Future King of England talks "environmental economics"

Has Price Charles been sneaking into Environmental Economics 101 lectures?

He actually uses the word "economic" and demonstrates some decent joined up thinking.

"...a new economic model must be found because the Earth can no longer support the demands of a growing "consumerist society" where growth is an end in itself."

Time to wheel out the theorists. He could do worse than reading Copeland and Taylor's Green Solow paper.

Nature Can't Take Unrestrained Economic Growth: Prince Charles [PlanetArk]

LONDON - The quest for unlimited economic growth is unsustainable and could bankrupt the environment through climate change and depleted natural resources, Britain's Prince Charles said Wednesday.

Charles, next-in-line to succeed Queen Elizabeth, said a new economic model must be found because the Earth can no longer support the demands of a growing "consumerist society" where growth is an end in itself.

People must realize they are not "the masters of creation," rather just one part of a fragile natural world, he added.

"Just as our banking sector is struggling with its debts... so Nature's life-support systems are failing to cope with the debts we have built up there too," Charles said at a BBC lecture at St James's Palace in central London.

"If we don't face up to this, then Nature, the biggest bank of all, could go bust.

"That is the challenge we face, it seems to me -- to see Nature's capital and her processes as the very basis of a new form of economics."

Charles, the former husband of the late Princess Diana, has long campaigned on the environment.

His own farm went organic in the 1980s, he publishes details of his estate's annual carbon emissions and has developed a sustainable village in western England called Poundbury.

"Our ability to adapt to the effects of climate change...depends on us adapting our pursuit of unlimited economic growth to that of sustainable growth," he said.

While conceding that industrialization had brought benefits such as better education, prosperity and higher life expectancy, the future king said that progress had come at a price.

Consumption has grown so much in the last 30 years that demands on natural resources now exceed the planet's capacity for renewal by a quarter each year, he added.

By 2050, the world's population will swell to about 9 billion people, from more than 6 billion currently, and a higher proportion will expect Western levels of consumption.

Modern farming methods that use fertilizers and pesticides that have helped feed a growing population have taken a "huge and unsustainable" toll on ecosystems, he added.

"Our current model of progress was not designed of course to create all this destruction," Charles said. "However, given the overwhelming evidence from so many quarters, we have to ask ourselves if it any longer makes sense or whether it is actually fit for purpose."

Economic growth has failed to end poverty, stress, ill health and social tensions, he added. A reformed economy must give more weight to the environment and local communities.

Incentives and Mosquitos

I have always wondered whether anti-virus software detection companies employ hundreds of people to write virus' so that customers then have to buy and renew ant-virus software. If not, why not (apart from the moral issue).

News from Sri Lanka at least shows such perverse incentives exist this time for mosquitoes.

Mosquito Repellent Firm In Dock For Mosquito Breeding [PlanetArk]

COLOMBO - A Sri Lankan court threatened a mosquito repellent factory manager with six months in jail for failing to destroy mosquito breeding areas on company premises to stop the spread of dengue fever, an official said Tuesday.

The Indian Ocean island nation is battling an outbreak of the mosquito-borne viral infection that has killed more than 150 people this year and infected 13,479 people, according to Health Ministry figures.

"The court fined the superintendent of a mosquito coil company for failing to destroy mosquito breeding places after we found larvae in several empty cans inside the premises," said Rohana De Silva, Attagalla public health inspector.

The court Monday fined the superintendent 1,500 rupees ($13) and imposed a suspended sentence of six months hard labor, which can be reinstated if the company does not keep its premises free of breeding grounds, De Silva said.

To fight the spread of dengue, police and health officials have started a campaign to destroy mosquito breeding grounds through insecticide spraying and the removal of standing fresh water from public and private property.

Those who do not comply face fines and punishments including imprisonment.

Sri Lanka's public health infrastructure and services suffered during a quarter-century war with Tamil Tiger separatists, when the health budget was cut to help bear the cost of fighting. The government declared victory on May 18.

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Waxman-Markey - Stavins summarises

I appear to have missed some serious climate change action over the pond.

Stavins provides a good overview of what actually happened. It is a good start.

National Climate Change Policy: A Quick Look Back at Waxman-Markey and the Road Ahead[Belfer Centre]

Like any legislation, the Waxman‑Markey bill has its share of flaws, but its cap-and-trade system has medium and long‑term targets for reducing greenhouse gas emissions that are sensible, and the cap‑and‑trade system is — for the most part — well designed. With some exceptions, the bill’s cap‑and‑trade system will achieve meaningful reductions of carbon dioxide and other greenhouse gas emissions at minimal cost to the economy.

