{"title":"Transmission of flood damage to the real economy and financial intermediation: Simulation analysis using a DSGE model","authors":"Ryuichiro Hashimoto , Nao Sudo","doi":"10.1016/j.jeem.2024.103058","DOIUrl":"10.1016/j.jeem.2024.103058","url":null,"abstract":"<div><div>We assess physical risk associated with floods in Japan, using a dynamic stochastic general equilibrium (DSGE) model. We construct a model that incorporates transmission mechanism of floods and estimate the model using the data of flood-induced damage to capital stock and public infrastructure collected by the government in the last 40 years. The result of the analysis is threefold. First, a flood that reduces the private capital stock by about 0.1% as a direct effect causes GDP to fall by about 0.1% in the first period, with a gradual recovery to pre-flood level. Second, floods dampen GDP through multiple channels. From the supply side, a decline in capital stock inputs and total factor productivity (TFP) reduce GDP. From the demand side, the balance sheets of firms and financial intermediaries are impaired, resulting in disruptions to financial intermediation and depressing GDP. Based on our estimates, all these channels are quantitatively comparable in magnitude. Third, the quantitative impacts of flood shocks on GDP up to now have been minor compared to the standard structural shocks that are considered important in existing macroeconomic studies. However, according to the estimates that use the relationship between the key variables in our model together with climate change scenarios published by the Network for Greening the Financial System (NGFS), the impacts of these shocks could become somewhat larger in the future.</div></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103058"},"PeriodicalIF":5.5,"publicationDate":"2024-09-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142322547","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Do green parties affect local waste management policies?","authors":"Augusto Cerqua , Nadia Fiorino , Emma Galli","doi":"10.1016/j.jeem.2024.103056","DOIUrl":"10.1016/j.jeem.2024.103056","url":null,"abstract":"<div><p>We explore whether mayors supported by pro-environmental parties enhance local environmental outcomes compared to their non-environmental counterparts. We study close elections within a regression discontinuity design and find a notable rise in recycling rates in Italian municipalities governed by pro-environmental coalitions. This uptick becomes far less pronounced when adopting broader criteria to define green mayoral candidates. Crucially, the enhanced recycling rates are not realized through augmented budgets for environmental initiatives or waste collection, but rather are primarily attributed to the implementation of local policies, such as on-call waste collection and the establishment of waste collection centers.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103056"},"PeriodicalIF":5.5,"publicationDate":"2024-09-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S009506962400130X/pdfft?md5=e0af604da4e18aeb33a1cf79a9220003&pid=1-s2.0-S009506962400130X-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142272241","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Rainwater shocks and economic growth: The role of the water cycle partition","authors":"François Bareille , Raja Chakir , Charles Regnacq","doi":"10.1016/j.jeem.2024.103047","DOIUrl":"10.1016/j.jeem.2024.103047","url":null,"abstract":"<div><p>This paper improves our understanding of how rainwater impacts economic growth by investigating the effects of overlooked properties of the water cycle. First, we consider the natural separation of rainwater into <em>flows</em> of <em>blue water</em> (i.e., the water that runs off towards rivers) and <em>green water</em> (i.e., that remaining in the soil). Second, we account for the presence of surface and groundwater <em>stocks</em>. These considerations allow us to comprehensively address the whole partition of rainwater, which, upon reaching the ground, splits into distinct water resources that determine water availability inland. Our analyses on a global panel coupling sub-national economic and hydrological data show that rainwater does increase growth, but do so differently depending on its partition. Specifically, blue water leads to more economic growth than green water at the margin, but, because two thirds of terrestrial water is green, the latter contributes more to growth in total. By missing this crucial partition, we find that commonly used rainwater measurements overstate rainwater’s contribution to growth (by about two). Our analyses further indicate that, although groundwater reserves always mitigate the impacts of rainwater reduction on growth, surface water reserves sometimes amplify regional dependence to rainwater (depending on sector, income and reserve types).