent to seven energy technologies were performed by the use of several learning curve specifications these specifications permit to deal with some crucial issues related to the learning curve estimation which are associated with the problem of omitted variable bias the endogeneity effects and the choice of learning indicators results show that dynamic economies from learning effects coupled with static economies from scale effects are responsible for the lock in phenomena of the energy system they also show that the magnitude of such effects is correlated with the technology life cycle maturity in particular results point out that 1 the emerging technologies exhibit low learning rates associated with diseconomies of scale which are argued to be symptomatic of the outset of the deployment of new technologies characterized by diffusion barriers and high level of uncertainty 2 the evolving technologies present rather high learning rates meaning that they respond quickly to capacity expansion and r d activities development 3 conventional mature technologies display low learning rates but increasing returns to scale implying that they are characterized by a limited additional diffusion prospects

the level and quality of value at risk disclosure by commercial banks in this paper we study both the level of value at risk var disclosure and the accuracy of the disclosed var figures for a sample of us and international commercial banks to measure the level of var disclosures we develop a var disclosure index that captures many different facets of market risk disclosure using panel data over the period 1996 2005 we find an overall upward trend in the quantity of information released to the public we also find that historical simulation is by far the most popular var method we assess the accuracy of var figures by studying the number of var exceedances and whether actual daily vars contain information about the volatility of subsequent trading revenues unlike the level of var disclosure the quality of var disclosure shows no sign of improvement over time we find that var computed using historical simulation contains very little information about future volatility

managerial incentives on the near linearity of optimal compensation contracts are examined when outcomes depend on managers choices as well as efforts as the cost of effort shrinks relative to payoffs the optimal contract converges to a linear payoff if the control space of the agent has full dimensionality but not otherwise thus when the agent can trade expected return for greater correlation with other returns it is better to ignore relative performance when the cost of effort is small when the choices include all fair gambles and hedges the linear schedule is no more expensive than any other schedule that induces effort unfair gambles are examined as well

trade openness and environmental quality international evidence we examine the relationship between trade openness and the environment in a cross country panel using the emission of particulate matter pm10 as the basic indicator of environmental quality the panel cointegration test results show a long run relationship between particulate matter emissions trade openness and economic growth we find that increased trade openness leads to environmental degradation for the global sample however the results differ according to the income of countries trade openness has a benign effect on the environment in high income countries but a harmful effect in middle and low income countries these results are generally robust to different measures of trade openness and environmental quality interestingly and significantly the results are consistent with the popular notion that rich countries dump their pollution on poor countries finally we find evidence of a feedback effect between trade openness and particulate matter emissions for the global sample as well as different income groups of countries

technological learning and renewable energy costs implications for us renewable energy policy abstract this paper analyzes the relationship between current renewable energy technology costs and cumulative production research development and demonstration expenditures and other institutional influences combining the theoretical framework of learning by doing and developments in learning by searching with the fields of organizational learning and institutional economics offers a complete methodological framework to examine the underlying capital cost trajectory when developing electricity cost estimates used in energy policy planning models sensitivities of the learning rates for global wind and solar photovoltaic technologies to changes in the model parameters are tested the implications of the results indicate that institutional policy instruments play an important role for these technologies to achieve cost reductions and further market adoption

cost effectiveness as energy policy mechanisms the paradox of technology neutral and technology specific policies in the short and long term when choosing policy mechanisms to design and deploy energy policies policymakers typically seek cost effective ones linking cost effectiveness to the lowest cost of support for res e generation and or consumer costs the objectives of this paper are to analyze the cost effectiveness of renewable portfolio standards rps feed in tariffs fit and auctions in the short and long term considering both technology neutral and technology specific approaches results show that rps and auctions are more cost effective than feed in tariffs fit in the short term if cost effectiveness is defined as minimizing consumer costs also if one or more emerging technologies with higher levelized life cycle costs lcc low cumulative production and high experience elasticity are considered in the pool of res e policy design a technology neutral approach in the short term could lock out these emerging technologies avoiding a long term lcc reduction in this case a technology specific policy used in the short term would reflect lower total generation policy costs in the long term if compared with a technology neutral policy in both short and long term this paper calls this phenomenon the paradox of technology neutral and technology specific policies in the long term considering the results this paper suggests a mix of technology neutral and technology specific policies using rps or auction mechanisms to promote res e

