the impact of population on co2 emissions evidence from european countries this paper analyses the impact of population growth on co2 emissions in european union countries traditionally researchers have assumed a unitary elasticity of emissions with respect to population growth in this study population is treated as a predictor in the model instead of being included as part of the dependent variable per capita emissions thus relaxing the above mentioned assumption of unitary elasticity we also contribute to the existing literature by taking into account the presence of heterogeneity in the sample and considering a dynamic specification the sample covers the period 1975 1999 for the current european union members our results show that the impact of population growth on emissions is more than proportional for recent accession countries whereas for old eu members the elasticity is lower than unity and non significant when the properties of the time series and the dynamics are correctly specified the different impact of population change on co2 emissions for the current eu members should therefore be taken into account in future discussions of climate change policies within the eu

pollution and economic growth evidence from central and eastern european countries abstract we investigate the relationships between pollution and growth in eleven central and eastern european cee countries aggregate results robust to different estimators and control variables reveal an increasing nonlinear link between gdp and co2 for the group of cee countries however at a disaggregated country level the relationship between gdp and co2 is characterized by much diversity among cee countries namely n shaped inverted n u shaped inverted u monotonic or no statistical link thus despite an aggregated upward trend some cee countries managed to secure both higher gdp and lower co2 emissions from a policy perspective eu policymakers could pay more attention to these countries and amend the current unique environmental policy to account for country heterogeneities in order to support economic growth without damaging the environment

fiscal policy and growth in a small open economy with elastic labour supply endogenizing labour supply leads to fundamental changes in the equilibrium structure of the ak growth model of a small open economy the balanced growth equilibrium is described by two tradeoff loci relating the equilibrium growth rate to the fraction of time devoted to leisure the implications of endogenous labour supply for fiscal policy are addressed the effects of distortionary taxes and government expenditure on the equilibrium growth leisure employment tradeoff are analysed the responses contrast with both those of a closed economy having an elastic labour supply and an open economy with fixed labour supply optimal fiscal policy is also characterized jel classification f41 f43 politique fiscale et croissance dans une petite economie ouverte quand l offre de travail est elastique l endogeneisation de l offre de travail entraine des changements fondamentaux dans la structure d equilibre du modele de croissance du type ak d une petite economie ouverte l equilibre de croissance balancee est decrit par deux lieux de relations d equivalence reliant le taux de croissance d equilibre a la fraction du temps allouee au loisir on examine les implications de cette endogen6isation de l offre de travail pour la politique fiscale on analyse les effets de taxes distorsionnantes et des depenses gouvemementales sur la relation d 6equivalence entre taux de croissance et loisir et donc emploi on obtient des reactions differentes de celles qu on obtient en economie ferm6e quand l offre de travail est elastique et en economie ouverte quand l offre de travail est fixe on proc ede alors a la definition de la politique fiscale optimale

optimal capital income taxation with incomplete markets borrowing constraints and constant discounting for a wide class of infinitely lived agent models chamley has shown that the optimal capital income tax rate is zero in the long run lucas has argued that for the u s economy there is a significant welfare gain from switching to this policy this paper shows that for the bewley class of models with incomplete insurance markets and borrowing constraints the optimal tax rate on capital income is positive even in the long run therefore cutting the capital income tax to zero may well lead to welfare losses

environmental kuznets curves new evidence on both panel and country level co2 emissions using data on per capita co2 emissions and per capita real gdp from fifteen countries spanning the period 1960 2013 this paper tests the validity of the environmental kuznets curve ekc using both panel based and time series based methodological approaches of cointegration given that the ekc hypothesis postulates an inverted u shaped relationship between emissions and output the study tests for cointegration between per capita co2 emissions per capita real gdp and the squared values of per capita real gdp the evidence from panel cointegration methodologies is mixed this result might arise due to time dependence of cointegrating coefficients the time varying cointegration approaches provide strong evidence in favor of time varying cointegration parameters furthermore based on the quantile cointegration approach the results indicate that the ekc hypothesis holds in 12 out of the 15 countries however even for these three countries the ekc hypothesis seems to hold at certain quantiles

sunk costs and strategic commitment a proposed three stage equilibrium dixit s i980 paper in this journal the role of investment in entry deterrence has attracted considerable interest from economists concerned with constructing a modern theory of strategic behaviour towards entry in fact the paper has spawned quite an industry of commitment models in which the equilibrium payoffs in some final period game can be influenced by strategic commitments made by the players in an earlier period for similar models with important insights into strategic entry deterrence see eaton and lipsey i980 i98i schmalensee i98i the purpose of this note is to argue that when the instrument of stragetic commitment takes the form of sunk costs which both entrant and incumbent have to bear as it does in dixit s paper and in many other examples a three stage model rather than the two stage model presented by dixit is required although the proposed equilibrium differs from dixit s its qualitative features are the same it may or may not be profitable to deter entry and if it is the first mover may still prefer to play an accommodation strategy and allow entry to take place following dixit we restrict our attention to the asymmetric case in which one firm the incumbent makes the first move the two stage game involves the first mover sinking part of its costs in advance so that in the second stage equilibrium it will have a current cost advantage over the entrant which must incur the full cost of producing any desired output level the second period cost asymmetry ensures the incumbent a lar ger share of the post entry market which may be sufficient to deter entry altogether the problem with the two stage game lies in the nature of sunk costs sunk costs by definition are committed before the production period takes place if they were expended as a flow simultaneously with production they would not be sunk the installation of capacity is the natural example employed by dixit and well illustrates the point if installed capacity is a sunk cost which it must be for the incumbent to acquire any strategic advantage at all then the entrant s installed capacity is equally sunk and must also be committed before the production period takes place given this observation the post entry final period equilibrium should not be modelled as if the entrant were simultaneously incurring both variable and sunk costs but the incumbent only incurs variable costs this implies too great an asymmetry in favour of the incumbent the final period equilibrium should involve both firms incurring only variable

on the relationships between co2 emissions energy consumption and income the importance of time variation abstract the environment that governs the relationships between energy consumption carbon dioxide co2 emissions and gross domestic product gdp in the g7 countries changes over time due to variations in economic growth regulatory policy and technology using a novel approach that may detect causalities when the time constant hypothesis is rejected we find significant time varying granger causalities among the variables under consideration there is bidirectional causality between gdp and energy consumption for japan unidirectional causality running from gdp to energy consumption for italy and unidirectional causality running from energy consumption to gdp for the resource country canada moreover the results also show a bidirectional time varying causality between energy consumption and co2 emissions for the united states and causality from energy consumption to co2 emissions for france finally while we find significant time varying causalities running from gdp to co2 emissions for italy and japan the finding of inverted n shaped curves italy and japan lends no support to the traditional environmental kuznets curve ekc hypothesis for these countries it implies that environmental policy and economic growth should go hand in hand other policy implications of the empirical results have been proposed

