This paper contributes to the literature on the determinants of environmental standards by studying the role of income inequality and freedom of the press. Given that evidence of the environmental Kuznets curve has only been found for some countries, it is thus crucial to investigate whether other factors besides income per capita levels may be affecting countries' decisions to pass environmentally-friendly legislation. We investigate the effects that inequality and freedom of the press have on environmental stringency for a sample of OECD and BRIICS countries and a global sample of 82 countries using data over the period 1994–2015. We hypothesize that the more unequal a society is, and the greater the oppression of the press is, the less stringent environmental policies are. The results partially confirm our hypothesis. In particular, lack of press freedom is negatively correlated with environmental stringency, whereas inequality shows a non-linear effect only for non-high-income countries.

It is well known that an efficient pollution taxation scheme should charge each source according to its specific marginal contribution to social damages. Despite significant advances in environmental assessment, geographic information systems and data analysis, this requirement would impose technical, informational and administrative expenses that most regulators – notably in developing countries – seem unable to afford. This paper shows that it can actually be less demanding than it seems. If polluters are price-takers, for instance, in a context where the affected population concentrates at a given location, then the optimal emission tax will disregard a source's location. Otherwise, the adjustment of the optimal tax to location will depend on the extent of a polluter's market power.

This research uses field-level data from Burkina Faso to ask what determines farmers' investment in two well-known soil and water conservation techniques: field bunds (barriers to soil and water runoff), and microcatchments (small holes in which seeds and fertilizers are placed). Survey data for 1993 and 1994 are used to estimate Tobit functions, compute elasticities of adoption and intensity of use, perform robustness tests and estimate alternative models. Controlling for land and labor abundance and other factors we find that those who have more ownership rights over farmland, and who do more controlled feeding of livestock, tend to invest more in both technologies. The result suggests that responding to land scarcity with clearer property rights over cropland and pasture could help promote investment in soil conservation, and raise the productivity of factors applied to land.

Formulation and estimation of a correctly specified abatement cost function would be central to policy formulation regarding imposing taxes or user-fees as well as of sharing social cost in the presence of environmental pollution. Often in research, the output of an abatement activity for water pollution appears to us not to have been clearly specified. This activity is very distinct from whatever is the actual product of the plant. We propose in this paper that the output is only and exclusively the reduction in the level of the pollutant in the outflow from the plant and illustrate this with primary data for small-scale factories in Nandesari Industrial Estate in Gujarat, India. The cost function estimates provide evidence of significant scale economies and high marginal abatement cost in wastewater treatment by small-scale factories.

For a closed economy with human-made capital, non-renewable resource depletion and (possibly) exogenous, hyperbolic technical progress as explicit-form inputs to a production function, there is a feasible development path that is ‘as if’ optimal with respect to hyperbolic utility discounting. On this path, typically, welfare-equivalent income > wealth-equivalent income > Sefton-Weale income > net national product, with possibly dramatic differences among these measures; and sustainable income can be greater than, equal to, or less than NNP. For low enough discounting, growing consumption is optimal even when technical progress is zero. A particular discount rate makes all income measures and consumption constant and (except net national product) equal; and zero technical progress then gives the Solow (1974) maximin as a special case. The optimal path is time-consistent because of the way the utility discount rate is chosen to depend on the economy's stocks, and hence on absolute time.

This article analyzes a general equilibrium growth model with overlapping generations and (production-induced) environmental degradation. Individuals react to environmental damages through mitigation or adaptation. In the former case, they reduce production and its environmental impact. In the latter, they do not tackle the causes of the problem but rather its consequences (i.e., the wellbeing loss due to environmental degradation) by increasing defensive expenditures. Despite its simplicity, the model can generate different long-term outcomes: convergence to a stationary state following a unique trajectory or local/global indeterminacy. In the last scenario, initial conditions (history) and individual expectations matter and the model can generate coordination failures and endogenous fluctuations. Results cast doubt on solutions to environmental problems relying on the role of individual behavior change or adaptation.

There have been increasing pressures by governments and NGOs to restrict international trade in secondary material waste in the conviction that imports of these goods are in reality a disguise for waste dumping by the exporting country. Moreover, cheap imports of secondary material waste tend to crowd out the local recovery system leading to a domestic waste disposal problem. Alternatively, proponents of trade argue that a ban on secondary material waste leads to an inefficient use of resources resulting inevitably in higher economic and environmental costs, both in developed and developing countries. In this paper we set out to investigate if free trade in secondary material waste can support economic development and simultaneously reduce environmental degradation in a developing country and the conditions necessary for the trade to be permitted. In this study we focus on the trade in waste plastics in China. A life cycle model is formulated within an optimization framework and solved by non-linear programming methods. Preliminary results suggest that trade in waste plastics is both economically and environmentally advantageous but under a number of stringent conditions.

