Environmental Economics

A frequency table of USDA ERS employee outcomes

An ERS updata (USDA expects ‘significant delays’ in economic research reports):

Mass attrition at the Economic Research Service as a result of USDA’s decision to move the agency out of Washington will lead to “significant delays” in vital research reports, according to an internal document provided to POLITICO.

The memo, which was drafted by department management for planning purposes, outlines how widely the agency’s work will be paralyzed as a result of the relocation.

ERS conducts research into areas such as climate change, nutrition, export data and the farm economy. Farmers also heavily rely on its outlook reports to make planting decisions. Crop markets can swing on the results of the numbers. ...

USDA identified 38 specific reports that may be delayed because staff members have departed. They include research on topics such as consolidation in the dairy industry, food security among veterans, and international agricultural market access. Some reports will be delayed and perhaps even discontinued, such as price spreads, which calculates what percentage of food dollars goes to farmers. ...

Separately, the union for the agency’s employees estimates that only 19 out of 280 employees chose to move, representing just 7 percent of total staff. USDA has set a deadline of Sept. 30 for the relocation. Current employees have until Sept. 30 to change their status and those "numbers are changing daily," the spokesperson said. ...

Since the move was announced in August of last year, 88 employees left the agency and 50 staffers chose to retire, according to the union.

Forty-four employees were granted special accommodations allowing them to temporarily keep working in Washington, such as via telework or an extension to their report date in the new office space. A reported 79 employees will stay in D.C. that make up the operations deemed "core" by USDA.

The union’s survey doesn't account for new hires that have reported for work at the new location. An Agriculture Department spokesperson said that 10 new employees at ERS and three at the National Institute of Food and Agriculture, which sends grant money to agricultural research institutions, have started work in the Kansas City area. Four new ERS staffers and one NIFA employee will begin next week.

The USDA is actively recruiting for more than 100 positions at both agencies, the spokesperson added.

Agriculture Secretary Sonny Perdue has defended the move as a means to cut costs, improve recruitment and retention of staff, and bring USDA closer to farming communities. USDA has said that locating ERS and NIFA in the Kansas City region would save about $20 million per year over 15 years.

But several employees and former officials have suggested that USDA ordered the relocation to stifle research that contradicts the Trump administration's agenda.

Whatever the purpose of the move, can we agree that it is stifling research and will do so for a very long time? Here is the frequency distribution, as promised:

Outcome	Number	Percentage
Move to KC	19	6.8
Quit the ERS	88	31.4
Retire from ERS	50	17.9
Work for ERS in DC	79	28.2
Temporarily work for ERS in DC	44	15.7
Total	280

 

Another daily demand and supply (two in one week!)

From the WSJ Micro Weekly Review (reviewed by Edward Scahill, University Of Scranton):

Canada’s Oil Market Finds Outlet in U.S. Demand

By Vipal Monga | September 12, 2019

Summary: An increase in the demand for dense crude oil from the U.S. and cuts in production ordered by its government has eased an oil glut in Canada. One year ago, Canadian oil sold at a discount of over $50 per barrel to the U.S. benchmark price as pipeline congestion increased inventories. In 2019, a U.S. embargo on Venezuelan oil reduced the difference in price between Canadian and West Texas Intermediate oil.

Classroom Application: The article demonstrates why the market for petroleum is an international, rather than a national or regional, market. Although oil supplies can differ in sulfur content, oil is essentially a homogenous product, as are commodities such as wheat and corn. This implies that market forces tend to reduce differences in the price of oil produced in different countries.

Questions:

• The article mentions that “…output from U.S. oil companies has been plentiful…” Why, then, has the U.S. imported oil from Canada?
• What is an oil embargo? Would an embargo be more likely to result in a shortage or a surplus of oil?
• The Keystone pipeline is used to transport oil from Canada to refiners in the United States. A proposed extension of the pipeline, called Keystone XL, was delayed by legal challenges raised by groups opposed to the route the pipeline would follow. Proponents of the pipeline argue that it would be safer for oil to be transported by the Keystone
• XL pipeline than by rail. Why do advocates for Keystone XL believe transporting oil via pipeline is less hazardous than transportation by rail?
• The article refers to a “glut of oil in Canada.” What is another term for a market glut?
• Draw and label a graph that illustrates the demand and supply for Canadian oil. Indicate in the graph a price that would be consistent with a market glut. In the graph, show how “…higher demand… from U.S. Gulf Coast refineries and government-imposed cuts…” reduced a glut of Canadian oil in 2019.
• “The U.S. imported an average 3.58 million barrels a day from Canada for the four weeks ended Aug. 30…That was an 8% gain from the four-week average recorded at the end of last year and a 3% increase from the end of August 2018.” From the article, cite one reason why the U.S. increased its purchases of Canadian oil over the past year.
• “Moving a barrel from terminals in Alberta to the U.S. Gulf Coast costs between $9 and $12 a barrel by pipeline and between $15 and $20 by rail.” If the cost of transporting oil from Canada to the Gulf Coast by pipeline is lower than the cost of rail transportation, why would any oil be transported by rail?

