Wednesday, October 31, 2007

Arguments over Droughts, Dams and Water Shortages: Kicking off in the US

When economists talk about global warming and the potential for it to cause widespread conflict, wars and the migration of millions of "environmental refugees" they usually have the developing world in mind.

It is interesting therefore to see how the current US drought is playing out politically.

Environmentally, it appears that by law a certain amount of water must be released from Lake Lanier "to protect mussels, sturgeon and other species in the Florida Panhandle". This is where the debate between economics, water quality and nature gets a little murkier.

Drought in Southeast US Leads to Spat Over Lake [Planet Ark]

LAKE LANIER, Ga. - A large, man-made lake in north Georgia is at the center of a political storm over how to distribute water resources between three US states in the face of the region's worst drought in decades.

Lake Lanier stands near the head of a watershed that feeds the booming city of Atlanta about 45 miles (72 km) to the south, leading to accusations that the city is consuming more than its fair share of water.

Also relying on the lake are other towns, industries and power plants in parts of Georgia, Alabama and Florida before the water drains south into the Gulf of Mexico.

More than a year of low rainfall has reduced the lake's water level by about 14 feet (4.3 meters) from its seasonal norm and the situation is worse in lakes farther south, according to the US Army Corps of Engineers. Atlanta has had 23.5 inches of rain this year compared to 39.1 inches in a normal year.

Experts dismiss as alarmist headlines predicting that Lanier could run dry in 90 days but the drought has reignited two-decade-old tensions over access to water.

Georgia's governor, Sonny Perdue, declared an emergency in parts of the state, imposed water restrictions and appealed to Washington for help for people hit by the shortage.

He also filed a federal lawsuit bid to force the Corps, which manages Lake Lanier, to reduce the amount of water it sends downstream each day.

Florida Gov. Charlie Crist strongly opposed the suit, arguing that the US$200 million commercial fishing industry in Florida's northwestern Panhandle region already was threatened by reduced flows from Georgia.


Alabama Gov. Bob Riley said any reduction in flows from Lake Lanier would hinder cooling at the Farley nuclear plant in southeastern Alabama, jeopardizing electricity to 800,000 households across all three states.

For most of its 7.5 million annual visitors, Lake Lanier is a pleasure park close enough to Atlanta to provide a getaway from city life with nearly 700 miles (1,120 km) of shoreline and 10,000 private boat docks. Now, the sight of stranded docks sticking out of the mud is the most visible symbol of the drought.

Buford Dam, a vast concrete structure hidden behind a wall of grass at the lake's southern end, is a symbol of the political battle the drought has set off.

By law the dam must release at least 650 cubic feet (18 cubic meters) per second of water downstream to ensure water quality and, crucially, to supply other rivers and lakes, said Jonathan Davis, the Corps' operations project manager at the lake.

Given that water flowing into the lake from the Chattahoochee and Chestatee rivers is down by more than half, one might expect the outflow to be similarly reduced.

But water in the total river basin stands at 35 percent of normal and Davis said the Corps has been sending up to 3,000 cubic feet (85 cubic meters) of water per second cascading south, raising water levels and churning the river.

In part, the Corps is responding to the demands of the Endangered Species Act, which stipulates a minimum outflow from the lake to protect mussels, sturgeon and other species in the Florida Panhandle.


But beyond that some scientists argue that the region's over-reliance on Lake Lanier is flawed.

"It's scientifically unsound to expect Lake Lanier to support the entire ... watershed as the Army Corp of Engineers is doing," said David Stooksbury, Georgia's state climatologist.

"They are artificially keeping the (Chattahoochee) river much higher than it would be if those (downstream) lakes were not there."

Atlanta, like US cities such as Phoenix, Dallas and Denver, has experienced rapid growth without being based around a major water source, Stooksbury said.

For the region that depends in part on Lanier for water the situation is exacerbated because Atlanta, which has more than quadrupled in size since Lanier was built 50 years ago and is the largest city in the region, also happens to stand near the headwaters.

Ronald Payne, deputy commander of the Mobile district in Alabama for the Corps, said over-consumption did not play a significant part in creating the resource problem.

But Adam Snyder, executive director of Conservation Alabama, said poor water management planning -- as much as low rainfall -- was at the root of the dispute.

"The problem is that you have a high demand for water in the Atlanta area," he said. "They being at the headwaters of so many different streams and everyone else is at their mercy .... It is three states versus the Atlanta metropolitan area.

"Forty years ago Atlanta claimed they were 'too busy to hate,'" he said, referring to the city's slogan as a racially harmonious city. "Since then they have been too busy to plan and the rest of us are suffering as a result."


Toilet Paper, the German Army and surveillance cameras

In a recycling related post comes news that each German soldier appears to get though 10 rolls of toilet paper A DAY. After a close investigation this was later reduced to 8.8 sheets per soldier per day.

The question on the lips of people everywhere is "where did the other loo rolls go?"

More scarily, surveillance cameras in a bus depot in Germany have been set up to monitor toilet paper use. Next time you sit down to read the paper check for hidden cameras watching your every (bowel) movement.

Bogged Down in Paper [Times]

Governments can fumble a key treaty, cause havoc by yet again revising the nation's exam system, or run out of vital vaccines, and the furore will eventually subside. But when a scandal erupts over the cost of lavatories, there will be a price to pay.

Two decades ago, the Pentagon was pilloried for paying defence contractors $640 for a toilet seat cover. Now a German defence minister has been forced to placate the Green Party, which is upset that official figures (when you marry procurements to personnel) indicate that each German soldier is getting through 10 toilet rolls a day. A day. The minister ridicules such an extravagant calculation, insisting solemnly that the real usage is just 8.8 sheets per soldier per day.

Well, that's some relief. But what, then, is happening to these rolls? Is there a German Milo Minderbender, the commercially inventive mess officer in Catch-22, who is bartering surplus loo rolls for fancier commodities? And should that scheme go awry, will German soldiers be eating chocolate-covered loo paper, the way pilots at Milo's US army air base were fed chocolate- covered cotton when his plan to trade an entire year's Egyptian cotton harvest backfired?

But Germany's loo paper woes are multilayered. A fortnight ago a bus driver there took his employers to court after they had sacked him for filching a toilet roll from the bus depot lava-tory: he had been caught on surveillance cameras installed, partly, to monitor toilet paper usage. The morality of such monitoring apart, the cameras have caught a moment proving that a once mighty country has become a paper tiger.


Monday, October 29, 2007

Ecuador, non-renewables and Coase

In a post that covers pretty much the entire environmental economics course in one way or other, Ecuador has suggested that the developed world pay it $350 million a year not to pump any more crude oil, thereby avoiding further pollution of its eastern rainforest.

Is this a Coasian bargaining problem? Who are the suffers and who are the polluters?

It is difficult not to be sceptical - will the West actually pay up? Can the Ecuadorian government be trusted? Will it not take the money now but find the bounty beneath the ground to tempting to pump out later? Will the individuals in Ecuador that have experienced the largest suffering actually see any of the $350,000,000?

Ecuador’s startling oil proposal [Chinadialogue]

Oil has been pumped from here for almost four decades and the result, say environmentalists, is 1,700 square miles (4,400 square kilometers) of industrial contamination, with rivers poisoned, wildlife wiped out and humans falling sick.

But now, mindful of the environmental and political cost, the state has made a startling proposal: if wealthy nations pay Ecuador $350 million a year -- half of the estimated revenue from extraction -- it will leave the oil in the ground.

Supporters say it is an idea whose time has come, a logical step forward from carbon offsetting, in which rich polluters in developed countries compensate for environmental damage caused by their consumer habits.

Since the proposal was first floated in June, there have been promising signals, said Alberto Acosta, a former mining minister and close ally of president Rafael Correa. The German and Norwegian governments have expressed interest, as have parliamentarians from Italy, Spain and the European Union. “This could be a historic accommodation,” he said. Donors could pay in cash, debt relief or other indirect ways.

Some greens champion the proposal as a way to protect biodiversity and combat global warming while allowing a poor country to develop. “It’s not utopian, it’s realistic,” said Esperanza Martínez, of the Quito-based organisation Acción Ecológica (Ecological Action).

But others are sceptical. They predict that rich countries will not stump up the money and that Ecuador’s government will ultimately find its oil bounty too tempting to pass up. The government and oil companies already are eyeing another chunk of Amazonian rainforest, the Yasuní national park, a UNESCO-designated biosphere reserve. Beneath part of the 982,000-hectare park lie the Ishpingo-Tambococha-Tiputini (ITT) oilfields, with an estimated one billion barrels of heavy crude. For the cash-strapped government, this is a tempting bounty potentially worth up to $700 million a year.