the environment left wing political orientation and ecological economics the objectives of this commentary are twofold the first is to examine the relationship between a party s position within the left right political spectrum and its stance on environmental issues as stated in party manifestos the second is to examine the relationship between individuals ideological orientation and pro environmental beliefs attitudes and self reported behavior equality distributional concerns and market skepticism are typically regarded as defining factors of left wing political orientation our results suggest that left wing parties and individuals are also more pro environmental than their right wing counterparts ecological economics similarly embraces sustainability efficient resource allocation and equitable distribution and is skeptical towards the ability of unregulated markets to achieve these objectives the hypothesis is put forward that ecological economics is more likely to be supported by left wing parties and individuals

macroeconomic uncertainty precautionary saving and the current account abstract the relationship between current account developments and changes in the macroeconomic environment is a key issue in open economy macroeconomics this paper extends the standard intertemporal model of the current account to incorporate the effects of macroeconomic uncertainty on external saving behavior it is shown that the greater the uncertainty in national cash flow defined as output less investment less government consumption the greater will be the incentive for precautionary saving and ceteris paribus the larger the current account surplus empirical support for the model is found using post war quarterly data for the united states japan and the united kingdom as well as a long time series 1919 1990 for the united states

technological change in energy systems learning curves logistic curves and input output coefficients abstract learning curves have recently been widely adopted in climate economy models to incorporate endogenous change of energy technologies replacing the conventional assumption of an autonomous energy efficiency improvement however there has been little consideration of the credibility of the learning curve the current trend that many important energy and climate change policy analyses rely on the learning curve means that it is of great importance to critically examine the basis for learning curves here we analyse the use of learning curves in energy technology usually implemented as a simple power function we find that the learning curve cannot separate the effects of price and technological change cannot reflect continuous and qualitative change of both conventional and emerging energy technologies cannot help to determine the time paths of technological investment and misses the central role of r d activity in driving technological change we argue that a logistic curve of improving performance modified to include r d activity as a driving variable can better describe the cost reductions in energy technologies furthermore we demonstrate that the top down leontief technology can incorporate the bottom up technologies that improve along either the learning curve or the logistic curve through changing input output coefficients an application to uk wind power illustrates that the logistic curve fits the observed data better and implies greater potential for cost reduction than the learning curve does

investigation of the environmental kuznets curve for carbon emissions in malaysia do foreign direct investment and trade matter abstract environmental degradation has become a central issue of discussion among the economists and environmentalists in view of malaysia s position as one of the main contributors to co2 emissions in asia and its status as a fast growing economy it is vital therefore to conduct a study to identify the relationship between economic growth and co2 emissions for malaysia this study attempts to examine empirically the environmental kuznets curve hypothesis for malaysia in the presence of foreign direct investment and trade openness both in the short and long run for the period 1970 to 2008 the bounds testing approach and granger causality methodology are applied to test the interrelationships of the variables the results of our study indicate that the inverted u shaped relationship does exist between economic growth and co2 emission in both the short and long run for malaysia after controlling for two additional explanatory variables namely fdi and trade importantly the results of the study also provide some crucial policy recommendations to the policy makers

does trade openness improve environmental quality the literature on trade openness economic development and the environment is largely inconclusive about the environmental consequences of trade this study treats trade and income as endogenous and estimates the overall impact of trade openness on environmental quality using the instrumental variables technique we find that whether or not trade has a beneficial effect on the environment varies depending on the pollutant and the country trade is found to benefit the environment in oecd countries it has detrimental effects however on sulfur dioxide so2 and carbon dioxide co2 emissions in non oecd countries although it does lower biochemical oxygen demand bod emissions in these countries we also find the impact is large in the long term after the dynamic adjustment process although it is small in the short term

quantitative study on long term global solar photovoltaic market abstract this paper analyzes the relationship between the declines in solar photovoltaic pv module costs and cumulative production silicon prices supply demand imbalance and the presence of lower cost chinese products in global pv market using learning curve model state of market development and its connection with learning is also examined results indicate that learning effect is best measured when supplementing output with silicon prices in the analysis learning rate lr diminishes over the time periods examined thereby suggesting the declining of progress as market reaches maturity the outcomes from the learning curve analysis are subsequently applied to project future uptake of pv worldwide module and electricity costs till 2035 demand for pv is anticipated to remain robust with cumulative installed capacity worldwide projected to reach 659 gw by 2035 at the same time module cost is estimated to decline from 3 8 w in 2006 to 1 78 w in 2035 a reduction of over 50 relative to 2006 level unit cost of electricity from pv is predicted to be in the range of 0 13 kwh to 0 17 kwh by 2035 for the three scenarios analyzed

