In the absence of legislation for a US national climate policy, regulatory responsibility has fallen to the US Environmental Protection Agency (EPA). In March 2012, the EPA announced a proposed carbon pollution standard for new power plants. Then in September 2013, the EPA withdrew the proposal upon issuing a revision as part of President Obama’s Climate Action Plan. This article analyzes the stringency of the proposed emission standards for new electricity generating units relative to the emission rates of existing, recently constructed, and proposed units in the United States. No coal-fired units would come close to the emission targets unless there are future innovations in carbon capture and storage. While natural gas units designed to meet peak demand are effectively exempt, very few of them would comply on an annual basis. For the baseload natural gas units—that is, combined-cycle gas turbine units—we find that between 90 and 95 percent of the units that began operating in 2006 or later would already meet the proposed targets. Finally, we discuss differences among states regarding the characteristics of recently constructed and planned units as they relate to the proposed standards.
Climate scientists, and natural scientists more generally, believe that climate change is a major, perhaps the most important, problem facing humankind this century, and that it is increasingly linked to extreme weather events. However, the impression one gets from much of the economic literature, particularly simulations from integrated assessment models used in policy analysis, is that the potential impacts of climate change are not large enough to warrant aggressive mitigation efforts in the near term. Although these models represent an important step in the needed interdisciplinary analysis of climate change by elucidating the links between climate and economy, we argue that they grossly underestimate potential impacts and associated damages because they (and the related policy analyses) fail to adequately capture extreme conditions, catastrophic events, and tipping points that trigger irreversible changes in the climate system, as well as impacts on the natural environment that cannot be monetized. Because the most severe impacts are expected in the later years of this century and beyond, discounting is crucial, and we argue that the appropriate rate is well below market rates. Moreover, we show that in the uniquely long period relevant to climate policy, the irreversibility of climate changes and impacts is more serious than the irreversibility of proposed mitigation measures. We conclude that an aggressive mitigation policy is warranted, one that holds further increases in global mean temperature to the scientific consensus on what is required to avoid the worst impacts, and that such a policy can be achieved at a cost that is well below potential damages.
Kenneth J. Arrow, Maureen L. Cropper, Christian Gollier, Ben Groom, Geoffrey M. Heal, Richard G. Newell, William D. Nordhaus, Robert S. Pindyck, William A. Pizer, Paul R. Portney, Thomas Sterner, Richard S. J. Tol, and Martin L. Weitzman:
Should governments use a discount rate that declines over time when evaluating the future benefits and costs of public projects? The argument for using a declining discount rate (DDR) is simple: if the discount rates that will be applied in the future are uncertain but positively correlated, and if the analyst can assign probabilities to these discount rates, then the result will be a declining schedule of certainty-equivalent discount rates. There is a growing empirical literature that estimates models of long-term interest rates and uses them to forecast the DDR schedule. However, this literature has been criticized because it lacks a connection to the theory of project evaluation. In benefit-cost analysis, the net benefits of a project in year t (in consumption units) are discounted to the present at the rate at which society would trade consumption in year t for consumption in the present. With simplifying assumptions, this leads to the Ramsey discounting formula, which results in a declining certainty-equivalent discount rate if the rate of growth in consumption is uncertain and if shocks to consumption are correlated over time. We conclude that the arguments in favor of a DDR are compelling and thus merit serious consideration by regulatory agencies in the United States.
How do you get your work published? I recently offered readers of the Journal of Policy Analysis and Management (JPAM) a top 10 list of things to do and not do if you want your work published in peer-reviewed journals. It was based on my experience as a senior scholar and the editor-in-chief of JPAM for the past decade. This advice is directly relevant for scholars in business and the social sciences, but some of the advice is less germane for scholars in the fine arts and humanities. This is a condensed version of a more detailed article that is available online.
Think globally. ... It is important to understand global and national trends to place your work in that context and motivate your research.
Create a good research team. ... writing strong papers often exceeds the capacity of one person. ... Create a team of researchers whose skills complement your own.
Select a strong research design. Research design trumps statistics, econometrics and stellar writing. It is not possible to resuscitate a weak or flawed research design. ... you should select and frame research questions so that you can construct a strong research design.
Use good data and measures. Data are widely available, but they vary in quality. There is more easily accessed, high-quality data available now than ever before. You can choose to use these data or collect your own. ...
