Environmental Economics

CVM Trash

I just threw away hard copies of about 18% of all of the contingent valuation method papers ever published between 1976 and 2002. I'm trying to avoid any implication that this is a symbolic act.

Imagine if there is no ... income tax cut with a budget deficit

EconomistMom doesn't seem to think that carbon tax (or cap-and-trade auction) revenues must be paired with reductions in income and corporate taxes in order to generate a little bit of efficiency in this crazy world:

The point is, like the fact that economists universally (across the political and ideological spectra) seem to hate the idea of a gas tax holiday, we universally seem to love the idea of environmentally-motivated taxes.  Yes, a tax increase that even tax-cutting economists support.

Why?  Sustainability.  Some economists support the carbon tax purely on the grounds that it would help combat global warming and promote environmental sustainability.  As a mom and an economist, I love the carbon tax idea because it promotes fiscal as well as environmental sustainability.  It’s a revenue increase–yes, a tax increase!–but an efficient one, with the potential for at least some of that revenue to go toward deficit reduction.

I left this comment:

Some of those that you cite above only seem to like a carbon tax if it is paired with reductions in income and corporate taxes. I’ve mentioned that the second part seems a little extravagant with big budget deficits but that idea doesn’t seem to get much support among economists.

A Global Cooling Diet?

Slightly weird news:

Obesity contributes to global warming, too.

Obese and overweight people require more fuel to transport them and the food they eat, and the problem will worsen as the population literally swells in size, a team at the London School of Hygiene & Tropical Medicine says.

But don't most healthier diets increase methane production?  Trade-offs.

At least the article gets the demand/quantity demand thingy right:

"Promotion of a normal distribution of BMI would reduce the global demand for, and thus the price of, food."

The value of my PhD just went up

Not to brag, but (from UK News ...):

A recent study regarding the rankings of doctoral programs in economics in the U.S. spotlights the high quality of the Department of Economics at the University of Kentucky’s Gatton College of Business and Economics.

Help Wanted: NMFS

NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION, NATIONAL MARINE FISHERIES SERVICE, Miami, FL

The National Marine Fisheries Service (NMFS) has a position for a marine economist with the Social Science Research Group at the Southeast Fisheries Science Center in Miami, FL.  The position will be open through June 6, 2008, and will be filled at the ZP-03.

We are looking for a Ph.D. economist with research interest in the fields of natural resources and policy analysis to further develop an economics research program in support of the management of living marine resources in the southeastern U.S.  Duties and responsibilities include: the development of economic models and analyses with which to estimate the economic effects of proposed fishery management actions; the design and supervision of economic data collections when needed; and the presentation of research results in the form of scientific papers, reports and oral presentations.  The position involves participation on various committees to provide scientific information and expertise to fishery managers.

To view the announcement and apply online, please go to either of the following websites.  The vacancy number or job title is NMFS-SEFSC-2008-0023.
http://www.usajobs.opm.gov/
http://jobsearch.usajobs.opm.gov/a9cm.asp

Environmental Capital Takes on Environmental Valuation

Update:  Apparently John and I were writing at the same time.  He just writes faster--or has more time to waste--or something.  So I am shortening my post and just giving you my opinion.

From the WSJ Environmental Capital blog:

At the heart of the debate is whether the same tools that can determine the economic wisdom of a building a new factory serve to protect the environment generations into the future. It got fresh legs this month with a back-and-forth at Grist by two eminent law professors and self-professed environmentalists.

I know I am biased in my opinion here, but to me the question is not "Is it moral to put dollar values on the environment?" but rather "Is it not immoral to fail to put dollar values on the environment?"  That's a lot of nots.

Protect the environment at all costs is not a feasible, practical or reasonable policy stance.  Common ground can only be found through common comparison.  That almost sounds profound.

What do Manny Ramirez and I have in common?

This video reminds me of a time John and I were at yet another thrilling academic conference.  I was in the midst of a typically amazing presentation when I was rudely interupted by some inane question.  After wittily embarrassing the unnamed, but famous, questioner, I calmly walked to the front row, gave John a fist-bump and turned back to the presentation as if unfazed. 

Ok, I made that up.  I just thought the video was cool.  Even if it comes at the expense of my formerly beloved Baltimore Orioles with the owner-who-must-not-be-named.

A disagreement over the usefulness of benefit-cost analysis

From Environmental Capital:

Are environmental goods—be they polar bears, tropical forests, or clean air—best preserved with a dollar sign on them? Or does the attempt to put a price on everything lead to knowing the value of nothing?

