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  • 1.
    Aronsson, Thomas
    et al.
    Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
    Sjögren, Tomas
    Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
    Optimal Taxation, Redistribution, and Environmental Externalities2017In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 11, no 3, p. 233-308Article in journal (Refereed)
    Abstract [en]

    This paper surveys research on optimal redistributive taxation in economies with environmental externalities. A key question is whether externality correction only motivates an adjustment of the tax policy rule for the externality-generating activity, or whether the marginal value of the externality directly enters the policy rules for other tax instruments as well. In a static benchmark model with an atmospheric consumption externality, where the government uses a mix of a nonlinear income tax and linear commodity taxes, one can show that Sandmo's (1975) additivity property applies. This means that externality correction leads to an additional term (measuring the marginal value of the externality) in the commodity tax formula for the externality-generating good, while the policy rules for commodity taxation of clean goods and marginal income taxation take the same form as in the absence of any externality. We also extend this benchmark model to capture a number of scenarios (such as non-atmospheric externalities, border trade in the externality-generating good, and competition between governments in a multi-country framework), where the additivity property no longer applies. We end by examining an intertemporal model of optimal taxation with a stock-externality, allowing us to integrate the study of optimal redistributive taxation with literature on environmental economics and policy based on dynamic models.

  • 2. Bostian, Moriah
    et al.
    Färe, Rolf
    Grosskopf, Shawna
    Umeå University, Faculty of Social Sciences, Center for Environmental and Resource Economics (CERE). Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics. Department of Economics, Oregon State University, USA.
    Lundgren, Tommy
    Umeå University, Faculty of Social Sciences, Center for Environmental and Resource Economics (CERE). Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
    Network Representations of Pollution-Generating Technologies2017In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 11, no 3, p. 193-231Article in journal (Refereed)
    Abstract [en]

    We update developments on modeling technology including unintended outputs and show how these can, at least to a large extent, be incorporated in a network model framework. Recently there have been efforts to specify more detailed models which include multiple functions to separately capture intended and unintended products. Yet another recent strand of the recent literature has also explicitly tried to include a material balance condition in the model. We see this general evolution as beginning with what might be called a black box technology, with inputs entering the box, and good and bad outputs exiting the box. The more sophisticated models can be thought of as filling in the black box with the more detailed processes involved with production, prevention and abatement, with production accompanied by undesirable byproducts subject to legal regulations and laws of nature. This can be modeled as a network within the black box.

  • 3.
    Broberg, Thomas
    et al.
    Umeå University, Faculty of Social Sciences, Center for Environmental and Resource Economics (CERE).
    Kazukauskas, Andrius
    Umeå University, Faculty of Social Sciences, Center for Environmental and Resource Economics (CERE).
    Inefficiencies in Residential Use of Energy: A Critical Overview of Literature and Energy Efficiency Policies in the EU2015In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 8, no 2, p. 225-279Article in journal (Refereed)
    Abstract [en]

    A rather large literature argues that firms and households do not always improve energy efficiency by investing in new technology even if it would be cost-effective to do so. In this paper, we review the theoretical and empirical literature on the so-called energy efficiency gap and provide a rationale for policymakers to act to improve energy efficiency. By eliminating market failures, welfare can be improved in a broad sense, including both environmental quality and material welfare. We also discuss social 'nudges' as examples of policy instruments that do not directly target any market failure in energy markets but that still may have a significant impact on energy use. Although we acknowledge the existence of the energy efficiency gap, we argue that the gap in general is overestimated as parts of it can be explained by heterogeneity in preferences and thus explained by rational choices.

  • 4.
    Li, Chuan-Zhong
    et al.
    Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Economics. Royal Swedish Acad Sci, Beijer Inst, Stockholm, Sweden.
    Crepin, Anne-Sophie
    Royal Swedish Acad Sci, Beijer Inst, Stockholm, Sweden;Stockholm Univ, Stockholm Resilience Ctr, Stockholm, Sweden.
    Folke, Carl
    Royal Swedish Acad Sci, Beijer Inst, Stockholm, Sweden;Stockholm Univ, Stockholm Resilience Ctr, Stockholm, Sweden.
    The Economics of Resilience2017In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 11, no 4, p. 309-353Article in journal (Refereed)
    Abstract [en]

    This paper provides an interpretive overview on the economics of resilience with special reference to social-ecological systems. We address the basic sciences of regime shifts and resilience in different settings linked to empirical cases and review the economic models related to these aspects. In particular we discuss models to assess market outcomes when thresholds exist and are known and particular characteristics of such systems when they are optimally managed. We also examine multiple aspects of uncertainty including unknown but learnable thresholds and systems where either the threshold or the stock dynamics are uncertain because they change in a stochastic way. Moreover, we discuss resilience in relation to measurement and valuation using approaches that focus on the role of biodiversity for resilience, the insurance value of resilience and the value of resilience as a stock that influences social welfare. Finally, we discuss issues related to practical resilience management and identify knowledge gaps that future research efforts could address.