There has been much lamenting about the corporate give-away in the bill, but this is unfounded, as I explained in detail in my May 27th post on The Wonderful Politics of Cap-and-Trade: A Closer Look at Waxman-Markey. Concerns have also been expressed — such as by a number of Republican members of Congress during last Friday’s floor debate in the House of Representatives — about negative impacts on the international competitiveness of U.S. firms. The only real solution to the international competitiveness issue in the long term is to bring non‑participating countries within an international climate regime in meaningful ways. (On this, please see the work of the Harvard Project on International Climate Agreements.) But that solution is fundamentally outside of the scope of the domestic policy action of any individual nation, including the United States.

In the meantime, the Waxman‑Markey approach of combining output‑based updating allocations in the short term for select sectors with the option in the long term of a Presidential determination (under stringent conditions) for import allowance requirements for specific countries and sectors was sensible and pragmatic (see my June 18th post on Worried About International Competitiveness? Another Look at the Waxman-Markey Cap-and-Trade Proposal).

That’s the good news. But the bad news is that last-minute changes in the bill changed what was a Presidential option regarding long-term back-up border adjustments (tariffs) to a requirement that the President put such tariffs in place under specified conditions. This moved the legislation considerably closer to risky protectionism, as President Obama rightly noted in comments to the press on Sunday.

Also, the compromise amendments with the House agriculture committee that provide for generous numbers of potential offsets from the agricultural sector (regulated not by EPA, but by USDA!) are troubling — not in terms of driving up compliance costs, but in terms of reducing the real environmental performance of the system. This is because of the general problem of limited additionality of claimed reductions under offset (or emission-reduction-credit) systems, as opposed to cap-and-trade systems, plus the well-known difficulties of measuring non-point emissions, let alone emissions reductions, from agriculture.

These and other design issues will be important topics when the Senate takes up its own climate legislation, although the debate in that body on some of these issues will likely be quite different. For example, there is likely to be more interest in the Senate in the use of a “price collar,” a mechanism to constrain both the maximum and the minimum market price of allowances over time. This would be a move beyond the safety-valve mechanism that is provided in the House legislation.

When the action moves to the Senate, the greatest attention and the greatest skepticism should be directed not to the cap‑and‑trade mechanism, which is — for the most part — well designed in Waxman‑Markey, but rather to other elements of the legislation, some of which are highly problematic. While the titles of Waxman‑Markey that create the cap‑and‑trade system are ‑‑ on balance ‑‑ sensible, and will result in meaningful emissions reductions cost effectively, the other titles of the bill include a host of conventional standards and subsidies, many of which (under the cap‑and‑trade umbrella) will have minimal or no environmental benefits, but will limit flexibility and thereby have the unintended consequence of driving up compliance costs. That’s the soft under‑belly of this legislation that needs to be selectively, surgically repaired.

It is the fault of economists — myself included — that we have given so much attention to the cap-and-trade system that we have ignored these other important elements of the legislation, elements that unfortunately can degrade significantly the cost-effectiveness of the package while providing little if any incremental benefits to the environment. Even the Congressional Budget Office, in its excellent economic analysis of HR 2454, focused exclusively on the bill’s cap-and-trade program. Going forward, CBO, EPA, and independent analysts need to examine the bill’s other elements, and assess what those elements provide at what incremental cost.

A broader question — also raised by House Republicans in the floor debate — is whether the United States should be moving towards the enactment of a domestic climate policy before a sensible, post‑Kyoto international agreement has been negotiated and ratified. Such an international agreement should include not only the countries of the industrialized world, but also the key, rapidly‑growing economies of the developing world ‑‑ China, India, Brazil, Korea, Mexico, South Africa, and Indonesia ‑‑ which are and will increasingly be major contributors to emissions.

It’s natural for such a question to be raised about the very notion of the U.S. adopting a policy to help address what is fundamentally a global problem. The environmental benefits of any single nation’s reductions in greenhouse gas emissions are spread worldwide, unlike the costs. This means that for any single country, the costs of action will inevitably exceed its direct benefits, despite the fact that the global costs of action will be less than global benefits. This is the nature of a global commons problem, and this is the very reason why international cooperation is required.

