quantifying structural subsidy values for systemically important financial institutions abstract claimants to systemically important financial institutions sifis would receive transfers when governments are forced into bailouts ex ante this bailout expectation lowers sifis daily funding costs the funding cost advantage reflects both the structural level of the government support and the time varying market valuation for such a support based on a large worldwide sample of banks we estimate the value of the structural subsidy by exploiting expectations of state support embedded in credit ratings and by applying the long run average value of the rating bonus the value of the structural subsidy was already sizable 60 basis points bp as of the end 2007 before the crisis it increased to 80 bp by the end 2009

cost push impact of taxing carbon in china a price transmission perspective abstract this paper aims to provide a comprehensive look at the potential price effects of a carbon tax at the sectoral level in chinese economy from a production perspective the sectors subjected to the levy are discussed based on sectoral linkage characteristics and then the tax induced repercussions of output prices are simulated using an extended i o price model the results based on the chinese economy for the year 2012 show that levying a carbon tax on sectors with above average co2 emission linkages and non significant production linkages will increase their output prices by an average of 1 93 while induce relatively slight price increases in the encouraged group 0 30 and the other group 0 34 the household is the least affected sector 0 28 in the economy this means that an appropriate tax design tends to shift intermediate inputs and expenditure toward less co2 intensive goods and services by its uneven cost push impacts on production sectors and the entire economy will ultimately get affected by establishing techniques for policy evaluation our analysis highlights the value of linkage analysis in the design of a carbon tax and brings more clarity to price transmission after the imposition of a carbon tax in the economy consequently the indirect effect of carbon tax on household can be better understood

sequential bargaining as a noncooperative foundation for walrasian equilibrium allocation are weakly preferred to those obtainable from the initial endowments by means of the given set of net trades these conditions are similar to ones studied by schmeidler and vind 1972 and vind 1978 but here they are thought of as characterizing the set of net trades available in steady state equilibria of market games like those studied by douglas gale 1984 1985 1986a 1986b and 1986c the characterization result is used as a key step in the proof of results like gale s the allocations induced by steady state equilibria are walrasian for the economy given by the constant flow of new agents into the market our approach generalizes the one followed in gale 1986c and allows us to dispense with assumptions made in previous treatments for example gale s 1986a assumption of dispersed characteristics is dropped we also demonstrate that such a result depends on the assumption that agents cannot observe the past behavior of agents with whom they trade

input output analysis of alternative policies implemented on the energy activities an application for catalonia abstract the aim of this paper is to analyze the economic impact of alternative policies implemented on the energy activities of the catalan production system specifically we analyze the effects of a tax on intermediate energy uses a reduction in intermediate energy demand and a tax on intermediate uses combined with a reduction in intermediate energy demand the methodology involves two versions of the input output price model a competitive price formulation and a mark up price formulation the input output price framework will make it possible to evaluate how the alternative measures modify production prices consumption prices private real income and intermediate energy uses the empirical application is for the catalan economy and uses economic data for the year 2001 the combination of a tax on energy uses and an improvement in the energy efficiency of the production system is a measure that accomplishes both economic and environmental goals since it has no effects on prices it has a positive effect on private real income and finally energy consumption is considerably reduced

environmental protection policies and the structure of the us economy the policy of regulation has been used to abate pollution in the usa however a number of other measures such as a tax cum subsidy program and taxes on polluters have been frequently suggested in the literature in this paper the impact of these policies on the structure of pices production income distribution and the input requirements of labour and capital is determined the input output methodology is used for this purpose the direct and primary input requirement coefficients of the 1971 input output table are adjusted to reflect the input requirements of pollution abatement technology the policy of regulation is found to be more effective in controlling pollution than the tax cum subsidy program though the latter will create more jobs the reason for this is that the tax cum subsidy program is not as successful as the policy of controls or taxes on polluters in steering consumption away from the polluting industries

electricity intensity convergence in iea oecd countries aggregate and sectoral analysis convergence in electricity intensity is analyzed among a sample of iea countries sigma convergence the narrowing of the distribution and to a lesser degree gamma convergence movement within the distribution are detected however electricity intensity convergence is less dramatic than energy intensity convergence convergence within the end use sectors is more diverse in terms of the rates timing extent and ultimate modal structure of the distributions commercial electricity intensity has more recently converged toward a bell shape distribution by contrast industry electricity intensity is largely converging toward two distinct groups of countries one with relatively high electricity intensity and another one with relatively low electricity intensity different still is related residential electricity consumption per capita where a small group of countries has stopped growing another group has slowed considerably while a third group experienced rapid growth

the multi factor energy input output model abstract energy input output analysis eio analysis is a noteworthy tool for the analysis of the role of energy in the economy however it has relied on models that provide a limited description of energy flows in the economic system and do not allow an adequate analysis of energy efficiency this paper introduces a novel energy input output model the multi factor energy input output model mf eio model which is obtained from a partitioning of a hybrid unit input output system of the economy this model improves on current models by describing the energy flows according to the processes of energy conversion and the levels of energy use in the economy it characterizes the vector of total energy output as a function of seven factors two energy efficiency indicators two characteristics of end use energy consumption and three economic features of the rest of the economy moreover it is consistent with the standard model for eio analysis i e the hybrid unit model this paper also introduces an approximate version of the mf eio model which is equivalent to the former under equal energy prices for industries and final consumers but requires less data processing the latter is composed by two linked models a model of the energy sector in physical units and a model of the rest of the economy in monetary units in conclusion the proposed modelling framework improves eio analysis and extends eio applications to the accounting for energy efficiency of the economy

energy embodied in the international trade of china an energy input output analysis abstract growing international trade has not only positively affected the people s republic of china s china s economic development but also expanded the exportation of energy embodied in goods during their production this energy flow out will pose risks to china s rational utilization of natural resources as well as environmental protection in this paper we evaluate the energy embodied in goods produced in china during 1992 2005 and use input output structural decomposition analysis to identify five key factors causing the changes of energy embodied in exports direct primary energy efficiency primary energy consumption structure structure of intermediate inputs structure of exports and scale of exports for the three sub periods of 1992 1997 1997 2002 and 2002 2005 results show that china is a net exporter of energy and the energy embodied in exports tends to increase over time the expanding total volume of exports and increasing exports of energy intensive goods tend to enlarge the energy embodied in exports within all three sub periods but these driving forces were offset by a considerable improvement of energy efficiency and changes in primary energy consumption structure from 1992 to 2002 and the effects of structure of intermediate input only in the sub period from 1992 to 1997 from 2002 to 2005 the sharp augmentation of energy embodied in exports was driven by all the five factors our research has practical implications for the chinese economy results of this study suggest that the energy embodied in trade should receive special attentions in energy policies design to limit the energy resource out flow and pollution generation

