Environmental Economics

Pictures of the Day: Just me hanging with Jeff Sachs

Jeffrey Sachs was on campus last Friday to kick off the new OSU Discovery Theme Lecture Series.  I had the privilege of hosting Jeff for a small session with a sample of students majoring in Environment, Economy, Development and Sustainability.

Here's a couple of photos.  Not sure why I'm giving him the stink-eye.

The Tournament Challenge is Over

Congratualtions SteadfastZach on winning the 2014 EnvEcon NCAA Basketball Tournament Challenge.  You can now proceed to make merciless fun of John who finished dead last by choosing his alma mater's archrival to win it all (while his alma mater is playing for the national championship tonight). 

If only he had some loyalty.

As I sit by my mailbox and anxiously await...

...oh where, oh where can it be? (note the publication date, and and don't forget to order yours today).

Predictive validity of stated preference data: demand for Rocky Knob Mountain Bike Park visits

I have a student at the National Cconference on Undergraduate Research in Lexington, KY this week. His abstract is here and here: 

Author: Kevin Atkinson; Department of Economics, Appalachian State University, Boone, NC 28608

Economists prefer revealed preference data, yet some situations lack sufficient revealed preference information for economic analysis. Stated preference data, acquired from surveys asking respondents about their behavior under hypothetical scenarios, may be useful in such situations. Stated preference data is often biased, but revealed preference data also has limitations. Combining both types of data may be especially useful in many situations because it grounds the results from stated preference surveys in the reality of revealed preferences while using data that extends beyond what can be observed from the past. The purpose of this research is to investigate the predictive validity of stated preference data, a current topic of debate among economists (Hausman 2012, Haab et al. 2013). This project will inform that debate through a survey of mountain bike park recreation participants about proposed trail development scenarios and then collecting data to determine revealed preferences after the proposed scenarios become reality. The Rocky Knob Trails Survey was conducted during 2011 and 2012, garnering 302 nearly complete responses. During these years the average number of annual trips to Rocky Knob reported by survey respondents was 16. The trails were not yet completed, so we asked respondents how many trips they would take during a typical year after completion of the trails. The average number of annual trips to Rocky Knob during a typical year with 6 and 8 miles of trail reported by survey respondents is 24 and 60. One half of the survey respondents agreed to be interviewed after the trails were completed. To date, 99 have responded to a follow-up survey begun in November 2013. We asked respondents for the number of mountain bike trips they had taken to Rocky Knob during the past 12 months. No results are yet available since data collection is ongoing (data will be available in January). Regression models will be estimated to determine if stated preference trips accurately predict revealed preference trips. The dependent variable will be revealed preference trips taken as reported in the November 2013 survey. Independent variables will include stated preference trips reported in the previous survey, time between surveys, socioeconomic and other variables. Recreation demand models will then be estimated using both the revealed and stated preference data to determine if the stated preference data can be calibrated to predict accurately. Consumer surplus estimates from the demand models will be estimated.

If you happen to be going (and why wouldn't you not attend an undergraduate research conference on a Saturday morning?), be sure to tell him his presentation was awesome. 

Not red yet

Mike Giberson at Knowledge Problem in response to this post:

So a sample of my complaints: She trumpets the fast declining price of solar panels by picking a factoid out of a story in ComputerWorld: “declined an estimated 60 percent since the beginning of 2011!” ComputerWorld? Maybe the work of the U.S. Department of Energy or other more traditional information sources wasn’t sensational enough (claiming as it does, merely that ”U.S. solar industry is more than 60 percent of the way to achieving cost-competitive utility-scale solar photovoltaic electricity”).

An investment company would have to acknowledge that cherry-picked past results are no guarantee of future performance, but it isn’t even clear that she is firm on the idea of “cost.” Folbre declares that generous subsidies and feed-in tariffs have “allowed solar photovoltaics to achieve vastly lower unit costs.” Really? Well maybe if we subsidize it a little harder, it will become free for everyone!

C’mon professor, get serious! Perhaps it is true that generous subsidies and feed-in tariffs have allowed owners of solar PV systems to experience lower out-of-pocket expenses, but it is a little embarrassing to see a distinguished economist make this mistake about costs. Should we conclude congressional junkets overseas don’t cost anything because the government foots the bill?

 Why didn't I say that?

I've turned into THAT professor

Every PhD I know has stories from graduate school of THAT professor.  The one who loses it, goes off the deep end and finally makes some decisions that are odd, weird, or just plain screwy. Stories of THAT professor are usually told over beers at a professional meeting and start with "Remember the time when..."

Well, yesterday I pulled a stunt that may put me into THAT category.  I'm currently teaching a PhD Applied Econometrics class to 32 first and second year PhD students--yes, 32! (Due to a scheduling change we had to combine the first and second year classes this year so I have way more students than I can handle.)   This class is the last in a a sequence of applied econometrics classes and my job is to take the students from classroom students to researchers.  These are smart people taking the highest level class we have to offer, and frankly they can pretty much learn anything on their own at this point. 

Anyway, as part of a project I am working on, I've been struggling for the past week with an econometric problem.  It's something I should be able to figure out, and given enough time, could probably figure out, but given all of my other duties, I haven't yet figured it out.  This is frustrating to me. 

I don't mean frustrating as in 'gosh-dangit,' but frustrating as in @#$%^&*!!!

