title: Agglomeration elasticities and firm heterogeneity

authors: Maré, David C.

subjects: agglomeration

abstract: This paper examines three key issues encountered when estimating the relationship between agglomeration and multi factor productivity ('agglomeration elasticities'): the sorting of heterogeneous firms, the convexity of agglomeration effects, and the challenges of identifying the impact of persistent spatial differences in effective density. We use a firm-level panel containing production data together with detailed information on the geographic location of employment, covering a high proportion of the New Zealand economy. We are able to control for heterogeneity along firm, region, and industry dimensions, and to estimate separate agglomeration elasticities across industries and regions. Sorting leads to upward biased elasticity estimates but using firm fixed effects can lead to downward bias due to the highly persistent nature of agglomeration variables. Our preferred estimates control for sorting across regions and industries. Overall, we find a positive agglomeration elasticity of 0.066. Within industries and, to a lesser extent within regions, there is pronounced variation in the strength of agglomeration effects, and evidence of decreasing returns to agglomeration. High density areas attract firms that benefit most from agglomeration.

text: Agglomeration elasticities and firm heterogeneity This paper examines three key issues encountered when estimating the relationship between agglomeration and multi factor productivity ('agglomeration elasticities'): the sorting of heterogeneous firms, the convexity of agglomeration effects, and the challenges of identifying the impact of persistent spatial differences in effective density. We use a firm-level panel containing production data together with detailed information on the geographic location of employment, covering a high proportion of the New Zealand economy. We are able to control for heterogeneity along firm, region, and industry dimensions, and to estimate separate agglomeration elasticities across industries and regions. Sorting leads to upward biased elasticity estimates but using firm fixed effects can lead to downward bias due to the highly persistent nature of agglomeration variables. Our preferred estimates control for sorting across regions and industries. Overall, we find a positive agglomeration elasticity of 0.066. Within industries and, to a lesser extent within regions, there is pronounced variation in the strength of agglomeration effects, and evidence of decreasing returns to agglomeration. High density areas attract firms that benefit most from agglomeration.

year: 2013

title: Optimal dynamic regulation of the environmental impact of mining across diverse land types

authors: Doole, Graeme J.

subjects: non-renewable resources

abstract: Optimal dynamic regulation of mineral extraction and environmental rehabilitation across diverse land assets is studied using discrete-time, distributed optimal control. An extension of Hotelling's Rule is derived that indicates the need to manage both processes over space and time to maximise social welfare. Key empirical insights are drawn from a case study involving the Western Australian mineral sands industry. The incorporation of temporal and spatial dimensions allows for greater precision in the analysis of alternative management strategies. However, numerical analysis shows that optimal regulation may not require information-intensive tax instruments if abatement occurs in the year that land is damaged. Rather, a tax that is constant across time or space that provides a sufficient incentive for firms to rehabilitate degraded land can suffice. Bond instruments are shown unequivocally to provide too weak an incentive for timely rehabilitation by mining firms.

text: Optimal dynamic regulation of the environmental impact of mining across diverse land types Optimal dynamic regulation of mineral extraction and environmental rehabilitation across diverse land assets is studied using discrete-time, distributed optimal control. An extension of Hotelling's Rule is derived that indicates the need to manage both processes over space and time to maximise social welfare. Key empirical insights are drawn from a case study involving the Western Australian mineral sands industry. The incorporation of temporal and spatial dimensions allows for greater precision in the analysis of alternative management strategies. However, numerical analysis shows that optimal regulation may not require information-intensive tax instruments if abatement occurs in the year that land is damaged. Rather, a tax that is constant across time or space that provides a sufficient incentive for firms to rehabilitate degraded land can suffice. Bond instruments are shown unequivocally to provide too weak an incentive for timely rehabilitation by mining firms.

year: 2006

title: The hydrodynamic evolution of the Maketū Estuary after the re-diversion of the Kaituna River