...

At the heart of the debate is whether the same tools that can determine the economic wisdom of a building a new factory serve to protect the environment generations into the future. It got fresh legs this month with a back-and-forth at Grist by two eminent law professors and self-professed environmentalists.

Richard Revesz, the dean of New York University School of Law, wants environmentalists to embrace and improve economic tools, especially the art of tallying up costs and benefits of any given policy. Lisa Heinzerling, professor of law at Georgetown, says environmental “cost-benefit analysis” is an oxymoron, because it’s unable to tally many of the environment’s intangible benefits (“the first warbler of spring.”)

Of course, you know what we think about this in general: benefit-cost analysis helps prioritize environmental quality improvements and helps improve the efficiency of environmental resource allocation.

I'll read the two pieces above and offer some comments at a later date. I'm sure that you will breathlessly await.

Oppose the gas tax holiday your own dag-gone-self

From TerraPass:

Dear newsletter subscriber,

Just today we launched our petition opposing the gas tax holiday proposed by Senator Clinton and Senator McCain, and already we've gathered 1,000 signatures from citizens who want to send a strong message that this policy is bad for the environment and bad for America.

Will you keep the momentum going? The proposed legislation goes into effect on Memorial Day, so we only have a few weeks to act. Take 30 seconds to sign our petition:

Say no to the gas tax holiday

To make matters worse, some legislators have been circulating their own petition endorsing the gas tax holiday. They claim to have thousands of signatures. Let's show them that the voices of green-minded citizens are just as strong as those pushing this irresponsible idea.

Regards,

The TerraPass team

George Will raises an interesting question

From the Washington Post:

The housing perhaps-not-entirely-a-crisis resembles, in one particular, the curious consensus about the global warming "crisis," concerning which, the assumption is: Although Earth's temperature has risen and fallen through many millennia, the temperature was exactly right when, in the 1960s, Al Gore became interested in the subject. Are we to assume that last year, when housing prices were, say, 10 percent higher than they are now, they were exactly right? If so, why is that so? Because the market had set those prices, therefore they were where they belonged? But if the market was the proper arbiter of value then, why is it not the proper arbiter now?

I'm not too worried about the housing "crisis."  House prices are falling.  So what?  Isn't that good for some and bad for others?  Houses in my neighborhood are losing value.  Tough luck for me--that's the way markets work sometimes.  Markets determine the "right" price.   

But what is the "right" global temperature? The current answer seems to be something at or lower than the current temperature.  But why?  Are we convinced that the current situation is better or worse than any other?  Are we sure that higher temperatures will result in worse conditions than current temperatures? 

Do-it-yourself stated preference* survey

The amazing 26econ.com shows you how to collect your own data with a web survey and Google spreadsheets:

Google spreadsheets has added forms, which allow web users to input data into a spreadsheet that you’ve created. This makes it perfect for running simple surveys. Here’s a quick run-down on how to do it:

First go to Google Docs and create an account if you haven’t already got one. Then make a new blank spreadsheet. ...

I'll incorporate this into my benefit-cost analysis course so that students won't need to go into the field to collect their data with in-person surveys (something they seem to hate to do).

*Note: or revealed preference or any other type of survey.

Quote of the day

In announcing the decision to protect polar bears under the Endangered Species Act:

While the legal standards under the ESA compel me to list the polar bear as threatened, I want to make clear that this listing will not stop global climate change or prevent any sea ice from melting.  Any real solution requires action by all major economies for it to be effective.  That is why I am taking administrative and regulatory action to make certain the ESA isn't abused to make global warming policies.

-- Secretary of the Interior Dirk Kempthorne

A "Sap"py Story

Warning:  Cynicism ahead. 

Corn ethanol got you down?  Maybe sweet sorghum is the answer. Or maybe not.

Sweet sorghum is grown in the U.S. for cooking and livestock feed. But the tall plant also might help at the gas pump.

A sugary sap inside the plant's stalk, which grow as tall as 12 feet, can be turned into a potent biofuel, and experts and companies are studying its potential with hopes that farmers will want to plant more of it.

Have we learned nothing from the corn ethanol experiment debacle?

Two words: bore ring

From GatE (links added):

We tend to steer clear of the endless discussion of US greenhouse gas tax proposals as they are extensively covered elsewhere. Env-econ and Mankiw appear to me to post on this topic almost daily.

