Environmental Economics

Deja Vu

Remember the new inlets?

A temporary manufactured bridge will be installed across the largest breach at Hatteras Island, restoring traffic on N.C. 12 within a month, Gov. Bev Perdue announced Friday.

Hatteras Island has been cut off from the mainland since Hurricane Irene's storm surge washed out big chunks of the highway a week ago, creating a new inlet at Pea Island National Wildlife Refuge.

Other breaches will be filled to restore the road while the state Department of Transportation comes up with a long-term plan for N.C. 12, which has been knocked out repeatedly by storms over the years.

The repair will cost an estimated $10 million and will be paid for by emergency federal funds, Perdue's office said. The short-term solution was developed after transportation officials consulted with 75 experts, contractors and scientists.

The bridge will span 650 feet and will be installed about six miles south of the Bonner Bridge on Pea Island. The manufactured bridge will be shipped in about 35 truckloads and assembled at the site. It is metal, so it can't be a permanent solution in a marine environment, DOT said. ...

It is unclear how long it will take the state to develop a long-term solution for N.C. 12. Perdue has directed DOT to work closely with experts and local, state and federal agencies to create a strategy as soon as possible.

via www.newsobserver.com

In the past they've filled the new inlets in and repaired the road. I wonder if that is not an option this time.

I guess my co-blogger didn't take the bait

Here is the article I mentioned the other day when I was at the beach and, not the rub it in, you weren't (and I was hoping Tim would do my work for me):

Many economists agree that regulation comes with undeniable costs that can affect workers. Factories may close because of the high cost of cleanup, or owners may relocate to countries with weaker regulations.

But many experts say that the effects should be assessed through a nuanced tally of costs and benefits that takes into account both economic and societal factors. Some argue that the costs can be offset as companies develop cheaper ways to clean up pollutants, and others say that regulation is often blamed for job losses that occur for different reasons, like a stagnant economy. As companies develop new technologies to cope with regulatory requirements, some new jobs are created.

I would argue that the effects of environmental regulation shouldn't be assessed based on the net change in jobs that result. Regulations that generate costs and benefits should be assessed on those, and jobs shouldn't be included in a benefit-cost analysis (except in their role as a cost of doing business). The benefits of environmental regulations are the improvements in health, recreation and other good things that the regulations generate.

[Michael Greenstone, an economist at the Massachusetts Institute of Technology] has conducted one of the few studies that actually measure job losses related to environmental rules. In researching the amendments to the Clean Air Act that affected polluting plants from 1972 and 1987, he found that those companies lost almost 600,000 jobs compared with what would have happened without the regulations.

That is about 40,000 jobs per year.

But Mr. Greenstone has also conducted research showing that clean air regulations have reduced infant mortality and increased housing prices, and indeed many economists argue that job losses should not be considered in isolation. They say the costs of regulations are dwarfed by the gains in lengthened lives, reduced hospitalizations and other health benefits, and by economic gains like the improvement to the real estate market.

Housing prices go up because as air quality improves the demand for housing does as well. I'm not sure if this is an aggregate increase in housing prices ... demand for housing (and prices) falls in areas where air quality is relatively poor.

The story ends with one of my favorite themes:

Finding a middle ground is difficult, especially in the midst of heated political wrangling over how to cope with the sputtering economy. Businesses are focusing almost entirely on the costs. Environmental groups, meanwhile, tally up the benefits without paying much heed to the costs.

“My view is that the Republican claim that ‘job-killing regulation’ is a redundancy is as ridiculous as the left-wing view that ‘job-killing regulation’ is an oxymoron,” said Cass Sunstein, head of the White House Office of Information and Regulatory Affairs. “Both are silly political claims that have no place in a serious discussion.”

Cheer up, Gernot!

After getting all dreary reminding us that pro-environmental behavior is a waste of time, former env-econ contributor Gernot Wagner summarizes the case for climate policy in the NYTimes:

Every ton of carbon dioxide pollution causes around $20 of damage to economies, ecosystems and human health. That sum times 20 implies $400 worth of damage per American per year. That’s not damage you’re going to do in the distant future; that’s damage each of us is doing right now. Who pays for it?

We pay as a society. My cross-country flight adds fractions of a penny to everyone else’s cost. That knowledge leads some of us to voluntarily chip in a few bucks to “offset” our emissions. But none of these payments motivate anyone to fly less. It doesn’t lead airlines to switch to more fuel-efficient planes or routes. If anything, airlines by now use voluntary offsets as a marketing ploy to make green-conscious passengers feel better. The result is planetary socialism at its worst: we all pay the price because individuals don’t.