“It's a ploy; we don’t trust the government on this,” said Anita Rivas, the mayor of Coca, a town on the edge of the park. Like many in the Amazon, she scorned the notion that oil revenues would ease poverty, a mantra of successive governments worn thin by decades of stolen or wasted revenues. “Where are the benefits?” said Ms Rivas.

Even Acosta said: “We don't want to develop it because we know there will be damage. But if we have no other choice then, lamentably, we will do it.”

The costs of Ecuador’s oil industry are all too visible in those parts of the jungle where crude has been drilled, spilled, pumped and dumped -- a vision of what might be in store for Yasuní park.

Between Coca and Lago Agrio, bleak oil-rush settlements carved out of the bush, oil is never far away. It is in the 300-mile (480-kilometre) pipeline stretching through valleys and mountains. It is in the air in the form of rain and waste gas burnt by flares. It is in 1,000 or so waste pits of black sludge that leak into the water supply. It is in the soil in the form of congealed tar that stunts trees.

It is in the bodies of residents, according to several scientific studies, in the form of tuberculosis and other diseases that make hamlets such as San Carlos, adjacent to a refining plant, zoom off the medical charts. “Two-thirds of my patients have contamination-related illnesses,” said Rosa Moreno, a nurse at a small clinic.

Oil is even in the name Lago Agrio. It means Sour Lake and is taken from the Texas hometown of Texaco, the United States oil giant that drilled in the region from 1972 to 1992 and operated as a mini-state.

Chevron, the even-bigger giant that subsequently bought Texaco, is now embroiled in a $6 billion class-action lawsuit brought by 30,000 indigenous people and settlers. They claim that Texaco poisoned the region by dumping billions of gallons of toxic waste-water and want the company to clean it up. It is one of the world’s biggest environmental cases and has been dragging on for 14 years. “What happened here, we can’t let happen anywhere else, least of all Yasuní,” said the plaintiffs’ lawyer, Pablo Fajardo.

Chevron says Texaco broke no law, performed a $40 million clean-up in 1995 and that any contamination must be the fault of other companies that have operated there since then. “Ours was a beautiful operation, very clean. This lawsuit is a farce,” said Rodrigo Perez, a company lawyer.

Regardless of blame, there is no doubt that oil has devastated much of Ecuador’s forests. The question is whether Yasuní -- which is said to have more tree species in an average hectare than there are the US and Canada combined -- will be next.

For the indigenous tribes who call the region home, the untapped wealth far beneath the jungle floor is a threat.

“We wish it weren’t here,” said Wiyame Irumenga, an indigenous leader and forest ranger, tapping a bare foot against the earth. “We wish people would just forget about it.”


The future of economics blogging

An interesting debate on the sustainability of econ-blogging is taking place amongst the big boys, Mankiw and Rodrik. Mankiw has been around for a long time but some of the more recent blogs include Dani Rodrik, Paul Krugman, George Borjas, Becker-Posner, Levitt and others.

The debate has been taken up by Nicolas Carr at Rough Type. In one sense I am surprised it has taken so long for economists to bring this up.

Mankiw's move prompted Dani Rodrik, another Harvard blogger, to wonder, "Is the econ-blogosphere unsustainable?" As the smartest economist-bloggers become more popular, he theorized, they will spend increasing amounts of time working on their blogs, steadily raising their opportunity costs without producing much if any income, until at some point blogging becomes, well, uneconomical: "So if economists with high opportunity costs of time start to get out, shall we have a lemons problem on our hands? Will eventually the only prolific bloggers remain the ones that are not worth reading?" Does, in other words, the economics of blogging guarantee that only the mediocre and the worthless will survive - the ones whose time isn't particularly valuable to begin with?

Free Exchange stressed that he wasn't saying that academic economists should "leave off blogging," but nevertheless his point implies that it's probably not a good idea for the best economists to spend time blogging that might have instead gone into research and journal-writing. They should, to ensure the most efficient possible idea market, focus on the areas in which they hold the greatest advantage, and let the amateurs crank out the blog posts.

But what's left out of all these economic equations is the ego-gratification that comes from being a popular blogger. Because blogging is such a personal pursuit, with strong and immediate ego-rewards, it can be irrationally seductive, particularly to highly competitive overachievers. The hazard - and this applies as well to disciplines beyond economics - is that extraordinarily talented individuals may end up, like lab mice drinking sugar water, spending more time blogging than they should, even though their comparative advantage is smaller in blogging than it is elsewhere. Distorted by noneconomic but nonetheless powerful rewards, the idea market would become less efficient than it should be, and we'd all suffer as a result. The real danger, in other words, may not be that the "lemons" - the "tolerable bloggers" - will take over as the mainstays of the blogosphere but that they won't.

The quotes from the Carr article all make good points. However, a blogger does not have to post every day and nor does the post have to be ground breaking and filled with originality and wit (as we show clearly at "Globalisation and the Environment").

I post merely on what I find interesting/amusing/strange and hope there is some sort of positive externality for readers as there is for myself by informing and setting my own research agenda. Whilst it might be true that there is an opportunity cost in terms of writing research papers, the ability of blogging to identify the questions worth writing a paper on more than outweigh the costs.


The Environmental Performance of Firms

NEP: New Economics Papers Environmental Economics list the following paper in their new releases now forthcoming in Ecological Economics.

Getting environment and labour data for a country such as Ghana required some serious leg work but inevitably the quality of data prevented us getting a better grip on this important (at least to us) topic. Quality of data can be crucial to the eventual journal destination.


The Environmental Performance of Firms: The Role of Foreign Ownership, Training, and Experience

Date: 2007-08

By: Matthew A Cole
Robert R J Elliott
Eric Strobl


In this paper we extend the debate on the environmental implications of foreign direct investment in developing countries by examining a new mechanism through which foreign influence can affect the environmental performance of firms. We focus on the extent to which key workers who have had previous training or experience in a foreign owned firm transfer and utilise their knowledge gained to the benefit of the local environment. To this end we use detailed firm-level data on manufacturing firms in Ghana. Our econometric results sugggest that the foreign training of a firm's decision maker does reduce fuel use, particularly so in foreign owned firms. Foreign ownership per se does not influence fuel use or total energy use but is found to increase electricity use, perhaps the cleanest form of energy used by Ghanaian firms.
Keywords: Environment, Spillovers, FOreign Direct Investment
JEL: Q56 Q52 F21 F23


Sunday, October 28, 2007

Geo-4 "Global Environmental Outlook" - Bleak for Mankind

UNEP have just released their "Global Environmental Outlook". Generally speaking humanity remains at risk from climate change, food shortages and a collapse in biodiversity. In short, things are looking rather bleak.

There is a lot of interesting material to wade through.

This post has gone multimedia with links to podcasts and videos after the press release.

"The fourth Global Environment Outlook: environment for development (GEO-4) assessment is a comprehensive and authoritative UN report on environment, development and human well-being, providing incisive analysis and information for decision making."

Here is the English Press release:

Planet’s Tougher Problems Persist, UN Report Warns

Nairobi/New York, 25 October: The United Nations Environment Programme says that major threats to the planet such as climate change, the rate of extinction of species, and the challenge of feeding a growing population are among the many that remain unresolved, and all of them put humanity at risk.

The warning comes in UNEP’s Global Environment Outlook: environment for development (GEO-4) report published 20 years after the World Commission on Environment and Development the Brundtland Commission) produced its seminal report, Our Common Future.

GEO-4, the latest in UNEP’s series of flagship reports, assesses the current state of the global atmosphere, land, water and biodiversity, describes the changes since 1987, and identifies priorities for action. GEO-4 is the most comprehensive UN report on the environment, prepared by about 390 experts and reviewed by more than 1 000 others across the world.

It salutes the world’s progress in tackling some relatively straightforward problems, with the environment now much closer to mainstream politics everywhere. But despite these advances, there remain the harder-to-manage issues, the “persistent” problems. Here, GEO-4 says:

“There are no major issues raised in Our Common Future for which the foreseeable trends are favourable.”

Failure to address these persistent problems, UNEP says, may undo all the achievements so far on the simpler issues, and may threaten humanity’s survival. But it insists: “The objective is not to present a dark and gloomy scenario, but an urgent call for action.”

Achim Steiner, UN Under-Secretary General and UNEP Executive Director, said: “The international community’s response to the Brundtland Commission has in some cases been courageous and inspiring. But all too often it has been slow and at a pace and scale that fails to respond to or recognize the magnitude of the challenges facing the people and the environment of the planet”.

“Over the past 20 years, the international community has cut, by 95 per cent, the production of ozone-layer damaging chemicals; created a greenhouse gas emission reduction treaty along with innovative carbon trading and carbon offset markets; supported a rise in terrestrial protected areas to cover roughly 12 per cent of the Earth and devised numerous important instruments covering issues from biodiversity and desertification to the trade in hazardous wastes and living modified organisms,” he added.