Here is the link ($): https://www.wsj.com/articles/canadas-oil-market-finds-outlet-in-u-s-demand-11568289600

Daily demand and supply

Here is an example of two curves shifting (supply decrease, demand decrease):

Fall typically brings lower gas demand, and the Energy Information Administration’s latest weekly report shows just that. For the week ending on September 13, demand dropped by 900,000 b/d from the previous week to 8.9 million b/d. Additionally, total domestic stocks increased by 800,000 bbl to 229.7 million bbl. Typically, these market shifts would push pump prices down, but increased oil prices – a result of attacks on oil facilities in Saudi Arabia over the weekend – have pushed pump prices up. Since Monday, the national average for unleaded regular gasoline has increased 10 cents to $2.66.

via gasprices.aaa.com

What title do you tell journals you prefer? Dr.? Prof? Me? I prefer (Kentucky) Colonel

"EPA is soliciting comment on issues related to water quality trading" @willwheels

This might be the first good thing to be coming out of the EPA in quite some time. via Will Wheeler on twitter:

EPA is soliciting comment on issues related to water quality trading ... (looks like the http://regs.gov docket is not live, but that just means you have more time)

Here is the link: https://www.epa.gov/sites/production/files/2019-09/documents/water_quality_trading_under_the_npdes_program-signed_pre-pub.pdf

Here is the summary at the beginning of the document:

The Environmental Protection Agency (EPA) is requesting comment on policy approaches for addressing “baseline” issues in watersheds with EPA-approved Total Maximum
Daily Loads (TMDLs) where policy makers would like to pursue water quality trading as a regulatory option for National Pollutant Discharge Elimination System (NPDES) permit compliance. These policy approaches may also be of interest to stakeholders pursuing marketbased water quality improvement programs outside of the NPDES permit program.

And the end: 

The EPA is considering modifying or clarifying existing EPA policy and guidance on water quality trading to remove unnecessary barriers and better support market-based mechanisms, including water quality trading, consistent with the 2019 Memorandum. The EPA is requesting comment from states, tribes, stakeholders and other members of the public on all aspects of this notice. In particular, the Agency is requesting comment on:

• The proposed approaches described in Section III, including preferences between the approaches and the recommended mechanisms to implement those approaches;
• Other policy ideas or enhancements that could help promote or facilitate market-based programs to improve water quality; and
• Other aspects of the 2003 Policy and the 2019 Memorandum (including potential conflicting or ambiguous policy advice) that may benefit from additional policy or clarification from the EPA.

 

AERE Sessions at the 2019 SEA meetings @AereOrg

There are 70 papers in 14 regular sessions, 17 papers in 4 graduate student sessions and the (first ever) AERE keynote session. The keynote speaker is AERE immediate past president Laura Taylor. She will present "Reflections on the Credibility Revolution in Nonmarket Valuation".

Here is the link to all of the sessions: https://www.southerneconomic.org/current-year-program/?conferenceId=5&organizationId=2

We had a great panel of speakers for another professional development session but someone (me) screwed up and didn't get it submitted on time. My apologies to Elaine Frey who organized it and everyone who agreed to present. Hopefully, this panel is ready to go in 2021. 

Take the "What Are Things REALLY Worth?" survey!

I did and I'm only mildly traumatized (how in the world did this get past the IRB???):

Stanford, CA — How valuable are the things that money cannot buy? Dr. Tim Kane, a research fellow at the Hoover Institution, is running a week-long research survey to find out. This survey, in the format of an “economic beauty contest,” as described by economist John Maynard Keynes, is open to all American adults during the first full week of September. One hundred dollars in Amazon gift certificates will be awarded to each of one hundred people judged to have the most insightful answers.

Kane’s questions aim to determine how much things are really worth that cannot be simply priced in the market, including national parks, advanced technology, free speech, and police protection. The online survey and contest takes about fifteen minutes to complete, and it promises to provide a deeper understanding of the value of things that are ignored in government figures such as gross domestic product (GDP). 

“Political debates today are so polarized that people often forget how much progress has been made over the past hundred years,” says Kane. “From the internet to lowered children’s mortality, we are taking for granted the fruits of civilization and may be neglecting how much work remains to be done. I’m confident this study is going to really make politicians think differently about what matters.”

Any American aged 18 and above can participate simply by visiting the link at www.hoover.org/KaneStudy and completing the fifty questions. Submissions are due before 11:59 pm on Monday, September 9.

The notion of an “economic beauty contest” comes from a popular British newspaper guessing game that Keynes described in his famous 1936 book The General Theory of Employment, Interest, and Money. Kane’s contest, like the British version, asks participants to select a subset of the most beautiful photos then identifies the most common responses. Kane is testing for the worth of intangible things such as freedom, health, and security.

Rules for winning the one hundred cash prizes can only be described to participants after they visit and begin the contest. To incentivize honest responses, Kane turned to psychological studies that suggest cash prizes encourage accuracy in guessing games.

via www.hoover.org

All pubs are good pubs

From the inbox:

I am [name] from [name] Publishing.

Would you be interested in publishing your work "Corrigendum: A revealed preference approach to valuing non-market recreational fishing losses from the Deepwater Horizon spill" as a paperback edition?

At [name]Publishing, we have worked with more than 250,000 authors, offering them international, free-of-charge publishing.
Can you imagine your work as a book?

The definition of corrigendum is "a thing to be corrected, typically an error in a printed book." So, yes, sure, I can definitely imagine my correction as a paperback book! Maybe a mystery where I'm the detective trying to uncover research errors of omission and suddenly I look in the mirror and find one of my own?

Actually, my reply was "no thanks."