But not today! [yet]

New Book: Frontiers in Resource and Rural Economics

Available for book review, serious reviewers only:

Frontiers in Resource and Rural Economics
JunJie Wu, Paul W. Barkley, and Bruce A. Weber, editors

February 2008/266 pages
Cloth, ISBN 978-1-933115-64-1 / $85.00
Paper, ISBN 978-1-933115-65-8 / $41.95

Book Description

Most land in the United States is in rural areas, as are the sources of most of its fresh water and almost all its other natural resources. One of the first books to approach resource economics and rural studies as fundamentally interconnected areas of study, Frontiers in Resource and Rural Economics integrates the work of 18 leading scholars in resource economics, rural economics, rural sociology and political science in order to focus on two complex interdependencies - one pertaining to natural resources and human welfare, the other to urban and rural communities and their economies. ...

Submit your interest to review this book via email or in the comments. Under our first come, first served policy, the book review has been claimed. Thanks for your interest!

Beach allocation conflicts

From the Virginian-Pilot:

After 12 posts marking a bird closure were found knocked to the ground, the area closed to off-road vehicles on [South Beach in Cape Hatteras National Seashore, about 1.7 miles east of Ramp 49] has been expanded by 50 meters.

... An investigation found two sets of footprints along the edge of the fence line. Footprints or tire tracks were not seen within the closed area, and the least tern colony appeared undisturbed, the statement said.

The posts holding "area closed" signs were broken and several closure markers were pulled out at the shoreline.

Rumors that the source of the footprints is the "Ghost Captain (and ghost crew) of the Graveyard of the Atlantic" are currently being investigated by Velma, Daphne, Fred, Shaggy and Scooby-Doo. In a cruel, ironic twist, they've found it impossible to get the Mystery Machine near the scene of the crime due to the beach driving van.

Ug99 is not another Neil Diamond cover band*

And you thought food prices were high now?

The United Nations Food and Agriculture Organization (FAO) warned in March that Iran had detected a new highly pathogenic strain of wheat stem rust called Ug99.

The fungal disease could spread to other wheat producing states in the Near East and western Asia that provide one-quarter of the world’s wheat.

*I know UB40 isn't a cover band.  But their most popular song--at least in the U.S., and really, where else does music matter?**--was a cover of Neil Diamond's Red, Red Wine.  "Red, Red Wine you make me fell so fine, you keep me happy, all of the time"...then there's something about a monkey.

**I'm joking international readers. 

In a strange twist, a U of Michigan economist called me yesterday to ask me how he can be more like John Whitehead

From the Detroit Free Press:

The Winston-Salem Journal reports that Appalachian State, which pulled a shocking 34-32 upset at then-No. 5 Michigan last season, is getting calls from Big Ten schools looking for an edge over the Wolverines. Coach Jerry Moore, the genius behind Appalachian State's three straight national championships has been receiving numerous phone calls.

The favorite topic: ASU's spread offense, which is based on Urban Meyer's Utah model but involves nuances that Moore's staff learned while visiting West Virginia as guests of Coach Rich Rodriguez.   "Since Rodriguez got the Michigan job," Moore told the Journal, "I've had calls from every other school in the Big Ten."

I won't sign the "cap & trade economist statement"

From the inbox (links added):

Dear Economist:

Are you concerned about the impact efforts to cap U.S. carbon emissions may have on the economy? 

For the past year, we have worked with the Southern Alliance for Clean Energy and other interested groups to ensure that legislation making its way through Congress is structured correctly.

A critical aspect of a carbon cap and trade program will be how the carbon credits are allocated -- will they be given free to emitting industries or will they be sold at auction? 

The attached statement makes the case for auctions.  Please review it and let us know if you are willing to add your name. 

Current signatories include Greg Mankiw from Harvard and James Barrett from Redefining Progress. This is an issue that transcends politics and party -- getting the allocation question right is critical to the success of the program and our economic future. 

Please respond and let us know if we can add your name to this important statement. 

Some environmental economics of Nissan's electric cars

From the NYTimes:

The Nissan Motor Company plans to sell an electric car in the United States and Japan by 2010, raising the stakes in the race to develop environmentally friendly vehicles. ... The zero emissions refers to those from the car’s tailpipe and not those from the production of electricity used to power the car. ...

Mr. Ghosn [Nissan’s chief executive], ..., said the Israeli government would encourage sales of electric cars by sharply cutting taxes to levels below those on gasoline-powered vehicles.

“We would never have done this if the Israeli government was not encouraging it,” he said. “Whoever puts the most incentive on the table is going to get the technology first.”

Quote. Incentives matter. Unquote.