</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103047"},"PeriodicalIF":5.5,"publicationDate":"2024-09-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142238488","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Environmental protection for bureaucratic promotion: Water quality performance review of provincial governors in China","authors":"Liguo Lin , Wei Sun , Jinhua Zhao","doi":"10.1016/j.jeem.2024.103060","DOIUrl":"10.1016/j.jeem.2024.103060","url":null,"abstract":"<div><div>We show including quantitative environmental targets for bureaucratic promotion incentivizes government officials to enforce environmental regulation but at significant economic costs. Taking advantage of the gradual expansion of China's water quality performance review (WQPR) over time and space, we find that WQPR significantly reduced ambient concentrations of criteria pollutants, digestive cancer mortality, and GDP growth rate. WQPR's effects are more pronounced along provincial borders, which are targeted by WQPR, and when provincial governors have more promotion potential. An important mechanism is investment in wastewater treatment facilities. There is evidence that WQPR passed the benefit-cost test, especially in rural areas.</div></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103060"},"PeriodicalIF":5.5,"publicationDate":"2024-09-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142312168","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Cross-dynastic intergenerational altruism","authors":"Frikk Nesje","doi":"10.1016/j.jeem.2024.103059","DOIUrl":"10.1016/j.jeem.2024.103059","url":null,"abstract":"<div><p>Does saving behavior reveal socially relevant intertemporal preferences? People concerned about the next generation as such might assign welfare weights on other dynasties. These concerns are captured in a model of saving by decomposing the present generation’s preference for the next into its dynastic and cross-dynastic components. With such preferences, saving for one’s descendants benefits present members of other dynasties if they also care cross-dynastically. These preference externalities imply that socially relevant intertemporal preferences cannot be inferred from saving behavior and that utility discount rates revealed by saving behavior should be lowered. The external effect of present saving also decreases over time, implying that intertemporal preferences inferred from saving behavior are time-inconsistent.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103059"},"PeriodicalIF":5.5,"publicationDate":"2024-09-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S0095069624001335/pdfft?md5=87b5edc2f98d9b8a00b60cc999471b57&pid=1-s2.0-S0095069624001335-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142272242","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Paying income tax after a natural disaster","authors":"Merve Kucuk , Mehmet Ulubasoglu","doi":"10.1016/j.jeem.2024.103044","DOIUrl":"10.1016/j.jeem.2024.103044","url":null,"abstract":"<div><p>We investigate the effects of a climatic shock on individuals’ tax deduction and tax payable patterns, alongside their income dynamics. Using individual-level annual tax return data and exploiting the 2010–2011 Queensland Floods in Australia as a natural experiment, we find that the floods affect different income groups differently. They also lead to persistent higher tax deductions for high-income taxpayers. For the population at large, we detect spikes in certain tax deduction items that lasted longer than the income shock. Overall, our findings uncover discernible changes in tax deduction patterns following floods.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103044"},"PeriodicalIF":5.5,"publicationDate":"2024-09-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S0095069624001189/pdfft?md5=62ef6c23054ae57cd6ddbb2c224adee1&pid=1-s2.0-S0095069624001189-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142163536","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Michael Finus , Francesco Furini , Anna Viktoria Rohrer
{"title":"Barrett's paradox of cooperation: A full analytical proof 30 years after","authors":"Michael Finus , Francesco Furini , Anna Viktoria Rohrer","doi":"10.1016/j.jeem.2024.103045","DOIUrl":"10.1016/j.jeem.2024.103045","url":null,"abstract":"<div><div>In his seminal paper, Barrett (1994) argues that international environmental agreements (IEAs) are typically not successful, which he coined \"the paradox of cooperation\". If the potential gains from full cooperation would be large, self-enforcing IEAs have low participation and, therefore, cannot achieve much, or, if the potential gains are small, agreements are not important, even though IEAs may enjoy large participation. This message has been reiterated by several subsequent papers. Even though these papers explain the driving forces of the paradox, the analysis of membership in stable agreements and the actual and potential gains from cooperation are still mainly based on simulations. In this paper, we provide a full analytical characterization of all items on which the paradox of cooperation is based.</div></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103045"},"PeriodicalIF":5.5,"publicationDate":"2024-08-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142319160","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Hanna Fuhrmann-Riebel , Ben D’Exelle , Kristian López Vargas , Sebastian Tonke , Arjan Verschoor