The authors use dynamic lab-in-the-field common pool resource experiments to investigate the role of two forms of democracy on the cooperation of forest users in Ethiopia. In this experimental setup, participants can either directly select a rule (direct democracy) or elect a leader who decides on the introduction of rules (representative democracy). These two treatments are compared with the imposition of rules and imposition of leaders. It is found that both endogenous leaders elected by the community members and endogenous rules selected by the direct involvement of the participants are more effective in promoting cooperation among the community members compared to exogenous leadership, exogenous rule imposition and the baseline scenario without any of these modifications. However, no significant difference is found between representative democracy in the election of leadership and direct democracy in the selection of rules. Leadership characteristics and behavior are further analyzed. The results underline the importance of democratic procedures.

In the December 2014 issue of Environment and Development Economics, we published the article, ‘The economic power of the Golden Rice opposition’ by Wesseler and Zilberman. The paper generated substantial interest, not only in academia but also among civil society groups. In this note, we address some of the concerns that have been raised about our results. Our main conclusion remains that misguided regulations in the case of Golden Rice have cost millions of healthy life years and billions of dollars.

This study analyzes a public-spending option from mining and oil resources and its impact on Niger's economy. The windfall gain from mining and oil revenues provides an opportunity for the country to reinvest natural resource rents, enhance economic development, and address infrastructure gaps. Drawing on the country's recent and expected mining and oil exploitation, we evaluate the effects of a reinvestment policy in road infrastructure using a dynamic computable general equilibrium (CGE) model. We find that investment in road infrastructure brings positive spillover effects to other sectors of the economy and benefits to the economy in the long run. Our analysis additionally shows that reinvestment in road infrastructure, given the initial state of infrastructure in Niger, could help mitigate the resource curse.

We analyze the performance of the Federal Industrial Inspection Program operated by the Federal Attorney for Environmental Protection (PROFEPA) in Mexico City. We seek to answer three questions: What drives the inspections? What determines non-compliance? And what drives imposition of fines? We use firm-level data that identify certain characteristics of the firms, PROFEPA's inspections, compliance results and fines for all air polluting firms under the Program during the period January 2000–October 2008. We obtain three main results. First, PROFEPA's inspections have focused on larger firms devoted to industrial activities located in poor and dense municipalities. Second, past inspections were significant and have a high marginal effect on compliance. Third, the severity of the infraction was not relevant to the decision to impose a fine but rather to its amount.

Sense of ownership is often advocated as an argument for local participation within the epistemic development and nature conservation communities. Stakeholder participation in initiating, designing or implementing institutions is claimed to establish a sense of ownership among the stakeholders and subsequently improve the intended outcomes of the given institution. Theoretical and empirical justifications of the hypothesis remain scarce. A better understanding of the effects of local participation can motivate more extensive and stronger participation of local stakeholders and improve institutional performance. This paper applies theories from psychology and behavioral economics to sense of ownership. The empirical investigation is a framed field experiment in the context of tropical forest conservation and payments for environmental services in Tanzania. The results lend little support to the hypothesis in this context. The participation treatment in the experiment is weak, and a possible explanation is that sense of ownership is sensitive to the participation form.

The paper examines how recent trends in agricultural productivity in Brazil, occurring both inside and outside the Amazon, affected deforestation and agricultural incomes. The analysis uses a computable general equilibrium model adapted to capture regional economic structures, and accounts for uncertainty concerning productivity improvements. Due to countervailing effects on deforestation of innovation inside and outside the Amazon – respectively, increasing and decreasing it – innovation in Brazilian agriculture in the period from 1985 to 1995 has not altered substantially deforestation rates. However, innovation inside the Amazon has to be reckoned as a driving force behind the continuing high levels of deforestation rates.

Innovation rates for livestock activities, inside and outside the Amazon, prove crucial in determining deforestation and agricultural income. Technological improvements outside the Amazon for small farm production systems and for farms in general in the North-East increase agricultural income, improve income distribution, and limit deforestation rates.

This paper applies a household production framework (Becker, 1971) to infer the economic value of a cultural heritage site, namely, the Petroglyph National Monument, situated in Albuquerque, New Mexico, USA. The empirical analysis uses benefit-transfer techniques from three source studies: those of Bergstrom and Cordell (1991) and Boxall et al. (2003), which concern willingness-to-pay to hike and view rock art sites; and those of Rolfe and Windle (2003, 2006), which concern willingness-to-pay by Aboriginal and general populations to preserve a cultural heritage site containing rock art. The benefit-transfer analysis estimates recreational values between 3.75 million and 7 million dollars per year (depending on perceptions of the cultural attribute quality) and a nonuse value of approximately 12.5 million dollars per year. By comparison the annualized costs of developing/operating the study site are 8.5 million dollars per year. Thus a partial cost-benefit analysis suggests the study site yields net economic benefits upwards of 7.8 million dollars per year.