authors: Razzaghi, Mojgan

abstract: The Maketū Estuary and lower Kaituna River located in the Bay of Plenty, Aotearoa, New Zealand have undergone anthropic disturbances since late 1800s, including land reclamation, river diversion and re-diversion, and modifications to the river channels and estuary tidal inlet. This has resulted in estuarine degradation, as is a common issue worldwide. Globally different approaches to estuary restoration have aimed at mitigating the adverse impacts of estuarine degradation.  However, there are still gaps in restoration frameworks and how the success of the scheme is evaluated that mean there is no ready-made solution to the issues at Maketū.
This thesis examines the important role of the hydrodynamic processes (including water quality) that govern the overall physical response of Maketū Estuary to two stages of partial re-diversion of the Kaituna River into the estuary. The assessment of this physical response highlighted the necessity of a proper framework in which restoration attempts, such as at Maketū are evaluated.
Field time series data were collected before and after two stages of river re-diversion, Stage 1 in 2020 and Stage 2 in 2021, each over a span of a month, to record the immediate response of the estuary to the added freshwater flows. Freshwater flow into the estuary was constrained to approximately 4 hours during flood tides when the water level In the Kaituna River was at least 40 mm higher than the upper Maketū Estuary. The control gates also operate as a flood control scheme, so they remain shut if there is flood risk causing all the flood volume to discharge directly to the sea through Te Tumu Cut river mouth. 
The field data were obtained using Aquadopp ADPs, RBR Maestros, RBR Concertos, and Solinst water level loggers at seven different sites throughout the estuary and the Kaituna River. A hydrographic survey of the estuary using RTK-GNSS was undertaken and combined with LiDAR to produce a bathymetric map of the estuary and Lower Kaituna River. Comparison of this map to previous compilations showed that the tidal inlet and lower estuary have not undergone major changes since the original river diversion in 1958, apart from an expansion in the area occupied by the flood tidal delta. However, the upper estuary has undergone both artificial and natural changes, including construction of artificial channels, causeways and reclamation, which have influenced the flow regime, circulation patterns and the flushing ability of the upper estuary. 
Based on field observations, the freshwater inflow to the estuary during Stage 1 was higher than Stage 2 even though Stage 1 was a partial re-diversion restricted to 400,000 m3 per flood tide, compared to the maximum 600,000 m3 for Stage 2. There was great spatial variability in the response of the estuary to the added freshwater flow despite the estuary’s small size and lack of inter-tidal vegetation. To better isolate the impact of freshwater flow and eliminate variables such as spring/neap tidal events, rainfall and wind, all of the data were averaged over a semi-diurnal tidal cycle of 12.4 hours. There was an increase in mean water level after both stages. Flow in the mid and upper estuary shifted towards ebb-dominance after Stage 1, but no further shift to ebb-dominance was observed after Stage 2. Mean bottom salinity increased in the upper estuary while it decreased everywhere else after Stage 1. Mean bottom salinity reduced uniformly throughout the estuary after Stage 2, most likely due to higher rainfall rate during the monitoring period, and not the added freshwater flow.
To better understand the mixing patterns within the estuary, Estuarine Richardson number (R_iE) was calculated at 3 main sites before and after both stages of re-diversion. R_iE increased after Stage 1, but not sufficiently to cause a shift in classification; therefore, the estuary remained partially-mixed. Current dynamics within the estuary varied depending on proximity to the tidal inlet, with sites close to the inlet showing a strong tidal signal, and the ones near the control gates showing a decreased tidal influence and an increased response to freshwater inflows during flood tide when the control gates were open. Surface currents were influenced by strong winds during storm events and dictated the mixing (stratification) in the mid and upper shallow estuary. However, it was difficult to assess the significance of these changes in relation to the community aspirations for the re-diversion and estuarine restoration as there were insufficient quantitative or qualitative targets defined.
To complement the field observations and better evaluate the impact of alternative restoration options, a 2D numerical model of the estuary was developed using Delft3D. After successfully being calibrated and validated, Delft3D-FLOW and PART were used to simulate different scenarios to assess the flow regime and flushing ability of the estuary. The scenarios included Stage 1 re-diversion, river inflow flow without control gates; and a pulsed flood flow using control gates that imitated natural flood events. Particle tracking was used determine the residence time across the estuary, and assess within which zones decay rate changed with tidal fluctuations, and which zones were sheltered from the tidal fluctuations. Model results showed that the pulsed flood scenario created the optimal conditions for sediment transport, increased flushing ability, and reduced salinity throughout the estuary. The model results also highlighted differences in how various zones in the estuary responded to the added freshwater flow, further emphasising the need to monitor them separately with an improved monitoring framework.
The results of this study have led to a better understanding of the impact of added freshwater flow on estuarine hydrodynamics and water quality: specifically how the river input moves the boundaries of fluvially or tidally dominated, and mixing zones. The most vulnerable zones in terms of the flushing ability under different scenarios of freshwater restoration were also identified. This study also highlighted the importance of setting tangible targets in the restoration scheme in alignment with the environmental uncertainties such as the average river flow and limitations due to flooding issues in the upper catchment.

