Environmental Economics

"Applying econometrics to elephant poaching: our response to Underwood and Burn"

Solomon Hsiang at G-FEED (some background here):

Nitin Sekar and I recently released a paper examining whether a large legal sale of ivory affected poaching rates of elephants around the world. Our analysis indicated that the sale very likely had the opposite effect from its original intent, with poaching rates globally increasing abruptly instead of declining. Understandably, the community of policy-engaged researchers and conservationists has received these findings with healthy skepticism, particularly since prior studies had failed to detect a signal from the one-time sale. While we have mostly received clarifying questions, the critique by Dr. Fiona Underwood and Dr. Robert Burn fundamentally questions our approach and analysis, in part because their own analysis of PIKE data yielded such different results. 

 

Here, we address their main concerns. ...

In spite of the "longest post ever" warning, go ahead and read (or skim) the post. You may agree or disagree but the part that I found most interesting is this:

In the context of a debate like the present one, it becomes particularly important that the data and analytical methods of all parties are accessible so they can be poked, prodded, and interrogated. I am an affiliate of the Berkeley Institute for Transparency in Social Science where I have taught classes on how to carefully compare findings across a literature (e.g. seehere), and I personally have replicated a large number of studies by other authors, sometimes verifying their original findings and sometimes uncovering inconsistencies and errors (e.g. see here, here, here, here, here). While we should obviously do our best to prevent making errors in research, mistakes happen, and I believe innocent mistakes should be destigmatized—being transparent about our research can accelerate the pace of scientific progress.

 

In keeping with this belief, Nitin and I have done what we can to be transparent. We have posted our replication code here so that anyone can examine exactly what we did and verify our findings. In our appendix, we spell out the various checks we did so observers can check our work. We show the statistics for all our covariates and explain why, despite the occasional low p-value, we do not think they undermine our main finding. We also detail a large number of checks on the data in our appendix.

 

The fact that Burn et al. have not posted their replication code publicly—and that Dr. Underwood did not share it with us when we requested it—has made it very difficult for us (or anyone else) to adjudicate our disagreement about how best to analyze the PIKE data to look for a signal from the one-time sale. 

 

Overall, we believe we have exerted substantial effort to be transparent with our analysis and handling of data to ensure that our results can be replicated by any other member of the community. We hope that the conservation community will make use of our transparency to check our results and verify the validity of what we have done (and, of course, graciously point out any errors we might have made). We also hope the CITES and other members of the community will move towards greater data transparency wherever it is feasible. 

Agreed. You can't complain about others' research unless you are transparent about your own. I'm a major complainer so if you'd like to see any of my data just ask. 

 

There is also an explanation for those outside economics about why we post working papers and present unpublished work at seminars:

Multiple colleagues from ecology have inquired why we released the paper as an NBER working paper prior to peer review. In economics, this is standard procedure. I personally have multiple working papers in circulation, such as this one on the effects of tropical cyclones on economic growth and this one on the effect of temperature on US incomes. Circulating and presenting working papers allows authors to obtain feedback and ideas from colleagues for projects that are close enough to completion that they are coherent and can be understood by a broad audience, while allowing researchers to make adjustments and extensions to their work prior to its final form. In a normal departmental economics seminar, researchers only present working papers and would never present a published paper, since the purpose of the seminar is for the author to obtain feedback from the audience (while of course informing the audience of what work the author is doing). Working papers are regularly cited, both in other working papers and publication, both inside and outside of economics (e.g. interdisciplinary outlets such as Nature and Science recognize this different norm and allow working papers to be cited), as well as by policy-makers. Many of the norms around working papers in economics are similar to how authors in physics use arxiv.org, as I understand it.

This is such an obvious way to move research forward I'm not quite sure why non-economists object. 

Potty humor

Which takes precedence:  Flushing the public toilet, or respecting the cell phone conversation of someone in another stall?

Yes, I was just faced with this dilemma.

Picture of the day: me and the Adam Smith statue #seriousacademic

"Diamondbacks Try To Squeeze More Money From Taxpayers"

And the voters will get to have their say (again):

The Diamondbacks have been playing in their current ballpark since 1998. Their stadium cost $364 million to build, and Maricopa County picked up $238 million of the tab. Eighteen years later, it is need of some repairs, and the fight over who is going to pay for them has gotten ugly.