optimal inflation persistence ramsey taxation with capital and habits ramsey models of fiscal and monetary policy featuring time separable preferences and a fixed supply of capital predict highly volatile inflation with no serial correlation in this paper we show that an otherwise standard ramsey model that incorporates capital accumulation and habit persistence predicts highly persistent inflation the result depends on increases in either the ability to smooth consumption or the preference for doing so the effect operates through the fisher relationship a smoother profile of consumption implies a more persistent real interest rate which in turn implies persistent optimal inflation our work complements a recent strand of the ramsey literature based on models with nominal rigidities in these latter models inflation volatility is lower than in the baseline model but continues to exhibit little persistence we quantify the effects of habit and capital on inflation persistence and also relate our findings to recent work on optimal fiscal policy with incomplete markets

the co2 growth nexus revisited a nonparametric analysis for the g7 economies over nearly two centuries abstract using a long dataset and some recently popularized nonparametric econometric techniques this study revisits the nexus between economic growth and carbon dioxide co 2 emissions for the g7 countries over nearly two centuries the use of nonparametric modelling is warranted by the fact that long historical time series are often subject to structural breaks and other forms of nonlinearity over the course of time we employ nonparametric cointegration and causality tests along with the cross validated local linear regression analysis and validate the existence of the environmental kuznets curve in six of the g7 countries canada france germany italy u k and the u s and the only exception is japan our empirical analysis also finds co 2 emissions and economic growth to be cointegrated and closely interrelated in the granger sense our results are robust and highlight the nonlinear causal relationship between the two variables

environmental kuznets curve for co2 in canada abstract according to the environmental kuznets curve hypothesis the relationship between per capita gdp and per capita pollutant emissions has an inverted u shape this implies that past a certain point economic growth may actually be profitable for environmental quality most studies on this subject are based on estimating fully parametric quadratic or cubic regression models while this is not technically wrong such an approach somewhat lacks flexibility since it may fail to detect the true shape of the relationship if it happens not to be of the specified form we use semiparametric and flexible nonlinear parametric modeling methods in an attempt to provide more robust inferences we find little evidence in favour of the environmental kuznets curve hypothesis our main results could be interpreted as indicating that the oil shock of the 1970s has had an important impact on progress towards less polluting technology and production

optimal fiscal and monetary policy in an economy without capital abstract this paper is concerned with the structure and time consistency of optimal fiscal and monetary policy in an economy without capital in a dynamic context optimal taxation means distributing tax distortions over time in a welfare maximizing way for a barter economy our main finding is that with debt commitments of sufficiently rich maturity structure an optimal policy if one exists is time consistent in a monetary economy the idea of optimal taxation must be broadened to include an inflation tax and we find that time consistency does not carry over an optimal inflation tax requires commitment by rules in a sense that has no counterpart in the dynamic theory of ordinary excise taxes the reason time consistency fails in a monetary economy is that nominal assets should from a welfare maximizing point of view always be taxed away via an immediate inflation in a kind of capital levy this emerges as a new possibility when money is introduced into an economy without capital

are there environmental kuznets curves for us state level co2 emissions abstract the environmental kuznets curve ekc hypothesis argues that the relationship between the pollutant and output is inverted u shaped implying that environmental degradation increases with output during the early stages of economic growth but declines with output after reaching a specified threshold for the first time in the literature on the ekc hypothesis this paper assesses the validity of the hypothesis across 48 us states using the common correlated effects cce estimation procedure by pesaran 2006 which allows us to obtain results in the presence of cointegration in the relationship between carbon emissions and a measure of output and its squared value which captures the inverted u shaped relationship postulated by the ekc hypothesis the panel data approach allows the study individual members of the panel also resulting in efficiency gains that would not be associated with time series approaches based on the small sample size of 51 observations 1960 2010 the findings postulate that the ekc hypothesis holds in only 10 states with the remaining 38 states should be reforming their environmental regulatory policies to prevent environmental degradation coming only at the expense of production and economic growth as for the other 10 states given that a threshold has been achieved higher growth would be accompanied with lower emissions and hence no additional environmental policies are required

carbon dioxide emissions and global gdp abstract a positive relationship between carbon dioxide emissions the most important greenhouse gas ghg implicated in global warming and gdp is shown in this paper examining per capita income and co2 emissions of 137 countries across 21 years it also appears that as per capita incomes accelerate across countries emissions increases for the most part tend to decelerate it could be that higher income levels lead to increased demand for environmental protection only emissions reduction proposals that assure incomes will not be adversely affected particularly those of less developed countries ldcs will have any possibility of successful implementation

the dynamic impact of renewable energy consumption on co2 emissions a revisited environmental kuznets curve approach this paper considers a revisited environmental kuznets curve ekc hypothesis with potential impact of renewable energy consumption on environmental quality to this end paper aims at investigating the validity of the ekc hypothesis employing the dependent variable of co2 emissions and regressors of gdp quadratic gdp and renewable energy consumption this paper hence analyzes this revisited ekc hypothesis to observe if i there exists an inverted u shaped relationship between environmental quality in terms of co2 emissions per capita income and per capita income squared and ii there exists a negative causality from renewables to co2 emissions within ekc model paper employs a panel data set of 17 oecd countries over the period 1977 2010 and launches panel fmols and panel dols estimations the findings support the ekc hypothesis for the panel and indicate that gdp per capita and gdp per capita squared have the impacts on co2 emissions positively and negatively respectively and that renewable energy consumption yields negative impact on co2 emissions another remark of this paper is that the validity of ekc does not depend on income level of individual countries of panel in which ekc hypothesis holds eventually paper argues that if countries carry out i policies i e for fair and easy access to the electricity from renewable sources and ii policies to increase renewables supply through i e improved renewable energy technologies they will be able to contribute to combating global warming problem as they increase their gdp s

financial development growth and the distribution of income a paradigm is presented in which both the extent of financial intermediation and the rate of economic growth are endogenously determined financial intermediation promotes growth because it allows a higher rate of return to be earned on capital and growth in turn provides the means to implement costly financial structures thus financial intermediation and economic growth are inextricably linked in accord with the goldsmith mckinnon shaw view on economic development the model also generates a development cycle reminiscent of the kuznet hypothesis in particular in the transition from a primitive slow growing economy to a developed fast growing one a nation passes through a stage in which the distribution of wealth across the rich and poor widens

the role of economic theory in modelling the long run this argues for a closer link between the modelling of the long run relations in applied economics and the intertemporal equilibrium notion from economic theory this abstract was borrowed from another version of this item

compelling evidence of an environmental kuznets curve in the united kingdom the objective of this paper is to investigate the relationship between per capita emissions hbox co 2 and hbox so 2 and economic growth per capita gdp in the uk using a long span of data this paper examines the existence of a non linear relationship between emissions and economic growth using methods that do not restrict the relationship to be any particular shape the methodology employs instrumental variables in the place of per capita gdp to deal with potential concerns about errors in variables and endogeneity the empirical results provide strong support for the environmental kuznets curve with estimated turning points in 1966 and 1967 for hbox co 2 and hbox so 2 respectively these turning points correspond roughly with the introduction of the clean air act in the uk as well as the reduction in the use of coal as an energy source and together they provide a snapshot of the forces driving the turning points the paper continues by further investigating the temporal behavior of the inverted u shaped relationship the findings indicate that if emissions and per capita gdp deviate from their long run relationship emissions do the heavy lifting to restore the system to equilibrium this result is intuitively pleasing because mitigation is directly affected by legislation as opposed to declining economic growth

