Environmental Economics

Whatever happened to user fees?

From The Hill's Overnight Energy and Environment email:

Sen. Lisa Murkowski (R-Alaska) and the rest of the Energy and Natural Resources Committee will get a chance Tuesday to challenge Interior Secretary Sally Jewell on her department's budget request for fiscal year 2016. 

Jewell will be the sole witness at the hearing on Interior's budget. The Obama administration is asking for $13.2 billion, an 8 percent hike from the current funding. It includes items like reducing the payments the states get for offshore drilling and new money for the National Park Service to prepare for its centennial next year.

Here is what PERC has to say about additional funding for the national parks:

Last year, America’s national parks received more visits than ever before, according to new data released by the National Park Service. A record-setting 292.8 million people visited national parks in 2014, breaking the earlier park attendance record set back in 1987.

But a lot has changed since 1987. Population has increased considerably, and so have the number of parks. So how do the new visitation numbers compare once we consider these other factors?

The chart above shows national park visitation as a share of the overall U.S. population. Since 1987, U.S. population has increased by approximately 75 million people. Measured on a per capita basis, national park visitation is about 20 percent less than it was in 1987. As a share of the population, park visitation has gradually declined almost ever since.

This decline is even more pronounced once we consider the growth of the National Park System. Since 1980, more than 70 national park units have been added to the National Park System. Yet these additional parks do not seem to be attracting more overall visits per capita.

As the National Park Service prepares to celebrate its centennial in 2016, there is much emphasis being placed on its ability to attract people to parks – especially millennials. Park visitors can play an important role in funding parks in their next century and helping to address the agency’s $12 billion maintenance backlog. But these data suggest that the National Park Service still has much work to do.

via perc.org

Raising user fees at popular parks would raise revenue and allocate scarce space those who are most willing (and able) to pay for park visits. To answer my own question above, the goal of equity got in the way. At some point, the National Park Service decided that everyone should get a chance to visit the most popular parks. Access is rationed by lottery and queuing. And then taxpayers are asked to fund the system.

Is Economics classified as a Social Science or Business?

Wondering what to major in? If you're a college student wondering what you'll do after you graduate, it might be good to know that young workers with degrees in agriculture, mining, teaching and medicine are in high demand. So are those who studied physics or chemistry. But if you major in architecture or a social science, you might find it hard to get a job when you graduate.

via www.washingtonpost.com

Saturday sports post

Joe Nocera in the NY Times:

“The basic story is that all professional leagues try to have fewer teams than the number of locations that would like to have them,” says Roger Noll, a sports economist at Stanford University. “That is what monopolists do — contrive scarcity to drive up the price.” Los Angeles, he adds, “is perfect for this purpose, because the threat is so credible.” Indeed, during the first decade of this century, according to figures compiled by Judith Grant Long, an associate professor of sport management at the University of Michigan, states and counties spent at least $10.1 billion subsidizing sports facilities. A new football stadium with all the modern amenities costs around $1 billion.

It is easy enough to understand why N.F.L. owners would want to use the threat of moving to extract public subsidies — why pay for something yourself when you can get taxpayers to pick up the tab? Besides, $1 billion is a lot of money, even for billionaires. But why do cities go along with it? It can’t be because they expect some economic benefit to come from a new sports stadium; according to Andrew Zimbalist, a sports economist at Smith College, “The academic literature says that there should be no expectation that a new arena will boost the local economy.”

It has much more to do with civic pride — the sense that your town is truly big-time. Plus no city wants to feel abandoned, the way Baltimore was in 1984 when the owner of the Colts, Bob Irsay, moved the team to Indianapolis in the middle of the night. This is especially true for cities like San Diego, which live in the shadows of bigger cities like Los Angeles. ...

The contingent valuation method has been used to estimate those civic pride benefits. But in most cases the civic pride benefits don't outweigh the costs (the exception is the Vikings study).

"What Have We Learned from the Deepwater Horizon Disaster?"

Dan Petrolia:

This paper outlines what we have learned about the impacts of the Deepwater Horizon (DWH) oil disaster from the economics discipline as well as what effect the DWH disaster has had on the economics discipline. It appears that what we know about the economic impact of the DWH spill today is limited, possibly because such analysis is tied up in the federal Natural Resource Damage Assessment (NRDA) process and other state-led efforts. There is evidence, however, that the NRDA process has changed over time to de-emphasize economic valuation of damages. There is also evidence that economists may be producing fewer outputs as a result of the DWH relative to scholars from other disciplines because of an apparent absence of funding for it. Of the research that has taken place, this paper provides a summary and highlights the main directions of future research. It appears that the most pressing topic is addressing the incentives and policies in place to promote a culture of safety in the offshore oil industry. Also, it appears that the most prominent, and challenging, direction of future research resulting from the DWH is the expansion of an ecosystems services approach to damage assessment and marine policy.

via cbe.miis.edu

Petrolia, Daniel R. "What Have We Learned from the Deepwater Horizon Disaster? An Economist’s Perspective," Journal of Ocean and Coastal Economics: Vol. 2014: No. 1, Article 1.