UNEP FULL REPORT (22.5MB) - that is large.


UNEP Press release VIDEO.

As an academic I always want to know how such reports are refereed before release especially after the farce of the Stern Review. The refereeing appears to be comprehensive enough.

Did the GEO-4 report undergo a peer review process? How were comments from reviewers addressed in the drafting of the GEO-4?

The GEO-4 report underwent two rounds of governmental and expert review. We received over 13 000 comments on the drafts of the GEO-4 report and 3 000 comments on the GEO-4 Summary for Decisions Makers. Every comment was recorded and addressed by the GEO-4 Chapter Expert Groups, and their responses to the comments were posted on a password-protected Web site. All reviewers were able to see the responses to their and others’ comments. The Web site is not available to the general public in order to maintain confidentiality and allow for candid feedback from the reviewers. Further review was provided by independent experts who served as review editors, ensuring that all review comments were adequately and objectively addressed by the Chapter Expert Groups.

Finally, we end on a slightly brighter note. The 4 main messages from the report almost read like there is a shaft of light at the end of the tunnel.

What are GEO-4’s main messages?

1. The world has changed considerably over the past 20 years, but we have not turned the corner towards sustainable development. We live in a better world than at any time in history, but unprecedented environmental change has made us more vulnerable than we have ever been.

2. Human innovation to engineer and exploit the environment is being countered by the force of environmental change itself. Change is happening faster than we can keep up with.

3. We have a much better toolbox and technologies to tackle some of the global challenges. We have better science, a more informed public, and a more proactive private sector but are yet to cross the threshold of sustained action and staying power to reverse the negative trends of environmental decline.

4. How many environmental assessment reports such as GEO-4 and various others that have been or are being launched in 2007 do we need to reach the tipping point? We have a better understanding of the challenges we face. We can undo and reverse some of the damage now unfolding, adapt to those we can’t, and cease opportunities to strengthen mitigation. But we don’t have the luxury of time – delay exacerbates the problems and increases the complexity and cost to address the problems of environmental decline. The time to act is NOW!


Saturday, October 27, 2007

UNCTAD launch "Ideas 4 Development"

UNCTAD launch "Ideas 4 Development" blog. An all star blog on development economic issues on a blog with a poor name. Surely they could have come up with something better or at least without a number in the middle of it.

“Ideas for Development” is an international Blog meant to stimulate debate on development issues. It brings together a set of senior professionals engaged in this sphere through their careers and personal convictions. This Blog aims at offering a new forum for open discussion and interaction between scholars, students, professionals of various backgrounds and the public at large. Together, they can share information, viewpoints and visions for the future with the common goal of advancing the cause of development.

We wish it success. We have added it to our blogroll:

Ideas 4 development

H/T: IPE Zone.

Wednesday, October 24, 2007

Can Coasean Bargaining Justify Pigouvian Taxation?

In my very next lecture on Econ211 Environmental Economics we come across Coase and Coasean bargainning for the first time.

It is again timely that the most recent Economica journal has a paper that combines Coase with Pigouvian taxes (covered last week).

Students should be able to get access to this paper. If you do not have access I am sure a friendly academic will be able to send you a PDF version if asked nicely.

This paper is not for the mathematically faint hearted.

Can Coasean Bargaining Justify Pigouvian Taxation?

* STEPHANIE ROSENKRANZ††University of Utrecht and CEPR and
* PATRICK W. SCHMITZ‡‡University of Cologne and CEPR


The fact that, according to the celebrated Coase Theorem, rational parties always try to exploit all gains from trade is usually taken as an argument against the necessity of government intervention through Pigouvian taxation in order to correct externalities. However, we show that the hold-up problem, which occurs if non-verifiable investments have external effects and parties cannot be prevented from always exploiting ex post gains from trade through Coasean bargaining, may be solved by government intervention. In this sense, the impossibility of ruling out Coasean bargaining (after investments are sunk) may in fact justify Pigouvian taxation.

Here is the first paragraph.

A standard textbook argument known by every student of public economics goes as follows.1 If the activity of party A has an uncompensated external effect on party B’s utility, then party A will not choose the socially efficient activity level. Party A can be made to internalize the externality by Pigouvian taxation. However, opponents of government intervention typically argue that Pigouvian taxation is not necessary. According to the celebrated Coase Theorem, rational parties always exploit all possible gains from trade, provided there are no frictions (specifically, if there is symmetric information).2 They will hence write a contract that induces party A to choose the efficient activity level and divide the gains from trade by appropriate transfer payments. Thus, if one does not make the assumption that the government has better information than the parties themselves (which many economists consider to be unrealistic), Coasean bargaining makes Pigouvian taxation unnecessary.

The paper concludes:

It is true that externalities per se do not automatically make intervention by the government through Pigouvian taxation necessary in order to maximize the social surplus. If the activities that have external effects are verifiable, the parties can negotiate contracts that induce an internalization of the externalities, as is suggested by the Coase Theorem. But if investments with direct externalities are unverifiable, contractual arrangements may have no value. Indeed, the very reason that contracts fail to induce first-best behaviour is the fact that (after the investments have been sunk) private partieswill always exhaust all ex post gains from trade through Coasean bargaining. A simple form of Pigouvian taxation can solve or at least alleviate the resulting hold-up problem. Our analysis illustrates that removing tax subsidies, which is a prominent item on the political agenda of many European countries, may well have negative welfare consequences, because it might aggravate hold-up problems. More generally, we emphasize that, if hold-up problems do have the importance that is suggested by recent contributions in the contract theoretic literature, then the possibility of reducing the welfare losses caused by hold-up problems with the help of government intervention should not be completely neglected.


Natural resource economics under the rule of Hotelling

More on the Hotelling Rule ahead of this years lecture on the subject. As this is a presidential address it is more accessible than most academic papers.


Natural resource economics under the rule of Hotelling

* Gérard Gaudet
Département de sciences économiques and CIREQ, Université de Montréal

Presidential address delivered at the 41st Annual Meeting of the Canadian Economics Association, Halifax, 2 June 2007.


Natural resource stocks held in situ are physical assets. Equilibrium in the assets market requires that their rates of return be such that their owners are just willing to hold on to them rather than invest elsewhere. I discuss a number of factors relating to the evolution of extraction costs, to the durability of the resource, to market structure, and to uncertainty, that are important in correctly characterizing the rate of return on holding exhaustible natural resource stocks. The emphasis is put on how those factors can potentially help bridge the gap between the basic Hotelling's rule of natural resource exploitation and the historical behaviour of the flow price of a number of resources. I also highlight some theoretical and empirical issues that need further attention.

Opening paragraph:

The year 2006 marked the 75th anniversary of the publication in the Journal of Political Economy of Harold Hotelling’s ‘The economics of exhaustible resources’ (Hotelling 1931). The word seminal takes all its sense when we write or speak about this article. Rarely has a single paper had as much influence on the development of a whole field of economic research as this one has had on the economics of exhaustible resources. This anniversary provides a good occasion to look back at how the famous Hotelling’s rule of natural resource exploitation has evolved as a framework for understanding the functioning of natural resource markets and to look forward at some unresolved issues, both theoretical and empirical, that would help reconcile the theory and the facts about resource price behaviour over time.


Tuesday, October 23, 2007

Schwarzenegger to sue Bush over emissions

It seems remarkable that Republican Arnie has to file a lawsuit against the US government to be able to tighten its own environmental regulations.

Why are the EPA dragging their feet on this one - two years and counting.

The best quote is from Jerry Brown hinting at the political ramifications:

"It is highly significant that the most trumpeted Republican governor in America feels its absolutely necessary to sue the Bush administration in order to defend California's rights to protect the environment".

California set to sue over emissions [FT]

Arnold Schwarzenegger, the governor of California, is on Wednesday expected to file a lawsuit against the US government over its failure to grant a waiver that would allow the state to set its own fuel emissions standards.

The state made the request for a waiver to implement new standards in 2005. But despite promises from the Environmental Protection Agency that its case was being looked at, no decision has yet been made on whether to issue the waiver. Mr Schwarzenegger warned the EPA six months ago that he would sue if one was not issued and the six-month deadline he imposed expired at the beginning of the week.


Monday, October 22, 2007

File sharing, copying and kids

This following post has nothing to do with the environment and only a tenuous link to globalisation but it provides insights on many levels not least how academics are going to have to keep the plagiarism software up to date for future generations.

It is hard to fault the logic of Hannah (9 year old file sharer).

If I were working for a record company I would start looking for another job quick.

Hannah is either a genius or this is a ITV/BBC style fraud and she is really 38 years old. There is more to the interview (see link).

My italics [ed.]


Inside the Mind of a 9 Year Old File-Sharer

TF. When did you first start using the internet to get music?