technical change dynamics evidence from the emerging renewable energy technologies abstract this paper explores the respective contributions of the effects of learning and returns to scale in the capital costs reduction pattern experienced by renewables causality analysis and econometric estimation of learning curves are performed on two emerging renewable energy technologies namely pv and wind learning effects appear as an essential driving force a result which concurs with the widely acknowledged importance of experience in technical progress inherent to economic growth the existence of non constant and flexible returns to scale are further highlighted their effect on diffusion dynamics is shown to be potentially considerable particularly at the outset of innovation deployment however returns to scale are suggested to be constant in the long term institutional commitment in supporting innovation therefore seems justified both on the basis of the occurrence of learning effects and diseconomies of scale these findings appear to be essential to the dynamics of innovation diffusion and market structure

an optimization model for renewable energy generation and its application in china a perspective of maximum utilization in response to climate change china s power industry is undertaking the task of reducing carbon emissions renewable energy generation has become an important option for the government and state grid companies it is important to know the maximum possible capacities of renewable energy generation from its different sources in order to plan the construction of the power grid in the future in this paper several important factors affecting the development of renewable energy generation are identified through a review of the existing literature such as cost technical maturity and so on and analyzed combined with the learning curve model the technology diffusion model and expectations about future economic development in china a new model the renewable energy optimization model reom is developed to analyze the development of three renewable energy sources wind power solar power and biomass power from 2009 to 2020 results show that 1 the maximum installed capacities of wind power solar power and biomass power will reach 233321 26680 and 35506 mw in 2020 2 from 2009 to 2020 biomass power will develop rapidly at the early stage while wind power is developed massively at the final stage and solar power has relatively stable growth 3 due to the added capacity in the early periods the unit investment cost of solar power shows a large decline which is good for its following scale development 4 the investment ratio constraint has a large effect on the development of wind power while the constraint of on grid proportion of renewable energy generation has a significant effect on the development of wind power and solar power the results have important policy implications for long term energy planning in developing countries such as china and india

the carbon footprint of greek households 1995 2012 abstract the goal of this paper is twofold i to investigate the carbon footprint of greek households throughout the period 1995 2012 in order to identify the main socio economic factors that affect ghg emissions and ii to evaluate the effectiveness of the implemented policies to tackle climate change in this a consumption based emissions inventory approach is applied the analysis is based on an environmentally extended input output model including direct co2 emissions from households indirect co2 emissions from electricity consumption and indirect co2 emissions from energy used in the production of goods and services purchased by households domestic or imported statistical analysis and appropriate regression models were developed in order to identify the main factors influencing the carbon footprint of greek households the results indicate that the observed trends during the period 1995 2008 can be attributed to the effect of high economic growth this trend is partially counterbalanced by favorable weather conditions and the implementation of greenhouse mitigation policies and measures mainly in the supply side since 2008 the shrinking household income is the dominant driver in addition the effectiveness of energy conservation policies and measures in place is rather low while the effect of imports is limited

technological learning in energy environment economy modelling a survey abstract this paper aims at providing an overview and a critical analysis of the technological learning concept and its incorporation in energy environment economy models a special emphasis is put on surveying and discussing through the so called learning curve both studies estimating learning rates in the energy field and studies incorporating endogenous technological learning in bottom up and top down models the survey of learning rate estimations gives special attention to interpreting and explaining the sources of variability of estimated rates which is shown to be mainly inherent in r d expenditures the problem of omitted variable bias the endogeneity relationship and the role of spillovers large scale models survey show that despite some methodological and computational complexity related to the non linearity and the non convexity associated with the learning curve incorporation results of the numerous modelling experiments give several new insights with regard to the analysis of the prospects of specific technological options and their cost decrease potential bottom up models and with regard to the analysis of strategic considerations especially inherent in the innovation and energy diffusion process in particular the energy sector s endogenous responses to environment policy instruments top down models

a review of learning rates for electricity supply technologies a variety of mathematical models have been proposed to characterize and quantify the dependency of electricity supply technology costs on various drivers of technological change the most prevalent model form called a learning curve or experience curve is a log linear equation relating the unit cost of a technology to its cumulative installed capacity or electricity generated this one factor model is also the most common method used to represent endogenous technical change in large scale energy economic models that inform energy planning and policy analysis a characteristic parameter is the learning rate defined as the fractional reduction in cost for each doubling of cumulative production or capacity in this paper a literature review of the learning rates reported for 11 power generation technologies employing an array of fossil fuels nuclear and renewable energy sources is presented the review also includes multi factor models proposed for some energy technologies especially two factor models relating cost to cumulative expenditures for research and development r d as well as the cumulative installed capacity or electricity production of a technology for all technologies studied we found substantial variability as much as an order of magnitude in reported learning rates across different studies such variability is not readily explained by systematic differences in the time intervals geographic regions choice of independent variable or other parameters of each study this uncertainty in learning rates together with other limitations of current learning curve formulations suggests the need for much more careful and systematic examination of the influence of how different factors and assumptions affect policy relevant outcomes related to the future choice and cost of electricity supply and other energy technologies