The U.S. is now engaged in international negotiations, and the credibility of the U.S. as a participant, let alone as a leader, in shaping the international regime is dependent upon our demonstrated willingness to take actions at home.

Europe has put its climate policy in place, and Australia, New Zealand, and Japan are moving to have their policies in place within a year. If the United States is to play a leadership role in international negotiations for a sensible post‑Kyoto international climate regime, the country must begin to move towards an effective domestic policy ‑ with legislation that is timed and structured to coordinate with the emerging post‑Kyoto climate regime.

Without evidence of serious action by the U.S., there will be no meaningful international agreement, and certainly not one that includes the key, rapidly‑growing developing countries. U.S. policy developments can and should move in parallel with international negotiations.

So, the Waxman‑Markey bill has its share of flaws, but it represents a reasonable starting point for Senate deliberation on what can become a national climate policy that will place the United States where it ought to be -‑ in a position of international leadership to help develop a global climate agreement that is scientifically sound, economically rational, and politically acceptable to the key nations of the world.

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"environmentally induced migration"

Apologies for the lay off from blogging - academia can be a tough taskmaster.

I have no doubt that climate change induced migration is on the rise and will cause significant tensions across the globe. The Economist provide a nice introduction. Academics will follow.

I predict a value closer to the top end of estimates - 700m by 2050.

This article is "classic" journalism. Keep it personal about a small tribe in a small region and they go global with the dull science stuff.

Lovelock stars yet again - now we are talking:

James Lovelock, an environmental guru, posits a collapse in human population, in part related to migration, with a few “lifeboat” regions surviving.

Here is the article in full.

A new (under) class of travellers [Economist]

THE airstrip at Lokichoggio, in the scorched wastes of north Kenya, was once ground zero for food aid. During Sudan’s civil war, flights from here kept millions of people alive. The warehouses are quieter now, but NGOs keep a toehold, in case war restarts—and to deal with what pundits call the “permanent emergency” of “environmentally induced” migration.

Take the local Turkana people. Their numbers have surged in recent decades, and will double again before 2040. But as the area gets hotter and drier, it has less water, grazing and firewood. The drought cycle in northern Kenya has gone from once every eight years to every three years and may contract further. That means no recovery time for the Turkana and their livestock; the result is an increasingly frantic drift from one dry place to another.

A local crisis with local causes? Only partly. Scientists think it is part of a global phenomenon: people across the world on the move as a result of environmental degradation. Just how many are moving, or about to move, is maddeningly unclear.

The International Organisation for Migration thinks there will be 200m climate-change migrants by 2050, when the world’s population is set to peak at 9 billion. Others put the total at 700m.

These startling numbers may conjure up a picture of huge, desperate masses, trekking long distances and if necessary overrunning border defences because their homelands have dried up or been submerged. But at least initially, the situation in Kenya and other parts of east Africa is likely to be more typical: an already poor population whose perpetual search for adequate pasture and shelter grows harder and harder. In such conditions, local disputes—even relatively petty ones between clans and extended families—can easily worsen, and become embroiled in broader religious or political fights. And that in turn makes it harder for everybody in the area to survive, and more desperate to find new places to live, even if they are not far away.

A new report—“In Search of Shelter”—by the United Nations University, the charity CARE and Columbia University in New York lists the eco-migration “hot spots”: dry bits of Africa; river systems in Asia; the interior and coast of Mexico and the Caribbean; and low islands in the Indian and Pacific Oceans.

A one-metre rise in sea levels could displace 24m people along the Ganges, Brahmaputra, Irrawaddy, Salween, Mekong, Yangtze and Yellow rivers—which together support a quarter of humanity. A two-metre rise could uproot 14m people on the Mekong alone and swamp much of its farmland. Meanwhile, the melting of the Himalayan glacier will cause floods and erosion upstream, boosting the price of rice and other staples. And many regional conflicts could be exacerbated.

The scale of the likely population shift raises big questions. Will climate-change migrants be recognised? The classic definition of refugees—tossed between states by war or tyranny—is outdated. Eco-migrants will be paperless paupers, whose multiple woes are hard to disentangle.

Poverty campaigners want a revised legal regime to protect the new migrants. However, this looks tricky. America resists calling them “environmental refugees”: the word “refugee” implies guarantees that cannot realistically be given to the coming torrent of migrants. As American diplomats quietly admit, their rich country is still reeling from Hurricane Katrina in 2005, which killed 1,800 people and displaced hundreds of thousands.

