Environmental Economics

That's $160,784 worth of trees*

Sheesh, why do I have to learn about a national environmental travesty from the Brits**?

It was billed as a triumphant parade for a big chunk of history, but the space shuttle Endeavour's procession through Los Angeles has come with a catch: the city must chop down 400 trees.

Authorities have started felling some much-loved trees to let Nasa's pride and joy rumble from LAX through streets and boulevards to its final home at the California Science Center.

Some residents have protested against the sacrifice of pines, myrtles and magnolias and other species lining the 12-mile route, saying it's a high price for a two-day parade dubbed "mission 26", following the shuttle's 25 missions orbiting Earth.

...

"The move of the shuttle allows the city to be a part of this national endeavor," Sabrina Barnes, Inglewood's director of parks, recreations and library services, told the LA Times. "And gives the chance to address problematic trees that have eroded the landscape."

I have a feeling "problematic" means "ugly, in my snooty suburban elitist opinion."

*I'm extrapolating.

**Note, I have nothing against the English, I just get perverse pleasure from referring to the esteemed English gentleman with whom I work and who pointed me toward this story in The Guardian, a Brit, and then watching him bristle in his fine English way.

Quote of the Day: Snooki edition

“It’s tempting to dismiss celebrity comments on science and health, but their views travel far and wide and, once uttered, a celebrity cancer prevention idea or environmental claim is hard to reverse,” managing director for Sense About Science (SAS), Tracey Brown, told Reuters. “At a time when celebrities dominate the public realm, the pressure for sound science and evidence must keep pace.”

via newsfeed.time.com

That's a much more eloquent way of saying what I was trying to say back in 2005:

I'm probably overreacting.  But it bugs me when fame is equated with knowledge--the ability to entertain is interpreted as an entitlement to take up a cause.  I'm a huge fan of pop-culture.  I love watching TV and movies, because they entertain me.  But, if Leonardo DiCaprio can claim to be an expert on environmental policy simply because he's an entertainer, then I now declare that I can sing.  Watch out Broadway...here I come.

While his own dang pants are on fire

Thomas L. Friedman teases Gov. Perry and Rep. Bachmann for their poor grades in science class ("here is the Texas governor rejecting the science of climate change while his own state is on fire") and then, in a surprising twist, turns his attention to economics:

Not only has the science of climate change come under attack lately, so has the economics of green jobs. Here the critics have a point — sort of. I wasn’t surprised to read that the solar panel company Solyndra, which got $535 million in loan guarantees from the Department of Energy to make solar panels in America, filed for bankruptcy protection two weeks ago and laid off 1,100 workers. This story is an embarrassment to the green jobs movement, but the death by bankruptcy was a collaboration of the worst Democratic and Republican impulses.

How so? There is only one effective, sustainable way to produce “green jobs,” and that is with a fixed, durable, long-term price signal that raises the price of dirty fuels and thereby creates sustained consumer demand for, and sustained private sector investment in, renewables. Without a carbon tax or gasoline tax or cap-and-trade system that makes renewable energies competitive with dirty fuels, while they achieve scale and move down the cost curve, green jobs will remain a hobby.

Here is a link to my latest attack on the notion of green jobs. The basic idea is that the Federal Reserve, The President and Congress should pursue full employment. The Environmental Protection Agency (EPA) should work to cost-effectively protect the environment. We should be color blind on the issue of jobs. If the EPA (or Congress) is trying to create green jobs then the EPA (and Congress) has taken its eye off the cost-effectiveness ball.

At least in the U.S., the worst thing you can do to try to protect the environment is make environmental protection too costly. "A carbon tax or gasoline tax or cap-and-trade system" are environmental policies that reduce the costs of achieving most any given environmental quality target.

I personally don't believe in gravity, I choose to believe that we are held in place by the invisible hand, but why not teach both theories and let people choose?

For those who don't get the connection to our subject matter, substitute 'climate change' for 'evolution' and see whether the answers sound familiar.