bounds testing approach to analysis of the environment kuznets curve hypothesis abstract this paper examines the long run and the dynamic temporal relationships between economic growth energy consumption population density trade openness and carbon dioxide co 2 emissions in brazil china egypt japan mexico nigeria south korea and south africa based on the environment kuznets curve ekc hypothesis we employ the ardl bounds test to cointegration and cusum and cusumsq tests to ensure cointegration and parameter stability the estimated results show that the inverted u shaped ekc hypothesis holds in japan and south korea in the other six countries the long run relationship between economic growth and co 2 emissions follows an n shaped trajectory and the estimated turning points are much higher than the sample mean in addition the results indicate that energy consumption granger causes both co 2 emissions and economic growth in all the countries our results are consistent with previous studies that show that there is no unique relationship between energy consumption population density economic growth trade openness and the environment across countries

simpson s reversal paradox and cost allocation allocation of indirect costs among products sometimes yields a paradoxical result that unit cost for each product may increase under one method of allocation and may decrease for each product under another method the stalcup paper company case illustrate such behaviour of costs at the same time provides an accounting example of simpon s reversal paradox simpson 1951 which blyth 1972 discussed in the statistics literature as with other paradoxes this cost allocation paradox disappears upon closer scrutiny this paper examines the properties of allocated costs in order to arrive at an intuitive understanding of the results the relationship of the cost allocation problem to simpson s paradox and the implications of the analysis for cost control are briefly discussed necessary and sufficient condition for occurrence of the paradox is also given this abstract was borrowed from another version of this item

threshold cointegration and nonlinear adjustment between co2 and income the environmental kuznets curve in spain 1857 2007 abstract article history received 9 march 2011received in revised form 24 february 2012accepted 2 march 2012available online 14 march 2012jel classi cation c2q4keywords environmental kuznets curveco 2 emissionsnonlinear relationshipthreshold cointegration inthispaper wemodelthe long run relationship between per capita co 2 and per capita income for the spanisheconomy over the period 1857 2007 according to the environmental kuznets curve eck the relationshipbetween the two variables has an inverted u shape however previous studies for the spanish economy onlyconsidered the existence of linear relationships such an approach may lack exibility to detect the trueshape of the relationship our empirical methodology accounts for a possible non linear relationship throughthe use of threshold cointegration techniques our results con rm the non linearity of the link between thetwo above mentioned variables pointing to the existence of an environmental kuznets curve for the spanishcase 2012 elsevier b v all rights reserved

reassessing the environmental kuznets curve for co2 emissions a robustness exercise the number of studies seeking to empirically characterize the reduced form relationship between a country economic growth and the quantity of pollutants produced in the process has recently increased significantly in several cases researchers have found evidence pointing to an inverted u benvironmental kuznetsq curve in the case of co2 however the evidence is at best mixed in this paper we reconsider that evidence by assessing how robust it is when the analysis is conducted in a different parametric setup and when using alternative emissions data from the international energy agency relative to the literature our contribution can be viewed as a robustness exercise in these two respects the econometric results lead to two conclusions firstly published evidence on the ekc does not appear to depend upon the source of the data at least as far as carbon dioxide is concerned secondly when an alternative functional form is employed there is evidence of an inverted u pattern for the group of oecd countries with reasonable turning point regardless of the data set employed not so for non oecd countries as the ekc is basically increasing slowly concave according to the iea data and more bellshaped in the case of cdiac data d 2005 elsevier b v all rights reserved

the kuznets curve a reassessment abstract this paper revisits the kuznets hypothesis an extensive data set containing the most recent estimates of income distribution is utilized to test the kuznets hypothesis in addition the data comparability problem with respect to income distribution data when conducting econometric analysis is addressed the results indicate that the data comparability problem is not severe enough to nullify the estimates obtained from pooled regressions the kuznets hypothesis holds for this data set

intertemporal distortions in the second best we consider a very general class of public nance problems that encompasses ramsey models of optimal taxation as well as economies with limited commitment private information and political economy frictions we identify a su cient condition to rule out permanent intertemporal distortions at the optimum if there exists an admissible allocation that converges to the rst best steady state then all intertemporal distortions are temporary in the second best we analyze a series of applications to illustrate the signi cance of this result

is there an environmental kuznets curve for sulfur abstract most existing estimates of the environmental kuznets curve ekc for sulfur which use samples of mainly high income countries indicate a maximum emissions turning point at middle to lower high income levels of gdp per capita we use a larger and more globally representative sample than previous sulfur ekc studies we find that sulfur emissions per capita are a monotonic function of income per capita when we use a global sample and an inverted u shape function of income when we use a sample of high income countries a model estimated in first differences results in a monotonic ekc when estimated with both high income and global samples reductions in emissions are time related rather than income related

international lending with moral hazard and risk of repudiation in this paper i examine the constrained optimal pattern of capital flows between a lender and a borrower in an environment in which there are two impediments to forming contracts the first impediment to contracting arises from the assumption that lenders cannot observe whether borrowers invest or consume borrowed funds this assumption leads to a moral hazard problem in investment the second impediment arises from the assumption that the borrower as a sovereign nation may choose to repudiate his debts the optimal contract is shown to specify that the borrowing country experience a capital outflow when the worst realizations of national output occur this seemingly perverse capital outflow forms a necessary part of the optimal solution to the moral hazard problem in investment

energy consumption economic growth and co2 emissions in middle east and north african countries this article extends the recent findings of liu 2005 ang 2007 apergis et al 2009 and payne 2010 by implementing recent bootstrap panel unit root tests and cointegration techniques to investigate the relationship between carbon dioxide emissions energy consumption and real gdp for 12 middle east and north african countries mena over the period 1981 2005 our results show that in the long run energy consumption has a positive significant impact on co2 emissions more interestingly we show that real gdp exhibits a quadratic relationship with co2 emissions for the region as a whole however although the estimated long run coefficients of income and its square satisfy the ekc hypothesis in most studied countries the turning points are very low in some cases and very high in other cases hence providing poor evidence in support of the ekc hypothesis co2 emission reductions per capita have been achieved in the mena region even while the region exhibited economic growth over the period 1981 2005 the econometric relationships derived in this paper suggest that future reductions in co2 emissions per capita might be achieved at the same time as gdp per capita in the mena region continues to grow