quantifying china s oil import risks and the impact on the national economy abstract with an increase in china s oil imports china s oil supply will also continue to be effected by the socio economic stability of oil exporting countries and the safety of oil transport routes this paper introduces a systematic and quantitative method to evaluate the influence of china s oil import risks oir on the national economy and industrial sectors from a perspective of apply chain process for this analysis china s oir is quantified by integrating oil exporting country risk and the risks from oil transportation routes country risk is defined as the oil exporting country s political risk caused by political changes or internal conflicts transport risk is defined as the risk of shipping routes affected by pirate attacks and geopolitics second the relationship between china s oir and oil import costs is analyzed using a multiple linear approach third an input output analysis method is used to research the effect of the cost of china s oil imports on the cost of investment within china s domestic sectors this research finds that the corresponding impact on gdp is 3494 5 million dollars given an increasing by 10 of china s oir and the impact on domestic sectors differs from sector to sector finally this paper puts forth recommendations to improve long term oil supply security in china

quantifying the impacts of energy price reform on living expenses in saudi arabia abstract as part of vision 2030 saudi arabia has initiated a broad based energy reform programme aimed at gradually reducing its dependence on oil this paper assesses the impacts of energy price reforms on living expenses of various household groups in saudi arabia for this purpose the input output table combined with household expenditure data are used to model the impacts results show that the distributional impacts of energy price reforms are regressive with low income households experiencing a higher increase in living expenses compared to high income households the impacts are primarily instigated by rising prices of energy intensive products after decomposing the impacts into direct and indirect effects it was found that indirect effect is not only responsible for a considerable rise in household expenditure on energy intensive products but it is also distributionally regressive it is therefore vital for policymakers to review and fine tune the social protection system to protect poor households against reforms

co2 emissions and intersectoral linkages the case of spain this paper proposes a methodology to identify the most relevant productive transactions in terms of co2 emissions in the most polluting sectors of an economy and applies this methodology to the spanish case emissions can be related to the co2 emissions intensity of sectors co2 intensity factor to the size of the economy s flows scale factor to the input output productive relationships within an economy technology production factor and to the structure of final demand of different sectors demand factor a formal analysis of these factors is carried out by means of an input output framework combined with a sensitivity analysis by considering key sectors and relevant transactions in terms of co2 emissions the most effective policy measures aimed at reducing co2 emissions can be identified

energy consumption financial development and economic growth in india new evidence from a nonlinear and asymmetric analysis this paper investigates the asymmetric relationship between energy consumption and economic growth by incorporating financial development capital and labour into a production function covering the indian economy from 1960q1 2015q4 the nonlinear autoregressive distributed lag bounds testing approach is applied to examine the asymmetric cointegration between the variables an asymmetric causality test is also employed to examine the causal association between the considered variables the results indicate cointegration between the variables in the presence of asymmetries the asymmetric causality results show that only negative shocks in energy consumption have impacts on economic growth in the same vein only negative shocks in financial development have impacts on economic growth by contrast symmetrically capital formation causes economic growth finally over the study period a neutral effect exists between the labour force and economic growth in india the implications of these results for growth policies in india are also discussed

a note on energy requirements calculations using the 1968 and 1974 uk input output tables abstract input output data are useful when studying the way the economy uses fuels for the uk there are now two well based sets of input output tables available which permit the allocation of total fuel use in 1968 and 1974 to the production of 90 commodities this paper reports some results using these data sets relating the situation in 1968 and 1974 with respect to the primary energy requirements of commodities the ranking of commodities by primary energy intensity the impact on the relative prices of commodities of primary fuel price increases and the roundaboutness of electricity use in the production of commodities

changes in energy requirements of the residential sector in india between 1993 94 and 2006 07 abstract a substantial amount of primary and secondary energy is consumed by the residential sector residential energy consumption includes energy required for construction activity and household consumption hence there is a need to quantify energy consumption its significance and causes calculating energy intensity of goods and services is the first step towards quantifying the causes this research is based on the 115 sector classification input output tables for india for 1993 94 1998 99 and 130 sector classification input output tables for 2003 04 and 2006 07 energy intensity of sectors related to household consumption has been calculated to analyze the trend between 1993 94 and 2006 07 indirect energy requirements of indian households have been assessed in this study from calculations of total primary energy intensity along with private final consumption expenditure results indicate that energy consumption has increased for all categories except medical care and hygiene percentage increase in indirect primary energy consumed by households is maximum for house building and recreation categories finally a complete decomposition analysis of indirect primary energy consumed by households has been carried out based on changing structural composition of the private final consumption expenditure energy intensity patterns per capita expenditures on energy and population

the effects of carbon taxation in china an analysis based on energy input output model in hybrid units abstract this paper evaluates the economy wide effects of carbon taxation in china to this end we build a price model based on an energy input output table in hybrid units that ensures the consistency of the analysis the results indicate that carbon taxation has small negative impact on gdp there are however relatively substantial emissions reductions to explore whether the impacts are spatially blind in the sense of having similar impacts on urban and rural residents the results of the distributional effects show that the impacts of carbon taxation on different urban household groups reveal small differences and are slightly regressive yet for rural residents carbon taxation may be significantly regressive in addition rural residents are found to be affected much more than urban residents furthermore the paper explores a policy intervention to investigate the effects of redistributing the carbon tax paid by households the main results reveal that reallocating the carbon tax to the groups with low income levels can offset the negative distributional effects significantly moreover the results of miyazawa style interrelational income multiplier analysis indicate that the household groups with high income would benefit significantly from the income increases in those with low income levels but not vice versa

a portfolio risk analysis on electricity supply planning abstract conventional electricity planning selects from a range of alternative technologies based on the least cost method without assessing cost related risks the current approach to determining energy generation portfolios creates a preference for fossil fuel consequently this preference results in increased exposure to recent fluctuations in fossil fuel prices particularly for countries heavily depend on imported energy this paper applies portfolio theory in conventional electricity planning with taiwan as a case study the model objective is to minimize the risk weighted present value of total generation cost both the present value of generating cost and risk variance of the generating cost are considered risk of generating cost is introduced for volatile fuel prices and uncertainty of technological change and capital cost reduction the impact of risk levels on the portfolio of power generation technologies is also examined to provide some valuable policy suggestions study results indicate that replacing fossil fuel with renewable energy helps reduce generating cost risk however due to limited renewable development potential in taiwan there is an upper bound of 15 on the maximum share of renewable energy in the generating portfolio in the meantime reevaluating the current nuclear energy policy for reduced exposure to fossil fuel price fluctuations is worthwhile

