Environmental Economics

Whew! I'm only 6'3"

I had the pleasure today of attending (and paying for refreshments) for a program titled: Creating Confident Girls, Cultivating Women Who Lead, put on by a local organization called Ruling Our Experiences (Rox)

Rox' mission "IS TO EQUIP GIRLS WITH THE KNOWLEDGE AND SKILLS NECESSARY TO LIVE HEALTHY, INDEPENDENT,PRODUCTIVE AND VIOLENCE-FREE LIVES."

Being the father of three, two of whom are young women, interested in STEM fields and entering (or soon to be entering) the workforce, this is a subject I am personally interested in.

During the discussion today, a long-time colleague (and good friend) commented something to the effect "If you look around the University, most of the administration is 6'4" middle-aged white guys."

Good think I'm only 6'3". 

I wouldn't want to be part of the problem.

 

I'm declaring war on automatic reminders from journals

Me:

This review has risen to the top of my review pile. I should have it completed within a week. That would be about 1 month after I agreed to the request and only about a week after the 3 week deadline that I foolishly agreed to.

Did you know that in the same email you ask me to let you know if there will be further delay AND ask me not to reply?

In reply to:

+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

On Wed, May 30, 2018 at 8:25 AM, ... <[email protected]> wrote:

This message was sent automatically. Please do not reply.

[...]

Dear Dr. Whitehead,

You kindly agreed to review the above-referenced manuscript on 07/May/2018. Your completed review was due on 28/May/2018.

I still value your feedback on this manuscript and would be grateful if you could submit your review as soon as possible at: http://www.evise.com/evise/... If your review will be further delayed for any reason, kindly let me know when I can expect to receive your comments.

+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

What was I thinking? Agreeing to referee a paper in three weeks when I had a stack to get to after final grades were submitted (and a survey to field)?

Climate Change

Last week (or at least that's when it was covered in the popular press), climate scientist Ed Hawkins put out a simple illustration of changes in global temperatures since 1850.  I used Dr. Hawkins image and had a little fun:

 

 

 

At What Cost? Legislators come up with solutions to Harmful Algal Blooms. Environmental Economists come up with cheaper solutions.

The Legislature of the State of Ohio is currently considering legislation to reduce Phosphorous loadings into Lake Erie by 40%.  This is a good thing, as reducing Phosphorous going into Lake Erie will reduce the incidence and impact of Harmful Algal Blooms in the Western Lake Erie Basin.  

The proposed legislation establishes a Clean Lake 2020 plan that includes:

A significant new Clean Lake Capital Fund that may appropriate up to $100 million per year for five years for both Lake Erie algae reduction, and agricultural best practices.  Funding may include establishing facilities to improve manure application processes, projects to reduce open lake disposal of dredged materials, funds to local governments for water quality-based green infrastructure, water management projects to help reduce nutrient and sediment runoff impacting the lake and other strategies.

A new Soil and Water Support Fund, with some of the funding provided directly to soil and water conservation districts to assist farmers in soil testing, nutrient management plans, installing edge of field drainage devices, encouraging inserting of nutrients (subsurface placement), and agreed to conservation methods that may include riparian buffers, filter strips and cover crops.

To the casual observer, this all looks good.  The proposed bill has widespread support among agricultural groups, and local and state authorities. As one of the bill's sponsors notes:

“These are not brand new ideas, just a greater sense of urgency to implement them,” Arndt said.  “There appears to be widespread agreement with state officials, environmental and agriculture groups, tourism advocates and business leaders that many of these strategies will make a big difference.”

And he is right, these strategies could make a big difference. 

But as economists we are trained to ask, 'At what cost?' 

"Conferences and workshops in environmental, energy, and natural resource economics"

Via caseyjwichman.com:

Conferences and workshops in environmental, energy, and natural resource economics

• Northeast Workshop on Energy Policy and Environmental Economics
  • New York, NY
  • May 17-18, 2018
  • Submissions: closed
  • https://www8.gsb.columbia.edu/socialenterprise/research/northeastworkshop

• NBER Summer Institute – Environmental & Energy Economics
  • Cambridge, MA
  • July 23-24, 2018
  • Submissions: closed (invite only)
  • http://papers.nber.org/sched/SI18EEE

• Camp Resources XXV
  • Wrightsville Beach, NC
  • August 12-14, 2018
  • Submissions: closed
  • https://cenrep.ncsu.edu/workshops/camp-resources/

• Heartland Environmental and Resource Economics Workshop at Illinois
  • Urbana-Champaign, IL
  • September 29-30, 2018
  • Submissions due: July 8, 2018
  • http://events.idtg.illinois.edu/here/

• 20th Annual CU Environmental and Resource Economics Workshop
  • Vail, CO
  • September 14-15, 2018
  • Submissions due: July 15, 2018
  • https://www.colorado.edu/Economics/news/environmental-workshop/index.html