the impact of financial development on carbon emissions an empirical analysis in china given the complexity between china s financial development and carbon emissions this paper uses some econometric techniques including cointegration theory granger causality test variance decomposition etc to explore the influence of financial development on carbon emissions results indicate that first china s financial development acts as an important driver for carbon emissions increase which should be taken into account when carbon emissions demand is projected second the influence of financial intermediation scale on carbon emissions outweighs that of other financial development indicators but its efficiency s influence appears by far weaker although it may cause the change of carbon emissions statistically third china s stock market scale has relatively larger influence on carbon emissions but the influence of its efficiency is very limited this to some extent reflects the relatively lower liquidity in china s stock markets finally among financial development indicators china s fdi exerts the least influence on the change of carbon emissions due to its relatively smaller volume compared with gdp but it is mainly utilized in carbon intensive sectors now therefore with the increase of china s fdi in the future many efforts should be made to adapt its utilizing directions and play its positive role in promoting low carbon development

consumption based and territory based carbon emissions intensity determinants and forecasting using club convergence across countries abstract understanding the dynamics of carbon emissions across time and space is important when formulating energy policies to minimise climate changes in the future if per capita carbon emissions or carbon intensity converge over time then any negotiation of multilateral agreements will be easier than if convergence is absent it is also possible for club convergence to exist where countries within a club converge but countries between clubs do not converge we examine the convergence of consumption based and territory based carbon emissions intensity across 70 countries we find two convergent clubs for consumption based emissions and three convergent clubs for territory based emissions increases in each of total factor productivity renewable energy consumption and urbanisation increase the odds of belonging to a low carbon emissions intensity club an increase in industry value added reduces the odds of belonging to a low carbon intensity club increases in total factor productivity can be obtained through effective macroeconomic policy while increasing renewable energy consumption may require structural changes in economies focused on transitioning to a low carbon economy under a business as usual forecasting scenario the number of consumption based carbon emissions intensity clubs increases between 2014 and 2030 making it more difficult to negotiate multilateral agreements on climate change in the future

is trade good or bad for the environment sorting out the causality we seek to contribute to the debate over globalization and the environment by asking what is the effect of trade on a country s environment for a given level of gdp we take specific account of the endogeneity of trade using exogenous geographic determinants of trade as instrumental variables we find that trade tends to reduce three measures of air pollution statistical significance is high for concentrations of so2 moderate for no2 and lacking for particulate matter although results for other environmental measures are not as encouraging there is little evidence that trade has a detrimental effect on the environment

testing the environmental kuznets curve hypothesis across the u s evidence from panel mean group estimators abstract it is widely believed that greenhouse gases contribute to a warmer climate since global warming is a serious threat and greenhouse gas emissions are one of the main causes of it analyzing the effects of economic development on environment have great importance in this study the validity of the environmental kuznets curve ekc hypothesis is tested for the 50 u s states during the 1960 2010 period using recent panel data estimators that take cross sectional dependence and slope heterogeneity into account accordingly the cross sectional dependence and slope heterogeneity robust estimators augmented mean group amg and common correlated effects mean group estimator ccemg provide mixed results the amg estimator strongly validates the ekc hypothesis asserting that the ekc holds in 30 of the 50 states with turning points for income per capita lie between 1292 and 48597 on the contrary the ccemg estimator provides only weak evidence on the ekc hypothesis and the ekc holds only in 10 states with turning points between 2457 and 14603

cost based transfer pricing under r d risk aversion in an integrated supply chain abstract this paper examines the economic role of transfer pricing for a vertically integrated supply chain when a risk averse production division manager faces uncertainty on the outcomes from r d investment in particular we compare two representative cost based transfer pricing methods full cost and variable cost pricing we construct an economic model based on the assumption that r d investment reduces the expected fixed costs of a production factor as well as the variable production costs we show that a firm s profit under full cost transfer pricing is greater than that under variable cost transfer pricing under certainty contrary to this benchmark result variable cost pricing becomes more profitable than full cost pricing when the risk averse manager bears relatively high risk

non renewable and renewable energy consumption and co2 emissions in oecd countries a comparative analysis abstract this paper attempts to explore the determinants of co 2 emissions using the stirpat model and data from 1980 to 2011 for oecd countries the empirical results show that non renewable energy consumption increases co 2 emissions whereas renewable energy consumption decreases co 2 emissions further the results support the existence of an environmental kuznets curve between urbanisation and co 2 emissions implying that at higher levels of urbanisation the environmental impact decreases therefore the overall evidence suggests that policy makers should focus on urban planning as well as clean energy development to make substantial contributions to both reducing non renewable energy use and mitigating climate change

dynamic optimal taxation in small open economies abstract this paper examines the effects of perfect capital mobility on the determination of optimal capital taxation it shows that capital movements do not change dramatically the optimal tax path studied for the closed economy in addition the paper provides a counterexample to the standard belief that the worldwide system is the optimal regime of taxation finally it shows that the rate of taxation of the rest of the world is not fundamental to determine the optimal decision of a small economy

a test for parameter homogeneity in co2panel ekc estimations this paper casts doubt on empirical results based on panel estimations of an inverted u relationship between per capita gdp and pollution using a new dataset for oecd countries on carbon dioxide emissions for the period 1960 1997 we find that the crucial assumption of homogeneity across countries is problematic decisively rejected are model specifications that feature even weaker homogeneity assumptions than are commonly used furthermore our results challenge the existence of an overall environmental kuznets curve for carbon dioxide emissions

dynamic misspecification in the environmental kuznets curve evidence from co2 and so2 emissions in the united kingdom this study looks at the behaviour of emissions when in disequilibrium with respect to the environmental kuznets curve ekc relationship we use the non linear threshold cointegration and error correction methodology and a long dataset beginning in 1830 in an application to the united kingdom there is significant evidence that not only does the inverse u shape hold between per capita co 2 and so 2 emissions and gdp per capita but we also find that temporary disequilibrium from the long run ekc is corrected in an asymmetric fashion this may be due to the historical pressure of environmental regulation in the uk to reduce emissions that are higher than permitted however further analysis suggests that technological change can partially account for the asymmetric adjustment

the welfare cost of inflation in a cash in advance economy with costly credit the paper presents a modification of the lucas stokey 1983 cash in advance economy in which the representative consumer decides based on relative prices which goods to buy with cash and which with costly credit an explicit baumol 1952 condition emerges that guides this consumer choice deriving and estimating a closed form welfare cost function in an example economy the paper shows that the welfare cost of inflation depends on the margins of substitution the consumer avoids inflation through costly credit and faces higher welfare costs of inflation than in standard cash in advance economies

empirical study on the environmental kuznets curve for co2 in france the role of nuclear energy this paper attempts to estimate the environmental kuznets curve ekc in the case of france by taking the role of nuclear energy in electricity production into account we adopt the autoregressive distributed lag ardl approach to cointegration as the estimation method additionally we examine the stability of the estimated models and investigate the granger causality relationships between the variables in the system the results from our estimation provide evidence supporting the ekc hypothesis and the estimated models are shown to be stable over the sample period the uni direction running from other variables to co2 emissions are confirmed from the casualty tests specifically the uni directional causality relationship running from nuclear energy to co2 emissions statistically provides evidence on the important role of nuclear energy in reducing co2 emissions

co2 emissions and economic activity heterogeneity across countries and non stationary series this paper explores the relationship between co2 emissions and economic activity for 31 countries 28 oecd brazil china and india during the period 1950 to 2006 using cointegration analysis single country long run relationships are estimated and equality in the functional form the parameters and the turning point when appropriate are rejected this confirms the relevance of considering the differences among countries in the relationship between air pollution and economic activity to avoid wrong estimations and conclusions