- My cousin showed me YouTube and then LimeWire and I was like “whoa cool!”

TF. What was cool about it?

- Because you can put anything in and it will come up and you don’t actually pay for it. Well you have to pay for the internet and LimeWire comes with the internet but you have to pay for that so LimeWire isn’t really free. [ed. That is damn cool]

TF. Ok…I see….Do you get music from anywhere else?

- My cousin gets it from BEBO. She copies it from other people’s pages and puts it on her own.

TF. Do you think it’s ok to copy the music?

- Yes it’s ok because she only does it to make her page better. [ed. A damn good reason]

TF. So you’re sure that it’s ok to copy it? What do you think about copying?

- I suppose it’s not ok to copy but people copied it off her site so she just copies theirs. It’s like, you’re copying my t-shirt so i’m copying you on shoes. [ed. Tit for tat - a winning strategy in game theory]

TF. Ok, so a bit like copying school work?….Hmm….ok, let’s talk about copying on the computer again. When you started using LimeWire, did anyone ever mention that if you did certain things you might be breaking some laws?

- Why would they put it [music] on the internet and invent mp3 players if it was against the law? [ed. Damn good point]

TF. Confusing isn’t it?….You mentioned you like Sean Kingstone - what if I told you that Sean Kingstone’s boss might send you a letter asking for money because you shared his album on LimeWire? What would you say to him?

- W.E! [whatever!] [ed. Genius]

TF. Come on, play along with me. What would you say if he did?

- I’d say “tooooo strict!” and anyway he can’t make me do anything. He’s not the boss of me, he’s the boss of Sean Kingstone. [ed. she will go far]

TF. What do you think might happen if you didn’t pay him?

- Nothing. I’m too young to be charged by the government so he can’t charge me. [

[ed. showing a remarkable knowledge of the US legal system at 9 years old and a classic punchline]

TF. Would you carry on using LimeWire after he sent the letter?

- Yeah!

[ed. Please do not try this at home]


Bubbles in Prices of Exhaustible Resources

In Econ211 Environmental Economics we will soon be covering the Hotelling (1931) Rule.

This paper takes it on to look at bubble equilibria. With many non-renewable resource prices at record highs this is a timely paper.


Bubbles in Prices of Exhaustible Resources

New York University - Department of Economics; National Bureau of Economic Research (NBER) August 2007

NBER Working Paper No. W13320

Aside from the equilibrium that Hotelling (1931) displayed, his model of non-renewable resources also contains a continuum of bubble equilibria. In all the equilibria the price of the resource rises at the rate of interest. In a bubble equilibrium, however, the consumption of the resource peters out, and a positive fraction of the original stock continues to trade forever. And that may well be happening in the market for high-end Bordeaux wines.

JEL Classifications: E44, G12

Sunday, October 21, 2007

New Term Watch: "Resilience Economics"

This post builds on yesterday's mention of "Resilience Science" who today, coincidentally posted on something called "Resilience Economics".

It certainly sounds good and it appears that some well respected environmental economists are working in this area. IMHO I think this is an area of research to watch.

I like the statement "but the there is a lot that needs to be done to create a broadly useful resilience economics" that infers that economists to date have made a pretty poor effort at linking economics to resilience science and have thus far not come up with anything that the scientists deem to be "useful". I wonder how they define "useful"?

Coral Reef Futures and Resilience Economics

It will be interesting to see what type of resilience economics John Quiggin develops. Several other economists have been working on the economics of resilience, such as Wisconsin economist Buz Brock, Charles Perrings at Arizona State U, as well as Anne Sophie Crepin and others at the Beijer Institute, but the there is a lot that needs to be done to create a broadly useful resilience economics


Saturday, October 20, 2007

The Resilience Science weblog

We have added another blog to our growing blogroll. Whilst not economics, it touches on a number of the same issues are gives a little more "science" linked to the Resilience Alliance "a multidisciplinary research group that explores the dynamics of complex adaptive systems."

They define the social-ecological system as: – an integrated system in which the dynamics of the social and ecosystem domains are strongly linked and of equal weight.

Do equal weightings make sense?

Resilience Science

The Resilience Science weblog is operated by Garry Peterson, a professor in Geography and the School of the Environment at McGill University in Montreal, Canada. It was started in early 2005 by Garry Peterson and Marco Janssen as an experiment to communicate recent work by and of interest to those interested in resilience in social ecological systems.

Currently its contributors are members of Resilience Alliance (RA), a research network of scientists and practitioners from many disciplines who collaborate to explore the dynamics of social-ecological systems. Key RA concepts include resilience, the adaptive cycle, and panarchy. The RA works to develop a practical theoretical foundation for a sustainable civilization. The RA develops sustainability science along three paths:

* Contributing toward theoretical advances in the dynamics of complex adaptive systems
* Supporting rigorous testing of theory via: participatory regional case-studies, adaptive management, minimal-modelling, and the use of scenarios and other qualitative modelling tools.
* Developing guidelines and principles that will enable others to assess the resilience of coupled human-natural systems and develop policy and management tools that support sustainable development

Some interesting reading from a different perspective.

This is a paper I must read - any title that include the word "bandit" deserves credit. I still never know why Science papers tend to have so many authors. What do they all do? Especially if this paper really is only 1 page long. That is about 3 lines each.

Berkes F, Hughes TP, Steneck RS, Wilson J, Bellwood DR, Crona B, Folke C, Gunderson LH, Leslie HM, Norberg J,. Nyström M, Olsson P, Österblom H, Scheffer, M, Worm B. (2006). Globalization, roving bandits and marine resources. Science 311: 1557-1558.


Friday, October 19, 2007

"Planet in Peril": CNN's latest investigation

CNN in their "planet in peril" press release show how easy it is to get us to cover an environmental economics related topic:
Dear Dr. Robert J. R. Elliott, As the author of leading environmental blog 'globalisation and the environment', I thought you may be interested in CNN’s upcoming environmental documentary, Planet in Peril, and have access to previews
before it airs next week.

How could we resist. More seriously, having checked it out, the CNN planet peril website is an excellent resource in its own right. There are links for educators, that include worksheets, PDFs, a quiz and short videos covering issues such as deforestation, over population, global warming and biodiversity.

The whole launch has been well thought out, planned and executed.

For example:

CNN Student News Learning Activity: Climate Change

Warming World [Video]

About the show:

CNN takes viewers around the world in a two-part, four-hour documentary that examines our changing planet. This worldwide investigation, shot in high definition, looks at four key issues: climate change, vanishing habitats, disappearing species and human population growth.

To tell this story, Anderson Cooper, Dr. Sanjay Gupta and Animal Planet's Jeff Corwin traveled to some of the most remote and remarkable places on Earth. From exposing illegal wildlife trading undercover in Southeast Asia to seeing first–hand the devastating effects of deforestation in Brazil, they have gathered evidence on the unsettling changes taking place all around us.

Planet in Peril premieres October 24 and 25 at 1300 or 1900 GMT to watch this important documentary on CNN International.

On the surface then this looks like an excellent contribution and CNN's global reach should ensure it reaches plenty of homes especially in the US where there remains a great deal of environmental scepticism. The proof of the pudding will as always be in the eating. How many factual errors and bad science traps have CNN fallen into? Has this 4 hour documentary been spun to make the US government a good guy or a bad guy? Will the show be all glossy locations and no analysis?

Time will tell - the previews offered on the website might also give us a clue.


Free trade

It must be Friday.

For the pixelly challenged the racial stereo types on the right are "US argi-business" and "European farmers" - the latter is the one wearing the beret while the former has a fine stetson a top his head. The anti-globalisation protester being beaten by the law enforcement officer in full riot gear is saying "Wealth Sux"


Thursday, October 18, 2007

Zoellick: Development - Environment trade off

An underlying theme of this blog is the trade off between development economics on the one hand and environmental economics on the other. We could not agree more with the following quote:
"This is all about integrating climate change economics with development economics," Mr Zoellick said. "They are not separate."

The question that motivated us to set up this blog in the first place touches on the same theme:

"Is globalisation good for the environment"

We have subsequently published numerous papers trying to answer that very question.

It is interesting therefore to read this piece from Robert Zoellick (Director of the World Bank) addressing this issue in a recent interview with the Guardian's Larry Elliott.

Whilst Zoellick is saying nothing earth shattering it is reassuring to know that the head of the World Bank is willing to make this point clearly and powerfully in the world's press.

What Zoellick does need to be aware of though is that those in the rich west are going to become less enthusiastic about giving money to the World bank for development projects that involve damaging the environment. Deforestation in the Amazon is a classic example. Creating jobs is one thing, but when those jobs are in the logging industry the World Bank does need to consider the inclusion of environmental impact studies in its poverty reduction project planning.