trade the pollution haven hypothesis and the environmental kuznets curve examining the linkages abstract this paper examines the extent to which the ekc inverted u relationship can be explained by trade and specifically the migration or displacement of dirty industries from the developed regions to the developing regions the pollution haven hypothesis phh using detailed data on north south trade flows for pollution intensive products the evidence for the phh is assessed emissions of 10 air and water pollutants are then estimated controlling for trade openness structural change and dirty north south trade flows evidence of pollution haven effects is found although such effects do not appear to be widespread and appear to be relatively small compared to the roles played other explanatory variables

are left wing party strength and corporatism good for the environment evidence from panel analysis of air pollution in oecd countries abstract the effect of left wing party strength and corporatism on air pollution levels in up to 21 oecd countries over the period 1980 or 1990 1999 is tested with both fixed effects and random effects estimators controlling for scale composition technique as well as aggregate time effects robust evidence is found that parliamentary green left libertarian party strength is associated with lower pollution levels the rise of ecologically oriented parties has thus had a real impact on air pollution levels traditional left wing party strength is possibly also associated with lower pollution levels but the evidence is less consistent and robust combined left wing party strength in government is possibly associated with higher pollution levels but this result is also far from robust and is practically small no evidence is found for a consistent systematic impact of corporatism on pollution levels

domestic and international influences on green taxation economists have made a strong case for the relative efficiency of market based mechanisms for environmental regulation such as cap and trade and green taxes yet the spread of these forms has been limited and traditional command and control regulation still predominates the authors explain geographical and temporal variation in green tax burdens by considering their domestic and international determinants modeling international influences using spatial lags hypotheses are tested using panel data on organisation for economic co operation and development member states from 1995 to 2004 at the domestic level the authors show that green tax burdens are influenced by the left right and environmental positions of legislative medians and the power of the energy producing sector among other factors the authors also show that ideas about policy diffuse through international networks generated by trade and environmental intergovernmental organizations but they do not find compelling evidence for intern

agency theory and stochastic dominance recently agency theory has become popular as a means of explaining the structure of contracts between various classes of economic agents oftentimes the contracts of interest represent sharing rules for the payoffs that result from some production activity in the usual two party model of the contracting problem one party designated the principal delegates authority for decisions affecting production to another party designated the agent typically the assumptions made about the consequences of the agent s actions are that they are associated with effort on the part of the agent for which the agent but not the principal has disutility and that greater effort will result in higher payoffs from production in every state of nature moral hazard is then introduced by assuming that the principal is unable to observe the agent s effort or to infer what effort the agent applied through an ex post observation of the payoff that results

macroeconomic volatility and welfare in developing countries macroeconomic volatility and welfare in developing countries an introduction norman v loayza romain ranciere luis serven and jaume ventura macroeconomic volatility both a source and a reflection of underdevelopment is a fundamental concern for developing countries this article provides a brief overview of the recent literature on macroeconomic volatility in developing countries highlighting its causes consequences and possible remedies to reduce domestic policy induced macroeconomic volatility by controlling the level and variability of fiscal expenditures by keeping inflation low and stable and by avoiding price rigidity including that of the exchange rate which eventually leads to drastic adjustments the ability to conduct countercyclical fiscal policies is crucial and it depends largely on the ability of the authorities to reduce public indebtedness to internationally acceptable levels establish a record of saving in good times to provide for bad times and develop credibility tha

is economic volatility detrimental to global sustainability in a dynamic panel data model allowing for error cross section dependence output volatility is found to impede sustainable development through a financial development channel liquidity liability ratio output volatility exerts a significant effect on depletion of natural resources a key component of sustainability low income countries low energy intensity countries and low trade share countries tend to be especially vulnerable to macroeconomic volatility and shocks the findings highlight the interaction between global financial markets and the wider economy as a key factor influencing sustainable development with important implications for macroeconomic and environmental policies in an integrated global green economy