time consistency of fiscal and monetary policy the problem of time inconsistency arises from two different sources first as shown by guillermo a calvo 1978 the re is an incentive for each government to engage in an initial unanti cipated inflation second as discussed by robert e lucas and nancy l stokey 1983 there is an incentive for each government to deviat e from the path of taxes announced by the preceding government in th is paper it is shown that these two sources of time inconsistency ca n be removed by a particular method of debt management involving bot h nominal and indexed government bonds of various maturities copyright 1987 by the econometric society

cost allocation and opportunity costs one explanation for the widespread use of allocated fixed costs is that they can serve as a proxy for difficult to calculate opportunity costs this explanation is pursued by modeling a service department as an m m s s queueing system two main results are that the expected value of opportunity costs equals both the incremental productivity of capacity and the optimal transfer price when the cost of capacity is of the form cs as and is close to one we show that allocated fixed costs are a good proxy for average opportunity costs however if there are great economies of scale is close to zero then a method which charges users only for the variable costs of the service department is recommended finally the economic efficiency of transfer prices based on either variable cost or full cost is compared with optimal transfer pricing policies

simultaneity modeling analysis of the environmental kuznets curve hypothesis the environmental kuznets curve ekc hypothesis has been recognized in the environmental economics literature since the 1990 s various statistical tests have been used on time series cross section and panel data related to single and groups of countries to validate this hypothesis in the literature the validation has always been conducted by using a single equation however since both the environment and income variables are endogenous the estimation of a single equation model when simultaneity exists produces inconsistent and biased estimates therefore we formulate simultaneous two equation models to investigate the ekc hypothesis for fifty six countries using annual panel data from 1990 to 2012 with the end year is determined by data availability for the panel to make the panel data analysis more homogeneous we investigate this issue for a three income based panels namely high middle and low income panels given several explanatory variables our results indicate that there exists a bidirectional causality between economic growth and pollution emissions in the overall panels we also find that the relationship is nonlinear and has an inverted u shape for all the considered panels policy implications are provided

the impact of financial development on energy consumption in emerging economies abstract financial development is often cited as a very important driver of economic growth in emerging economies and it is thus likely that financial development affects energy demand this study uses generalized method of moments estimation techniques to examine the impact of financial development on energy consumption in a sample of emerging countries several different measures of financial development are examined using a panel data set on 22 emerging countries covering the period 1990 2006 the empirical results show a positive and statistically significant relationship between financial development and energy consumption when financial development is measured using stock market variables like stock market capitalization to gdp stock market value traded to gdp and stock market turnover the implications of these results for energy policy are discussed

model uncertainty and intertemporal tax smoothing in this paper we examine how model uncertainty due to the preference for robustness rb aects optimal taxation and the evolution of debt in the barro tax smoothing model 1979 we rst study how the government spending shocks are absorbed in the short run by varying taxes or through debt under rb furthermore we show that introducing rb improves the model s predictions by generating i the observed relative volatility of the changes in tax rates to government spending ii the observed comovement between government decits and spending and iii more consistent behavior of government budget decits in the us economy finally we show that rb can also improve the model s predictions in the presence of multiple shocks

carbon emission energy consumption trade openness and financial development in pakistan a revisit the paper empirically examines the cointegrating relationship between carbon emissions energy consumption trade openness and financial development in pakistan using ardl bounds test for cointegration procedure annual time series data is used for the period 1971 2011 the results reveal an inverted u shaped relationship between carbon emission and energy consumption with a maximum threshold value of energy consumption per capita 640 kg of oil equivalent currently the economy is operating below this level and therefore it is expected that carbon emission will continue to rise gradually over some time until the threshold level is reached the lower than threshold level of energy consumption implies that scale and composition effects dominate the technology effect in terms of energy use further the long run results indicate that one percent increase in trade openness and financial development will increase carbon emission by 0 247 and 0 165 respectively the short run elasticities are 0 122 and 0 087 for trade openness and financial development respectively the granger causality results indicate a unidirectional causality from energy consumption trade openness and financial development to carbon emission and a bi directional causality between energy consumption and financial development in line with the results and given the growing focus on climate change effects in pakistan the paper discusses some policy issues for consideration and highlights the need to interpret elasticities with caution

co2 emissions energy consumption and output in france abstract this paper examines the dynamic causal relationships between pollutant emissions energy consumption and output for france using cointegration and vector error correction modelling techniques we argue that these variables are strongly inter related and therefore their relationship must be examined using an integrated framework the results provide evidence for the existence of a fairly robust long run relationship between these variables for the period 1960 2000 the causality results support the argument that economic growth exerts a causal influence on growth of energy use and growth of pollution in the long run the results also point to a uni directional causality running from growth of energy use to output growth in the short run

assessing income population and technology impacts on co2 emissions in canada where s the ekc abstract this study investigates the macroeconomic forces underlying carbon dioxide co2 emissions from fossil fuel use in canada in keeping with the relevant literature on environmental degradation three forces are expected to influence co2 emissions gross domestic product per capita gdp capita population and technological change while previous work has employed reduced form models that allow for non linear relationships between co2 and gdp capita it has been common practice to assume linear relationships between co2 and the latter two variables this study tests a more flexible model using a five region panel data set in canada over the period 1970 2000 findings indicate that gdp capita is unrelated to co2 that an inverted u shaped relationship exists with population and that a u shaped relationship exists with technology thus technological and population changes are supported over the commonly hypothesized environmental kuznets curve an inverted u shaped relationship between gdp capita and environmental degradation for affecting co2 emissions from fossil fuel use in canada

internal pricing and cost allocation in a model of multiproduct competition with finite capacity increments internal prices are used in practice to allocate central resources to a firms profit centers the fixed costs of capacity acquisitions are often included in these prices we examine the interaction between capacity acquisition and competition when capacity is available in fixed increments we find predictably that if the increments are small unit capacity cost is a good approximation for the internal price and if the increments are large the internal price is zero however the relationship between the internal price and the capacity increment for intermediate cases is quite irregular to the extent that it is not possible to approximate the internal price with accounting data the analysis also suggests that full cost allocation overcharges for the opportunity cost of capacity furthermore the right internal price does not act either as a way of recovering fixed costs or as a proxy for externalities such as congestion costs the conclusions are not materially altered in the case where variable costs increase at the margin and where these costs rather than hard capacity constraints are the reason to restrict output

the environmental kuznets curve in the oecd 1870 2014 carbon dioxide co2 emissions play an important role in global warming consequently studying the relationship between co2 emissions and economic development is important especially when viewed from a historical perspective we test the environmental kuznets curve ekc hypothesis for a panel of 20 oecd nations dating back to the first globalization boom in the nineteenth century utilising recently developed panel data estimators that account for cross sectional dependence and parameter heterogeneity for the period 1870 to 2014 we find support for the ekc hypothesis for the panel as a whole with three of our preferred four estimators with turning points in income per capita that lie between 18 955 and 89 540 in 1990 us country specific results however only provide mixed support for the ekc hypothesis specifically we find evidence of an ekc for nine of the 20 countries with five exhibiting a traditional inverted u shaped relationship three exhibiting an n shaped relationship and one an inverted n shaped relationship