No trees were harmed in the production of this research

From the inbox:

Dear Dr. Haab,

The final corrections to your proof have been made. Further corrections cannot be made. Your article is now published online at:

http://dx.doi.org/10.1016/j.reseneeco.2010.04.008

Details:

Title: Effects of information about invasive species on risk perception and seafood demand by gender and race

Authors:Timothy C. Haab, John C. Whitehead, George R. Parsons and Jammie Price

Abstract: In this paper we consider the effects of negative and positive risk information on perceived seafood risks and seafood consumption by gender and race. The data is from a Mid-Atlantic survey of coastal seafood consumers. We elicit risk perceptions in three risk scenarios with a dichotomous choice with a follow-up question format. We elicit continuous revealed and stated preference seafood consumption in nine risk and price scenarios. Analysis in four gender and race categories indicates that demographic groups respond to the positive and negative information in different ways. Communication of risk information as risk mitigation policy is a challenge.

via www.sciencedirect.com

Amen

A bit long (16:00), but worth a look:

A real hypothetical debate

What you are about to read is a look inside the sausage factory that is academic publishing.  Unfortunately, this is going to be long and technical, but John and I feel that airing our side in public might be useful in the hopes of putting a debate to rest.

First a little background

In 1997, I was two years into a career as an assistant professor in the Department of Economics at East Carolina University.  Most of my research at the time focused on the valuation of environmental goods and services and I had a particular interest in a fairly young survey based method known as Contingent Valuation (CV):  CV involves asking survey respondents whether they would hypothetically be willing to pay a certain price for a change in an environmental amenity.  I was fortunate enough to have two colleagues with equal interest in CV: Ju-Chin Huang and John Whitehead--yeah, that John Whitehead. Around since the 1970's, CV gained popularity in the early 1990's when Exxon was kind enough to run one of its oil tankers aground in Alaska, creating the need to develop readily applicable techniques for valuing damages to pristine environments.  After the Exxon Valdez crash, the debate over the use of hypothetical value elicitation questions raged.

Read on...

I need some help from our friends in engineering

I'm not an engineer (but I did play one for two semesters in college).  As an economist, I fully expect that as the external costs of carbon emissions are incorporated into current decisions, the search for ways to sequester carbon will increase--rapidly. 

Like this:

Let me introduce...K.R. Sridhar. Khosla, the co-founder of Sun, set out several years ago to fund energy start-ups. His favorite baby right now is a company called Calera, which was begun with the Stanford Professor Brent Constantz, who was studying how corals use CO2 to produce their calcium carbonate bones.

If you combine CO2 with seawater, or any kind of briny water, you produce CaCO3, calcium carbonate. That is not only the stuff of corals. It is also the same white, pasty goop that appears on your shower head from hard (calcium-rich) water. At its demonstration plant near Santa Cruz, Calif., Calera has developed a process that takes CO2 emissions from a coal- or gas-fired power plant and sprays seawater into it and naturally converts most of the CO2 into calcium carbonate, which is then spray-dried into cement or shaped into little pellets that can be used as concrete aggregates for building walls or highways — instead of letting the CO2 emissions go into the atmosphere and produce climate change.

As an economist though, I've got no frickin' clue as to the likelihood that such technologies are feasible or practical.  That's where I need help.  Any engineers out there know if this is someplace we should be hanging hope (or my retirement investments)?  Here are some more details...  

Statistics or Stories?

First, a passage from the Recreational Fishing Alliance's complaints about the Marine Recreational Fishing Statistical Survey:

While [a new recreational fishing statistical survey] is still in the design and development stage, the recreational fishing industry is left to adhere to the best available science, leaving their own on-water observations and industry data to be considered at best “anecdotal” in nature.  According to the NRC report, those types of experiential, narrative or local information should be used during the scientific process.  “When no other information is available, anecdotal information may constitute the best information available,” the NRC reported in its executive summary, adding “In addition, anecdotal information may be used to help validate other sources of information and identify topics for research.”  

Now one from the Columbus Dispatch highlighting the Columbus Airport's reaction to a recent mediocre J.D. Powers satisfaction rating and a better ranking from Airports Council International:

[David Whitaker, vice president of business development for Port Columbus Airport] said the ACI survey, conducted in person at Port Columbus, "is statistically reliable. ... The J.D. Power survey, from all I can gather, is far more anecdotal in nature and not, as I understand it, statistically reliable."

So, which is better, statistics or stories? 

I guess it depends on the point you're trying to make.

Comforting news for John...

This is why I love science...

"We hope that one day we can demonstrate that xanthohumol prevents prostate cancer development..."

Xanthohumol is derived from hops...