Can the United Nations High Commissioner for Refugees (UNHCR) expand to cope with eco-migrants? It has already struggled to widen its remit to include the internally displaced (26m at the end of 2008) as well as strictly-defined refugees (10m, excluding the Palestinians who come under another agency). A tenfold surge in the numbers within its orbit would push the agency out of control, says James Milner, a professor at Ottawa’s Carleton University. Meanwhile some aid workers see signs of a competition between institutions to take ownership of the eco-migration issue, perhaps by oversimplifying it.

Charles Ehrhart of CARE thinks UNHCR will remain central, but wonders how it or anybody can now distinguish between “forced” and “voluntary” migration. He says climate change may cut agricultural output by half in lowland Africa by 2020. “In such a context, does migration constitute a choice or a necessity?”

Migrants’ rights may be easy to assert for islanders whose homes are drowned—but hard in the case of big, messy movements across Africa and Asia. Most of the displaced will drift to the next-most-liveable place, as the poor do anyway.

“Many states are already overwhelmed by internally displaced populations,” says Mr Ehrhart. “Will they be able to support even more people on the move? If not, whose duty is it to make up the difference?”. At the least, the gap between carbon usage and climate change’s effects portends angry North-South rows.

Meles Zenawi, who as Ethiopia’s prime minister will speak for Africa at several global gatherings this year, predicts that some parts of the continent will become uninhabitable and “those who did the damage will have to pay.” At the December summit on climate change in Copenhagen, he hopes that Africa will “aggressively” demand compensation for environmental damage as well as help with migrants and the mitigation of climate change: in his view a demand of $40 billion would be reasonable.

Many agree that more research is needed to pinpoint the reasons why migrants pick up sticks. People concur that climate change fuels conflict in Darfur, but nobody knows how big a factor it is. Drought helped jihadist fighters seize bits of south Somalia, but was it the main reason?

Gloom abounds. James Lovelock, an environmental guru, posits a collapse in human population, in part related to migration, with a few “lifeboat” regions surviving. Then there is the pace of social change. The number of “megacities”—with populations in the tens of millions—may grow to several hundred by the middle of the 21st century. Most are poorly planned.

Would a migrant from a collapsed city receive aid? “We’ve not experienced anything of this kind, where whole regions, whole countries, may well become unviable,” says Jeffrey Sachs, head of Columbia University’s Earth Institute.

No wonder strategists see vast new security risks, and a big expansion in the world’s “ungoverned spaces”. But much can be done before the exodus turns biblical. In West Africa subsistence farming is badly irrigated. Improve that, throw in some seeds and fertiliser, scrap tariffs, build warehouses and roads, and the region may beat the worst of climate change.

Geographers at UN Habitat, a city-planning agency, say conurbations must adapt to the needs of climate-change migrants. “You can’t just stockpile people,” says Alex de Sherbinin of Columbia University. The pressure is tangible in Addis Ababa, which already has teeming slums. The price of teff, a staple, has surged after a famine that is still pushing people to the city. Mr Meles is not alone in his wrath.

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The End of the Line: Overfishing on video

Good video looking at EU overfishing and why we will be "fishless" by 2050.

A useful video for my "economics of fishery students".

http://www.babelgum.com/html/clip.php?clipId=3020495

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Spatially disaggregated analysis of pollution

A must read paper for the pile. Apologies for using this blog as an online repository of papers I need to read but it helps me keep a record.

The abstract does not make for very interesting reading I am afraid. It is the techniques that are important in my view.

Measuring the effects of the Clean Air Act Amendments on ambient PM10 concentrations: The critical importance of a spatially disaggregated analysis

Maximilian Auffhammer, Antonio M. Bento and Scott E. Lowec

Abstract

We examine the effects of the 1990 Clean Air Act Amendments (CAAAs) on ambient concentrations of PM10 in the United States between 1990 and 2005. We find that non-attainment designation has no effect on the “average monitor” in non-attainment counties, after controlling for weather and socioeconomic characteristics at the county level. In sharp contrast, if we allow for heterogeneous treatment by type of monitor and county, we do find that the 1990 CAAAs produced substantial effects. Our best estimate suggests that PM10 concentrations at monitors with concentrations above the national annual standard dropped by between 7 and View the MathML source, which is roughly equivalent to a 11–14% drop. We also show that monitors which were in violation of the daily standard experience two fewer days in violation of the daily standard the following year. Empirical results suggest that this treatment effect is independent of whether the Environmental Protection Agency (EPA) has finalized the non-attainment designation.