joint implications of consumption and tax smoothing in this paper the joint hypotheses of consumption and tax smoothing are shown to imply that the present value of expected proportionate declines in government non interest outlays is approximately equal to a log linear function of the budget deficit and private dissaving in this exact linear relation the budget deficit signals declines in future government outlays after controlling for prospective changes in the tax base private dissaving controls for such prospective changes since under the joint hypotheses the present value of expected proportionate rises in tax revenues are approximately equal to a log linear function of private dissaving both exact linear relations are tested in a var framework on annual post world war ii u s data we find considerable empirical support for the theory

cointegration in panel data with structural breaks and cross section dependence summary the power of standard panel cointegration statistics may be affected by misspecification errors if structural breaks in the parameters generating the process are not considered in addition the presence of cross section dependence among the panel units can distort the empirical size of the statistics we therefore design a testing procedure that allows for both structural breaks and cross section dependence when testing the null hypothesis of no cointegration the paper proposes test statistics that can be used when one or both features are present we illustrate our proposal by analysing the pass through of import prices on a sample of european countries copyright 2013 john wiley sons ltd

do economic financial and institutional developments matter for environmental degradation evidence from transitional economies abstract several studies have examined the relationship between environmental degradation and economic growth however most of them did not take into account financial developments and institutional quality moreover stern stern d 2004 the rise and fall of the environmental kuznets curve world development 32 8 1419 1439 noted that there are important econometric weaknesses in the earlier studies such as endogeneity heteroscedasticity omitted variables etc the purpose of this paper is to fill this gap in the literature by investigating the linkage between not only economic development and environmental quality but also financial development and institutional quality we employ the standard reduced form modelling approach to control for country specific unobserved heterogeneity and gmm estimation to control for endogeneity our study considers 24 transition economies and panel data for 1993 2004 our results support the ekc hypothesis while confirming the importance of both institutional quality and financial development for environmental performance we also found that financial liberalization may be harmful for environmental quality if it is not accomplished in a strong institutional framework

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

the interaction of population growth and environmental quality an important question for policy is whether holding constant per capita income and other relevant factors population pressures have a significant effect upon environmental degradation the authors examine the effect of population pressures upon deforestation in 64 developing countries in an attempt to provide relevant empirical findings data on deforestation were drawn from the food and agriculture organizations production yearbook results suggest that a relationship exists between per capita income and deforestation and that for africa rural population density shifts the relationship upward the increase in the rate of deforestation levels off as income increases the rate of growth in per capita income also has a significant negative impact upon deforestation although the magnitude of the effect is small the authors close in stressing that reducing the rate of population growth is not necessarily the best way to reduce the rate of deforestation deforestation in developing countries is really a problem of market failure since property rights are often neither defined nor enforced there is essentially no private cost of deforestation with no long term stake in the land people have no incentive to use land efficiently this situation must be addressed in conjunction with the problems of poverty and population growth

decoupling analysis and environmental kuznets curve modelling of provincial level co2 emissions and economic growth in china a case study abstract guangdong is one of the most representative provinces of china in terms of reflecting how the provincial level co2 emissions dynamically evolve with economic development during the process of industrialisation and urbanisation the present study combines decoupling analysis with environmental kuznets curve ekc modelling to systematically explore the interactions between co2 emissions and economic growth in guangdong from the short to long terms aiming to provide the referential significance of low carbon development to other chinese provinces empirical results indicate that co2 economy interactions in guangdong dynamically changed with time performing an effect of expansive weak decoupling during 1995 2014 and having a potential to achieve a strong decoupling in the long run the decoupling states of various sectors and their contributions to the provincial overall decoupling differed greatly and varied by time and household and service sectors played increasingly important roles overall the decoupling effect of provincial co2 emissions is distinctly affected by the stage of industrialisation and urbanisation renewable energy utilisation as well as low carbon technical progress therefore promoting co2 economy decoupling at the provincial level should be specific to the feature and development reality of various provinces

income and wealth heterogeneity in the macroeconomy how do movements in the distribution of income and wealth affect the macroeconomy we analyze this question using a calibrated version of the stochastic growth model with partially uninsurable idiosyncratic risk and movements in aggregate productivity our main finding is that in the stationary stochastic equilibrium the behavior of the macroeconomic aggregates can be almost perfectly described using only the mean of the wealth distribution this result is robust to substantial changes in both parameter values and model specification our benchmark model whose only difference from the representative agent framework is the existence of uninsurable idiosyncratic risk displays far less cross sectional dispersion and skewness in wealth than u s data however an extension that relies on a small amount of heterogeneity in thrift does succeed in replicating the key features of the wealth data furthermore this extension features aggregate time series that depart significantly from permanent income behavior

product line selection production decisions and allocation of common fixed costs abstract product costs are determined in practice for the purpose of pricing make buy and product line decisions while many costs are directly assignable to individual products common costs have historically presented a difficult conundrum a variety of cost allocation methods are used in practice or have been suggested in the literature to attach these costs to individual products while such procedures are theoretically unsupported they may be able to mimic the correct decisions adequately in this paper we investigate the efficacy of certain cost allocation schemes in a competitive environment the schemes are evaluated with reference to a scenario in which there is a single fixed cost incurred in manufacturing any subset of a set of products under idealized conditions a cournot nash model is developed that describes the number of entering firms and the equilibrium price and production levels using this as a point of reference it is shown that by using gross contribution as an allocation basis optimal product line decisions are achieved without distorting the selection of production levels moreover competitive pressure sufficient to drive total net profits close to zero is sufficient to require that any allocation rule supporting optimal product line decisions yields allocations nearly proportional to gross contributions an analogy is drawn with the allocation of joint costs to coproducts in a competitive environment and the corresponding allocation in proportion to net realizable value

welfare analysis of currency regimes with defaultable debts abstract we modify the cole and kehoe model by including domestic debt according to the original model a speculative attack on a high debt level issued abroad triggers external debt default here it is possible to inflate away the domestic debt to avoid the external debt default we consider two possibilities for domestic debt denomination i local currency and ii common currency in the second case inflation depends on a monetary union decision our numerical results show that to have a debt share denominated in a common currency is optimal when the refinancing risks are highly correlated across union members otherwise the best is to keep the domestic debt denominated in local currency finally the extreme case of having all debt issued abroad and denominated in a foreign currency is suitable when under alternative regimes suboptimal inflation motivated by political factors is likely although the paper was originally developed for emerging market economies it sheds some light on the recent eurozone crisis

