A number of studies show that climatic shocks have significant economic impacts in several regions of the world, especially in, but not limited to, developing economies. In this paper we focus on a drought-related indicator of well-being and emergency spending in the Brazilian semi-arid zone – rainfed corn market – and estimate aggregate behavioral and forecast models for this market conditional on local climate determinants. We find encouraging evidence that our approach can help policy makers buy time to help them prepare for drought mitigating actions. The analysis is applicable to economies elsewhere in the world and climatic impacts other than those caused by droughts.

This paper addresses the potential of in situ crop landrace conservation, employing market-based instruments, which pre-requires that (1) consumers hold positive use-value for the landrace attribute and (2) their willingness to pay covers both the transaction cost of implementing these instruments and the opportunity cost of landrace cultivation. The empirical examination is based on two closely related analyses of eggplant production and consumption sectors of India. At present, the vegetable markets of south India provide the landrace cultivators with a price premium adequate enough to cover the opportunity cost of not opting for high-yielding modern varieties. However, we detect an underutilized consumer demand for landrace products. The wide margin that exists between the price premium farmers currently obtain for the landrace attribute and what consumers are willing to pay for it is indicative of the unexploited potential of labelling and certification schemes as an emerging agrobiodiversity conservation strategy.

Migration literature has considered environmental constraints as one of the prime movers of populations, especially from dry regions, where water rather than land is the primary limiting factor. This study examines the impact of degradation of private as well as common pool land resources on migration decisions, based on primary data from over one thousand households in three dry land districts in Gujarat. The study finds that economic assets and natural capital have differential impacts on short-term and long-term migration decisions. Thus, any employment creation in rural dry land regions is likely to help the poorest. Further degradation of common-pool land resources influences short-term but not long-term migration. Therefore, better management of common-pool resources would strengthen the livelihood base of traditional herder communities and limit migration among middle-income households. Overall, in dry areas such as Gujarat, access to irrigation, rather than land ownership per se, is likely to deter migration.

The Emissions Compensation (EC) Program in Santiago, Chile, has been affected from the beginning by the incidence of individual violations of maximum-emission capacity permits. Based on information at the individual source level, in this paper we develop and estimate a model explaining the individual compliance decision with emission capacity permits. Our results indicate that the compliance behavior of sources during the period 1993–1999 do in fact depend on their individual characteristics. Among other factors, type of equipment used, industrial sector to which the source belongs, fuel type used, the initial allocation of emission capacity permits to the source, and population density as well as average income in the area where the source is located, turn out to be relevant. Furthermore, the evidence does not allow us to reject the presence of structural change in the individual decision to comply with permit holdings because of the introduction of natural gas in the Metropolitan Region of Santiago at the end of 1997.

Hedonic valuation of quality attributes can be misleading when the assumption that these attributes are exogenous to sample selection is violated. This paper considers the simultaneity between hedonic valuation and sample selection in the context of a model of consumer behavior over packaged goods and investigates empirically how the decision on house location (urban/rural) affects the household's valuation of water-related characteristics of the house in question. The empirical analysis uses data from the Indonesian housing market and suggests that households value access to safe and improved domestic water sources. However, failing to correct for sample selection results in a biased valuation of willingness to pay for house characteristics. This might misguide policy recommendations for improved provision of domestic water, based on cost–benefit analysis.

Two very similar contingent valuation surveys eliciting willingness-to-pay (WTP) to avoid eye irritation, gastroenteritis, and coughing episodes due to seawater pollution were conducted on visitors to beaches in Portugal and Costa Rica. Various forms of the hypothesis regarding the transfer of mean WTP between the two countries were rejected, as was the hypothesis that model parameters were drawn from the same pooled sample across countries for three different illness episodes. When compared to on-site studies in Costa Rica, benefit transfer from Portugal leads to errors typically of the order of 100 per cent. Adjusting WTP for declared income or other easily accessible socio-demographic variables does not reduce transfer error. This study shows that transfer of health benefit estimates can be potentially quite unhealthy for policy analysis, questioning whether the time and resource savings are justified in this particular transfer context.