trade policy and learning by doing the case of semiconductors abstract the study examines the role of learning by doing for production of different types of semiconductors and how this affects the dynamics of market structure for erasable programmable read only memories eproms the learning curve determines aggregate market dynamics whereas for dynamic random access memories drams economies of scale seem to be more important these results are compared with some stylised facts for eproms persistence of leadership in product innovation could be observed whereas for drams there was leap frogging in product innovation moreover scope for vertical product differentiation is more enhanced for eproms and price competition is less intense these findings are then related to the problem of identifying the appropriate trade policies in oligopolistic industries the analysis concerns the antidumping actions undertaken by the european commission it is shown how markets enjoying similar patterns of protection have a completely different evolution of market shares for european producers the conclusion for strategic trade policy is that industry specific features matter crucially

understanding wind turbine price trends in the u s over the past decade understanding wind turbine price trends in the u s over the past decade mark bolinger and ryan wiser lawrence berkeley national laboratory pre print of article submitted to energy policy abstract on a per kw basis wind turbine prices in the u s have declined by nearly one third on average since 2008 after having previously doubled over the period from 2002 through 2008 these two substantial and opposing trends over the past decade and particularly the earlier price doubling run counter to the smooth gradually declining cost trajectories predicted by standard learning curve theory taking a bottom up approach we examine seven possible drivers of wind turbine prices in the u s with the goal of estimating the degree to which each contributed to the doubling in turbine prices from 2002 through 2008 as well as the subsequent decline in prices through 2010 in aggregate these seven drivers which include changes in labor costs warranty provisions manufacturer profitability turbine scaling raw materials prices energy prices and foreign exchange rates explain from 70 to 90 depending on the year of empirically observed wind turbine price movements in the u s through 2010 turbine scaling is found to have been the largest single contributor to the price doubling through 2008 although the incremental cost of scaling has been justified by greater energy capture resulting in a lower cost of wind generation acknowledgments the work described in this article was funded by the u s department of energy s wind water power program within the office of energy efficiency and renewable energy under contract no de ac02 05ch11231 disclaimer this document was prepared as an account of work sponsored by the united states government while this document is believed to contain correct information neither the united states government nor any agency thereof nor the regents of the university of california nor any of their employees makes any warranty express or implied or assumes any legal responsibility for the accuracy completeness or usefulness of any information apparatus product or process disclosed or represents that its use would not infringe privately owned rights reference herein to any specific commercial product process or service by its trade name trademark manufacturer or otherwise does not necessarily constitute or imply its endorsement recommendation or favoring by the united states government or any agency thereof or the regents of the university of california the views and opinions of authors expressed herein do not necessarily state or reflect those of the united states government or any agency thereof or the regents of the university of california ernest orlando lawrence berkeley national laboratory is an equal opportunity employer

the impact of r d on innovation for wind energy in denmark germany and the united kingdom this paper examines the impact of public research and development r d support on cost reducing innovation for wind turbine farms in denmark germany and the united kingdom uk first we survey the literature in this field the literature indicates that in denmark r d policy has been more successful than in germany or the uk in promoting innovation of wind turbines furthermore such studies point out that subsidy induced capacity expansions were more effective in the uk and denmark in promoting cost reducing innovation than in germany the second part of the paper describes the quantitative analysis of the impact of r d and capacity expansion on innovation this is calculated using the two factor learning curve 2flc model in which investment cost reductions are explained by cumulative capacity and the r d based knowledge stock time series data were collected for the three countries and organized as a panel data set the parameters of the 2flc model were estimated focusing on the homogeneity and heterogeneity of the parameters across countries we arrived at robust estimations of a learning by doing rate of 5 4 and a learning by searching rate of 12 6 the analysis underlines the homogeneity of the learning parameters enhancing the validity of the 2flc formulation

the pernicious effects of contaminated data in risk management banks hold capital to guard against unexpected surges in losses and long freezes in financial markets the minimum level of capital is set by banking regulators as a function of the banks own estimates of their risk exposures as a result a great challenge for both banks and regulators is to validate internal risk models we show that a large fraction of us and international banks uses contaminated data when testing their models in particular most banks validate their market risk model using profit and loss p l data that include fees and commissions and intraday trading revenues this practice is inconsistent with the definition of the employed market risk measure using both bank data and simulations we find that data contamination has dramatic implications for model validation and can lead to the acceptance of misspecified risk models moreover our estimates suggest that the use of contaminated data can significantly reduce market risk induced regulatory capital

macroeconomic volatility and welfare in developing countries an introduction macroeconomic volatility both a source and a reflection of underdevelopment is a fundamental concern for developing countries their high aggregate instability results from a combination of large external shocks volatile macroeconomic policies microeconomic rigidities and weak institutions volatility entails a direct welfare cost for risk averse individuals as well as an indirect one through its adverse effect on income growth and development this article provides a brief overview of the recent literature on macroeconomic volatility in developing countries highlighting its causes consequences and possible remedies it then introduces the contributions of a recent conference on the subject sponsored by the world bank and pompeu fabra university barcelona