This paper attempts to develop a dynamic model of optimal biodiversity preservation in a stylized ecosystem. Species richness (number of species) is used as a measure of diversity and its interactions with the resource stock, consumptive extraction and preservation efforts are explored using a two-state variable optimal control model. The analysis extends to the implications of a random threshold in species richness and the relationship between ecological and economic stability conditions. Dynamic paths and equilibrium characteristics are illustrated using numerical techniques.

Fossil fuel combustion generates both CO2 and SO2. CO2 is the most important greenhouse gas; SO2 can cause serious local pollution. But it can alleviate the potential global warming because of negative radiative forcing. Such a phenomenon can be characterized as negatively correlated local and global stock externalities. In this paper, we set up an optimal control problem of negatively correlated local and global stock externality provision. The efficiency conditions for this problem are derived. These conditions modify the Samuelson rules for optimal provision of externalities. In addition, we examine several policy related scenarios of negatively correlated local and global stock externality provisions. Finally, we discuss policy implications and limitation of the theoretical results derived in this paper. We also indicate applications of the theoretical results here to empirical research, particularly to economic analysis of multiple-gas issues in climate change.

This paper studies the role of middlemen in open-access fisheries and how the organization of the supply chains affects resource exploitation and the level and distribution of economic rent. Imperfect competition among middlemen can help ensure that fish stocks are not depleted, which is typically the case in open-access fisheries with competitive markets. Middlemen with market power can also induce higher economic rent for the supply chain in total, but these rents mainly benefit the middlemen. The supply chains of inshore anchovy and offshore skipjack tuna fisheries in Vietnam are used as empirical examples. The analysis shows that in the anchovy supply chain, the middlemen have insignificant market power and the stock is being overexploited. In the skipjack tuna supply chain, the middlemen have oligopsony power and the stock is higher than the level that produces maximum sustainable yield.

To guide investments in ecosystem-based adaptation (EbA) in developing countries, numerous stated preference valuation studies have been implemented to assess the value of ecosystem services. These studies increasingly use time payments as an alternative to money. There is limited knowledge, however, about how to convert time to money and how the type of payment affects willingness to pay (WTP). In this study, the results of choice experiments using time and money payments are compared in the context of EbA measures in Vietnam. Six, of which five individual-specific, conversion rates are applied. WTP estimates are found to be higher for time payments. Moreover, the type of payment vehicle as well as the conversion rate has substantial effect on mean WTP and WTP distributions. We discuss implications of these results for the conversion of time to money and the use of resulting WTP estimates in cost benefit analyses in developing countries.

The debt-resource-hypothesis suggests that high indebtedness leads to increased natural resource exploitation as well as more unsustainable patterns of resource use. Countries with high debt burdens supposedly increase their extraction of fossil fuels and mineral resources as well as their production of so-called cash crops in order to service their debt obligations. In spite of its popularity, there have been few attempts to systematically test the hypothesis. Existing analyses refer to deforestation only and come to mixed results. This study fills a gap in testing the hypothesis more comprehensively for 23 natural resources and cash crops. It uses first differencing, period-specific time dummies, and a lagged dependent variable to mitigate omitted variable bias. No evidence is found that would support the debt-resource-hypothesis.

In the mid-hills of Nepal, as in many developing countries, gradually developing urban centers and increasing demand for agricultural produce, due to population growth and early development activities, have persuaded farm households to reorient their subsistence farming to become farm systems growing surplus food to be sold in the markets. To cope with these changes, institutions play an important role and, for these institutions to be effective, farmers must perceive their participation as not being coerced. Their participation is influenced by individual household characteristics and proximity to support services and markets. Our main findings from the analysis of household surveys based on the level of market participation included: (1) the education level and amount of training attended by family members are influencing social variables, while farm size and gross farm income are dominant economic variables influencing household participation and perceived institutional effectiveness; (2) these variations revealed significant differences in the levels of market economy for household participation and institutional effectiveness within the watershed; and (3) the factor analysis further categorized several socioeconomic variables into three major factors explaining household participation and institutional effectiveness; these included labor quality and resources, supplementary income coming from migration and off-farm activities, and awareness and modern skills acquired by farm household members living within the watershed.