A contingent valuation (CV) method was performed to estimate the conservation value of the Woopo Wetland, Ramsar site, in Korea. The CV survey was rigorously designed to comply with the guidelines for best-practiced CV studies. Respondents overall accepted the hypothetical market and were willing to pay a significant amount (2,731 to 3,960 Korean won = USD 2.10 to 3.05), on average, per household annually to conserve the wetland. These findings have important implications for efforts to consider environmental quality in policy decisions.

Does gender matter in people's attitudes and cooperation in community-based natural resource management? If so, how do gender differences in conservation-related attitudes help or hinder sustaining the commons? Since biases ingrained in community norms and expectations often exclude women from decision making in co-management, it is imperative to find plausible answers to these queries in order to understand gender relations and cooperation in co-management. To this end, the authors conducted psychometric surveys and trust experiments on 196 forest-dependent households in West Bengal, India during 2009–2010. The findings suggest that, despite an overall negative perception about women's involvement in co-management, women are more conservation friendly and pro-social than men. It is also noticed that forest biomass and forest incomes as the indicators of sustainability have increased in those forest communities where women's proportional strength as decision makers is greater and people hold an overall positive conservation attitude.

This study provides evidence on the effectiveness of community controls in regulating the use of common agricultural land in Côte d'Ivoire and tests for factors such as group size, ethnic and income heterogeneity of the group, income and resource stock levels, in explaining the variation in effectiveness across communities. The results indicate significant deterioration in community controls. These results point towards the need for a comprehensive policy framework towards agriculture in general and land tenure in particular. The study also finds that smaller and ethnically homogenous communities are better able to coordinate their actions, thereby internalizing a higher proportion of the value of land as a factor of agricultural production than their large ethnically heterogenous counterparts. No evidence is, however, found in favour of income heterogeneity hindering or facilitating collective action.

Capture fish stocks are facing an increasing threat of extinction, partly due to the use of illegal fishing methods. In developing coastal countries – where fishing activities are the mainstay of the population along the coast – livelihoods are being directly threatened. Although a number of studies exist on fishing regulations and those who violate them, little has been done on the relationship between intrinsic catch potentials/fishing skills and illegal fishing behavior. Using data on violations of light attraction regulation among small-scale fishers in Ghana, our results show that the risk of punishment, the amount of fishing experience, the skipper's age, and religious norms all influence the decision to violate fishing regulations. Most importantly, we found that violators and non-violators have different fishing skills. Consequently, policies targeting illegal fishing must focus on equalizing efficiency and/or fishing skills among the fishermen as well as on traditional variables that influence violation decisions.

We use an empirical simulation model to examine links between trade integration, pollution, and public health in Chile. We synthesize economic, engineering, and health data to elucidate this complex relationship and support more coherent policy. Trade integration scenarios examined include Chile's accession to the NAFTA, MERCOSUR, and unilateral opening to world markets. The latter scenario induces substantial worsening of pollution, partly because it facilitates access to cheaper and dirty energy, and has a significant negative effect on urban morbidity and mortality. Damages caused by rising morbidity and mortality are of similar magnitude and substantial. Emissions of small particulates, SO2, and NO2, have the strongest impact on local mortality and morbidity. These three pollutants appear to be complementary in economic activity. Unilateral trade integration combined with a tax on small particulates brings welfare gains, which are 16 per cent higher than those obtained under unilateral trade reform alone.

This paper analyzes the effect of reducing pre-harvest burning of sugar cane on the population's respiratory health in Brazil. We collected data for the municipalities in the state of São Paulo for two different periods: 2000, before the state law requiring the gradual elimination of sugar cane area utilizing pre-burning, and 2007. We used panel models for inpatient visits due to respiratory diseases, outpatient visits for inhalation procedures and length of stay for inpatient visits due to respiratory diseases, controlling for the endogeneity between health and pollution. The results show that increasing the area of raw sugar cane harvested reduces the number of inpatient visits and does not affect the number of inhalation procedures or length of stay.