Aside: Amazon Loggers Hold Greenpeace Activists Captive


Don't neglect poor for sake of the environment, says World Bank boss

The west will fail to combat global warming unless it can convince deeply sceptical poor nations that the fight to reduce carbon emissions will not come at the expense of poverty reduction, the president of the World Bank, Robert Zoellick, said last night.

In an interview with the Guardian to mark his first 100 days in the job, Mr Zoellick warned the Bank's rich-country shareholders that "they would not be successful" if they tried to change the focus of the Washington-based institution from development to cutting greenhouse gas emissions.

"This is all about integrating climate change economics with development economics," Mr Zoellick said. "They are not separate."

The World Bank president added that he had been travelling at the time of this summer's G8 summit in Germany, which had climate change at the top of the agenda, and that he had "picked up a lot of nervousness among Africans that the big developed countries would move the Bank away from its traditional development agenda to focus on climate change".

His experience as the US trade representative had shown him the dangers of creating the impression that rich countries were foisting something on poor countries. "In my consultations with developed countries my message to them is to please be sensitive. If the impression is given that it [climate change] is a rich country project, you are going to have the devil of trouble getting a turnaround."

He said the Bank was well placed to help integrate adaptation and mitigation strategies to fight global warming into development programmes for poor nations, that it could help set up innovative funding tools, facilitate technology transfer, and act as the catalyst for private sector initiatives. He insisted that the Bank's main focus would remain on poverty reduction.

The Bank is asking rich-country donors to come forward with money for the International Development Association - the body that provides soft loans for the world's poorest countries. Mr Zoellick said he had more than doubled the Bank's contribution to the next round of IDA funding in an attempt to force the hands of reluctant countries in the developed world to provide a $26bn pot of new money.

"It strengthens my hand. It means I can go to developed countries and say 'I've increased the Bank's funding by 100%, what about you?'" Mr Zoellick made it clear that if rich countries wanted the Bank to do more on climate change they would have to stump up additional funds, and insisted it was time for the G8 to fulfil pledges made to poor countries. "The G8 made commitments at Gleneagles, but it is one thing having words in a communiqué, it is another thing to have money in the bank."

He expressed concern that the official aid figures for 2006 showed the first fall since 1997, and that the $11bn reported increase in aid for sub-Saharan Africa since 2004 amounted to $3.5bn when debt relief to Nigeria was excluded.

The World Bank president said he understood the need to build support in developed countries for higher aid, but the proliferation of funds designed to address specific causes popular in the west - such as HIV/AIDS - ran the risk of overwhelming poor countries.

He admitted his job had been tough following the departure of his predecessor, Paul Wolfowitz, who resigned in the summer after a scandal involving the promotion of his girlfriend. "It's demanding. There is a lot to do. Part of my purpose in coming here was to calm the waters, but also to navigate a course for the future. I've been able to do that."


EU to help pay to clean up Chinese rivers

It is always good news when we see cross country cooperation to help clean up the environment.

However, there is always something slightly odd about the EU helping pay to clean up China's polluted rivers when at the same time China is sitting on a huge pile of foreign reserves that it is ploughing into US paper at a time when the US dollar is falling rapidly against the rest of the worlds currencies.

On the other hand China is still a developing (albeit rapidly) country that could benefit from European expertise in this area.

Finally, I can't help but be rather sceptical about the concept of paying local people to plant trees. Ensuring the money is spent correctly will not be easy. Likewise, ensuring there is not someone else cutting them down again will be time consuming.

Unfortunately the PlanetArk article does not breakdown the contribution from China and the EU.

China, EU in Campaign to Clean Up China's Rivers

BEIJING - China and the European Union have launched a 175 million euro (US$248 million) campaign to clean up the country's two largest river basins as Beijing struggles to cope with the environmental consequences of rapid growth.

The five-year programme to clean up the Yangtze and Yellow river basins will work out policies on pollution control and promote public awareness about reducing industrial pollution and waste discharge, Xinhua news agency reported on Wednesday.

The project will also pay people living in China's southwestern provinces to plant trees in an effort to improve the ecology along the Yangtze.

The Yangtze basin is one of the most polluted rivers in the world, due to decades of heavy industrialisation, damming and influxes of sediment.

A stretch of the Yellow River became so polluted it turned red from contamination last year and nearly a third of all fish species in it have become extinct.

The problem of water shortages in China has also been compounded by pollution, with billions of tonnes of untreated waste water pumped directly into lakes and rivers.


Krugman, Rodrik and Johnson blogs

I have eventually got round to adding 3 (relatively) new blogs to the blogroll of "globalisation and the environment".

Dani Rodrik's blog
Unconventional thoughts on economic development and globalization

Paul Krugman's blog

and finally,

Simon Johnson's blog
Simon Johnson's blog offers comments about economic research and the global economy around the time of the IMF's Annual Meetings, and provides an informal discussion forum around those subjects.

All three blogs look more generally at issues related to globalisation although Krugman tends to comment more widely these days.

Krugman's early work on international trade and increasing returns is cited all over my late 1990's PhD thesis while Rodrik's work appears to be cropping up all over my recent China research.

Incidently, if anyone is in Nottingham, UK, TODAY then pop in to see Dani Rodrik give a the World Economy annual lecture (apologies for the short notice).

Thursday October 18

Public Lecture
The World Economy Lecture on 'Saving Globalisation from its Cheerleaders'
Room A48, Sir Clive Granger Building
Professor Dani Rodrik, Professor of International Political Economy (Harvard University)
For further details please contact:
Julie Freer
T: 0115 9514763


Wednesday, October 17, 2007


The concept of "debt-for-nature" is one of those ideas that seems so simple, logical and intrinsically "correct" that you wonder why it has not been around for years.

The has long been a "cancel the debt" movement to help developing countries escape the burden of paying back the money owed to western countries that was often incurred by corrupt leaders squandering money on white elephants (not literally) and military hardware. Such interest payments were often a good percentage of the GDP.

The solution that will also help protect the environment, prevent deforestation, maintain the existing carbon sinks and retain exiting biodiversity levels, is to swop debt for nature.

There are undoubtedly criticisms of "debt-for-nature" and it could be argued that this is a form of colonialism or exploitation (especially if if prevents local people making a living) but it still offers a partial solution to a growing problem. The other issue of course is how the "nature" is protected after the swop has been made.

Finally, the US deserves some rare praise for initiating this deal.

A Landmark Deal for Nature Conservancy in Costa Rica

The Nature Conservancy has brokered the largest debt-for-nature swap in history — a deal that will secure long-term, science-based conservation for Costa Rica’s tropical forests:

* The United States will forgive $26 million in debt owed to it by Costa Rica.
* This move will in turn provide necessary funds that will be used to finance forest conservation in Costa Rica over the next 16 years, protecting one of the world’s richest natural treasures for future generations.

And science — the Conservancy's hallmark — is at the center of the deal.

"This debt swap is unique in that it utilizes scientific analysis to determine the sites towards which the funds will be directed,” says Zdenka Piskulich, program director for the Conservancy in Costa Rica.

Biodiversity Under Threat

Costa Rica is a small nation — but it's home to some of the largest tracts of concentrated biodiversity on Earth. Its lush tropical forests are home to several endangered species such as jaguars, quetzals, scarlet macaws, howler monkeys, tree frogs and a host of other wildlife.

However, Costa Rica's natural treasures are under increasing pressure from human activity. Logging, development, agricultural expansion, gold mining, overfishing and unregulated tourism are just some of the factors threatening the country's ecosystems — and making the deal critical for nature and the people who depend on it.

"The funding that is a result of this debt swap will also allow local communities, 80 percent of which live in The Amistad Region, to pursue sustainable and economically viable livelihoods, thus improving their lives and sustaining the biodiverse resources on which they depend," said Piskulich.

Six Areas Will Benefit

The $26 million will be used to conserve Costa Rica’s magnificent forests in six areas — sites chosen from a blueprint of conservation gaps that the Conservancy helped create for Costa Rica.

* The Osa Peninsula is where rain forest meets sea in the Southwest corner of Costa Rica. The Osa is home to the jaguar, squirrel monkey, Baird's tapir, Scarlet Macaw, more than 370 bird species and a large variety of plant life.
* The Amistad region contains the largest untouched tract of rainforest in Costa Rica. The Amistad region borders Costa Rica and Panama and is home to a wealth of wildlife—including the ocelot, Baird’s tapir, giant anteater and more than 350 species of birds.
* Maquenque — home to the Great Green Macaw and ocelots — is rich in natural habitats including wetlands, lagoons, and forests.
* Tortuguero lies near the Caribbean Sea and consists of rich expanses of forests. It provides a safe refuge for jaguars, Green Macaws and several species of turtle.
* Zona Norte del Rincon de la Vieja is the area north of the Rincón de la Vieja volcano. The area has rich dry forests and is home to deer, peccaries, sloths, pumas, toucanets and 257 species of birds.
* Nicoya Peninsula in southern Costa Rica is home to beautiful beaches and rich rainforests. It is home to jaguars, ocelots, coatis, sloths and a wide variety of plants and birds.