The team recently said they needed $65 million for a new paint job and a new scoreboard, among other things. They requested the money from Maricopa County, but the county has largely refused to pay up. The Diamondbacks are locked into their lease with the county for 12 more years, and the stadium will need about $187 million in repairs over that time, according to the Arizona Republic. The county is essentially trying to set a precedent and force the team to pay for their own repairs over the next decade and change.

Both sides appear to be furious with each other, and it has turned personal. The Republic acquired a letter that current Maricopa County Supervisor Andy Kunasek sent to Diamondbacks president Derrick Hall in April, in which he yells at him in all caps, reprimands him for trying to squeeze more money from taxpayers, and calls modern professional baseball “parasitic.” When he delivered it, he apparently told team owner Ken Kendrick to go back to “[effing] West Virginia.” ...

Based on Kunasek’s fiery rhetoric, it doesn’t appear that he plans on backing down. However, he said that he will not run for re-election this November, so the resolution to this impasse could come down to the results of the election. Voters might not have gotten a chance to vote on the construction of the stadium, but they will get a chance to pick the politician in charge of its immediate future.

via deadspin.com

According to Forbes, the Diamondbacks are valued at $925 million with annual gate revenues of $44 million. If the county budget is as tight as any other county in the U.S., then it seems that the Diamondbacks have a greater ability-to-pay for maintenance of their primary capital input.

Are there any sports economists out there who could tell me about this "parasitic" claim? Is baseball, football, etc. the most heavily subsidized industry in the U.S.? 

Canongate Kirkyard #seriousacademic

From Wikipedia:

The Canongate Kirkyard (English: Churchyard) stands around Canongate Kirk on the Royal Mile in Edinburgh, Scotland. The churchyard was used for burials from the late 1680s until the mid-20th century.

The most celebrated burials at the kirkyard are the economist Adam Smith ...

Adam Smith LLD (1723–1790), economist and author of The Wealth of Nations, founded the study of political economics. His house was very close by, at the head of Panmure Close, and it survived until 1889. He lived here from 1778 until his death in 1790, having moved from his native town of Kirkcaldy. The grave is a place of pilgrimage for economists of the world. Although an imposing railed monument, it may have been altered in the 1930s, as it was then described as "too small to notice". It is understood that Dr Joseph Black, the chemist and physicist, and James Hutton, the founder of geology, were both at his funeral, being his executors, as would have been David Douglas ....

I made the pilgrimage post-IIFET. Here is my picture:

My guess is that the stone to the left is the original. Here is a picture:

Does anyone know what it says?

Here is a picture of the trail markers:

Daily Demand and Supply: I'm all for environmental regulations until my AC stops working and I need Freon

In 1987, the Montreal Protocol, an international treaty to address atmospheric ozone depletion, established timelines for the phasing out of Chloroflourocarbons (CFCs) and Hydrochloroflourocarbons (HCFCs).  Production and use of CFC's, the more damaging of the XCFC's was banned almost immediately-by 1996, immediate in regulatory terms--and hairdressers everywhere has to find alternatives to their Aquanet.  HCFCs, with less greenhouse gas potential, have faced a slower phase out, with most uses phased to zero by 2020 and all uses by 2030. 

Of importance to me, and really that's all that's important here, the primary refrigerant in most household air conditioning units installed before 2005 (as mine was, the significance of which will become apparent imminently) is Freon, also knows as R-22, or Chlordiflouromethane, an HCFC. 

Well, upon returning from my field research trip yesterday, I arrived home to local warming--that is, my air conditioner had crapped out while I was gone.  As the tech put it, we have a small leak in one of the copper lines--environmental shame on us--and a dirty coil, which caused the supply lines to freeze.  The long-term solution is a new AC unit (or a lot of sweat), but the short-term solution is a cleaning and recharging of our current unit with somewhere between 0-4 pounds of R-22. 

Knowing a rough history of Freon, this news from the tech caused my inner-economist to come to attention.  Future bans on R-22 (supply decrease) are going to cause current supplies to decrease (rationing) and cause current price increases.  So I ask, tepidly, "How much is R-22 these days?" 