text: The hydrodynamic evolution of the Maketū Estuary after the re-diversion of the Kaituna River The Maketū Estuary and lower Kaituna River located in the Bay of Plenty, Aotearoa, New Zealand have undergone anthropic disturbances since late 1800s, including land reclamation, river diversion and re-diversion, and modifications to the river channels and estuary tidal inlet. This has resulted in estuarine degradation, as is a common issue worldwide. Globally different approaches to estuary restoration have aimed at mitigating the adverse impacts of estuarine degradation.  However, there are still gaps in restoration frameworks and how the success of the scheme is evaluated that mean there is no ready-made solution to the issues at Maketū.
This thesis examines the important role of the hydrodynamic processes (including water quality) that govern the overall physical response of Maketū Estuary to two stages of partial re-diversion of the Kaituna River into the estuary. The assessment of this physical response highlighted the necessity of a proper framework in which restoration attempts, such as at Maketū are evaluated.
Field time series data were collected before and after two stages of river re-diversion, Stage 1 in 2020 and Stage 2 in 2021, each over a span of a month, to record the immediate response of the estuary to the added freshwater flows. Freshwater flow into the estuary was constrained to approximately 4 hours during flood tides when the water level In the Kaituna River was at least 40 mm higher than the upper Maketū Estuary. The control gates also operate as a flood control scheme, so they remain shut if there is flood risk causing all the flood volume to discharge directly to the sea through Te Tumu Cut river mouth. 
The field data were obtained using Aquadopp ADPs, RBR Maestros, RBR Concertos, and Solinst water level loggers at seven different sites throughout the estuary and the Kaituna River. A hydrographic survey of the estuary using RTK-GNSS was undertaken and combined with LiDAR to produce a bathymetric map of the estuary and Lower Kaituna River. Comparison of this map to previous compilations showed that the tidal inlet and lower estuary have not undergone major changes since the original river diversion in 1958, apart from an expansion in the area occupied by the flood tidal delta. However, the upper estuary has undergone both artificial and natural changes, including construction of artificial channels, causeways and reclamation, which have influenced the flow regime, circulation patterns and the flushing ability of the upper estuary. 
Based on field observations, the freshwater inflow to the estuary during Stage 1 was higher than Stage 2 even though Stage 1 was a partial re-diversion restricted to 400,000 m3 per flood tide, compared to the maximum 600,000 m3 for Stage 2. There was great spatial variability in the response of the estuary to the added freshwater flow despite the estuary’s small size and lack of inter-tidal vegetation. To better isolate the impact of freshwater flow and eliminate variables such as spring/neap tidal events, rainfall and wind, all of the data were averaged over a semi-diurnal tidal cycle of 12.4 hours. There was an increase in mean water level after both stages. Flow in the mid and upper estuary shifted towards ebb-dominance after Stage 1, but no further shift to ebb-dominance was observed after Stage 2. Mean bottom salinity increased in the upper estuary while it decreased everywhere else after Stage 1. Mean bottom salinity reduced uniformly throughout the estuary after Stage 2, most likely due to higher rainfall rate during the monitoring period, and not the added freshwater flow.
To better understand the mixing patterns within the estuary, Estuarine Richardson number (R_iE) was calculated at 3 main sites before and after both stages of re-diversion. R_iE increased after Stage 1, but not sufficiently to cause a shift in classification; therefore, the estuary remained partially-mixed. Current dynamics within the estuary varied depending on proximity to the tidal inlet, with sites close to the inlet showing a strong tidal signal, and the ones near the control gates showing a decreased tidal influence and an increased response to freshwater inflows during flood tide when the control gates were open. Surface currents were influenced by strong winds during storm events and dictated the mixing (stratification) in the mid and upper shallow estuary. However, it was difficult to assess the significance of these changes in relation to the community aspirations for the re-diversion and estuarine restoration as there were insufficient quantitative or qualitative targets defined.
To complement the field observations and better evaluate the impact of alternative restoration options, a 2D numerical model of the estuary was developed using Delft3D. After successfully being calibrated and validated, Delft3D-FLOW and PART were used to simulate different scenarios to assess the flow regime and flushing ability of the estuary. The scenarios included Stage 1 re-diversion, river inflow flow without control gates; and a pulsed flood flow using control gates that imitated natural flood events. Particle tracking was used determine the residence time across the estuary, and assess within which zones decay rate changed with tidal fluctuations, and which zones were sheltered from the tidal fluctuations. Model results showed that the pulsed flood scenario created the optimal conditions for sediment transport, increased flushing ability, and reduced salinity throughout the estuary. The model results also highlighted differences in how various zones in the estuary responded to the added freshwater flow, further emphasising the need to monitor them separately with an improved monitoring framework.
The results of this study have led to a better understanding of the impact of added freshwater flow on estuarine hydrodynamics and water quality: specifically how the river input moves the boundaries of fluvially or tidally dominated, and mixing zones. The most vulnerable zones in terms of the flushing ability under different scenarios of freshwater restoration were also identified. This study also highlighted the importance of setting tangible targets in the restoration scheme in alignment with the environmental uncertainties such as the average river flow and limitations due to flooding issues in the upper catchment.

year: 2023