What is a Debt-For-Nature Swap, Anyway?

Debt-for-nature swaps are an innovative mechanism to sustain long-term conservation efforts in countries with rich tropical forests.

Countries eligible for a debt swap use their debt payments to finance tropical forest conservation under the guidelines of the Tropical Forest Conservation Act of 1988.

This agreement is the largest debt-for-nature swap under the Tropical Forest Conservation Act and the eighth swap facilitated by the Conservancy. The Conservancy and Conservation International contributed over $1 million in the United States toward the deal. The U.S. government is providing $12 million towards the agreement.

The debt swap has been a coordinated effort between the Costa Rican Government, the Costa Rican Central Bank, the U.S. Treasury, U.S. State Department, the U.S. Embassy in Costa Rica, the Conservancy and Conservation International. The $26 million from the debt swap will be disbursed from a Conservation Trust Fund that will be managed by an oversight committee and administered by CRUSA (The Costa Rica USA Foundation).


Tuesday, October 16, 2007

Top Environmental Blogs

This is a useful list - the Top 35 Environmental blogs.

There are no real surprises and most are covered in the links in the sidebar. Too many wishywashy sites for my liking and not enough meaty analysis.

The shock of course is that Globalisation and the Environment is not featured nor is Environmental Economics.

I claim an anti-economics bias.

The Top 35 Environmental Blogs


Monday, October 15, 2007

Environmental Tax on Polluters in China

In tomorrow undergraduate Environmental Economics lecture we will cover pollution taxes.

It is timely therefore that China are now considering the implementation of a pollution tax on polluters.

The question is how do they know at what rate set the tax - what in other words is the "optimal tax" level?

China Considers Environmental Tax on Polluters [Planet Ark]

BEIJING - China is considering an environmental tax on polluters to cut emissions, a senior government official said on Monday.

"We are actively promoting this idea. But we have to consult with relevant ministries," Pan Yue, deputy head of the State Environmental Protection Administration, told reporters on the sidelines of the ruling Communist Party's five-yearly Congress.

Beijing has put environmental protection at the centre stage of its macro policies guiding the world's fourth-largest economy to achieve sustainable growth, though analysts are skeptical when it comes to implementing the well-intented rules.

Pan did not give details on the scope of the tax levy or a timeframe when such a new policy would come into effect.

President Hu Jintao, speaking earlier on Monday to delegates at the 17th Party Congress, said China's economic growth has come at "an excessively high cost of resources and the environment." He vowed to improve the pricing mechanism for scarce resources to account for environmental costs, among other market factors.

Already the world's top emitter of sulphur dioxide, which causes acid rain, China will overtake the United States as the biggest producer of greenhouse gas carbon dioxide this year or next.

China said last month that it would take environmental costs into account in electricity pricing, to encourage power generation using clean and renewable resources.


Sunday, October 14, 2007

Weekend Environmental Pictures of the Week

It is always a pleasure to find a photograph that encapsulates two environmental themes in one neat shot.

Trees and bikes are this weeks combination:

Finally, given this weekends comments from Alan Johnson (Secretary of State for Health) that "obesity is as big a threat as climate change" it is perhaps relevant to remember not to forget the trees. A few too many cakes for this fine specimen I suspect.

Obesity is as seriousa threat as climate change, says minister [Independent]


Left-side or right side of the brain?

As it is the weekend:

I admit that this TEST has got me completely stumped. I can only get the dancer to go clockwise. Unless I am confusing clockwise with anti-clockwise (where is that link again).

Economists should really see it going anti-clockwise (like most people apparently).

I cannot make it go the other way either. Is this an elaborate (or not so elaborate) hoax?

The Right Brain vs Left Brain test

H/T: CoRE economics.

Can anyone else really see this dancer going anti-clockwise?


Friday, October 12, 2007

Al "9 errors" Gore - the "Climate Change General"

I am as pleased as the next man that big Al was won the "Nobel Peace Prize".

In previous years it has certainly been won by those less deserving.

However, we have covered "the inconvenient truth" and the rigmarole surrounding it in depth over the last year and there is only so much one can take.

Hence, here are a few links to those still with the energy to go over all of it again. The TIME article is one of the best.

Gore's Nobel: A Green Tipping Point [TIME]
Climate scientists are obsessed with finding tipping points, the levels at which the momentum for change becomes unstoppable. For environmentalists, 2007 is likely to be remembered as the tipping point when public understanding of the existential threat of climate change reached a critical mass.

It is true that the launch of this blog last September was propitious timing. TIME trot out the old "what peace got to do with it" line:

Gore's win was widely expected, but there may still be those who wonder how an environmentalist could be, as the Peace Prize's description goes, the person who has "done the most or the best work for fraternity between nations." They shouldn't.

The best thing about this award is the credit given to the IPCC who provided the data and raw materials for Gore to use to get "climate change" into the living rooms of the general public (especially in the US).

TIME provide a good final quote:

But the final war on global warming will be fought not with PowerPoint but with politics, and it will be fought in the halls of power around the world. The scientists represented by the IPCC have spoken — what we need now are passionate, even partisan political soldiers to lead the way and push the final tipping point from awareness to action.

I can think of a pretty good general.

This post cannot pass without comment on the impressive timing of the "British judge" who found 9 errors with the "Inconvenient Truth". Convenient timing don't you think.

There is something fantastically British about some of the judges statements.

When Gore talks of 20 foot rises in sea levels that would swamp San Francisco to the Netherlands to Bangladesh the judge said this was "distinctly alarmist".

None of the errors are fatal but it is good to see the judicial system getting their teeth into a bit of "climate change".

U.K. Judge Rules Gore's Climate Film Has 9 Errors [Washington Post]
But he also said Gore makes nine statements in the film that are not supported by current mainstream scientific consensus. Teachers, Burton concluded, could show the film but must alert students to what the judge called errors.

The judge said that, for instance, Gore's script implies that Greenland or West Antarctica might melt in the near future, creating a sea level rise of up to 20 feet that would cause devastation from San Francisco to the Netherlands to Bangladesh. The judge called this "distinctly alarmist" and said the consensus view is that, if indeed Greenland melted, it would release this amount of water, "but only after, and over, millennia."

Burton also said Gore contends that inhabitants of low-lying Pacific atolls have had to evacuate to New Zealand because of global warming. "But there is no such evidence of any such evacuation," the judge said.

Another error, according to the judge, is that Gore says "a new scientific study shows that for the first time they are finding polar bears that have actually drowned swimming long distances up to 60 miles to find ice." Burton said that perhaps in the future polar bears will drown "by regression of pack-ice" but that the only study found on drowned polar bears attributed four deaths to a storm.

Other links:

Gore and U.N. Panel Win Peace Prize for Climate Work [New York Times]

If Gore wins the Nobel Peace Prize, will he run for president?[Slate]



Breaking news:

The immediate link to "peace" is not obvious although it is correct to say that issues related to climate change will undoubtedly lead to armed conflict in the future whether it is water, resources or refugee related.

Gore and UN panel win Nobel prize

Climate change campaigner Al Gore and the UN's Intergovernmental Panel on Climate Change have been jointly awarded the Nobel Peace Prize.

The committee said they had been chosen for "their efforts to build up and disseminate greater knowledge about man-made climate change".

Mr Gore, 59, was vice-president under Bill Clinton and has since devoted his efforts to environmental campaigning.

The UN's panel of 3,000 scientists is the top authority on global warming.

'Danger of war'

Announcing the award, the Norwegian Nobel Committee praised the recipients' efforts to "lay the foundations for the measures that are needed to counteract [climate] change".

It said it wanted to bring the "increased danger of violent conflicts and wars, within and between states" posed by climate change into sharper focus.

The committee highlighted the series of scientific reports issued by the IPCC over the last two decades, which had "created an ever-broader informed consensus about the connection between human activities and global warming".

Mr Gore was praised as "probably the single individual who has done most to create greater worldwide understanding of the measures that need to be adopted", through his lectures, films and books.


"I can't believe it, overwhelmed, stunned," IPCC chairman Rajendra Pachauri told reporters and co-workers after receiving the news on the phone at his office in New Delhi.

He later told a cheering crowd of co-workers and journalists outside his office in New Delhi he hoped the award would bring a "greater awareness and a sense of urgency" to the fight against global warming.

Mr Gore made a failed bid for the US presidency in 2000. Since then he has emerged as a leading climate campaigner - winning an Oscar for his 2006 film An Inconvenient Truth, an unlikely box-office hit.