crises volatility and growth how do volatility and liquidity crises affect growth when credit is constrained a bias toward short term debt can arise in financing long term investments generating maturity mismatches and leading potentially to liquidity crises the frequency of liquidity crises and the volatility of growth are found to have independent negative effects on growth financial development however dampens the growth cost of volatility but only in the case of normal volatility the growth cost of volatility therefore depends critically on the composition of normal and abnormal volatility the latter being more costly for growth

a hierarchical cost learning model for developing wind energy infrastructures renewable energy has been increasingly promoted and used to substitute non renewable fossil fuels which cause negative effects on the environment the taiwan statute for renewable energy development has regulated and promoted renewable energy since 2009 a feed in tariff fit for renewable energy is one of the incentives that the government uses to promote the installation of green power generation facilities the price of the electricity feed in tariff is based on the current and future costs of renewable energy generation when analyzing cost trends for renewable energy installation many researchers use a single factor cost learning curve model however past studies indicate that there are multiple factors affecting the overall cost of installing renewable energy hence this research develops a hierarchical installation cost learning model which considers multiple factors to accurately model and forecast wind energy development this research uses wind power development data from taiwan as a case study we identify the cost factors evaluate the learning effects and compare the hierarchical learning curve model to the basic non hierarchical learning curve model the research results show an improved fit between the hierarchical model and the actual data when compared to the basic learning model the study also provides new insights between the wind power learning progression of taiwan and three countries in europe

endogenous technological change and the policy mix in renewable power generation abstract this paper introduces the renewable power generation module which complements large scale macro econometric input output models by introducing technological change endogenously into the model so far technological change in renewable power generation technologies is either set exogenously autonomous energy improving technological change or price induced in economic models introducing endogenous technological change is necessary to adequately analyze not only the direct effects but also the indirect effects on important macro economic indicators such as growth employment welfare and trade as well as their feedback to the electricity sector the development of pv module and wind turbine prices is modeled using learning curves at the global scale i e depending on global capacity installed of each of these technologies national capacity additions in turn depend on global prices national policies and economic development while demand pull policies enhance capacity installations technology push policies do not seem to have a significant direct influence the empirical results confirm the overshooting of pv installations in germany which can be slowed down by introducing degression of feed in tariffs over time

the environmental consequences of trade evidence from subnational trade flows abstract the debate over the environmental consequences of free trade is not only quite heated but also entails significant policy ramifications recently cross sectional analysis at the country level has made use of exogenous determinants of trade to identify the causal effect of trade on the environment finding moderate evidence of a beneficial impact of expanded trade on environmental quality given the stakes involved we revisit this finding using subnational data on trade flows across us states and several measures of pollution not only does the analysis shed further light on the debate at the international level but also addresses a heretofore unexamined question does greater inter regional commerce at the subnational level harm the environment our findings are striking providing further evidence against a negative environmental impact of trade for the majority of measures analyzed however several sources of heterogeneity arise that are noteworthy

evaluating the causes of cost reduction in photovoltaic modules abstract photovoltaic pv module costs have declined rapidly over forty years but the reasons remain elusive here we advance a conceptual framework and quantitative method for quantifying the causes of cost changes in a technology and apply it to pv modules our method begins with a cost model that breaks down cost into variables that changed over time cost change equations are then derived to quantify each variable s contribution we distinguish between changes observed in variables of the cost model which we term low level mechanisms of cost reduction and research and development learning by doing and scale economies which we refer to as high level mechanisms we find that increased module efficiency was the leading low level cause of cost reduction in 1980 2012 contributing almost 25 of the decline government funded and private r d was the most important high level mechanism over this period after 2001 however scale economies became a more significant cause of cost reduction approaching r d in importance policies that stimulate market growth have played a key role in enabling pv s cost reduction through privately funded r d and scale economies and to a lesser extent learning by doing the method presented here can be adapted to retrospectively or prospectively study many technologies and performance metrics besides cost

are we consuming too much this paper articulates and applies frameworks for examining whether consumption is excessive we consider two criteria for the possible excessiveness or insufficiency of current consumption one is an intertemporal utility maximization criterion actual current consumption is deemed excessive if it is higher than the level of current consumption on the consumption path that maximizes the present discounted value of utility the other is a sustainability criterion which requires that current consumption be consistent with non declining living standards over time we extend previous theoretical approaches by offering a formula for the sustainability criterion that accounts for population growth and technological change in applying this formula we find that some poor regions of the world are failing to meet the sustainability criterion in these regions genuine wealth per capita is falling as investments in human and manufactured capital are not sufficient to offset the depletion of natural capital