comparison of china s oil import risk results based on portfolio theory and a diversification index approach in recent years the international oil price has fluctuated violently bringing about huge risk for the international oil trade in fact the risk of crude oil and petroleum product imports is different because of the different import origins and prices which import risk is lower for china from the perspective of oil supply security how should china portfolio crude oil and petroleum product imports to minimize its oil import risk using portfolio theory and a diversification index approach this paper compares and analyzes the supply price and transport risks of crude oil and petroleum product imports our results show that the following 1 specific risk diversification risk and marine transport risk of china s petroleum product imports are lower than that of crude oil imports 2 the average rate of return of china s petroleum product imports is higher than that of crude oil imports moreover the average import price variance of petroleum product imports is lower than that of crude oil imports thus the systematic risk price risk of petroleum products is lower too therefore from the perspective of oil supply security china should increase petroleum product imports to decrease its oil import risk

the finance and growth nexus revisited we find that an expansion of credit has a positive effect on per capita output growth only up to a point beyond this threshold the impact of finance on growth is not statistically significant anymore we show however that the estimated non linear relationship may stem from the omission of factors not considered in the literature so far these factors may have a negative impact on growth in mature financial systems and include the magnitude of financial cycles as well as the importance of non intermediation activities in banks business models

quantifying the risk of an increase in the prices of non energy products by combining the portfolio and input output approaches abstract an increase in the price of imported fossil fuels indirectly increases the producer price in non energy sectors however this indirect influence cannot be taken into account by the traditional portfolio approach this study proposes an analytical framework combining the input output i o model and the portfolio approach that can take the indirect influence into account a risk of an increase in the producer price in japanese non energy sectors during the period 1970 2000 is estimated and the causes of a decrease in the risk through the analysis period are clarified by decomposing an index of the risk the result indicates that almost all non energy sectors have decreased this risk during the analysis period the degree and cause of the decrease depends on a sector s location in the hierarchical structure of japanese industries for example assembly sectors have decreased their risk mainly as the result of improvement in energy usage by upstream sectors such as material sectors rather than their own improvements proper policies considering such a structure are required to decrease the risk further because the effort taken to do so is seldom motivated by economic profit

water use in the spanish economy an input output approach against the background of the water limitations that often appear in spain the aim of this paper is to study the behaviour of the productive sectors of the spanish economy as direct and indirect consumers of water to that end we employ input output analysis with the particular methodology being based on the linkages analysis known as the hypothetical extraction method hem we have introduced three modifications to this method first the valuation is made in terms of water consumption secondly we obtain the components of the impacts of each block of activity into which the economy is divided with these components being described as the internal effect mixed linkage net or external backward linkage and net or external forward linkage thirdly this methodology is used to detect key sectors our results confirm the marked importance of the agriculture food and other services blocks as regards the direct and indirect consumption of water in general we also find that other services chemicals metals and electronics and agriculture blocks play an important role in explaining the consumption of drinking water moreover the hem analysis allows us to classify productive sectors according to their forward or backward linkage character in a way that is more precise than that permitted by earlier methods finally this methodology can be extended to other types of environmental pressures 2002 elsevier science b v all rights reserved

assessing the influence of manufacturing sectors on electricity demand a cross country input output approach abstract the production and consumption of electricity is a major source of co2 emissions in europe and elsewhere in turn the manufacturing sectors are significant end users of electricity in contrast to most papers in the literature which focus on the supply side this study tackles the demand side of electricity an input output approach combined with a sensitivity analysis has been developed to analyse the direct and indirect consumptions of electricity by eighteen manufacturing sectors in fifteen european countries with indirect electricity demand related to the purchase of industrial products from other sectors which in turn require the consumption of electricity in their manufacturing processes we identify the industrial transactions and sectors which account for a greater share of electricity demand in addition the impact of an electricity price increase on the costs and prices of manufacturing products is simulated through a price model allowing us to identify those sectors whose manufacturing costs are most sensitive to an increase in the electricity price

an input output framework for analysing energy consumption abstract the paper develops an input output framework for measuring the direct indirect and income induced energy effect of a change in final demand and for estimating the effect of technical change on energy consumption

optimal investment portfolio in renewable energy the spanish case abstract this article presents a model for investing in renewable energies in the framework of the spanish electricity market in a way that risk is minimised for the investor while returns are maximised the model outlined here is based on an economic model for calculating cash flows intended to obtain the internal rate of return irr of the different energies being studied wind photovoltaic mini hydro and thermo electrical the irrs obtained are considered the returns on investments while their standard deviations are considered associated risks in order to minimise risk a comprehensive portfolio of investments is created that includes all of the available energies by means of a system of linear equations the solution of the linear system is graphically checked using the efficient frontier method for the different financing options several case studies within the renewable energies plan per is its spanish abbreviation that is in force in spain in the period 2005 2010 are analysed in order to illustrate the method as are other case studies using different types of financing helping us to reach the pertinent conclusions

comparison of energy intensities in european union countries results of a structural decomposition analysis abstract this work proposes an input output structural decomposition analysis model to identify the sources of the differences in the energetic intensities of the european union countries given an economic structure a determined composition of the final demand and determined direct energy intensities by countries the work studies to what extent these factors explain the difference in aggregate energy intensities that are observed for different european union countries on the basis of this information indicators are constructed by sectors and countries that allow us to identify the role that each sector or country plays as an energy consumer the results show that the aggregate total energy differences in europe are strongly influenced by the direct energy intensity effect and by the demand effect without the different economic structures of the countries being an important factor in the explanation of these differences the metallurgical and manufacturing products sectors are identified as the most intensive in the aggregate energy intensity

primary energy and greenhouse gases embodied in australian final consumption an input output analysis input output modeling of primary energy and greenhouse gas embodiments in goods and services is a useful technique for designing greenhouse gas abatement policies the present paper describes direct and indirect primary energy and greenhouse gas requirements for a given set of australian final consumption it considers sectoral disparities in energy prices capital formation and international trade flows and it accounts for embodiments in the gross national expenditure as well as the gross domestic product primary energy and greenhouse gas intensities in terms of mj and kg co2 e are reported as well as national balances of primary energy consumption and greenhouse gas emissions

