In wealth accounting and sustainability assessments, we characterize the non-declining wealth criterion under dynamic average utilitarianism (DAU) as defined by Dasgupta (2001). Under DAU, the objective function consists of total intergenerational well-being divided by the present discounted sum of population from the present to the future. It is shown that, in order for an economy to be on a sustainable path, inclusive wealth should grow at a rate higher than the difference between the discount rate and the share of current population of the discounted future population. Our application to the inclusive wealth index shows that, among other results, the DAU criterion changes sustainability assessments for some developing countries with future demographic change, implying that wealth does not accumulate sufficiently in light of DAU. We also show empirical estimates of the value of population change under total utilitarianism, average utilitarianism, and DAU.

We study the social discount rate, taking into account inequality within generations, that is, across countries or individuals. We show that if inequality decreases over time, the social discount rate should be lower than the one obtained by the standard Ramsey rule under certain but reasonable conditions. Applied to the global discount rate and due to the projected convergence across countries, this implies that the inequality adjusted discount rate should be about twice as high as the standard Ramsey rule predicts. For individual countries on the other hand, where inequality tends to increase over time, the effect goes in the other direction. For the United States for instance, this inequality effect leads to a reduction of the social discount rate by about 0.5 to 1 percentage points. We also present an analytical formula for the social discount rate allowing us to disentangle inequality, risk, and intertemporal fluctuation aversion.

We investigate households' decisions regarding livelihood activities in response to future climate change in the Eastern Cape, South Africa. We use the contingent behavior method and account for unobserved heterogeneity in order to overcome problems associated with limited data, collinearity and endogeneity. We characterize the climate change with two types of climate change scenarios: dry-spells and wet-spells. Results show that moderate and extreme increases in dry-spells increase adoption of off-farm activities such as casual labor and small business, and decrease adoption of on-farm activities such as gardening. We find opposite cases for mild or moderate wet-spells. Our results also show that households tend to diversify their livelihood portfolios in response to a moderate increase in dry-spells and a mild increase in wet-spells. Some household characteristics are also important in influencing some types of activities, including household's health status, gender of the household head, and household's prior experience.

This paper investigates the role of additional regulation in mitigating the ‘adverse scale effect’ associated with daily driving restrictions, which has become a popular regulatory tool used to control episodic air pollution internationally, especially in developing countries. We find that although an annual vehicle registration tax reduces the incentive to purchase additional vehicles among households whose sole purpose for doing so is to ‘cheat’ the restriction (i.e., the ‘adverse scale effect’), it does so with an external cost. The cost occurs because households whose purpose for purchasing an additional vehicle is not to cheat the restriction are given the same disincentive with the tax. We show how simple one- and two-stage lotteries can be used to not only discriminate between cheater and non-cheater households (in particular, to avoid providing a disincentive to the latter type of household), but also to provide an even stronger disincentive to the former.

Livestock health is economically important for agropastoral households whose wealth is held partly as livestock. Households can invest in disease prevention and treatment, but livestock disease risk is also affected by grazing practices that result in inter-herd contact and disease transmission in regions with endemic communicable diseases. This paper examines the relationships between communal grazing and antimicrobial use in Maasai, Chagga and Arusha households in northern Tanzania. We develop a theoretical model of the economic connection between communal grazing, disease transmission risk, risk perceptions, and antimicrobial use, and derive testable hypotheses about these connections. Regression results suggest that history of disease and communal grazing are associated with higher subjective disease risk and greater antimicrobial use. We discuss the implications of these results in light of the potential for relatively high inter-herd disease transmission rates among communal grazers and potential contributions to antimicrobial resistance due to antimicrobial use.

To foster the adoption of sustainable intensification practices amongst Ghana's farmers, they are widely promoted through training sessions provided by development organizations, companies, and the public extension service. We investigate whether these training sessions are effective and find that they are effective only for the diffusion of organic fertilizers but not for mulching. We suggest that this comes from the complexity of the innovations. Mulching is one of the simplest sustainable intensification technologies. It diffuses easily through peer learning and, after an initial training delivered to a critical mass of farmers, does not require training anymore. The use of organic fertilizers, in contrast, requires more specific knowledge and adaptation, which limits the effectiveness of peer learning and increases the effectiveness of training. This suggests that to achieve a widespread diffusion of sustainable intensification amongst Ghana's farmers, training sessions should focus on those practices that are complex and thus difficult to learn from peers.