The existing fisheries economics literature analyzes compliance problems by treating the fishing firm as one cohesive unit, but in many cases violations are committed by agents acting on behalf of a firm. To account for this, we analyze the principal–agent relationship within the fishing firm. In the case where the firm directly benefits from illegal fishing, the firm must induce its crew to violate regulations through the incentive scheme. Within this framework, we analyze how the allocation of liability between fishing firms and crew affects quota violations and the ability to design a socially efficient fisheries policy. We show that without wage frictions, it does not matter who is held liable. However, under the commonly used share systems of remuneration, crew liability generally yields a more efficient outcome than firm liability. Furthermore, asset restrictions may affect the outcome under various liability rules.

In the framework of the Harris–Todaro model we introduce a production–production externality and assume that the activity in the urban sector negatively affects (pollutes) the rural sector. As a means of reducing pollution a tax is imposed on the production of the polluting sector and the distributional and employment effects, as well as the national income aspects of such a tax, are explored. We take two versions of the Harris–Todaro model, the short run, where only labour is mobile between the rural and the urban sector, and the longer run, where all factors of production are intersectorally mobile. Our findings indicate that taxation will reduce pollution, may favour employment in the rural sector, and under certain conditions will also reduce unemployment, particularly in the longer run. National income will be generally enhanced if the share of the agricultural output in national income is higher than the share of manufactures.

The Arrow et al. paper is a welcome addition to a large literature on the linkage between asset values and social welfare. This literature has its roots in the concern about ‘greening’ the national accounts, but the paper shows how expanding the asset boundary beyond produced and natural goods could increase our measures of income, saving and wealth enormously. I will comment in turn on the wealth accounts, investment accounts and the treatment of CO2 emissions, using selected World Bank figures as a basis for comparison.

This paper examines the response of herders to increased shortage and degradation of land in an arid and semi-arid land setting in Kenya, under changing property right regimes using both survey and secondary data. We argue that the responses adopted are livelihood strategies to improve herder's welfare. We explore the determinants of three different strategies: crop cultivation, investment in land improvements, and migration with livestock. We employ the probit regression framework to explain each strategy. The main findings of the study are that private property rights, educational attainment, and availability of water are major determinants of the three strategies. We recommend policies that favour privatization of existing common property resources, improve education levels, and increase supply of water in the district.

Water rights are currently receiving increased attention from scholars and policymakers due to the growing understanding that ill-defined water rights impair efficient use. In South Africa, smallholder irrigation faces problems of low water use efficiency and cost recovery of government investments. This study uses contingent ranking to analyse the willingness to pay (WTP) of smallholder irrigators for changes in the water rights system. The results indicate that smallholders are prepared to pay considerably higher water prices if these are connected to improvements in the water rights system. By segmenting the population it was also shown that the importance attached to water rights dimensions varies in each segment. While lower institutional trust and lower income levels lead to a lower WTP for transferability, experiencing water shortage increases this WTP. Such information is valuable in guiding policy makers in the future design of water rights.

We find significant empirical links between the health structure of the population and the productive system of an economy that is subject to infectious disease, in particular tuberculosis. Consequently, development policy, aimed to improve the level of prosperity, has significant effects on the demographic-epidemiological dynamics of the population. Moreover, infectious diseases, such as tuberculosis, affect the size of the labour force and the productive capacity of the economy. We combine a Lotka-Volterra type system capturing the dynamics of TB epidemics with a Solow-Swan growth model where output is produced from capital and healthy labour. The demographic-epidemological parameters of the Lotka-Volterra type system are functions of GDP per healthy worker. We find significant differences between the most prosperous quartile and the rest of the world. In the former, the disease is eradicated whereas in the lowest three quartiles we predict damped capital and epidemic cycles converging to a population which is about 80 per cent of capacity and of whom about 2 per cent are TB infected. It follows that raising productivity in the lower quartiles is a critical policy aim.

Especially in developing countries, natural resources and the environment are not optimally managed. Even so, it is possible for green accounts based on current prices to measure the realized contributions of the environment to net product. The prices for use in the green accounts, however, are not necessarily shadow prices as would be recommended by cost–benefit analysis: in practice, green or comprehensive NNP is an approximation of an index of welfare. The fact that a linearization of generalized national income is used implies that disaggregated, partial-equilibrium models of resources are useful.