optimal policy supports for renewable energy technology development a dynamic programming model abstract policy support has played a significant role in driving the rapid development of renewable energy technologies rets this study constructed a dynamic programming model to derive the optimal policy supports for rets integrating both supply and demand sides the sensitivity of policy performance on the cost and price elasticities of ret diffusion was also analyzed the results show that policy supports could be a main force for ret development in their initial periods in the long run policy makers need to decrease the support level faster than the decrease in ret cost to maintain a high policy efficiency further improving the efficiency of policy is possible considering the influences of technical change on ret development

aggregation and linearity in the provision of intertemporal incentives we consider the problem of providing incentives over time for an agent with constant absolute risk aversion the optimal compensation scheme is found to be a linear function of a vector of n accounts which count the number of times that each of the n kinds of observable events occurs the number n is independent of the number of time periods so the accounts may entail substantial aggregation in a continuous time version of the problem the agent controls the drift rate of a vector of accounts that is subject to frequent small random fluctuations the solution is as if the problem were the static one in which the agent controls only the mean of a multivariate normal distribution and the principal is constrained to use a linear compensation rule if the principal can observe only coarser linear aggregates such as revenues costs or profits the optimal compensation scheme is then a linear function of those aggregates the combination of exponential utility normal distributions and linear compensation schemes makes computations and comparative statics easy to do as we illustrate we interpret our linearity results as deriving in part from the richness of the agent s strategy space which makes it possible for the agent to undermine and exploit complicated nonlinear functions of the accounting aggregates

the theory of moral hazard and unobservable behaviour part i principal agent models are studied in which outcomes conditional on the agent s action are uncertain and the agent s behaviour therefore unobservable for a model with bounded agent s utility conditions are given under which the first best equilibrium can be approximated arbitrarily closely by contracts relating payment to observable outcomes for general models it is shown that the solution may not always be obtained by using the agent s first order conditions as constraint general conditions of lagrangean type are given for problems in which contracts are finite dimensional 1 the moral hazard situation

linearity with project selection and controllable diffusion rate in continuous time principal agent problems i extend holmstrom and milgrom s model by allowing the agent to control privately or publicly the diffusion rate process and show that the optimal contract is still linear i discuss the conditions under which conflicts over the choice of diffusion rate do and do not arise as an application i examine project selection problems of a firm conflicts between the manager and investors arise because giving the manager too much incentive to work to increase the profit from ongoing operations can induce him to be too conservative in project selection possibly resulting in optimal contracts with low sensitivities

effects of political institutions on air quality we empirically test existing theories on the provision of public goods in particular air quality using data on sulfur dioxide so2 concentrations from the global environment monitoring projects for 107 cities in 42 countries from 1971 to 1996 the results are as follows first we provide additional support for the claim that the degree of democracy has an independent positive effect on air quality second we find that among democracies presidential systems are more conducive to air quality than parliamentary ones third in testing competing claims about the effect of interest groups on public goods provision in democracies we establish that labor union strength contributes to lower environmental quality whereas the strength of green parties has the opposite effect

economic analysis of the contribution of photovoltaics to the decarbonization of the power sector abstract an analytical method has been developed for the calculation of the future 2013 2050 reduction of co2 emissions by the deployment of photovoltaic pv systems according to three scenarios from the international energy agency 2ds roadmap and new policies next we have also evaluated the financial extra costs incurred in the implementation of the pv systems which would replace the current traditional power generation systems taking as reference four geographical areas european union united states china and the world s average the established method also allows the comparison of the influence on the extra costs of the actual electricity mix as well as the current electricity prices corresponding to the above regional areas in these calculations we have taken into account several frequently ignored factors like solar cell degradation emissions attributed to the pv systems life cycle and the repowering due to the substitution of the systems after their life time is reached finally the results of this work can be of interest in energy planning policies related to the contribution of pv technologies for the decarbonization of the power generation system

volatility and development why is gdp growth so much more volatile in poor countries than in rich ones we identify four possible reasons i poor countries specialize in more volatile sectors ii poor countries specialize in fewer sectors iii poor countries experience more frequent and more severe aggregate shocks e g from macroeconomic policy and iv poor countries macroeconomic fluctuations are more highly correlated with the shocks of the sectors they specialize in we show how to decompose volatility into these four sources quantify their contribution to aggregate volatility and study how they relate to the stage of development we document the following regularities first as countries develop their productive structure moves from more volatile to less volatile sectors second the level of specialization declines with development at early stages and slowly increases at later stages of development third the volatility of country specific macroeconomic shocks falls with development fourth the covariance between sector specific and country specific shocks does not vary systematically with the level of development we argue that many theories linking volatility and development are not consistent with these findings and suggest new directions for future theoretical work