energy requirements of sydney households supporting the lifestyles of the populations of modern cities requires vast quantities of natural resources and leads to environmental stresses such as air and water pollution research into the metabolism of cities therefore aims at understanding the physical flows into within and out of cities with a view to reducing the use of resources and the environmental impacts one important physical indicator is energy use most studies on cities only consider direct or end user energy consumption since the function of cities is to serve the lives of their residents indirect energy use in cities or energy embodied in the consumption of goods and services by its residents can be regarded as being as important as direct energy use however physical models of cities are extremely complex and have difficulty in dealing with boundary issues and hence the indirect resource requirements in this paper we use input output analysis and detailed household expenditure data to yield comprehensive energy use breakdowns for the 14 statistical subdivisions of sydney multivariate regression and structural path analysis spa are used to interpret the results clear correlations can be drawn between energy use and income household size age and degree of urbanity the structural path analysis is used to demonstrate how significant differences in lifestyles between inner and outer areas of sydney leads to different energy use characteristics this final consumption based approach to analysing the energy requirements for households has important implications for measures aimed at reducing energy use which tend to only consider direct energy use d 2004 elsevier b v all rights reserved

mechanism design by competing sellers a dynamic model with many sellers and buyers is constructed agents failing to trade may trade in the next period an equilibrium is found where sellers hold identical auctions and buyers randomize over the sellers they visit the distribution of buyer valuations is endogenous an auction with efficient reserve is an optimal mechanism from each seller s point of view in spite of the ability of any seller to alter the distribution of buyer types participating in the seller s mechanism by altering the mechanism copyright 1993 by the econometric society

estimation of embodied co2 emissions by general equilibrium model abstract this study estimates the extent to which embodied co2 emissions are increased or reduced when a socioeconomic structural change occurs embodied co2 emissions were estimated by input output models i o models and a general equilibrium model ge model and the respective results were compared the embodied co2 emissions differ greatly depending on the assumptions of the total system the embodied co2 emissions obtained by i o models are much larger than those obtained by the ge model in some cases the total co2 emissions increase even if less intermediate inputs are required owing to technological improvement it is shown that taking i o type embodied emissions alone into consideration is insufficient for the estimation of policy effects careful consideration is necessary to effectively reduce emissions when production and consumption are interconnected in a complex way

china s energy consumption under the global economic crisis decomposition and sectoral analysis abstract it is now widely recognized that there is a strong relationship between energy consumption and economic growth most countries energy demands declined during the economic depression of 2008 2009 when a worldwide economic crisis occurred as an export oriented economy china suffered a serious exports decline in the course of the crisis however it was found that energy consumption continued to increase against such a background this paper aims to assess and explain the factors causing the growth of energy consumption in china first we will explain the impact of domestic final use and international trade on energy consumption by using decomposition analysis second embodied energy and its variation across sectors are quantified to identify the key sectors contributing to the growth lastly the policy implications for long term energy conservation are discussed the results show that the decline in exports was one of the driving forces for energy consumption reduction in the crisis but that the growth of domestic demand in manufacturing and construction largely stimulated by economic stimulus plans had the opposite effect on energy consumption international trade contributed to decreasing energy consumption of china during and after the crisis because the structure of exports and imports changed in this period

solow meets leontief economic growth and energy consumption abstract this paper proposes a methodology that integrates a growth model with an input output model to analyze the impacts of economic growth on the consumption of energy the integration between the models is carried out by calibrating the growth module which incorporates energetic inputs renewable and nonrenewable in the production function and implementing shocks by the supply side capital labor renewable and nonrenewable energy in the input output model this allows us to verify the pattern of energy consumption for each sector in the input output matrix we apply this methodology to study the energy consumption of eleven economic sectors in brazil using data from the brazilian national accounts and input output matrix ibge and the national energy report ben we conduct experiments involving changes in technological progress growth rate extraction and regeneration rates of both renewable and nonrenewable resources and population growth to analyze the impact of changes in the parameters of the model on the sectoral output growth rate and consequently on the consumption of energy in each economic sector

who pays for industrial pollution abatement the distributional impact of industrial pollution abatement is measured for the years 1973 and 1977 the findings indicate that in 1977 1 09 of income or 0 510 of personal consumption expenditures of the lowest income class paid indirectly for abatement costs implicit in purchased goods for the highest income class the corresponding figures were 0 218 and 0 423 respectively in addition abatement costs per dollar of output are presented for representative industries

readjustment potentials in industrial energy efficiency and structure abstract with the availability of input output data for 1977 it is possible to analyze the short run effects of the 1974 energy price increase as well as other factors on the energy efficiency of the industries of the economy such an analysis is conducted here using a number of measures derived through the energy input output model attention is focused on patterns of energy use changes in energy intensities through time and the factors which underlie these changes a specific measure of the degree to which energy substitution is attributable to changes in direct and indirect energy requirements is developed and estimated results show that large changes in the economy s overall industrial energy requirements are not observed between 1963 and 1977 however for individual fuels large changes in intensity values are not at all uncommon among industries

systemic risks and the too big to fail problem the financial crisis of 2007 9 resulted in state intervention in financial markets around the world and the state became a major shareholder in many banks while state bailouts were politically sensitive policy makers had little alternative but to supply funds to financial institutions that were viewed as too big to fail or tbtf in this paper i review the history of and the rationale for the tbtf policy i argue that from a policy perspective the most important costs of the tbtf problem are incurred ex ante in the form of distorted incentives that arise as a consequence of distortions to the capital markets and to the choice of banks scale and scope i argue that it is impossible credibly to withdraw the tbtf policy and hence that it should be managed so as to minimize the costs of these distortions in this context i discuss the role of policy in institutional design in the restriction of bank scope and in designing appropriate capital regulations

economic impact of alternative water policy scenarios in the spanish production system an input output analysis abstract this paper analyses the economic impact of alternative water policies implemented on the spanish production system the methodology comprises two versions of the input output price model an average cost formulation and a mark up formulation the input output framework evaluates the impact of the various water policy measures on production prices consumption prices intermediate water use and private real income the results show that a tax on the water used by sectors considerably reduces intermediate water consumption and increases production and consumption prices on the other hand according to jevons paradox improvements in technical efficiency which lead to a reduction in the water requirements of all sectors and an increase in water production raise water consumption the combination of a tax on the water used by sectors and an improvement in the technical efficiency of water in the production sphere takes the pressure off prices and significantly reduces intermediate water consumption

income growth and atmospheric pollution in spain an input output approach abstract the relationships between economic growth and environmental pressures are complex since the early nineties the debate on these relationships has been strongly influenced by the environmental kuznets curve hypothesis which states that during the first stage of economic development environmental pressures increase as per capita income increases but once a critical turning point has been reached these pressures diminish as income levels continue to increase however to date such a delinking between economic growth and emission levels has not happened for most atmospheric pollutants in spain the aim of this paper is to analyse the relationship between income growth and nine atmospheric pollutants in spain in order to obtain empirical outcomes for this analysis we adopt an input output approach and use namea data for the nine pollutants first we undertake a structural decomposition analysis for the period 1995 2000 to estimate the contribution of various factors to changes in the levels of atmospheric emissions and second we estimate the emissions associated with the consumption patterns of different groups of households classified according to their level of expenditure