Keywords: Air pollution; Clean air act; Spatial modeling

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Pigs in Space

The geographical location of hog farms in the US and the impact of environmental regulations led to this inevitable blog title. I can only apologise.

However, the abstract does draw you in. What is the answer? Which of the three options won out? Now I have to also read the paper.

Environmental Regulations and the Structure of U.S. Hog Farms

Date: 2009
By: Nene, Gibson
Azzam, Azzeddine M.
Schoengold, Karina

URL: http://d.repec.org/n?u=RePEc:ags:aaea09:49395&r=env

The U.S hog production industry has been continually subjected to rapid structural changes since the early 1990s. The industryâs move towards more concentrated large hog farms and geographical concentration of such farms, have triggered public concerns over the dangers such big animal feeding operations are likely to pose to the waters of the country. This study investigates the implications of state-level environmental regulations on the structure of hog farms. The results of this study suggest that environmental regulations will result in one of three possible scenarios: (1) a more competitive industry in which small hog operations are not adversely affected which will allow more small operations to enter rather than exit the industry; (2) a more concentrated hog production industry in which large operations survive while small operations exit the industry; (3) no change in the structure of the industry where both sizes of operations are not significantly affected by environmental stringency.

Research fellow position - economy, energy and climate

For recent environmental economics PhDs. Living in either Milan or Venice sounds great.

FONDAZIONE ENI ENRICO MATTEI
Research Programme on Sustainable Development
Research fellow position

The Fondazione Eni Enrico Mattei (FEEM), an Italian research institute that carries out research on sustainable development, encourages to submit applications for a Research Fellow position. The successful candidate will join one of the two modelling teams at FEEM that are engaged in frontier research on the connections between the economy, energy and climate. An outline of the modelling done so far is available at http://www.feem-web.it/witch/ and http://www.feem-web.it/ices/. Duties will be carried out at the FEEM offices in Milan or Venice, Italy.

The candidate is expected to have a good general background in applied and theoretical economics, with previous experience in applied modelling work. Candidates must have a Ph.D. or be near its completion. The Ph.D should be preferably in economics; Ph.Ds in energy engineering/mathematics coupled with a solid economic background are also accepted. Experience in modelling, and proficiency in GAMS are important requisites.

The selected candidate will interact with researchers of different nationalities, and will write and present scientific papers. Part of the activities are realized in the context of European research projects. An excellent command of written and spoken English is essential for this position.

FEEM offers a truly international and interdisciplinary workplace. The strong ties with a world-wide network of research institutions engaged in environmental research and in particular on the analysis of climate change issues allows a continuous fruitful exchange of experiences. A full range of the activities of FEEM is available at http://www.feem.it/.

The successful candidate is expected to begin his/her assignment in September 2009. The appointment period will be at least one year long. Gross salary will be based on qualification and working experience (indicatively from 27,000 to 35,000 Euro/yearly). Higher salaries may be considered for particularly experienced candidates.

Applicants should send a detailed curriculum vitae with a full list of publications and at least one letter of recommendation to: Monica Eberle, monica.eberle@feem.it.

Deadline for applications: FEEM will begin considering candidates in June 2009 and will continue until the position is filled.

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The EU Emissions Trading Scheme: assessment and outlook

After setting this question to my Econ 211 students as part of their assessment I was interested to come across an academic answer to the question. I hope this paper does not "too" closely resemble the answers given by my students for their sakes.

The EU Emissions Trading Scheme: assessment and outlook

Sébastien E. J. Walker

The Queen's College, University of Oxford

ABSTRACT

In this article I assess the design of the EU Emissions Trading Scheme and the performance of its first Phase. The article argues that, contrary to common belief, Phase I fulfilled its objectives. It then discusses the changes that have been made to the Scheme's framework for Phase II, and those that are planned for Phase III, covering the latest developments and the recent price trends for emissions allowances. I conclude that the aforementioned changes constitute substantial improvements to the Scheme, while unwelcome uncertainties nevertheless remain over long-term price signals.