It won’t change until a regulatory system compels us to pay our fair share to limit pollution accordingly. Limit, of course, is code for “cap and trade,” the system that helped phase out lead in gasoline in the 1980s, slashed acid rain pollution in the 1990s and is now bringing entire fisheries back from the brink. “Cap and trade” for carbon is beginning to decrease carbon pollution in Europe, and similar models are slated to do the same from California to China.

Alas, this approach has been declared dead in Washington, ironically by self-styled free-marketers. Another solution, a carbon tax, is also off the table because, well, it’s a tax.

via www.nytimes.com

Why double-blind reviews usually aren't

Google is one of the greatest inventions ever.  Immediate access to unlimited information.  Unfortunately it has also rendered the practice of double-blind review of academic manuscripts virtually meaningless.

It may be wrong, or unethical, or whatever, but as soon as I open my inbox and see this...

Dear Prof. Timothy C. Haab,

You are invited to review the above-mentioned manuscript that has been submitted for publication in [redacted to prevent me being labelled an a-hole by the editor].

The manuscript abstract is attached below.  If you are willing to review this manuscript, please click on the link below:

[redacted]

If you are NOT able to review this manuscript, please click on the link below.  We would appreciate receiving suggestions for alternative reviewers:

[redacted]

...I immediately cut and paste the title of the above-mentioned manuscript into Google and 9 times out of 10 find the author(s).  

I'm pretty sure I'm not alone, and my concern is that the review process now succumbs to significant reviewer bias.  Many of the big journals have long uses a single-blind review process, but those journals want reviewer bias.  They would much rather publish a new paper by Arrow than have readers left wondering, 'Who the f*** is Tim Haab?' 

Lesser journals--you know, as low as top level field journals--often provide young unknown authors access through a double-blind review.  Google-bias makes it harder for the underpriveleged fledgling academic (you know, non-ivy league graduate) to crack good journals.  I have no evidence to support my claims, just a feeling.

Oh, and I almost never suggest alternative reviewers. 

Unless I'm pissed at John, then I suggest him.

Yes, I'm a jerk. 

xkcd: Hurricane Names

via xkcd.com

2011 AERE sessions at the SEA meetings

I guess it is official. The sessions have been posted on the AERE web page.

My most favorite is Top Ten Tips for Young Economists: Teaching, Research and Service. The panelists are Laura Taylor (living the life), Jill Caviglia-Harris (teaching), Will Wheeler (getting grants), Glenn Blomquist  (accumulated wisdom) and Glenn Sheriff (publications). The title is purely alliterative, as I'm sure there will be more than ten tips (which is only 2 per panelists, on average).

I propose an informal AERE social at the hotel bar afterwards. I'll buy the first round for each of the presenters and any one who tells me "I love your blog, except, who is that Tim guy?"

See you in November in DC!

"Is 'environmental economics' an oxymoron after all?"

Gernot Wagner:

Despite all the talk about environmentalists and economists needing to join forces, there’s one underlying, deeply inconvenient truth: Environmentalists and economists often see the world from two entirely different points of view.

via www.gwagner.com

I'd add a link to my take on the oxymoron question but The Energy Collective deleted all of my "exclusive" posts.

Not that there is anything wrong with that.

I don't need human trials to tell me I'm missing these genes

The difference between a couch potato and an Olympic athlete may be all in the genes. Researchers have discovered that disabling two genes in the muscles of mice severely limits their activity — specifically, their ability to run.

 

The findings may help to explain why some people have trouble getting off the couch, and why the longer you stay sedentary, the harder it becomes to get moving, the researchers say.

 

Of course, though mice are good models for much of human biology, the results need to be replicated in humans to see how they carry over.

via www.mnn.com

There is a great NYTimes article today on benefits and costs of regulations that I want to blog but I'm stuck at the beach without my computer

I'll get to it tonight unless I'm scooped by Tim.

Am I willing to pay $5.50* a day to park on campus?

I might not have a choice**...

Ohio State University would sell its parking operation for up to $375 million and invest part of the proceeds through its quasi-endowment, under a proposal to go before the board of trustees next week.

Under the plan developed with the Wall Street financial-services firm Morgan Stanley, the university would sell the roughly $30-million-a-year parking revenue stream to private investors, who would run the operation as a for-profit company for up to 50 years.

The estimated $350 million to $375 million that the operation is worth “would be a check that we would receive on Day One,” said Geoffrey Chatas, the university’s chief financial officer.

An undetermined percentage of that cash would be deposited in Ohio State’s quasi-endowment, which invests public and private money to build a funding machine for the future.

The winning firm would be granted the ability to double the parking revenue during the first decade of the contract.

via www.dispatch.com

Can I build a funding machine for the future too? That would save on all that goofy work/paycheck nonsense I go through now.

*I currently pay $720/year to park. That's about $2.75 a work day.

**OK, I have a choice, but 16 miles is a long way to walk or bike each way and there is no public transportation option for my route.