banking panics the role of the first come first served rule and information externalities this paper proposes that both the first come first served rule and information externalities are important in causing contagious bank runs the first come first served rule creates a negative payoff externality among depositors this payoff externality forces depositors to respond to early noisy information such as failures of other banks therefore failures of a few banks may trigger runs on other banks contagious runs may occur even if i depositors choose the pareto dominant equilibrium when there are multiple equilibria and ii the deposit contract is chosen to maximize depositor welfare the feasibility of reforming the fdic to impose market discipline is also investigated

an overview of energy consumption of the globalized world economy abstract for the globalized world economy with intensive international trade an overview of energy consumption is presented by an embodied energy analysis to track both direct and indirect energy uses based on a systems input output simulation in 2004 the total amounts of energy embodied in household consumption government consumption and investment are 7749 874 and 2009 mtoe million tons of oil equivalent respectively the united states is shown as the world s biggest embodied energy importer 683 mtoe and embodied energy surplus receiver 290 mtoe in contrast to china as the biggest exporter 662 mtoe and deficit receiver 274 mtoe energy embodied in consumption per capita varies from 0 05 uganda to 19 54 toe rest of north america based on a forecast for 2005 2035 china is to replace the united states as the world s leading embodied energy consumer in 2027 when its per capita energy consumption will be one quarter of that of the united states

an input output model of water consumption analysing intersectoral water relationships in andalusia abstract this paper presents an input output model of sectoral water consumption created by combining the extended leontief input output model with the model of energy use developed by proops the analysis is applied to andalusia a region situated in the south of spain which is characterized by water shortage we determine which economic sectors consume the greatest quantities of water both directly and indirectly and to what extent this natural resource may become a limiting factor in the growth of certain production sectors the model allows us to distinguish between direct and indirect consumption thus offering the possibility of designing an economic and environmental policy oriented towards water saving additionally the model allows simulation of possible changes in water consumption caused by certain environmental measures as well as their consequences on the regional economy

input output simulations of energy environment economy interactions in the uk this paper shows how a number of the complex interrelationships between energy environment and economic welfare can be investigated with the aid of a 10 sector input output i o model of the uk with pollution emission coefficients and a european sulphur deposition vector the paper reviews relevant past applications of i o analysis in the energy environment area and describes the endam program and its operation it is used to simulate the effects of a variety of policies and possibilities not only through changes in exogenous variables final demand and income taxes and transfers but also through changes in the structural matrices and their coefficients in each case the full effects direct indirect and income induced can be traced and the changes in comparative static equilibrium values discovered in this way policy issues connected with energy use and environmental impacts employment and economic welfare have been investigated

identifying strategies for mitigating the global warming impact of the eu 25 economy using a multi objective input output approach global warming mitigation has recently become a priority worldwide a large body of literature dealing with energy related problems has focused on reducing greenhouse gases emissions at an engineering scale in contrast the minimization of climate change at a wider macroeconomic level has so far received much less attention we investigate here how to mitigate global warming by performing changes in an economy to this end we make use of a systematic tool that combines three methods linear programming environmentally extended input output models and life cycle assessment principles the problem of identifying key economic sectors that contribute significantly to global warming is posed in mathematical terms as a bi criteria linear program that seeks to optimize simultaneously the total economic output and the total life cycle co2 emissions we have applied this approach to the european union economy finding that significant reductions in global warming potential can be attained by regulating specific economic sectors our tool is intended to aid policy makers in the design of more effective public policies for achieving the environmental and economic targets sought

fuel mix diversification incentives in liberalized electricity markets a mean variance portfolio theory approach monte carlo simulations of gas coal and nuclear plant investment returns are used as inputs of a mean variance portfolio optimization to identify optimal base load generation portfolios for large electricity generators in liberalized electricity markets we study the impact of fuel electricity and co2 price risks and their degree of correlation on optimal plant portfolios high degrees of correlation between gas and electricity prices as observed in most european markets reduce gas plant risks and make portfolios dominated by gas plant more attractive long term power purchase contracts and or a lower cost of capital can rebalance optimal portfolios towards more diversified portfolios with larger shares of nuclear and coal plants

the effect of fossil energy and other environmental taxes on profit incentives for change in an open economy evidence from the uk this paper argues that the underlying supply and demand analysis of fossil energy and other environmental taxes needs further elaboration when a country a introduces national fossil energy or environmental taxes and b is open to international trade at given world prices we provide evidence that such conditions are plausible for many sectors in the uk a key implication is that the short run effects of such taxes should not be felt in final good prices since these are determined in world markets but in terms of underlying profitability these changes in underlying profits provide two key incentives for producers to change to more environmentally friendly production techniques and to switch resources to production of less environmentally harmful goods using input output techniques we provide evidence for the uk to show how existing fossil energy and other green taxes have affected underlying profitability the evidence shows quite strong profit incentives to shift resources from a small number of energy intensive industries to others

deregulation and bank financial policy the standard view that banks can value maximize by exploiting non risk rated deposit insurance ignores the potential loss of a valuable bank charter due to insolvency recognition of this effect changes the bank s optimal financial policy and can induce extreme risk averting as well as risk taking behavior however as the value of the bank charter falls the risk taking strategy is more apt to dominate therefore current deregulation of the banking industry by easing entry and devaluing charters holds the potential for increases in the incidence of insolvency unless offsetting policies are instituted

comprehensive evaluation of household indirect energy consumption and impacts of alternative energy policies in china by input output analysis abstract households consume a large amount of indirect energy through the consumption of goods and services this fact makes the quantitative analysis of indirect household energy consumption the foundation of energy policy design this paper improves the compilation method of energy input output tables and establishes a sequence of energy input output tables for china based on these tables the indirect energy consumption of both rural and urban households is calculated then with economic data for the year of 2005 the adjusted input output price model is applied to evaluate how the alternative energy policies impact production prices consumption prices and real income of rural and urban households through the mechanism of indirect energy consumption by using electricity as an example this research has practical implications for chinese economy the integration of energy efficiency improvements and energy prices increase serves as a means to achieve both economic and energy conservation goals and may also have a positive effect on residents real income and a minimal effect on production prices