The tech, sensing my insider knowledge, says, well, unfortunately, prices have doubled in the past year and they're expected to keep going up until we can't use R-22 anymore in 2020.   He said prices are about $100 a pound now.

Don't believe the tech?  Well, here ya go:

In October 2014, the EPA announced its final phasedown schedule regarding the production and importation of HCFC-22. The order called for an immediate drop from 51 million pounds allowed in 2014 to 22 million pounds in 2015, 18 million pounds in 2016, 13 million pounds in 2017, 9 million pounds in 2018, and 4 million pounds in 2019. No new or imported R-22 will be allowed in the U.S. on or after Jan. 1, 2020.

Stefanie Kopchick, North America marketing manager for refrigerants, The Chemours Co., said the annual allowances have decreased faster than the market demand for R-22, which has depleted inventory across the supply chain.

“Chemours is not excluded from this reality,” she said. “As a result, in 2016, we’re starting to feel the snugness in supply; our wholesale partners have been cut back significantly as the inventory Chemours built in advance of the final phasedown period continues to be depleted.”

With meteorologists predicting normal to warmer-than-normal temperatures this summer, industry leaders only expect demand for the refrigerant to increase. Further adding to the increasing demand is a drop in reclamation and an increase in interest values affecting financing decisions, said Gordon McKinney, vice president and COO of Icor Intl.

“The amount of R-22 being recovered and reclaimed is not expected to contribute much more than 8 million pounds this year,” he said. “Interest rates are on the rise, and that will make repairing a better option than replaceing for many air conditioning and refrigeration equipment owners. With service demands for R-22 in the U.S. still estimated to be in the tens of millions of pounds per year, many R-22 users will need to transition to an ozone-safe alternative, like ICOR’s NU-22B®, to service legacy R-22 systems.”

McKinney mentioned the price of R-22 increased in the fourth quarter of 2015 by an average of 15 percent, is expected to increase through the year, and could reach record levels by the end of 2016. For HVACR contractors and distributors, this could spell trouble.

Damned ozone layer!

Field Research: The Effects of Climate Change on a Florida Vacation

With apologies to my loyal readers (OK, just John) for my intermittent posts, I spent the last week doing some 'field research' in the Florida Keys.  My goal was to observe the effects of climate change first hand.  And let me tell you my field observations are revealing.

1. It's freaking hot in August in the Keys.  And it's been getting hotter for the last couple of decades--at least according to Captain Tony--the Lyin' Hawaiian.  And who wouldn't trust someone with that name?
2. Despite my many efforts, climate change makes it extremely difficult to keep beer cold outside. I tried again, and again, and again, and again...to keep my beer cold until I reached the bottom, but the only reliable solution I came up with was to drink faster.    
3. 90 degree water temperatures are only mildly refreshing when the heat index is 110. 
4. Sea grasses in the flats and bays south of the Everglades are struggling to survive high water temperatures--at least according to Captain Tony (the Lyin' Hawaiian--see #1).  Water temperatures in Key Largo Bay are about 4 degrees above normal (according to the Lyin' Hawaiian).  According to SeaWeb (I don't know--I just Googled it): "Increases in water temperature would reduce the productivity and cause the die-back of those seagrasses growing in areas already around the upper limit of their thermal tolerance."  Captain Tony says the current die off rivals that of the early 2000's and he doesn't have much hope for a recovery of the sea bed in and around the flats of Key Largo--He even suggested the only reasonable solution would be for the Federal Government to invoke eminent domain ("They should use eminent, er, what's that word?  Damn it's hot out here") to preserve he sea beds in the flats.
5. During my field research, my assistant (14 year old only son of Env-Econ--OSEE) and I were able to observe close-up some of the fish species in the flats of Key Largo and South Florida.  Here's are a couple of observational exhibits.  The first is OSEE (and the Lyin' Hawaiian) battling Jaws--a 5 foot bull shark.  The second is the 4.5 foot black tip I was able to observe.  No fish were harmed (other than the bate fish) in this observational study--although I think the two sharks wanted to harm some humans before we released them back to their habitat.  The last picture is me and OSEE with another of OSEE's catches.  I don't remember the specie, because at that point climate change had affected my cognitive abilities-even the Lyin' Hawaiian was complaining how hot it was.