re examining the environmental kuznets curve hypothesis in the economic community of west african states a panel quantile regression approach abstract this study investigates the validity of the environmental kuznets curve ekc hypothesis for six west african countries over 1970 2017 while using human capital and biocapacity as additional determinants of carbon emissions it uses the panel quantile regression method that provides robust results in case the classical econometric assumptions fail the empirical results revealed that a u shaped relationship between economic growth and carbon dioxide co2 emissions holds in the low middle and high emissions countries as opposed to the inverted u shaped ekc hypothesis trade openness reduces environmental performance in low emission countries financial development has mixed impacts on co2 emissions across the quantiles while financial development enhances environmental quality in the low emissions countries it exerts a detrimental impact in the middle and high emissions countries human capital has significantly positive effects on the lower middle and upper quantiles the obtained results highlight the need for raising environmental awareness and promoting green r d in addition relevant incentives are required to redirect private credits towards green projects and renewable energy development

aggregate production planning for process industries under oligopolistic competition abstract we consider a competitive version of the traditional aggregate production planning model with capacity constraints in the general case multiple products are produced by a few competing producers oligopoly with limited capacities production quantities prices and consequently profits depend on production and allocation decisions of each producer in addition there is competition for the raw material whose supplies are limited and where prices reflect these limitations such situations have recently occurred in several process industry settings including petro refining petrochemicals basic chemicals cement fertilizers pharmaceuticals rubber paper food processing and metals we use a successive bertrand cournot framework to address this problem and to determine optimal production quantities prices and profits at the producers and at the raw material supplier our analysis allows a new way to understand and evaluate the marginal value of additional capacity when there is competition for the market and raw materials

trade and environment an empirical analysis of the technology effect in the steel industry abstract the objective of this paper is to study the impact of free trade on global environmental quality by focusing on the technology effect that is the relationship between trade openness and the adoption diffusion of clean technologies the paper attempts to empirically verify the existence of the technology effect by looking at the relationship between trade policy regime or openness and the speed of clean technology diffusion in the steel industry focusing on a cleaner steel technology the electric arc furnace eaf in 30 steel producing countries over 25 years the results show that eaf technology is diffused faster in countries that have more open trade policy regimes thereby supporting the existence of the technology effect for the industry considered

fiscal discipline and the budget process the critical economic policy issue for many oecd countries developing countries and transition economies currently is fiscal consolidation and the maintenance of long run fiscal balance two related components underlie this general goal first several countries face the issue of deficit reduction particularly those countries with high debt gdp ratios second it is becoming increasingly apparent that major reforms of the welfare system and specifically of social security systems are critical ingredients of a long lasting fiscal consolidation see alesina and perotti 1995a in the case of monetary policy a constructive discussion has generated a widespread consensus about the benefits of different monetary institutions relatively few economists dispute the benefits of a certain amount of central bank independence even though different commentators and policymakers may disagree on the optimal degree of independence also a contracting approach has highlighted the benefit of inflation targeting and of certain institutional relationships contracts between the executive and the central bank a similar theoretical and empirical discussion on the role of budget procedures and budget institutions is just beginning in this paper we ask the following two questions i do budget procedures matter for the determination of the budget balance and its composition ii are there certain institutional reforms that one should feel comfortable in recommending based on the relatively scarce empirical evidence available we tentatively answer yes to the first question budget procedures matter on the second question we suggest that the two critical areas of reform are first more transparency second a strengthening of the roles of the executive branch vis a vis the legislature and of the treasury minister vis a vis the rest of the executive branch in order to achieve a centralized and top bottom approach to the budget process

optimal monetary policy optimal monetary policy maximizes the welfare of a representative agent given frictions in the economic environment constructing a model with two sets of frictions costly price adjustment by imperfectly competitive firms and costly exchange of wealth for goods we find optimal monetary policy is governed by two familiar principles first the average level of the nominal interest rate should be sufficiently low as suggested by milton friedman that there should be deflation on average yet the keynesian frictions imply that the optimal nominal interest rate is positive second as various shocks occur to the real and monetary sectors the price level should be largely stabilized as suggested by irving fisher albeit around a deflationary trend path since expected inflation is roughly constant through time the nominal interest rate must therefore vary with the fisherian determinants of the real interest rate although the monetary authority has substantial leverage over real activity in our model economy it chooses real allocations that closely resemble those which would occur if prices were flexible in our benchmark model there is some tendency for the monetary authority to smooth nominal and real interest rates

co2 emissions in australia economic and non economic drivers in the long run abstractaustralia has sustained a relatively high economic growth rate since the 1980s compared to other developed countries per capita co2 emissions tend to be highest amongst oecd countries creating new challenges to cut back emissions towards international standards this research explores the long run dynamics of co2 emissions economic and population growth along with the effects of globalization tested as contributing factors we find economic growth is not emission intensive in australia while energy consumption is emissions intensive second in an environment of increasing population our findings suggest australia needs to be energy efficient at the household level creating appropriate infrastructure for sustainable population growth high population growth and open migration policy can be detrimental in reducing co2 emissions finally we establish globalized environment has been conducive in combating emissions in this respect we establish the beneficial effect of economic globalization

short and long interest rate targets can both short and long term interest rates be targeted independently can the target of the term structure help solve the problem of multiplicity of equilibria that occurs when only the short rate is targeted both questions are addressed and the answer is yes to both

revisiting the concept of environmental kuznets curve in period of energy disaster and deteriorating income empirical evidence from japan this study investigates the position of the japanese environmental kuznets curve in period of natural disaster and deteriorating income following the recent fukushima energy crisis the study aim to establish whether the ekc exist in period of energy disaster and deteriorating income to ensure this data from 1961 to 2012 was used while the zivot andrew structural break test the ardl bounds test were applied and these were validated using the innovation accounting test the finding of the study established the existence of inverted u shape suggesting the presence of ekc despite the deteriorating income of the country with the discovery of the existence of ekc in this study despite the dwindling productivity and revenue in japan this study challenged the ekc hypothesis and all existing studies on ekc by establishing that natural disasters are in themselves strong causative agents for the ekc to unfold and it is immaterial whether the economic fortunes of a country is increasing or decreasing the study further discovered energy consumption to be the major contributor of environmental degradation in japan while exports declines co2 emissions but imports adds to environmental degradation on the growth prospects of the japanese economy after the crisis the study discovered how energy consumption exports and imports contribute 33 55 1 027 and 7 126 to the country s economic growth respectively in return a minimum of 16 24 23 89 and 44 18 of co2 emissions was discovered the study proposed policy instruments that will help in realizing a balanced environment amidst efficient energy consumption and environmental management among others

energy innovations ghg emissions nexus fresh empirical evidence from oecd countries abstract this study explores the impact of improvements in energy research development erd on greenhouse gas ghg emissions using environmental kuznets curve hypothesis for 28 oecd countries over the period of 1990 2014 in doing so we have employed a panel data where public budget in energy research development and demonstration erd d has transformed into a finite inverted v lag distribution model developed by de leeuw 1962 this model considers that energy innovation accumulates in time and presents empirical evidence how energy innovation contributes in reducing energy intensity and environmental pollution as well our results indicate that energy innovation measures require lapses of time to reach their full effect i e innovation applied to measures for environmental correction does not reach its whole effect immediately requiring instead a certain amount of time to pass innovation policies have recommended for improving environmental quality