a goal programming model for environmental policy analysis application to spain abstract sustainable development has become an important part of international and national approaches to integrate economic environmental social and ethical considerations so that a good quality of life can be enjoyed by current and future generations for as long as possible however nowadays sustainable development is threatened by industrial pollution emissions which cause serious environmental problems due to a lack of adequate quantitative models for environmental policy analysis there is a strong need for analytical models in order to know the effects of environmental policies in the present paper a goal programming model based on an environmental input output linear programming model is developed and applied to the spanish economy the model combines relations between economic energy social and environmental effects providing valuable information for policy makers in order to define and examine the different goals that must be implemented to reach sustainability

is energy efficiency a driver or an inhibitor of energy consumption changes in spain two decomposition approaches abstract the 2000 2008 expansion period of the economy was accompanied by an important increase of energy consumption the desire of decoupling has led us to analyse the driving forces behind the energy consumption changes during this expansion period through a structural decomposition analysis sda based on the spanish input output tables previous decomposition has been supplemented by a logarithmic mean divisia index lmdi analysis of the energy consumption changes during a longer period 2000 2013 the results show that the energy intensity was the main inhibitor effect of the energy consumption changes of sectors of production not only during the recession but also during the expansion period secondly the energy intensity was a driver of the energy consumption change of households during the expansion period however during the recession period the energy intensity of private transport contributed to reducing energy consumption having an inhibitor effect therefore if the activity effect is still the most important driver the energy intensity effect has become the main inhibitor of energy consumption changes the energy policy recommendation is to focus on household energy consumption in the future if the spanish government aims to attain the eu energy efficiency objectives

global warming agreements international trade and energy carbon embodiments an input output approach to the italian case abstract in the kyoto protocol the absence of green house gases ghgs commitments of developing countries non annex i and the more flexible terms of implementation which are allowed to countries shifting toward a market economy transition economies naturally lead to the absence or to less constraining national measures and policies of reduction of the ghgs emissions which in turn may determine a comparative advantage in the production of the highest energy carbon intensive commodities for these countries these arguments are valid also considering the future implementation of the european emission allowance trading scheme eats thus developing countries may become a haven for the production of not environmental friendly commodities in this case the so called pollution haven hypothesis stating that due to freer international trade the comparative advantage may change the economic structure and consequently the trade patterns of the countries linked by trade relationships could occur this would lead to the increase of the transfers of energy and carbon embodied in traded commodities from developing countries and transition economies toward kyoto or eats constrained countries the aim of this paper is to verify if for italy as a kyoto and eats complying country evidence of a change in the trade patterns occurred on the basis of the pollution haven hypothesis does exist and to estimate the magnitude of the under estimation of the carbon actually emitted the carbon leakage the input output model has been used to calculate the intensities of energy consumption and the related green house gases emission for each italian economic sector

implicit bank debt guarantees costs benefits and risks implicit bank debt guarantees the expectation by market participants that public authorities might bailout the creditors of banks that are considered too important for financial system stability or another reason to be allowed to fail is commonly referred to as an implicit guarantee public authorities do not have any explicit commitment to intervene they may even honestly state that they not want to do so ex ante but may feel compelled to do so ex post a declared policy aim is to limit the value of implicit guarantees by making banks stronger more easily resolvable in case of distress as well as by imposing extra charges that rise as banks become more systemically important as part of the latter approach globally systemically important banks are identified and subjected to more costly and intrusive regulation there is little evidence that specific approach has been successful so far there is some evidence that the introduction of new resolution frameworks has been helpful while the use of newly available resolution tools and the involvement of bank creditors in the burden sharing associated with bank failure resolution has significantly reduced the value of implicit bank debt guarantees where it occurred in that sense actions speak louder than words

ex ante price offers in matching games non steady states a matching problem is considered in which sellers can publicly commit to a trading price that differs from the price at which buyers expect to trade elsewhere in the market when demand and supply are nearly equal the equilibrium ex ante price offer lies below the price associated with the nash bargaining split this relationship reverses when the level of excess demand is large sellers always have an incentive to make ex ante offers when prices elsewhere are determined by nash bargaining this can be interpreted to mean that nash bargaining is an unstable pricing institution copyright 1991 by the econometric society

what is happening to the impact of financial deepening on economic growth i introduction among the strongest elements of the modern economists canon is that financial sector development has a significant impact on economic growth a generation ago economists like goldsmith 1969 1 and mckinnon 1973 began to draw attention to the benefits of financial structure development and financial liberalization by the early 1990s mckinnon 1991 12 could write with confidence that now however there is widespread agreement that flows of saving and investment should be voluntary and significantly decentralized in an open capital market at close to equilibrium interest rates since the 1990s a burgeoning empirical literature has illustrated the importance of financial sector development for economic growth despite the growing consensus however we find that the link between finance and growth in cross country panel data has weakened considerably over time at the very time that financial sector liberalization spread around the world the influence of financial sector development on economic growth has diminished the seminal empirical work that established the growth finance link is king and levine 1993 which extended the cross country framework introduced in barro 1991 by adding financial variables such as the ratios of liquid liabilities or claims on the private sector to gross domestic product gdp to the standard growth regression they found a robust positive and statistically significant relationship between initial financial conditions and subsequent growth in real per capita incomes for a cross section of about 80 countries in the subsequent decade numerous empirical studies expanded upon this using both cross country and panel data sets for the post 1960 period 2 in this paper we reexamine the core cross country panel result and find that the impact of financial deepening on growth is not as strong with more recent data as it appeared in the original panel studies with data for the period from 1960 to 1989 we consider various explanations for this clear shift first we suggest that financial deepening has a positive effect on growth if not done to excess rapid and excessive deepening as manifested in a credit boom can be problematic even in the most developed markets because it can both weaken the banking system and bring inflationary pressures we test this hypothesis by looking at the finance growth nexus among countries that have or have not experienced financial sector crises we find that once crisis episodes are removed the finance growth relationship remains intact its weakening over time thus seems to be a result of an increased incidence of crises in later years our second and related hypothesis is that the widespread liberalization of financial markets that occurred in the late 1980s and early 1990s made financial deepening less effective this is reminiscent of robert lucas s 1975 critique of econometric policy evaluation advanced three decades ago policies that have promoted and or forced increases in financial depth over the past two decades may have altered the basic structural relationship between finance and growth this could occur if the observed benefits of financial deepening led many countries to liberalize before the associated legal and regulatory institutions were sufficiently well developed as a consequence the impact of financial deepening on growth would become smaller our evidence does not indicate that recent liberalizations are responsible for the breakdown of the finance growth link however there may be an indirect link as premature financial development can lead to financial crises that have real effects third we examine the role of global equity markets that have grown in importance and prominence in the years over which the finance growth relationship disappeared however we do not find any evidence to suggest that equity market growth has substituted for the role of credit markets and banks in particular