Losing sleep frustrated. 

Questioning my training and abilities frustrating. 

So yesterday morning I cracked.  Rather then spending the morning thinking about class, I obsessed over my problem.  Then I realized: "I have 32 captured students who know all the econometrics I have forgotten since graduate school."  So...

Yesterday's class went like this:  I began by announcing I was calling an audible.  Instead of talking about simulation based approaches to discrete choice models, I am giving a problem to solve.  I then spent 1/2 hour explaining (ranting about)  the problem, my attempted solutions and where I thought the problems were. 

After my insane hair-pulling rant, I told them their solution is due in two weeks.  I don't care if you work individually, in small groups or as a class as a whole.  You pick.  Work together.  Be smarter than someone else.  Show me what you know.  Talk to each other.  If you work in a group everyone in your group will get the same grade.

In fact, I don't care about your grade. 

I just want answers. 

Then I left the room. 

I have no idea what happened after that.

 

Q: Why do all of the businesses in Westview fail?

A: They don't maximize profits.

I was hoping that was an April Fool's joke but it is too consistent with the strip to be one. Today's strip proves me right (it wasn't a joke). Instead of buying the comic low and selling high (and what would make a more inelastic demand than trying to complete a comic book collection for your military son who is in Afghanistan?) and turning a nice profit, he gave Holly the Murdoch address so that she could cut out the middleman. 

http://comicskingdom.com/funky-winkerbean/2014-04-01

Insert fart joke here

Don't you wish some people you know would voluntarily reduce their own methane releases?

The Obama administration on Friday announced a strategy to start slashing emissions of methane, a powerful greenhouse gas released by landfills, cattle, and leaks from oil and natural gas production.

... Since cattle flatulence and manure are a significant source of methane, farmers have long been worried that a federal methane control strategy could place a burden on them. But Andrew Walmsley, director of congressional relations for the American Farm Bureau Federation, said that his group was pleased that, for now, the administration’s proposals to reduce methane from cattle were voluntary.

via www.nytimes.com

Seriously, insert fart jokes in the comments section. We won't mind. 

Beware when federal officials request innovative ideas

Here is another innovative idea, don't subsidize risky living:

A string of artificial islands off the coast of New Jersey and New York could blunt the impact of storm surges that proved so deadly during Superstorm Sandy, according to a new proposal.

It's a big proposal – one that would cost up to $12bn – but it's also the kind of innovative idea that federal officials requested as they consider how best to protect the heavily populated east coast from future storms. ...

The "Blue Dunes" proposal is part of a competition sponsored by the US Department of Housing and Urban Development to come up with novel ways to protect Americans against the next big storm. It is one of 10 projects that will be evaluated and voted on next week, but there's no guarantee any of them will receive funding. Other ideas include building sea walls around cities, re-establishing oyster colonies in tidal flats to blunt waves and creating water-absorbent nature and recreational preserves.

The artificial islands plan was created by Stevens Institute, along with the WXY architectural firm and West 8 Urban Design and Landscape Architecture. It is designed to blunt the worst effect of Sandy: the storm surge that pounded the coast. From Maryland to New Hampshire, the storm was blamed for 159 deaths, and New Jersey and New York alone claimed a total of nearly $79bn in damage. ...

The islands, 10 to 12 miles off the coast, would be uninhabited, although day trips for surfing or fishing might be allowed, Blumberg said. They would be built by pumping sand atop some hard base made of rock, concrete or other material.

Steve Sandberg, a spokesman for Senator Robert Menendez, a New Jersey Democrat, said funding for at least some of the proposals is already available as part of the $60bn in Sandy aid that Congress passed last year. Other money could come from disaster recovery grants as well as public and private-sector funding.

A gap would be left between the New York and New Jersey island groups to allow water from the Hudson River to flow out into the ocean.

Blumberg also said computer modeling has shown such islands would have produced vastly lesser damage during Sandy, Hurricane Donna in 1962 and the destructive December 1992 nor'easter.

Aside from the formidable cost, many other obstacles remain. ...

via www.theguardian.com

The most awesome part of the plan is that the $12 billion is already there! And every taxpayer in the U.S. has contributed! Why am I exclaiming like Mark Trail!

Hat Tip: Pearl

 

"Sea turtle eggs!"

The Comics Curmudgeon:

Mark Trail, 3/31/14

As was foretold in prophecy Friday, Mark has shrugged off a sucker-punch to the face and responded with fisticuffs of his own, somehow managing to wind up and knock Marlin down with a right hook despite literally being an inch and a half away from him. Still, this victory is bittersweet, as Mark looks poignantly at the avalanche of sea turtle eggs cascading comically out of Marlin’s green poachin’-sack. Yes, there’s an exclamation point at the end of his dialogue, but based on his stricken facial expression I would guess that this is as close as we’ve ever come to seeing Mark on the verge of tears, bereft over the senseless loss of endangered animal life.

By the way, is sea turtle egg-poaching an actual thing? Like, could those eggs ever hatch now that they’ve been removed from their nest and plopped in a big pile in a bag? Do people try to keep sea turtles as pets? Do people eat sea-turtle eggs? Have we been reading the wrong meaning of “poaching” in this storyline all along?

Mark Trail even thinks to himself with exclamation points!