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"Pollution, Health, and Avoidance Behavior: Evidence from the Ports of Los Angeles"

I have a forthcoming paper the Journal of Risk and Uncertainty looking at the relationship between pollution exposure and wages.

Dirty Money: Is there a Wage Premium for Working in a Pollution Intensive Job? [PDF old working paper version]

This paper is part of a growing literature looking at the health and the environment by economists. We argue that individuals demand higher wages to compensate for the negative health implications. These authors argue that individuals act to reduce exposure.

This appears to be a great natural experiment that gets to the heart of the matter without many of the measurement problems that are associated with studies of this type.

"Pollution, Health, and Avoidance Behavior: Evidence from the Ports of Los Angeles"

NBER Working Paper No. w14939

ENRICO MORETTI, University of California, Berkeley - Department of Economics, National Bureau of Economic Research (NBER), Institute for the Study of Labor (IZA)
Email: moretti@econ.berkeley.edu
MATTHEW NEIDELL, University of Chicago - Department of Economics and CISES
Email: mneidell@uchicago.edu

A pervasive problem in the literature on the health costs of pollution is that optimizing individuals may compensate for increases in pollution by reducing their exposure to protect their health. This implies that estimates of the health effects of pollution may vastly understate the full welfare effects of pollution, particularly for individuals most at risk who have the greatest incentive to adopt compensatory behavior. Furthermore, using ambient monitors to approximate individual exposure to pollution may induce considerable measurement error. We overcome these issues by estimating the short run effects of ozone on respiratory related health conditions using daily boat arrivals and departures into the two major ports of Los Angeles as an instrumental variable for ozone levels. While daily variation in boat traffic is a major contributor to local ozone pollution, time-varying pollution due to port activity is arguably a randomly determined event uncorrelated with factors related to health. Instrumental variable estimates are significantly larger than OLS estimates, indicating the importance of accounting for avoidance behavior and measurement error in understanding the full welfare effects from pollution.

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Climate Change Articles

New blog to check out. Nice layout and a good place to get information.

Climate Change Articles

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The End of Civilisation

Nothing better than a good "end of the world" story for a Monday morning. This should appeal to economists everywhere.

'Earth 2100': the Final Century of Civilization? [ABC News]

It's an idea that most of us would rather not face -- that within the next century, life as we know it could come to an end. Our civilization could crumble, leaving only traces of modern human existence behind.

To change the future, first you have to imagine it.

It seems outlandish, extreme -- even impossible. But according to cutting edge scientific research, it is a very real possibility. And unless we make drastic changes now, it could very well happen.

Experts have a stark warning: that unless we change course, the "perfect storm" of population growth, dwindling resources and climate change has the potential to converge in the next century with catastrophic results.

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"Economists in the Pits?"

Apologies for the low posting rate - academics occasionally have to take a holiday and when that location is "internetless" even the most ardent blogger has to admit defeat.

In UK academia the pressure to publish in "A" journals is immense. However, with a large increase in the number of economists and the pressure to publish increasing from all directions it is no surprise that this is difficult to achieve (not least if you are an environmental economist).

This paper is of interest to any academic trying to pin down that "A" publication and perhaps even more interesting to those who have accepted that this is a dream not worth pursuing.

The abstract definitely sucks you in. How do the losers react and why is it harmful. Any "losers" reading this post should think how they have or are reacting to see if it matches. How can the system be changed from rewarding those who are able to publish in the top journals? How can that not be a good thing?

Economists in the Pits? [SSRN]

Bruno S. Frey
University of Zurich - Institute for Empirical Research in Economics (IEW); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Swiss Federal Institute of Technology Zurich

March 2009

CESifo Working Paper Series No. 2594

Abstract:
Academic economists today are caught in a "Publication Impossibility Theorem System" or PITS. To further their careers, they are required to publish in A-journals, but this is impossible for the vast majority because there are few slots open in such journals. Such academic competition is held to provide the right incentives for hard work, but there may be serious negative consequences: the wrong output may be produced in an inefficient way, the wrong people may be selected, and the losers may react in a harmful way. The paper suggests several ways for improvement.

Keywords: academia, economists, publication, journals, incentives, economic methodology

JEL Classifications: A1, D02, I23
Working Paper Series

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Lobby groups killing the planet?

US politics is an ugly place. You have to wonder about the future of democracy and the planet when big oil and other lobby groups can have such an influence on the democratic decision making process.

This is a sad state of affairs.