incentives for effective risk management under the new capital accord banks choose between two different types of risk management systems the standard or the internal rating based approach the paper considers how a bank s preference for a risk management system is affected by the presence of supervision by bank regulators the model uses a principal agent setting between a bank s owner and its risk management the main conclusion is that previously unregulated institutions can be expected to switch to the lower quality standard approach subsequent to becoming regulated i e the presence of regulation may induce a bank to decrease the quality of its risk management system

unraveling the photovoltaic technology learning curve by incorporation of input price changes and scale effects in a large number of energy models the use of learning curves for estimating technological improvements has become popular this is based on the assumption that technological development can be monitored by following cost development as a function of market size however recent data show that in some stages of photovoltaic technology pv production the market price of pv modules stabilizes even though the cumulative capacity increases this implies that no technological improvement takes place in these periods the cost predicted by the learning curve in the pv study is lower than the market one we propose that this bias results from ignoring the effects of input prices and scale effects and that incorporating the input prices and scale effects into the learning curve theory is an important issue in making cost predictions more reliable in this paper a methodology is described to incorporate the scale and input prices effect as the additional variables into the one factor learning curve which leads to the definition of the multi factor learning curve this multi factor learning curve is not only derived from economic theories but also supported by an empirical study the results clearly show that input prices and scale effects are to be included and that although market prices are stabilizing learning is still taking place

unintended consequences of the market risk requirement in banking regulation abstract we analyze a bank that operates under the basel credit and market risk requirements and that maximizes its value through recapitalizations dividends and liquid asset investments according to our model the market risk requirement may postpone recapitalization and this way increase the bank s default probability we show that this is indeed the case if the expected return and volatility of the liquid asset portfolio are high i e then the market risk requirement raises the default probability of the bank in this sense the market risk requirement is inefficient

does risk aversion affect bank output loss the case of the eurozone abstract we propose a new model to infer the evolution of bank specific output losses due to the uncertainty in bank output prices losses are based on bank risk aversion with micro foundations tethered to the uncertainty regarding prices our model allows us to measure time varying bank specific output losses and risk aversion while taking into account all bank cross sectional heterogeneity we employ a panel data set to estimate the input and output elasticities with both parametric and non parametric techniques we are the first to document that increasing risk aversion among eurozone banks during the financial crisis resulted in sizable output losses although subdued thereafter losses have been resurging in recent years both conventional and unconventional monetary policy responses by the european central bank ecb mitigated uncertainty in bank output prices though unequally so across countries certain measures of unconventional monetary policy may have even enhanced bank risk aversion and thereby output losses but mainly so for large countries

dynamics of energy technologies and global change technological choices largely determine the long term characteristics of industrial society including impacts on the natural environment however the treatment of technology in existing models that are used to project economic and environmental futures remains highly stylized based on work over two decades at iiasa we present a useful typology for technology analysis and discuss methods that can be used to analyze the impact of technological changes on the global environment especially global warming our focus is energy technologies the main source of many atmospheric environmental problems we show that much improved treatment of technology is possible with a combination of historical analysis and new modeling techniques in the historical record we identify characteristic l such network e ects yield high barriers to entry even for superior competitors these simple observations allow three improvements to modeling of technological change and its consequences for global environmental change one is that the replacement of long lived infrastructures over time has also replaced the fuels that power the economy to yield progressively more energy per unit of carbon pollution from coal to oil to gas such replacement has d they also include endogenous generation of s we show that doing so can yield projections with lessened environmental impacts without necessarily incurring negative e ect on the economy arriving on that path by the year 2100 depends on intervening actions such as incentives to promote greater diversity in technology and lower barriers to entry for new infrastructures that could accelerate historical trends of decarbonization 1999 elsevier science ltd all rights reserved

cross country evidence on the link between volatility and growth this paper presents empirical evidence against the standard dichotomy in macroeconomics that separates growth from the volatility of economic fluctuations in a sample of ninety two countries as well as a sample of oecd countries the authors find that countries with higher volatility have lower growth the addition of standard control variables strengthens the negative relationship the authors also find that government spending induced volatility is negatively associated with growth even after controlling for both time and country fixed effects copyright 1995 by american economic association