a theory of market structure with sequential entry this article sets out a theory of market structure with sequential entry we characterize the perfect nash equilibrium to the entry game in several propositions first equilibria never involve excess capacity second a sufficient statistic for the entry of any firm is that its profits are positive when computed myopically i e with no further entry third the equilibrium number of firms is the smallest number that can deter entry fourth aggregate output in equilibrium is no smaller than the limit output we calculate some explicit solutions to the model and examine comparative static properties

on the optimal taxation of capital income abstract we show that in models in which labor services are supplied jointly with human capital the chamley and judd result on zero capital income taxation in the limit extends to labor taxes as long as accumulation technologies are constant returns to scale moreover for a class of widely used preferences consumption taxes are zero in the limit as well however we show by the construction of two examples that these results no longer hold for certains types of restrictions on tax rates or if there are profits generated journal of economic literatureclassification numbers e62 h21

game theory and cost allocation problems problems of allocating joint costs in a reasonable way arise in many practical situations where people decide to work together to save costs cost allocation methods based on game theoretical concepts take into account the strategic aspects of cost allocation situations we give a survey of cost allocation methods based on the nucleolus and the shapley value and introduce also a new one the so called cost gap allocation method which is based on the i value it is shown that for some large subclasses of cost allocation problems this new cost allocation method coincides with old separable cost methods proposed in the thirties by the tennessee valley authority and also with the separable costs remaining benefits scrb method properties of this cost gap allocation method are also treated

competitive location production and market selection abstract this paper investigates how firms should select their production sites capacities and quantities under rivalry there are assumed to be a finite number of discrete potential location sites and a finite number of discrete markets which may or may not coincide firms first decide either simultaneously or sequentially whether and where to establish a production site the fixed cost of opening a facility and the marginal cost of production both depend on where the facility is located firms then choose capacity and a production quantity for each market prices in each market are determined by the total quantity available at that location via the cournot mechanism this formulation thus addresses multi market oligopolistic spatial competition with heterogeneity in production and logistics costs we then analyze the nash equilibria of the entry game and provide sufficient conditions for the existence of equilibria in the simultaneous entry game at equilibrium firms may not produce for all markets and may have limited market areas however these areas may overlap so that there are multiple suppliers in any market in general there may not be a first mover advantage and early entrants may earn lower profits than later entrants

the long run relationship between co2 emissions and economic activity in a small open economy uruguay 1882 2010 abstract the long term relationship between carbon dioxide co 2 emissions from energy use and economic activity level is estimated for uruguay between 1882 and 2010 we include co 2 emissions both in levels and in per capita terms which allows to analyze if a decoupling exists both in absolute and in relative terms we also test for the functional form of the relationship something that is usually missed in the literature but which is very relevant because a misspecification could lead to biased estimates we apply cointegration techniques and estimate a vector error correction model vecm for testing whether these variables are endogenous over the long term while also considering the short term dynamics the economic productive structure the degree of openness and the share of clean sources in the total energy supply are also considered as explanatory variables in addition other variables that measure changes in the economic structure are included to check for robustness of the estimates the results show that there is a linear relationship when a log log transformation is employed between co 2 emissions and per capita economic activity level which would involve an exponential relationship between the non transformed variables moreover we cannot reject the level log model indicating that emissions increase at a decreasing rate in reference to the increase in economic level activity emissions increase jointly with the industrial sector s participation in the total output as a consequence of the intensity of this activity in the consumption of energy from fossil fuel sources the degree of openness is inversely related to co 2 emissions this is because the periods of major opening were based on primary input exports which are lower in energy intensity than industrial products the changes in co 2 emission are inversely related to the variation in the share of clean sources in the total energy supply finally all the variables included in the cointegration vector are endogenous adjusting together to the deviations from the long term relationship as a consequence of the above economic growth appears not to be enough for diminishing uruguayan emissions in the long term changes in the energy matrix should be encouraged and emissions reduction should come not through energy constraints but through the development of clean sources or improvements in energy use efficiency given the impact of energy on the economic activity level

pooled mean group estimation of an environmental kuznets curve for co2 abstract we apply the pooled mean group estimator to test for the existence of an environmental kuznets curve for co2 in 22 oecd countries this approach allows for more flexible assumptions in a panel data framework the period goes from 1975 to 1998

credible commitment and exchange rate stability canada s interwar experience in 1929 the canadian government floated the exchange rate which stayed at parity with sterling until 1931 when the canadian dollar appreciated with respect to sterling and depreciated with respect to the u s dollar this paper uses barro and gordon s reputation theory to explain the stability of the canadian dollar before 1931 and the subsequent depre ciation appreciation econometric analysis is then used to support the argument that between 1931 and 1933 the level of the exchange rate was determined by expectations of a return to parity with either sterling or the u s dollar

income fluctuation and asymmetric information an example of a repeated principal agent problem we examine a simple repeated principal agent model with discounting there are a risk averse borrower with an unobservable random income and a risk neutral lender the efficient contract is characterized it tends to the first best constant consumption contract as the discount factor tends to one and the time horizon extends to infinity if the time horizon is infinite and the contract is legally enforceable the borrower s utility becomes arbitrarily negative with probability one if the borrower has constant absolute risk aversion consumption is transferred between any two states at a constant interest rate which is less than the rate of time preference

the environmental kuznets curve does one size fit all abstract this paper uses a new panel data set on state level sulfur dioxide and nitrogen oxide emissions from 1929 1994 to test the appropriateness of the one size fits all reduced form regression approach commonly used in the environmental kuznets curve literature empirical results provide initial evidence that an inverted u shape characterizes the relationship between per capita emissions and per capita incomes at the state level parameter estimates suggest however that previous studies which restrict cross sections to undergo identical experiences over time may be presenting statistically biased results

theory of tax smoothing in the small open economy abstract we derive necessary and sufficient conditions for the martingale like behavior of tax rates the world real interest rate is exogenous to the small domestic economy consumers are risk averse and markets are incomplete the government s loss function is not ad hoc

revisiting the relation between economic growth and the environment a global assessment of deforestation pollution and carbon emission abstract the un s sustainable development goals for 2030 aim on one hand at inclusive growth and eradicating poverty and on the other at preserving environments the relation between development and the environment has been studied extensively since the 1990s documenting inverted u shaped relations between per capita income and indicators of environmental degradation this paper revisits the issue with machine learning techniques and novel disaggregate data to model these relationships heterogeneously across economic indicators results suggest that development gradually improves the efficiency of consuming the earth s nonrenewable resources but increased efficiency alone is not sufficient to offset growth in scale development shifts reliance on one nonrenewable source to another and on average we find successive inverted u shapes in deforestation air pollution and carbon intensities followed by a j shape in per capita carbon output local economic circumstances further determine the shape amplitude and location of tipping points in environmental output the general implications of the estimated dynamics are explored by extrapolating environmental output to 2030 under simplistic scenario s the results are a reminder that immediate and sustained global efforts are required to preserve our environment