Noahpinion's too "quick guide to the econ blogosphere"

@Noahpinion for environmental econ its @john_env_econ, @tim_env_econ and @mattkahn1966

— Toni Sipic (@ToniSipic) February 18, 2015

"Job creation shuffle"

Severin Borenstein:

Renewable energy proponents and advocates of the Keystone pipeline finally agree on something: that the right way to count “job creation” is to focus narrowly on the jobs in the industry they want to boost and ignore the overall impact on employment.  Unfortunately, researchers who actually study employment are not on board. ...

The “job creation” justification for government energy policies isn’t new, but its support among economists remains in the range of, well, zero. In the last couple weeks I’ve pinged leading macro, labor and environmental economists – many of whom have worked in the Obama administration – and got the same results that I got when I did this a few years ago: zero support for making energy policy based on job creation.

The problem is that when it comes to creating or destroying jobs, counting the direct industry impact misses a big part of the picture. In non-recession economic times – like today – most of the people who take a newly “created” job are leaving an existing job. Or would have found another job. So, the direct industry impact is smaller than claimed.

Then there are people who are displaced by the new jobs created – the coal miners who worked for the mine that is shut down; the workers at the incandescent light bulb plant; the fracking oil drillers in North Dakota laid off when cheaper crude from the tar sands is carried to market by the Keystone XL; or the workers who would have carried that same oil by rail if the Keystone weren’t built. Of course, many of these people too will find other jobs, but some will become unemployed.

But the fundamental fallacy of counting jobs is that any government policy alters demand, supply, prices and wages throughout the entire economy. Higher energy prices cause some energy-using industries to contract, reducing employment. Higher taxes that pay for subsidizing an energy source make some companies less inclined to expand. Reports of “green job creation” or the “jobs that will be created by Keystone” are just data cherry picking, not real analysis.

Here are some posts on green jobs. 

"RFF on the issues: Climate mitigation payments"

Common Resources:

A “strong majority” of people from the New York Times/RFF/Stanford University poll also indicated that while they worry about climate change and support government regulation, they oppose increasing gasoline taxes or electricity prices. The article questions “just how much they might be willing to pay” to reduce the risks of climate change.

In an international study, RFF’s Alan Krupnick and colleagues explain how willingness to pay to avoid the consequences of climate change “differs among and within countries.” They write: “For policymakers to maintain legitimacy in international negotiations, the costs that a country agrees to pay . . . must be accepted by the citizens who, in the end, will bear the costs of the reduction.”

via common-resources.org

I'm having a snow day

Squeal like a pig?

Economics Job Market Rumors continues to give Appstate some serious props:

1. Economist
   83dc

   Which strange schools are strong in a niche field?

   ex:

   Wyoming - Environmental Economics
   George Mason - Law and Economics

   2 months ago # QUOTE 0 GOOD 2 NO GIOD P !

2. Economist
   8f85

   Appalachian State - Environmental and Resource Economics

   2 months ago # QUOTE 3 GOOD 0 NO GIOD P !

3. Economist
   9a1d

   Appalachian State - Environmental and Resource Economics

   podunk good

   2 months ago # QUOTE 1 GOOD 0 NO GIOD P !

4. Economist
   ab7b

   Appalachian State - Environmental and Resource Economics

   So they say

   2 months ago # QUOTE 0 GOOD 0 NO GIOD P

5. Economist
   55cb

   Squeal like a pig, boy!

   Appalachian State - Environmental and Resource Economics

Here is another one:

1. Economist
   7e25

   If I got a few A-s in honors math classes other than real analysis at a HTC does that rule me out of sacred zip?

   2 months ago # QUOTE 0 GOOD 6 NO GIOD P !

2. Economist
   cb50

   Yes.

   You might have a chance a Appalachian State or Western Michigan.

   2 months ago # QUOTE 1 GOOD 2 NO GIOD P

I've been submitting misleading data to RePEc for years

And still, my rankings go nowhere:

The professor at the heart of a rankings scandal at the University of Missouri at Kansas City’s Henry W. Bloch School of Management has resigned, The Kansas City Star reported. The controversy centers on an innovation-management program that the professor, Michael Song, founded in 2005 and led until last year.

In 2012 a journal article ranked the university as the top institution in the world in the field of innovation management, and Mr. Song as the field’s top researcher. But an investigation by the Star last year raised questions about how the rankings had been obtained, and suggested that Mr. Song had been inappropriately involved in preparing the journal article. The newspaper also questioned whether he had played a role in the submission of misleading data about the Bloch School to Princeton Review, a college-preparation company that ranks universities and programs.

Mr. Song has denied any inappropriate involvement in the journal article or in the submission of flawed data to Princeton Review. An independent audit by PricewaterhouseCoopers LLP, however, confirmed many details of the newspaper’s investigation. Princeton Review has withdrawn its 2014 ranking of the Bloch School. ...

I guess you would conclude that the inflated rankings weren't worth it. Here is the link.