Barack Obama's key climate bill hit by $45m PR campaign [Guardian]

America's oil, gas and coal industry has increased its lobbying budget by 50%, with key players spending $44.5m in the first three months of this year in an intense effort to cut off support for Barack Obama's plan to build a clean energy economy.

The spoiler campaign runs to hundreds of millions of dollars and involves industry front groups, lobbying firms, television, print and radio advertising, and donations to pivotal members of Congress. Its intention is to water down or kill off plans by the Democratic leadership to pass "cap and trade" legislation this year, which would place limits on greenhouse gas emissions.

A defeat for the bill would have global consequences. The international community is depending on America, as the world's biggest per capita polluter, to set out a firm plan for getting off dirty fuels in the months before crucial UN negotiations in Copenhagen in December.

Without such action, the chances of getting a deal that scientists say is vital to limiting dangerous climate change are much reduced.

Those high stakes have intensified the fight for control over America's energy future. "There are an awful lot of people who have an awful lot to gain and lose and they have been acting accordingly," said Evan Tracey, founder of the Campaign Media Analysis Group (CMAG), who has tracked the proliferation of climate change ads.

But it is an unequal contest. Liberal and environmental organisations, as well as the major corporations that support climate change legislation, say they are being vastly outspent by fossil fuel interests.

"These guys are spending a billion dollars this year convincing Americans that they are clean, green, cuddly and warm," said Bob Perkowitz, founder of the eco- America PR firm. Perkowitz is to brief the White House yesterday on a new environmental messaging strategy. "The enviros are getting their message out, but they are being outspent by 10 to one." he said.On advertising, the ratio is about three to one. The oil and coal industry spent $76.1m on ads from 1 January to 27 April, according to CMAG data seen by the Guardian. Environmental groups, led by Al Gore's Alliance for Climate Protection, the Environmental Defence Fund and the Sierra Club, spent $28.6m on ads in the same period, Tracey said.

Despite its global significance, the fate of the draft "cap and trade" bill now lies in the hands of just a dozen Democrats, who have yet to back Obama's energy transformation. The Democratic leadership cannot take their support for granted. Seven of those pivotal Democrats received campaign donations in excess of $100,000 from the oil and gas industry, coal producers, and electricity firms during last year's elections, according to an analysis provided to the Guardian by the Centre for Responsive Politics. Another two received more than $90,000 last year.

Environmentalists say those Democrats, who hold the balance of power on the committee, pose a far greater threat to the chances of passing climate change legislation than a full vote in the House of Representatives. "If they can get that bill through the subcommittee what is going to emerge is a piece of legislation," said Tony Kreindler of the Environmental Defence Fund. "So this is ground zero for the vote."

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"Economic Instruments to Enhance the Conservation and Sustainable Use of Biodiversity"

Call for papers:

"Economic Instruments to Enhance the Conservation and Sustainable Use of Biodiversity"

The Fondazione Eni Enrico Mattei, in association with Conservation International, DEFRA, Department of Land Economy of Cambridge University and European Investment Bank, announces the Eleventh International BIOECON Conference on "Economic Instruments to Enhance the Conservation and Sustainable Use of Biodiversity". The Conference will be held at the Centro Culturale Don Orione Artigianelli, in Venice, Italy, on September 21st-22nd, 2009.

The Conference is targeted to researchers, environmental professionals, international organizations and policy makers who are interested in working in the management and conservation of biodiversity. The Conference is focused on identifying the most effective and efficient instruments for biodiversity conservation, such as auctions of biodiversity conservation contracts, payment-for-services contracts, taxes, tradable permits, voluntary mechanisms and straightforward command and control. Special emphasis will be given to policy reforms aimed at increasing the commercial rewards for conserving biodiversity, increasing the penalties for biodiversity loss and circulating information on the biodiversity performance requirements of firms. An increasing number of businesses, which were responsible for biodiversity loss in the past, are now supporters of biodiversity conservation. Markets for organic agriculture and sustainably-harvested timber are developing at double-digit rates, while rapid growth is observed in the demand for climate mitigation services, such as the protection of forests and wetlands to absorb carbon dioxide. Bio-prospecting, the search for new compounds, genes and organisms in the wild, is another biodiversity business on the rise.