  • 5. Li, Chuan-Zhong
    et al.
    Crepin, Anne-Sophie
    Stockholm University, Faculty of Science, Stockholm Resilience Centre. Royal Swedish Academy of Sciences, Sweden.
    Folke, Carl
    Stockholm University, Faculty of Science, Stockholm Resilience Centre. Royal Swedish Academy of Sciences, Sweden.
    The Economics of Resilience2017In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 11, no 4, p. 309-353Article in journal (Refereed)
    Abstract [en]

    This paper provides an interpretive overview on the economics of resilience with special reference to social-ecological systems. We address the basic sciences of regime shifts and resilience in different settings linked to empirical cases and review the economic models related to these aspects. In particular we discuss models to assess market outcomes when thresholds exist and are known and particular characteristics of such systems when they are optimally managed. We also examine multiple aspects of uncertainty including unknown but learnable thresholds and systems where either the threshold or the stock dynamics are uncertain because they change in a stochastic way. Moreover, we discuss resilience in relation to measurement and valuation using approaches that focus on the role of biodiversity for resilience, the insurance value of resilience and the value of resilience as a stock that influences social welfare. Finally, we discuss issues related to practical resilience management and identify knowledge gaps that future research efforts could address.

  • 6.
    Löfgren, Karl-Gustaf
    et al.
    Umeå University, Faculty of Social Sciences, Department of Economics.
    Gong, Peichen
    Department of Forest Economics, Swedish University of Agricultural Sciences.
    Modeling forest harvest decisions: Advances and challenges2009In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 3, no 3, p. 195-216Article in journal (Refereed)
    Abstract [en]

    Timber harvest decision is one of the most important topics of forest economics. Martin Faustmann presented in 1849 the first "correct model" for determining the optimal time to harvest a forest stand. The Faustmann model builds on a set of restrictive assumptions that are far from realistic. During the past four decades the Faustmann model has been extended substantially. One important extension is the inclusion of non-timber benefits. Another is the recognition of uncertainty, especially the adoption of the adaptive optimization framework to determine the optimal time to harvest a stand under conditions of uncertainty. Currently available economic models of forest harvest decisions can be used to determine the optimal time to harvest a forest stand in a variety of special cases, but their ability to describe a typical harvest decision problem remains unsatisfactory. To improve the decision models, researchers must pay more attention to the fact that forests usually are managed for multiple purposes and under conditions of economic, biological, and ecological uncertainties. Therefore, non-timber benefits and uncertainties need to be considered simultaneously, which often implies that the decisions for different stands are interdependent. The information needed for applying the decision models also requires much more research. A particularly important, yet difficult, matter is the rational expectations timber price process.

  • 7.
    Pettersson, Fredrik
    et al.
    Luleå University of Technology, Professional Support, Utbildnings- och forskningsenheten.
    Maddison, David
    Acar, Sevil
    Söderholm, Patrik
    Luleå University of Technology, Department of Business Administration, Technology and Social Sciences, Social Sciences.
    Convergence of carbon dioxide emissions: a review of the literature2014In: International Review of Environmental and Resource Economics, ISSN 1932-1465, E-ISSN 1932-1473, Vol. 7, no 2, p. 141-178Article in journal (Refereed)
    Abstract [en]

    The objective of this paper is to review previous research on convergence of carbon dioxide emissions among countries. We discuss the key findings in this work, how the choices of model, data, statistical tests, etc. influence the results, and highlight some policy implications. The empirical research on convergence in per capita carbon dioxide emissions shows some evidence of convergence between developed (OECD) countries, while at the global level there appear to be relatively persistent gaps or divergence. These results are however sensitive to the choice of econometric approach and data set (e.g., the length of the time series). Still, the empirical basis for an egalitarian rule of equal per capita emissions in the design of global climate policy is not solid; it ignores the specific structural characteristics of countries such as climate, natural resource endowments, etc. The analysis therefore points to a need for more in-depth analyses of the structural determinants of carbon intensity (productivity) at the country level, as well as to additional research on the economic consequences of different types of equity principles (including combinations of such principles).

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