• Canadian Resource and Environmental Economics Working Group
  • Montreal, Quebec
  • September 28-30, 2018
  • Submissions due: July 8, 2018
  • https://economics.ca/cree/

• 17th Occasional Workshop in Environmental and Resource Economics
  • Santa Barbara, CA
  • November 9-10, 2018
  • Submissions due: July 27, 2018
  • https://occasionalworkshop.weebly.com/submission.html

Bigger conferences

• Northeastern Agricultural and Resource Economics Association Annual Meetings
  • June 9-12, 2018
  • Philadelphia, PA
  • http://www.narea.org/2018/
    • AERE Sessions:

• World Congress of Environmental and Resource Economists
  • June 25-29, 2018
  • Gothenberg, Sweden
  • http://www.eaere-conferences.org/index.php?p=69

• Western Economic Association Annual Conference
  • June 26-30, 2018
  • Vancouver, British Columbia
  • http://www.weai.org/AC2018
    • AERE Sessions: http://www.aere.org/aere-weai

• Agricultural and Applied Economics Association Annual Meetings
  • August 5-7, 2018
  • Washington, DC
  • https://www.aaea.org/meetings/2018-aaea-annual-meeting
• Southern Economics Association Annual Meetings
  • November 18-20, 2018
  • Washington, DC
  • https://www.southerneconomic.org/conference/
    • AERE Sessions: http://www.aere.org/aere-sea

• Allied Social Science Association Annual Meetings

  • January 4-6, 2019
  • Altanta, GA
  • https://www.aeaweb.org/conference/
    • AERE Sessions: http://www.aere.org/conference—assa

  Association of Environmental and Resource Economists Annual Summer Conference

  • May 29-31, 2019
  • Lake Tahoe, NV
  • http://www.aere.org/summer-conference

  European Association for Environmental and Resource Economists Annual Conference

  • June 26-29, 2019
  • Manchester, UK
  • http://www.eaere.org/section-events/eaere-24th-annual-conference
   
   
   

If we all line up on the coast, count to 3, and jump in the ocean yelling "CANNONBALL" I think we could splash out enough water to counter sea-level rise*

Alabama Rep. Mo Brooks on possible causes of sea level rise:

"What about erosion?...Every time you have that soil or rock, whatever it is, that is deposited into the seas, that forces the sea levels to rise because now you've got less space in those oceans because the bottom is moving up."

Anyone still question the need for more science education in our schools?

*Flashback to my childhood...Dad, almost daily: "Leave some damn water in the pool!"

As Vice President Biden would say, "This is a BFD"

FB18-032 FISHERY BULLETIN ISSUE DATE: May 17, 2018 CONTACT: [email protected], Sustainable Fisheries, 727-824-5305

 Request for Comments: Limited Opening of Recreational and Commercial Red Snapper Fishery in South Atlantic Federal Waters

 

KEY MESSAGE:

NOAA Fisheries requests comments on a proposed rule for Amendment 43 to the Fishery Management Plan for the Snapper-Grouper Fishery of the South Atlantic Region (Amendment 43).  The proposed actions would specify recreational and commercial annual catch limits for red snapper beginning in 2018.

• Red snapper recreational and commercial seasons would open in South Atlantic federal waters for limited harvest beginning in 2018.  
• The South Atlantic Fishery Management Council approved Amendment 43 after recent scientific information indicated an increase in the red snapper population since 2014.
• NOAA Fisheries determined the proposed limited harvest beginning in 2018 is neither expected to result in overfishing, nor prevent continued rebuilding of the population.

*The comment period on the proposed rule begins on May 17, 2018, and comments are due by June 18, 2018.*

Source: http://sero.nmfs.noaa.gov/fishery_bulletins/2018/032/index.html

Daily Demand and Supply: Government prevents entire island population from getting crabs*

From NBC.com:

This community voted overwhelmingly for Donald Trump. But now his immigration changes are killing its livelihood — legendary crabs that are a mainstay of the local economy and a regional delicacy.

For decades, Hoopers Island, known for its crabbing industry, has relied on a federal seasonal work program — known as H-2B visas — to keep its businesses humming. This has allowed employers to hire foreigners, mostly Mexican women, to come temporarily to pick crab meat.

But this year, the cap on H-2B visas — and a shift from the first-come, first-served based model to a lottery system that has disadvantaged Hoopers Island seasonal workers — has left the island without 40 percent of the visas they have needed in the past.

The economics here are pretty straight forward.  The number of workers supplied at any particular wage is equal to the number of domestic workers willing to work at that wage, plus the number of H2B (foreign) workers willing to work at that wage.  For example, if the crab-picking wage is $10 per hour, and the number of domestic workers willing to pick crabs at $10 per hour is 100, and the number of H2B workers willing to pick crabs for $10 per hour is 200, then the total number of workers supplied at a wage of $10 per hour is $300.  If the number of H2B visas are cut by 40%, then the number of H2B crab pickers willing to work at $10 per hour becomes 120, and the total number of workers supplied at $10 per hour is now 220.  In other words, restricting the number of foreign workers results in a decrease in the supply of labor to the crab-picking industry.   So what are the effects of a decrease in the supply of labor in teh crab-picking industry?