Papers are specifically invited on the themes of:

* Assessment of the effectiveness and efficiency of biodiversity conservation instruments, taking into account spatial and governmental considerations;
* Development of new, incentive-compatible instruments to conserve biodiversity;
* Evaluation of the costs of conservation policies versus the costs of 'business-as-usual' within an existing policy framework (e.g. agriculture, fisheries, infrastructure, climate change, etc) that causes ongoing losses of ecosystems and biodiversity.
* Determination of the factors - including the choice of policy instruments - that increase or decrease a farmer's or public body's motivation to conserve biodiversity on their land;
* Application to strategies and projects of the ecosystem services approach for assessing and valuing environmental impacts;
* Benefit transfer methodologies to assess the socio-economic and monetary value of ecosystems services;
* Applications of economic instruments to enhance the conservation and sustainable use of biodiversity, with particular emphasis on case studies in biodiversity hotspots.

We are particularly interested in papers documenting practical applications and experiences on the above themes. Theoretical contributions are welcome (e.g., using computer artificial intelligence approaches), but also more applied work (e.g. how public bodies - managing for example flood risks - can innovatively deliver wider ecosystem benefits, or how private landowners can be encouraged to conserve biodiversity on their land). We are also interested in multi-disciplinary papers that combine scientific and economic assessments. However, we will also accept papers on a range of other issues related to renewable resources and biodiversity management.

The Conference will cover two days. Leading international environmental economists will present their latest research in two plenary sessions. The keynote speakers are: Professor Anil Markandya (University of Bath, UK and BC3, Spain) and Professor Edward Barbier (University of Wyoming, USA). Two special panel discussions are also scheduled. These are characterized by a round table and shall be focused on climate change, biodiversity management issues. One shall be co-organized with the European Investment Bank and the second by Conservation International, giving to the audience an interesting perspective that is the link between theory and practice.

Full/draft papers may be submitted for presentation and will be considered by the programme committee. Electronic copies (in WORD or PDF format) should be sent to Ughetta Molin Fop (ughetta.molin@feem.it) no later than May 20th, 2009. Acceptance of papers will be notified by email in June 2009.

The Conference will open with an evening reception at the Centro Culturale Don Orione Artigianelli on September 20th. Conference sessions will commence in the morning of September 21st and end in the afternoon of September 22nd. A Conference dinner will be organised on the evening of September 21st. Lunches and refreshments will also be provided. All the participants will be offered lunches and refreshments, the opening reception, the social dinner and the Conference package (program brochure with the book of abstracts, five hours of Internet connection, folder, bag, pen, badge, logistical information, Venice map). There is no registration fee.
Travel and accommodation expenses remain the responsibility of all the participants.

In order to register to the Conference and the your accommodation booking participants are invited to fill in the downloadable form at the BIOECON web-site and send it to the Conference Secretariat (Ughetta Molin Fop, e-mail ughetta.molin@feem.it, fax +39.041.2711461) by July 15th, 2009.

Further information about the Conference will be posted in the BIOECON web-site at http://www.bioecon.ucl.ac.uk/.

"Pollution and International Trade in Services"

Arik Levinson and his latest trade and the environment paper.

The bottom line is that services are relatively small polluters so Arik was never going to find much of real economic significance. Good to cover all bases though.

"Pollution and International Trade in Services"

NBER Working Paper No. w14936

ARIK LEVINSON, Georgetown University - Department of Economics, National Bureau of Economic Research (NBER)
Email: AML6@georgetown.edu

Two central topics in recent rounds of international trade negotiations have been environmental concerns, and services trade. While each is undoubtedly important, they are unrelated. In this paper I show that the services-environment link is small, for two reasons. First, services account for only a small fraction of overall pollution. For none of five major air pollutants does the service sector account for even four percent of total emissions; for three of the five services account for less than one percent. Second, those service industries that do pollute are the least likely to be traded internationally. Those services for which the U.S. collects and publishes international trade data - presumably those services that are traded internationally - are less polluting than services for which trade data do not exist - presumably because the services are not traded. Even if we limit attention to the services that are traded across borders, the service industries most intensively traded are the ones that pollute the least. The bottom line is simple. International services trade bears little relation to the environment, because services in general contribute relatively little to overall pollution, and those industries that are traded internationally are among the least polluting.

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The World According to Monsanto

I am on a "hammering big business roll" - first Chevron and now Monsanto.

Up the revolution.

The World According to Monsanto - Full Documentary [Twilight Earth]



The post above has the entire documentary for all to view.

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