{"title":"Correcting misperceptions about trends and norms to address weak collective action — Experimental evidence from a recycling program","authors":"Hanna Fuhrmann-Riebel , Ben D’Exelle , Kristian López Vargas , Sebastian Tonke , Arjan Verschoor","doi":"10.1016/j.jeem.2024.103046","DOIUrl":"10.1016/j.jeem.2024.103046","url":null,"abstract":"<div><p>Finding ways to encourage collective action in contexts where only a minority adopts the desired behavior is central to solving many of today’s global environmental problems. We study how correcting people’s beliefs about social norms and behavioral trends encourages collective action in a setting where the desired behavior is not yet prevalent. In a field experiment, we test whether low sign-up rates for a recycling program in urban Peru can be increased by providing information (1) that most people regard participation in the program as important, i.e., on the “injunctive norm”, (2) on an increasing recent trend in sign-up rates. We find that the effectiveness of the treatments depends on people’s prior beliefs: Correcting inaccurate beliefs increases sign-up decisions significantly among people who either substantially underestimate the injunctive norm or who underestimate the positive trend. As this sub-group of people is in the minority in our set-up, we do not observe statistically significant average treatment effects. We further find that the effects of the treatments increase in the level of underestimation. Our evidence demonstrates that belief updating can be used effectively to encourage collective action where it is weak as long as a meaningful number of people underestimates the relevant trends and norms.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"128 ","pages":"Article 103046"},"PeriodicalIF":5.5,"publicationDate":"2024-08-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S0095069624001207/pdfft?md5=1bc45aade440edc08775faadf0bf961b&pid=1-s2.0-S0095069624001207-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142137431","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Chao Han , Chongyu Li , Jiansuo Pei , Chunhua Wang
{"title":"Environmental regulation and intermediate imports: Firm-product-level evidence","authors":"Chao Han , Chongyu Li , Jiansuo Pei , Chunhua Wang","doi":"10.1016/j.jeem.2024.103043","DOIUrl":"10.1016/j.jeem.2024.103043","url":null,"abstract":"<div><p>This study examines the effects of domestic environmental regulations on import activity. Using a panel of firm-product-level data and variations in regulatory stringency across products established by China’s Eleventh Five-Year Plan for Environmental Protection (covering 2006–2010), it reveals that tougher regulations on emission-intensive industries at home led to increases in downstream manufacturers’ imports of emission-intensive intermediate inputs. Specifically, a 1% increase in sulfur dioxide emission intensity resulted in a 0.026% increase in intermediate imports after the implementation of the regulation. A back-of-the-envelope calculation suggests that, although the regulation increased emissions in source countries, it reduced global emissions of sulfur oxides and carbon dioxide. This is because the increases in imports caused by the regulation mainly came from countries with lower emission intensity than China. The regulation did not disproportionately increase imports from or emissions in developing countries.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"127 ","pages":"Article 103043"},"PeriodicalIF":5.5,"publicationDate":"2024-08-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142077380","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Gordon W. Leslie , Armin Pourkhanali , Guillaume Roger
{"title":"Is the clean energy transition making fixed-rate electricity tariffs regressive?","authors":"Gordon W. Leslie , Armin Pourkhanali , Guillaume Roger","doi":"10.1016/j.jeem.2024.103040","DOIUrl":"10.1016/j.jeem.2024.103040","url":null,"abstract":"<div><p>Wholesale electricity prices can rapidly change in real-time, yet households usually face fixed-price electricity tariffs. In markets with large amounts of solar electricity generation, households that predominantly import energy in the daytime when wholesale prices are low implicitly cross-subsidize households with energy use that is more weighted to the higher-priced evening. We map substation data on electricity use to demographic data, to identify the household characteristics associated with this cross-subsidization in a high-solar setting. We find that households in areas with low house prices and high levels of renters are the net funders of this implicit subsidy. These households currently have the lowest average energy cost for retailers to service, and could be the greatest immediate beneficiaries if real-time retail tariffs are made available, before accounting for price-responsiveness. Finally, we present evidence that cross-subsidy magnitudes have grown significantly in recent years, coincident with rapid solar generator penetration.</p></div>","PeriodicalId":15763,"journal":{"name":"Journal of Environmental Economics and Management","volume":"127 ","pages":"Article 103040"},"PeriodicalIF":5.5,"publicationDate":"2024-07-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S0095069624001141/pdfft?md5=107079a04c8c0937da05db46f1a6e23b&pid=1-s2.0-S0095069624001141-main.pdf","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141846058","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}