energy and carbon embodied in the international trade of brazil an input output approach abstract all goods and services produced in an economy are directly and or indirectly associated with energy use and according to the type of fuel utilized with co2 emissions as well international trade is an important factor in shaping the industrial structure of a country and consequently in affecting a country s energy use and co2 emissions this study applies input output techniques to the brazilian economy to evaluate the total impacts of international trade on its energy use and co2 emissions a commodity by industry io model in hybrid units energy commodities in physical units and non energy commodities in monetary units is applied to the brazilian economy in 1995 results show that total energy embodied in the exports of non energy goods of brazil equals 831 pj while total carbon embodied is 13 5 mtc these amounts are larger than the relevant amounts embodied in the imports of non energy goods respectively 679 pj and 9 9 mtc these figures are better understood by contrasting them with the total energy use and the corresponding total carbon emissions of the brazilian economy in 1995 estimated by this work 6781 pj and 99 4 mtc respectively this means that international inflows and outflows of energy embodied in non energy goods are in the order of 10 and 12 of the total energy use while inflows and outflows of carbon embodied in non energy goods are approximately 10 and 14 of the corresponding total carbon emissions of the brazilian economy in 1995 the general picture is that brazil is not only a net exporter of energy 153 pj and of carbon 3 6 mtc embodied in the non energy goods internationally traded by the country in 1995 but also that each dollar earned with exports embodied 40 more energy and 56 more carbon than each dollar spent on imports these findings suggest that brazilian policy makers should be concerned about the extra impacts international trade policy may have on energy use and carbon emissions of the country

an analysis of co2 emissions of japanese industries during the period between 1985 and 1995 this paper examines the factors that have an effect on co2 emissions produced by japanese industries between 1985 and 1995 by using input output tables the effects of environmental technological changes etc and production technological changes ptc on co2 emissions are considered separately furthermore backward and forward linkage effects in each sector that shows the extent to which each sector spreads or receives co2 emissions impacts across all of sectors will be calculated the results show that both types of technologies contributed to a decrease in co2 emissions during the bubble economy of the late 1980s but not during the recession of the early 1990s trade factors succeeded in decreasing co2 emissions in both periods thus trade structures facilitated the turning of japan into a net importer of co2 emissions between 1985 and 1995 the backward and forward linkage effects also decreased during the boom of the late in 1980s but not the recession of the early 1990s while the chemical products and electrical machinery sectors continued to reduce both effects this indicates that both sectors were relatively successful in decreasing their co2 emissions impacts between 1985 and 1995

energy and output implications of income redistribution in brazil abstract the energy and output impact of an income redistribution in brazil are simulated by means of a static semi closed input output model the study is undertaken for 1970 1975 with data on production in 48 sectors 12 of which are fuel ones it is suggested that more equitable size income distributions increase output and the employment output and energy output ratios the oil intensity of output would be independent of the income distribution though its fuel structure would not these findings bring little hope for an alleviation of oil imports stemming from an income redistribution in brazil

decentralized markets and endogenous institutions this paper is concerned with decentralized models of market equilibrium in which the primary interest lies in the nature of the institutions that govern trade there are two separate branches in this literature in the first the institutions that govern trade are taken to be given exogenously the primary motivation for models in this class is essentially the study of comparative institutions in particular the papers are interested in whether there are specific institutions that will generate walrasian prices and allocations approximately when transactions costs are small in the second branch of the literature the institutions that govern trade themselves are made endogenous these models characterize the nature of these endogenously generated institutions and examine their efficiency in environments where transactions costs are small

building an incentive compatible safety net abstract bank safety nets originally proposed as a means of stabilizing financial systems have become an important destabilizing influence government protection of bank debts encourages banks to undertake excessive risk particularly in response to adverse shocks to asset values reforms that would remove the destabilizing moral hazard consequences of government protection are considered both from the perspective of economic desirability and political feasibility requiring banks to maintain a minimal proportion of subordinated debt finance and restricting the means by which government recapitalization of insolvent banks occurs are the central features of promising reforms to the safety net

specialization patterns and reduction of co2 emissions an empirical investigation of environmental preservation and economic efficiency abstract we study the effects that different degrees of specialization in the production of the global net output of a group of countries might have on the emissions of co2 the analysis is based on the sraffian notion of subsystems which allows us to study what the input output table of a country would look like under different hypotheses on the allocation of the available resources we use the wiod input output tables and the related environmental accounts for 1995 2009 we show that the environmental benefits deriving from appropriate specialization patterns could be substantial moreover our results suggest that co2 reduction is not necessarily detrimental to economic activity on the contrary with the appropriate exploitation of suitable patterns of specialization co2 reduction and gdp growth may even be pursued jointly

information revelation in a market with pairwise meetings the paper presents a simple pairwise meetings model of trade the new feature is that agents have asymmetric information about the true state of the world the focus is on the transmission of the information through the process of trade the qualitative question is to what extent is the information revealed to uninformed agents through the trading process when the market is in some sense frictionless in particular does the decentralized process give rise to full revelation results as derived by the literature on rational expectations for centralized and competitive environments in the context of the model of this paper it turns out that the information is not fully revealed to uninformed agents even when the market is in some sense approximately frictionless

economic and environmental efficiency using a social accounting matrix abstract this paper aims to show the utility of the so called social accounting matrix and environmental accounts samea for economic and environmental efficiency analysis the article uses the samea for spain in 2000 applied to water resources and greenhouse gas emissions this matrix is used as a central core of a multisectorial model of economic and environmental performance and it calculates the denominated domestics samea multipliers and their decomposition into characteristic direct indirect and induced effects these multipliers show some evaluation of economic and environmental efficiency also we present an application of these multipliers that demonstrates that there is no causal interrelation between those sectors with higher economic backward linkages and those with higher environmental deterioration backward linkages

the importance of being systemically important financial institutions abstract we investigate whether financial markets reacted to the regulatory changes implied by the publication of the list of systemically important financial institutions sifi and the new rules designed to address the too big to fail problem of systemic banks by applying event study methodology to a sample of 70 of the world s largest banks we assess whether the stock prices of sifis reacted significantly and differently from those of other large banks not deemed to be systemically important following the release of information regarding the methodology used to identify sifis and their new capital requirements the disclosure of the first list of 29 sifis and the publication of the updated list of 28 sifis overall we determine that financial markets did not univocally react to the new regulation regarding sifis however markets discriminated between high and low capitalized banks and they correctly estimated the probable effects of the additional capital requirements