The IPCC, established in 1988, is tasked with providing policymakers with neutral summaries of the latest expertise on climate change.

The two winners will share the $1.5m prize.

The Nobel committee closely guards the names of nominees, but this year speculation was high that the recipient would be linked to climate change campaigns.


Wednesday, October 10, 2007

Robot Insect Spies

Surely an environmental blog is the right place to include a post about insects right?

Perhaps if they are robot spy insects it is even more appropriate. I have put this under the "other label". I can't work out whether this is "cool" or "dangerous/scary"?

Civil liberties anyone?

Full article here:

Dragonfly or Insect Spy? Scientists at Work on Robobugs. [Washington Post]

Vanessa Alarcon saw them while working at an antiwar rally in Lafayette Square last month.

"I heard someone say, 'Oh my god, look at those,' " the college senior from New York recalled. "I look up and I'm like, 'What the hell is that?' They looked kind of like dragonflies or little helicopters. But I mean, those are not insects."

Robotic fliers have been used by the military since World War II, but in the past decade their numbers and level of sophistication have increased enormously.

Out in the crowd, Bernard Crane saw them, too.

"I'd never seen anything like it in my life," the Washington lawyer said. "They were large for dragonflies. I thought, 'Is that mechanical, or is that alive?' "

That is just one of the questions hovering over a handful of similar sightings at political events in Washington and New York. Some suspect the insectlike drones are high-tech surveillance tools, perhaps deployed by the Department of Homeland Security.


PUBLIC LECTURE: "Climate Change: Why it is so tough to tackle"

For anyone living in or around Birmingham, UK, Frances Caincross will be giving a public lecture at the Birmingham Scinece Museum on the 25th October. See announcement below.


Prestige Lecture

British Association for the Advancement of Science - West Midlands Branch

Climate change: Why it's so tough to tackle

Why is climate change such a difficult environmental challenge to meet?
How should governments - and individuals - think about it?

President of The British Association 2006
Rector of Exeter College Oxford

Few political issues are as challenging as this.

Thinktank, Birmingham Science Museum

25th October 2007, 7pm

Free Admission - Advance booking strongly advised

Tel: 0121 202 2222 e-mail: website (booking fee applies):


455 parts per million of carbon dioxide equivalent is HERE

Have we gone past the point of no return already?

Have been tipped over the tipping point?

Are we irreversabley doomed to die in a rapidly heating world?

Today's news from the Austrailian scientist Tim Flannery suggests we have.

The fact we have reached the magic 455 parts per million CO2 equivalent already when it was expected to take 10 years does show the extent of the problem. With no real prospect of things improving any time soon it might be time to consider some of the more drastic solutions. Switching lights off and recycling jam jars may no longer be enough.

The reason? Predictable but knowing this answer brings us no closer to a solution.

Flannery said global economic expansion, particularly in China and India, was a major factor behind the unexpected acceleration in greenhouse gas levels.

His conclusions appear to me to be entirely correct.

"That 200 gigatonnes of carbon pollutant, the standing stock that's in the atmosphere, is there courtesy of the industrial revolution, and we're the beneficiaries of that and most of the world missed out," he said.

"So I see that as a historic debt that we owe the world. And I can't imagine a better way of paying it back than trying to help the poorest people on the planet."

Full article below.

Greenhouse Gas Emissions Hit Danger Mark - Scientist [PlanetArk]

SYDNEY - The global economic boom has accelerated greenhouse gas emissions to a dangerous threshold not expected for a decade and could potentially cause irreversible climate change, said one of Australia's leading scientists.

Tim Flannery, a world recognised climate change scientist and Australian of the Year in 2007, said a UN international climate change report due in November will show that greenhouse gases have already reached a dangerous level.

Flannery said the Intergovernmental Panel on Climate Change (IPCC) report will show that greenhouse gas in the atmosphere in mid-2005 had reached about 455 parts per million of carbon dioxide equivalent -- a level not expected for another 10 years.

"We thought we'd be at that threshold within about a decade," Flannery told Australian television late on Monday.

"We thought we had that much time. But the new data indicates that in about mid-2005 we crossed that threshold," he said.

"What the report establishes is that the amount of greenhouse gas in the atmosphere is already above the threshold that could potentially cause dangerous climate change."

Flannery, from Macquarie University and author of the climate change book "The Weather Makers", said he had seen the raw data which will be in the IPCC Synthesis Report.

He said the measurement of greenhouse gas in the atmosphere included not just carbon dioxide, but also nitrous oxide, methane and hydrofluorocarbons (HFCs). All these gases were measured and then equated into potentially one gas to reach a general level.

"They're all having an impact. Probably 75 percent is carbon dioxide but the rest is that mixed bag of other gases," he said.


Flannery said global economic expansion, particularly in China and India, was a major factor behind the unexpected acceleration in greenhouse gas levels.

"We're still basing that economic activity on fossil fuels. You know, the metabolism of that economy is now on a collision course, clearly, with the metabolism of our planet," he said.

The report adds an urgency to international climate change talks on the Indonesian island of Bali in December, as reducing greenhouse gas emissions may no longer be enough to prevent dangerous climate change, he said.

UN environment ministers meet in December in Bali to start talks on a replacement for the Kyoto Protocol on curbing climate change that expires in 2012.

"We can reduce emissions as strongly as we like -- unless we can draw some of the standing stock of pollutant out of the air and into the tropical forests, we'll still face unacceptable levels of risk in 40 years time," he said.

Flannery suggested the developed world could buy "climate security" by paying villages in countries like Papua New Guinea not to log forests and to regrow forests.

"That 200 gigatonnes of carbon pollutant, the standing stock that's in the atmosphere, is there courtesy of the industrial revolution, and we're the beneficiaries of that and most of the world missed out," he said.

"So I see that as a historic debt that we owe the world. And I can't imagine a better way of paying it back than trying to help the poorest people on the planet."


Is peer review in decline?

The standard method for judging the "quality" of an academic is via the peer review system in academic journals.

In a recent paper Glen Ellison notes a decline in the the papers written by economists from the highest ranked Universities in the highest ranked journals.

Ellison blames the internet suggesting that alternative methods of dissemination that are not peer reviewed means that top economists are cutting out this method of publication.

Whilst this may be partially correct such a conclusion does a disservice to those Economists that are not in the top departments and yet are publishing in the top journals. Moreover, the US tenure system ensures high productivity in an academics early career but then, due to the perverse incentives, academics have been known to slow down dramatically so as not to "dilute" their CV with "less than top journal" publications.

As long as publications = promotion there will be no decline in peer review for the vast majority of academics. It is perhaps only the elite few who will have the luxury of ignoring the "publish or perish" mentality pervasive in University structures.


"Is Peer Review in Decline?"
NBER Working Paper No. W13272

Massachusetts Institute of Technology (MIT) -
Department of Economics, National Bureau of
Economic Research (NBER)

Full Text:

ABSTRACT: Over the past decade there has been a decline in the fraction of papers in top economics journals written by economists from the highest-ranked economics departments. This paper documents this fact and uses additional data on publications and citations to assess various potential explanations. Several observations are consistent with the hypothesis that the Internet improves the ability of high-profile authors to disseminate their research without going through the traditional peer-review process.


Tuesday, October 09, 2007

"Plants just go nuts": Desertification the facts.

When one talks about "global warming", the encroachment of deserts and the feeling that one day all that will be left will be desert with the occasional overcrowded watering hole in pervasive.

Of interest is whether "desertification" represents a "tipping point" scenario. Once land become "desertified" (if that is a word) is there any way back? Discuss.

See this article for a relevant news story:

Egypt Plan to Green Sahara Desert Stirs Controversy

"A desert is not the best place to grow food," he said. "From a political perspective, it makes sense in terms of giving more people jobs even though it is not very rational from a water perspective," he added.

The best quote relates to the "greening of the deserts":

"There is no frost and there is sun all the time here," he said. "Plants just go nuts."

This story leads us into a whole new "water wars" debate that we will cover in this blog.

Does anyone care about desertification? When one reads that 1/3 of the US is in the process of desertification then maybe, just maybe, the world will take notice - eventually.

Therefore, we present 5 desertification facts for your delectation:

Five Facts About the Global Problem of Desertification

About 1.2 billion people are at risk from desertification as deserts expand and degraded dry lands cover close to a third of the world's land surface area, the United Nations estimates. Here are five facts about the phenomenon of encroaching desert lands.

* Desertification is not new. The Sumerian and Babylonian empires are among several ancient civilisations thought to have declined more rapidly after their agricultural output fell because of prolonged desiccation and water scarcity.

* Deserts expand naturally, but "desertification" is a different process where land in arid, semi-dry areas becomes degraded, soil loses its productivity and vegetation thins because of human activities and/or prolonged droughts/floods.