 

• Wages for crab-picking will increase.  A decrease in supply of crab-pickers will cause the equilibrium price of crab-pickers to increase.  Those crab-pickers who are hired will get higher wages.
• The number of domestic crab-pickers will increase.  At higher wages, the number of domestic crab-pickers willing to work will increase.  Since the supply of foreign crab-pickers has been reduced, a part of the shortage of workers will be filled by drawing new domestic crab-pickers into the crab-picking jobs.
• The total number of crab-pickers will decrease.  As with any decrease in supply, the equilibrium quantity of workers in the crab-picking market will decrease as the supply of workers decreases.  The gain in domestic workers is more than offset by the loss of H2B workers.  

So in the market for crab-picker we will have higher wages for more domestic workers, with fewer H2B workers in the market, and lower total employment among all crab-pickers.  SO if you are a protectionist, this doesn't sound all bad.  We have more domestic workers employed at higher wages.  Right?

Well, sort of.  We also have to think about what else happens.

Right now we have full employment.  With full employment, those domestic crab-pickers have to come from somewhere. The only place from where they can come are other, similar, jobs.  SO another effect is:

• A decrease in supply of H2B workers in the crab-picking industry will decrease the supply of domestic workers in other industries--driving up those wages as well.

But workers getting paid more is a good thing, right?

Sort of, but we have to remember that workers are an input into the production of outputs.  When the price of an input increase, the supply of the output decreases.  This means:

• A decrease in the supply of any output for which wages have gone up will see higher prices and lower quantities produced/consumed.  The decrease in the supply of labor will cause higher crab (and other food goods) prices.

For reference, here's the current price of crabs at a Baltimore area restaurant: 

Males by the Dozen

• Small (5″-5 ¾″) $30
• Medium (5 ¾″-6 ¼″) $48
• Large (6 ¼″-6 ¾″) $68
• XLarge (6 ¾″-7 ¼″) $101
• Jumbo (7 ¼″-8″) $124

Males by the Bushel

• Small $249
• Medium $309
• Large $379
• Lights (picking crabs) $120

Yikes.

 

*I know that's a cheap joke, but I bet John laughed.

 

Top 100 Economics Blogs of 2018

California mandates solar panels on all new homes

If you want to build a new home in California, you will have to build one with rooftop solar, according to a new mandate from the California Energy Commission. 

The solar rules will apply to new single-family homes and new multi-family housing of three stories or fewer. Under the plan, builders who obtain construction permits issued on Jan. 1, 2020 or later must comply.

Read more here: http://www.sacbee.com/latest-news/article210793889.html#storylink=cpy

This is pretty much a textbook definition of a command-and-control environmental policy, a type of policy that, as I repeat ad nauseam to my undergraduate environmental economics students, is one that is very unlikely to be as cost-effective as an incentive-based environmental policy like a pollution tax or a cap-and-trade market for pollution (which California already has BTW).

Environmental economists tend to dislike command-and-control policies.  Severin Borenstein at Berkeley wrote an email to the energy commission chair voicing his opposition, and James Bushnell at Davis has written and op-ed and a blog post arguing against it.  Both of them know a lot about energy and environmental economics, and about California's electricity markets in particular. 

In addition to not being cost-effective, the policy will likely exacerbate another enormous problem with California's economy: the housing affordability crisis. 

The requirements are likely to add nearly $9,500 to the construction cost per home as state officials have declared a housing crisis. Home prices have soared in California, and housing stock has failed to keep up with demand.

There are some defenders of the policy (not just the energy commission members, who passed it unanimously). There are two main arguments.  The first is a "second-best" or a political economy argument: a cost-effective incentive-based policy may be best but is unfeasible, so let's be happy with the imperfect policy that we got.  Costa Samaras tweets:

Lukewarm take on the Calif solar on homes mandate: should they have done something more optimum instead? Yes- & we should assess objectively. But climate policy/deep decarbonization is about coalition politics, & 2nd (9th?) best policy options often happen instead of the optimum.

A second argument is based on induced innovation: this policy will drastically reduce the costs of solar implementation, so it is effectively subsidizing the under-provided positive externality from knowledge diffusion.

Due to the state’s revolutionary 2019 Building Energy Code requiring solar power to be installed at time of construction for all newly built homes, over time California home buyers could see per unit prices drop to rates approaching that of some of the world’s largest utility scale solar installations ($1/W in the United States).

Some previous research has examined the effects of solar mandates on technological innovation, and my reading of this is that the effect is there not not nearly as big as proponents argue. 

Anyways the whole point is that no one ever listens to economists.

 

 

Read more here: http://www.sacbee.com/latest-news/article210793889.html#storylink=cpy