If your paper has flaws, do not ignore them. There is a world of difference between making a long list of all of the heinous problems with your work for referees and pretending that problems do not exist at all! Do not list the problems and do nothing about them, or conversely, ignore the existence of problems. Neither approach works well. ...
Get to the point and write clearly and compellingly. Get to the point right away. Tell us your research question, the contribution to knowledge, and why we should care in the abstract and then repeat it again in the first paragraph. ...
There are different cultural norms based and styles of education across the globe. For a U.S.-based journal, modesty about your contribution is self-defeating. ...
Constructive feedback is your friend, especially before you submit your manuscript to a journal. Whenever your work is close to being ready for journal submission, start presenting that paper. It does not matter if it is at your university, at a conference, or another venue. When someone makes a good suggestion after your presentation, write it down. When you go back to your office, make the recommended changes.
Be strategic. Look at the journal to which you are submitting your paper. Find articles that are related to yours. If there are none, this should give you pause. If you find related papers, cite them in your submission. ... Some of these authors are likely to be your referees. Failing to acknowledge their contributions, particularly in the same journal to which you are submitting, just makes your referees unhappy.
Get it off your desk. ... One hundred percent of the papers on your desk and in your files or on your floor will not be published. ...
I agree with all of these but have one thing to say about "be strategic." I'm not so sure this is so much about being strategic as it is about appropriate journal selection. If you can't find a paper to cite from your target journal then there is a good chance your target journal is not an appropriate outlet for your work.
My dissertation, written under the direction Glenn Blomquist in 1989, considered whether information about alternative environmental goods was missing from contingent valuation (CV) scenarios. Subsequently we received funding to consider whether the CV method could distinguish amongst quality differentiated environmental goods. The paper got beat around a bit but eventually Blomquist and Whitehead (1998) was published. It turns out to be my second most cited paper. Here is the abstract:
Elicitation of valid statements of contingent value requires survey participants who are familiar with the environmental resource change. A primary purpose of the contingent market must be to assure familiarity by providing information. Information about resource quality is important when incompletely informed respondents, say nonusers, perceive resource quality which diverges from true quality. Differences in perceived quality and true quality can be influenced as respondents learn from information in the contingent market. By presenting survey participants with information about four wetlands of varying qualities we test for information effects in a dichotomous choice contingent market for wetlands allocation. We find that information about quality is a determinant of willingness to pay for wetland preservation. Information about resource quality presented in contingent markets will result in more valid valuations of changes in allocations of environmental resources.
I don't think Glenn nor I walked away from Blomquist and Whitehead (1998) "suspicious" about the validity of the CV method. I've always wanted to be cited in the same parenthetical as Hausman (2012), for example, like this (Hausman 2012, Haab et al. 2013), but this one makes me feel yucky. For once, I wish one of my papers wasn't cited.
Retractions have arrived in the case of Peter Nijkamp, a leading Dutch economist accused of duplication and plagiarism. The Review of Economic Analysis has removed two of Nijkamp’s articles for self-plagiarism.
European Lifetime Achievement Award in Environmental Economics Prof. Sir. Partha Dasgupta In recognition of his lifelong contribution to the development of environmental and resource economics - in particular his work on the theory regarding the use of natural resources, and its application to a wide range of environmental problems - and for having provided many fundamental and crucial contributions to economic theory and methodology. Sir Partha Dasgupta has also been a consistent supporter of the European Association of Environmental and Resource Economists, and was the Association's President for 2010-11.
Outstanding Publication in the Journal Environmental and Resource Economics Antony MILLNER, Simon DIETZ and Geoffrey HEAL “Scientific Ambiguity and Climate Policy”. This is a paper which considers the challenge of decision making where uncertainty is of a quality somewhat incompatible with standard expected utility theory. Their consideration of the role of ambiguity aversion provides an important and we expect long-lasting contribution to the literature.
In addition, six papers published in ERE in 2013 were commended for their excellence.
Best Poster Award at WCERE/2014 First Prize Prasenjit BANERJEE, Sakib MAHMUD, Jason SHOGREN: "Coasean bargaining under insecure property rights and capital investment" Second Prize Benjamin GRAMIG, Nicole WIDMAR:"Estimating farmers’ willingness to change tillage practices to supply carbon emissions offsets"
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