* The destruction wrought by spreading deserts grabbed global attention in 1968, nine years before the United Nations held its first conference on the issue. Some 250,000 people and millions of domestic animals died over a six-year period of severe drought in west Africa's sub-Saharan Sahel region, that hit Mauritania, Senegal, Mali, Burkina Faso, Niger, and Chad.

* Globally, the rate of desertification is speeding up, the UN Environment Programme (UNEP) says. Africa is the worst affected continent; with two-thirds of its land either desert or drylands. Almost a third of land in the US is affected by desertification; and one quarter of Latin America and the Caribbean, and one fifth of Spain.

* Desertification is mainly a problem of sustainable development. Its causes include over-cropping, over-grazing, improper irrigation practices, and deforestation. Poor land management practices such as these often stem from the socioeconomic conditions in which the farmers live, and can be prevented.

Sources: Reuters, United Nations Convention to Combat Desertification (


Monday, October 08, 2007

New phrase watch: "Mega-Greenhouse Effect"

Always on look out for the amusing, inventive and profession changing terms, the release of a working paper with the title:

The Economics of the Mega-Greenhouse Effect: A Conceptual Framework

brings us the phrase "Mega-greenhouse effect".

Read below to find out what a mega-greenhouse effect actually is.

The Economics of the Mega-Greenhouse Effect: A Conceptual Framework
Date: 2007-08

By: John M. Gowdy (Department of Economics, Rensselaer Polytechnic Institute, Troy NY 12180-3590, USA)

Roxana Julia (Department of Economics, Rensselaer Polytechnic Institute, Troy NY 12180-3590, USA)


Integrated assessment models of climate change typically analyze the case of a doubling of atmospheric CO2.over the pre-industrial concentration of about 270 ppm. This is a serious shortcoming since under a scenario in which all accessible fossil fuels are burned, atmospheric CO2 concentrations will more than quadruple. We introduce an analytical framework that endogenously accounts for potential climate change events related to this “mega-greenhouse” and examine economic implications of two alternative mitigation strategies: one in which only the rates of annual emissions are reduced, and one that places absolute limits on the total amount of carbon released into the atmosphere. (JEL C53, D61, Q20, Q21 )


Regulations vrs profits

In today's news we see another illustration of the ongoing battle between governments, who want to introduce environmental regualtions to ensure cleaner air, less greenhouse gas emmissions and an altogther nicer environment to live in and the polluters who want to maxmisise profits.

This is not a post about China but the US.

This returns us to the issue of the power of industry lobby groups in the functioning of modern democracies.

Automakers Appeal Vermont Court Decision on Emissions

WASHINGTON - Major US and overseas auto manufacturers on Friday appealed a Vermont court decision that upheld a stringent vehicle emissions law and handed a victory to states trying to regulate greenhouse gases.

The Alliance of Automobile Manufacturers is challenging regulations imposed by California and adopted by a handful of other states, including Vermont, that go beyond federal rules to limit tailpipe emissions and improve fuel economy.

The trade group represents General Motors Corp Toyota Motor Co Ford Motor Co Chrysler LLC and other companies. GM and Chrysler's predecessor Daimler-Chrysler and Vermont auto dealers initiated the case in 2005.

US District Court William Sessions in Burlington ruled in September that federal regulations did not preempt a state law that would require a 30 percent reduction in carbon emissions by cars and light trucks starting with 2009 models.

Vermont, Connecticut, Maine, Massachusetts, New Jersey, New York, Oregon, Rhode Island and Washington adopted the rule, which must be approved by the US Environmental Protection Agency (EPA).

Several states are considering the measure and watching legal developments closely. Cases are pending in California and Rhode Island. The Vermont challenge was the first to go to trial.

Sessions also rejected industry's claim that the Vermont measure would hurt their business.

But industry pressed ahead with its notice of appeal on Friday that was filed with the district court in Burlington. The case now shifts to the 2nd Circuit Court of Appeals in New York.

Dave McCurdy, the auto alliance chief executive, said in a statement that Vermont's regulation is tantamount to a fuel efficiency standard and "federal law is very explicit: states are preempted from adopting fuel economy laws."

"This appeal is urgent as this legislation applies to model year 2009 vehicles, which consumers will start seeing in early 2008 - just a few months from now," McCurdy said.

The Vermont attorney general's office had no comment on the appeal motion, which was anticipated.

But in September, state Attorney General William Sorrell called Sessions' ruling a "big win" for "those concerned about a healthier environment."

Concerned about energy security and high gasoline prices, Congress is considering a new fuel economy standard in Senate-passed energy legislation.

The bill would boost fleet-wide fuel economy by 40 percent to a combined average for cars and trucks of 35 miles per gallon by 2020. It is unclear, however, if lawmakers will finalize the measure since the House of Representatives did not include a fuel standard in its energy bill.


Economics of the Environment in China update

Two articles of note from China Economics Blog.

A Green Awakening in Red China

Green Economics in Red China [Washington Post]

Both articles draw on material from a long post we wrote here on E. Economy's piece on environmental degradation in China.

Elizabeth C. Economy on "The great leap backward?"


Friday, October 05, 2007

Economists wanted at Resources for the Future

Just in case some wondering/wandering environmental economics stumble across this blog here are a couple of interesting jobs at Resources for the Future.



RFF Sr. Fellow (leadership)

Q0 Natural Resource & Environmental Economics
D0 Applied Microeconomics
L1 Market Structure, Firm Strategy and Market Performance
R0 Urban and Transportation Economics
O13 Economic Development and Environment/Resources

Resources for the Future (RFF) is seeking up to two Senior
to lead major prospective research programs in
Urban and Transportation Policy and in Global Ecosystems
Management. Ideas for different programs could also be


RFF is a nonprofit, nonpartisan research institution devoted
to independent economic analysis of environmental, energy,
and natural resource policy issues (see: ).
RFF offers an outstanding environment for scholarly publication
and high-level communication of research to policy audiences.


Basic qualifications are a graduate (Ph.D) degree in
economics or other quantitative social science discipline,
at least 7 years of research and/or policy experience; a
well-developed research agenda; a substantial publication
record, a history of successful fundraising; and
experience in planning and integrating communications
strategies into the research process.


Key activities include developing a program (with RFF seed
money); initiating, managing and conducting high-quality
research within the program; and actively participating in
the dissemination of research results and leading the
engagement of the policy community. Successful candidates
should be recognized as leading experts in their field by
people in the academic and policy communities, should be
able to attract funding for themselves and others in the
program; and have an abiding interest in seeing their
research affect public policy.


Indonesia to Plant 79 Mln Trees in One Day

Whilst forest fires and deforestation are now accepted as part and parcel of the destruction of global forest cover it is always a pleasure to be able to post a "good news" story (even if it goes again the dismal scientist mentality).

However, one does have to question whether it is really possible to plant 79 million trees in one day. That is a serious army of tree planters that require a serious supplies of saplings to plant.

The Indonesian government wonders if planting 79 million trees is a world record? Even without the official Guinness adjudicators one suspects that it will be.

When you read the following quote it is clear why the Indonesians are taking such drastic action.

"Indonesia currently holds a far less flattering world record: according to Greenpeace, it had the fastest pace of deforestation in the world between 2000-2005, with an area of forest equivalent to 300 soccer pitches destroyed every hour."

300 pitches an hour is some serious logging. How much is legal and how much illegal is a question for another day.

Indonesia Says to Plant 79 Mln Trees in One Day [Planet Ark]

JAKARTA - Indonesia, which has destroyed vast tracts of forest, will plant 79 million trees in a single day ahead of the UN climate change summit in Bali in December, an official said on Thursday.

The event, scheduled for Nov. 28, is part of a global campaign to plant one billion trees launched at UN climate change talks in Nairobi last year, said Ahmad Fauzi Masud, spokesman for the forestry ministry.

"Everybody, residents and officials from the lowest unit of the government to the president, will take part in this movement," he said. "It will be a national record and, possibly, a world record."

Indonesia currently holds a far less flattering world record: according to Greenpeace, it had the fastest pace of deforestation in the world between 2000-2005, with an area of forest equivalent to 300 soccer pitches destroyed every hour.

Southeast Asia's biggest economy is also among the world's top three greenhouse gas emitters because of deforestation, peatland degradation, and forest fires, according to a recent report sponsored by the World Bank and Britain's development arm.

Environmental groups are concerned that rapidly expanding palm oil plantations, partly driven by ambitious plans for biofuels, are damaging the country's rainforests.

Participants from 189 countries are expected to gather in Bali in December to discuss a new deal to fight global warming. The existing pact, the Kyoto Protocol, runs out in 2012.

Under Kyoto, about 35 rich nations are obliged to cut emissions by 5 percent below 1990 levels by 2008-12.