Environment

Ralph De Haas, 22 November 2019

We think about climate policies as moderating or interceding in markets. 
But a new paper implies that when stock markets play a bigger part in the economy, polluting industries become cleaner. Tim Phillips asks Ralph De Haas of the European Bank for Reconstruction and Development whether we already have a green finance initiative under our noses.

Stefano Carattini, Simon A. Levin, Alessandro Tavoni, 23 October 2019

Climate change is a global crisis, a fact long seen as an obstacle to fighting it. Contra conventional economic wisdom, this column argues that lessons from managing local commons may also apply to global dilemmas. Evidence ranging from hybrid cars to carbon offsets suggests that for people deciding whether to adopt climate-friendly behaviours, local social norms matter, despite the global nature of the problem. Further, interventions can play a key role in facilitating behavioural change by increasing the visibility of otherwise invisible behaviours such as green energy adoption.

Basak Bayramoglu, Brian Copeland, Marco Fugazza, Jean-François Jacques, 21 October 2019

With fisheries resources dwindling drastically, countries are scrambling to negotiate a deal to reduce subsidies and ensure sustainable management. This column suggests that reaching a deal on fisheries subsidies may be difficult. For many resources, international spillover effects create incentives to negotiate reductions in subsidies, since one country’s subsidy worsens other exporters’ terms of trade. However, the renewable nature of fisheries arguably limits these incentives, and a comprehensive approach to negotiations including quotas and subsidies is desirable to support both fishing communities and environmental sustainability.

David Keiser, Joseph S. Shapiro, 05 October 2019

The Trump administration recently repealed the US Clean Water Rule, which sought to extend federal water quality protection to cover most rivers and streams. This column seeks to better understand the effectiveness of such laws that govern US surface and drinking water quality, the efficiency of these laws, and the state of economic research on water quality. It finds that regulations governing surface water quality are more likely to fail cost-benefit tests compared to drinking water and air pollution regulations, possibly due to an underestimation of the benefits of surface water pollution control.

Achyuta Adhvaryu, Sadish D, Namrata Kala, Anant Nyshadham, 29 September 2019

The impact of environmental conditions on worker productivity provides an opportunity to study the effectiveness of management practices in increasing worker efficiency. This column uses evidence from Indian garment factories to show how air pollution reduces the relative productivity of workers in tasks in which they are otherwise more efficient. Effective managers can respond by reallocating workers to other tasks in order to bring total productivity losses to near zero. 

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