February 28, 2007
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A Guide to Information on Greenhouse Gases and Ozone Depletion
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FROM VOLUME 9, NUMBER 8, AUGUST 1996
POLICY AND ECONOMICS
"Energy, Carbon Dioxide Emissions, Carbon Taxes and the Chinese
Economy," Z.X. Zhang (Univ. Wageningen, Vakgroep Staathiushoudkunde,
Hollandesweg 1, 6706 KN Wageningen, Neth.), Intereconomics, 31(4),
197-208, July-Aug. 1996.
Given China's potential importance as a source of CO2 emissions, advocates
of control call for substantial efforts there. However, the Chinese authorities
have argued that they must receive substantial international aid for this
purpose. This paper explains these positions based on characteristics of the
Chinese energy system and by analyzing the economic implications of possible
future CO2 emissions limits in China. Advocates funding through joint
implementation as a near-term solution that would effectively limit CO2
emissions from China, and also lower the costs of undertaking carbon abatement
in the industrialized countries.
Two items from Energy Policy, 24(7), July 1996, a special
issue on valuing air pollution damage:
"Climate Change Costs: Recent Advancements in the Economic Assessment,"
S. Fankhauser (PRINCE, Global Environ. Facility, 1818 H St. NW, Washington DC
20433), R.S.J. Tol, 665-673. The first generation of estimates of the damage
costs of climate change is being substantially revised and complemented,
without, as yet, invalidating earlier results. Newer studies increasingly
emphasize adaptation, variability, extreme events, other (non-climatic) stress
factors and the need for integrated assessment of damages. As a result, the
market impacts in developed countries has tended to fall, and non-market impacts
have become increasingly important. Lists five crucial research topics for the
"Air Pollution and Green Accounts," K. Hamilton (CSERGE, Univ.
College, Gower St., London WC1E 6BT, UK), G. Atkinson, 675-684. Presents a
theoretical approach to the treatment of pollution and its abatement in national
accounts, and a first attempt to apply this approach to the European OECD
countries. The empirical results are presented in the context of previously
defined scheme in which "genuine savings" provide an indicator of
sustainable development. Figures developed for the UK and Europe show that
several countries had negative genuine savings during the 1980s.
"Joint Implementation from a Public Choice Perspective," A.
Michaelowa (Hamburg Inst. for Econ. Res. (HWWA), Neuer Jungfernstieg 21, 20347
Hamburg, Ger.), S. Greiner, World Resour. Rev., 8(2), 231-252,
Joint implementation should facilitate greenhouse gas control at lower cost,
but why is the concept encountering so many political difficulties? This paper
analyzes the efficiencies of joint implementation, and then tries to explain the
obstacles from a public choice perspective. Discusses the roles of different
countries and their interest groups, then proposes a regime that takes into
account both efficiency and public choice, as a real-world, second-best
"Fair Sharing of Greenhouse Gas Burdens," M.A. Ridgley (Dept.
Geog., Univ. Hawaii at Manoa, 2424 Maile Way, Honolulu HI 96822), Energy
Policy, 24(6), 517-529, June 1996.
Describes an approach for determining the relative accountability that each
region and individual nation should bear, based on as many measures of equity
that proponents want to support. However, each equity indicator yields a
different profile of accountability, so multicriterion decision methods are
proposed to achieve a compromise profile. The method is illustrated by applying
11 different equity indicators to 11 multinational regions.
"Time Preference, Abatement Costs and International Climate Policy:
An Appraisal of IPCC 1995," N. Khanna (Dept. Agric., Resource &
Managerial Econ., Cornell Univ., Ithaca NY 14853), D. Chapman, Contemporary
Econ. Policy, 14(2), 56-66, Apr. 1996.
Appraises current economic methods used in analyzing time preference and
discounting, abatement costs, and value of life estimates, in the context of the
draft 1995 report of Working Group III of the IPCC. Argues that the currently
estimated disparity in the cost of greenhouse gas abatement between developed
and developing countries may be inaccurate.
"A Case Study in Pollution Markets: Dismal Science vs. Dismal
Reality," J.V. Hall (Inst. for Econ. & Environ. Studies, California
State Univ., Fullerton CA 92634), A.L. Walton, ibid., 67-78.
Describes the theoretical advantages of pollution trading, and clearly
identifies three criteria that acceptable economic incentive-based programs must
meet. Examines the experience of the existing Regional Clean Air Incentives
Market (RECLAIM) program in Southern California, which is expected to reduce
pollution control costs relative to direct regulation by 50% over a decade.
"The SO2 Emissions Trading Program: Cost Savings Without Allowance
Trades," D. Burtraw (Resources for the Future, 1616 P St. NW, Washington DC
20036; e-mail: firstname.lastname@example.org), ibid., 79-94.
Experience with the emissions trading program established under Title IV of
the 1990 amendments to the U.S. Clean Air Act show that relatively little
allowance trading has occurred, yet the costs of compliance have been much less
than anticipated. This paper addresses this paradox: that the allowance trading
program may not require (very much) trading in order to be successful.
"Climatic Risks and Rational Actors," C.C. Jaeger (Swiss Fed.
Inst. for Environ. Sci. & Technol. (EAWAG), Ueberlandstr. 133, 8600
Duebendorf, Switz.), B. Kasemir, Global Environ. Change, 6(1),
23-36, Apr. 1996.
The present state of research indicates that substantial reductions in
greenhouse gas emissions can only be achieved by introducing a very high
greenhouse tax. Such a measure is unlikely to be realized. A way out of this
impasse can be found if a misleading assumption is corrected: that a system
involving a multitude of rational actors operating on interdependent markets has
only one equilibrium. The possibility of multiple equilibria implies that large
reductions of carbon emissions could be feasible without massive long-run
increases of fossil fuel prices.
"Rolling Dice for the Future of the Planet," D. Chapman (Dept.
Agric., Resource & Managerial Econ., Cornell Univ., Ithaca NY 14853), V.
Suri, S.G. Hall, Contemporary Econ. Policy, 13(3), 1 ff., July
In an influential paper published in Science in 1992, Nordhaus
employed an integrated climate-economy model to determine that optimizing
climate change policy requires low levels of controls on greenhouse gas
emissions. This paper takes the same approach, but using different though
equally plausible parameters finds a much higher level of emission control to be
"Markets and the Environment: A Critical Reappraisal," F.L.
Smith Jr. (Competitive Enterprise Inst., Washington, D.C.), ibid., 62
Environmental concerns have been addressed so far in the same manner that
socialist nations sought to address broader economic concerns: a political
entity determines the priority by which goals are satisfied with limited
financial resources. Argues for greater attention to environmental quality, but
concludes that we can better achieve it by integrating ecological resources into
the economy via "ecological privatization," a property rights approach
to environmental policy.
"Improving Environmental Policy: Are Markets the Solution?"
W.M. Hanemann (Dept. Agric. & Resour. Econ., Univ. California, Berkeley,
Calif.), ibid., 74 ff.
Market mechanisms are only part of the solution to improving environmental
policy, and they do not necessarily resolve what are perhaps the most
troublesome aspects of environmental regulation. This theme is explored by
emphasizing two fundamental components of environmental policythe decision
on the aggregate level of abatement needed, and the decision on how this
aggregate is to be allocated among individual polluters.
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