measuring the influence of energy prices in the price formation mechanism abstract environmental economics has proposed taxation on energy as a way of mitigating the pollution caused by the production and use of energy based on fossil fuels however it is generally assumed that energy is an important component of production costs and that taxes on energy have a detrimental impact on the economy this paper provides a method of analysing the extent to which energy prices influence the price formation mechanism the model used is based on a social accounting matrix sam the sam price model identifies the role of energy prices in the cost and price definition processes the empirical application is for the catalan economy and shows that energy prices have a considerable influence on both production and final prices and that different forms of energy exert asymmetric impacts on costs for sectors and consumers

a new method for estimating the effects of fuel taxes an application to thailand this article proposes a new methodology for estimating the impact of fuel price and tax changes on the general price level and the distribution of income and applies a model to thailand using data for 1975 76 and 1981 82 because the model allows for pricing under international competition where tax increases must be partially absorbed in reduced factor income rather than always being passed on in higher consumer prices the results are significantly different from those generated by the more conventional cost plus pricing rule the inflationary impact of fuel tax changes is slight because of both the openness of the economy and the low energy intensity of manufacturing and other production in thailand in contrast taxes on imports engender price increases not only for imports but also for goods which substitute for imports the model also indicates that the net effects of taxes on petroleum products other than kerosene are progressive in their distributional impact relative to a tax on imports or consumption a main policy conclusion of the study is that fuel taxes could be used to increase both equity and allocative efficiency without inducing significant inflationary responses it follows that in the current circumstances of falling world oil prices developing countries could generate revenues needed for structural adjustment by increasing fuel taxes to maintain domestic petroleum price levels

while visitors conserve residents splurge patterns and changes in energy consumption 1997 2007 abstract this study analyzes changes in energy consumption in hawai i between 1997 and 2007 using input output analysis residents increase their energy use by 33 in electricity and 18 in fuel largely due to direct consumption in contrast visitors contract energy demand by 9 and 4 in electricity and fuel respectively the findings are robust at per capita levels key drivers are the significant drops in energy intensity of primarily three industries air transportation hotels and restaurants further analysis decomposes the change to evaluate the underlying factors

interbank lending and systemic risk systemic risk refers to the propagation of a bank s economic distress to other economic agents linked to that bank through financial transactions banking authorities often prevent systemic risk through an implicit insurance of interbank claims or by reducing interbank transactions and centralizing banks liquidity management this paper investigates whether the flexability afforded by decentralized bank interactions can be preserved while protecting the central banks from the necessity of conducting undesired rescue operations it develops a model in which decentralized interbank leading is motivated by peer monitoring in this context the paper derives the optimal prudential rules and in particular looks at the impact of interbank monitoring on the solvency and liquidity ratios of borrowing and lending banks last it provides conditions which a too big to fail policy is or is not justified and studies the possibility of propagation of a bank s liquidity shock throughout the financial system copyright 1996 by ohio state university press

determination of income production and employment under pollution control an input output approach it can be shown that a variation of the multiplier approach solves the leontief pollution model in a more directly interpretable and computationally efficient manner than the conventional method of directly using the augmented leontief inverse matrix the solution of each endogenous variable of the model can be expressed in terms of the non augmented leontief inverse exogenous variables and two important multipliers the pollution control multiplier and a modified keynesian multiplier modified by pollution control the so called induced effect and the effect of pollution control on a given economy can be separated from the model 6 references 5 footnotes 1 table

bank bailouts and moral hazard evidence from germany we use a structural econometric model to provide empirical evidence that safety nets in the banking industry lead to additional risk taking to identify the moral hazard effect of bailout expectations on bank risk we exploit the fact that regional political factors explain bank bailouts but not bank risk the sample includes all observed capital preservation measures and distressed exits in the german banking industry during 1995 2006 a change of bailout expectations by two standard deviations increases the probability of official distress from 6 6 to 9 4 which is economically significant

bargaining search costs and equilibrium price distributions this paper studies a bargaining model of equilibrium price distributions consumers choose a seller at random and face search costs to switching to another store in the market equilibrium the prices at all stores are determined simultaneously as the perfect equilibrium of a bargaining game in this game the buyer has the outside option to search for another seller differences between the sellers types create price dispersions typically the number of active sellers increases with higher search costs the market equilibrium converges to the competitive equilibrium under perfect information when search costs become small

economic structure and strategies for greenhouse gas mitigation abstract greenhouse gas ghg emission mitigation policy impacts the economic system directly in the short term by altering relative prices and indirectly in the long term by shifting the structure of the economy there may also be adjustments to economic structure independent of policy intervention due to changes in population consumption patterns and global markets the overall effectiveness of specific mitigation policy will partly depend on these indirect and exogenous changes to economic structure this study develops a new measure linking economic development with its environmental effects the technical cost of ghg mitigation under economic growth in an economy is calculated by combining traditional input output io analysis and a linear programming based sensitivity analysis the approach is applied to northern ireland ni producing an isoemission matrix that maps emission neutral expansion paths for the economy the measurement provides an indicator of the demand for technical improvement to achieve ghg mitigation at a national or regional level the flexibility and transparency of the approach make it useful for evaluating potential ghg mitigation strategies

deposit insurance and wealth effects the value of being too big to fail this paper investigates the effect on bank equity values of the comptroller of the currency s announcement that some banks were too big to fail and that for those banks total deposit insurance would be provided using an event study methodology we find positive wealth effects accruing to tbtf banks with corresponding negative effects accruing to non included banks we demonstrate that the magnitude of these effects differed with bank solvency and size we also show that the policy to which the market reacted was that suggested by the wall street journal and not that actually intended by the comptroller the role of deposit insurance has become a topic of increasing debate advocates argue that by removing the incentive to run deposit insurance protects individual financial institutions from instability in the intermediation process thereby providing stability to the financial system as a whole 1 the recent rise in bank failures and the concomitant crises in the s l industry however demonstrate that this stability is not guaranteed moreover critics note that deposit insurance may introduce incentive problems and wealth effects into the financial system both of which can impede the effective functioning of any deposit insurance system these problems have prompted concern about the structure of the current deposit insurance system and have led to numerous proposals regarding its restructuring 2 this paper investigates one aspect of this debate by analyzing the effect on bank equity values of the policy decision to insure completely some banks but not others specifically in september 1984 the comptroller of the currency testified before congress that some banks were simply too big to fail tbtf and that for those banks total deposit insurance would be provided while not explicitly naming the banks the comptroller admitted that this policy would apply to the eleven largest banks using an event study methodology we analyze