Environmental and Urban Economics

As discussed below, 9 northeastern states are getting ready to sign a pact to cap and trade electric utility greenhouse gas emissions. Under what conditions would this pact accelerate the timing and increase the probability that the nation's electric utilities adopts a credible cap and trade CO2 policy?

1. Is this a demonstration project to show that the extra costs of meeting this new regulation (measured in higher electricity prices and lower electric utility profits) are not that high?

2. Will this accelerate the development and diffusion of new "green" technologies?

3. In aggregate,how much will this regional trading reduce national greenhouse gas production by?

4.

Perhaps Paul Krugman's popular writings have had a strong treatment effect causing Republican economists to hide or change stripes. Perhaps economists are jockeying to join President Clinton's "Economic Dream Team" in early 2009. Today the New York Times points out an interesting fact. The Bush Administration is finding that the "academic bench" is short. It is having trouble recruiting excellent senior economists to join its team.

Urban population density offers some advantages and some disadvantages. The usual laundry list of disadvantages includes congestion and pollution. When people think of pollution, they immediately think of air and water pollution. But, The New York Times today points out a new indicator of environmental trouble in the big city; bedbugs are back in New York City.

November 27, 2005

Just Try to Sleep Tight. The Bedbugs Are Back.

Two leading environmental economists have conducted a thorough study of the costly Superfund program. They conclude that the $30 billion dollars spent on hazardous waste site cleanups does not pass a cost/benefit test. Their primary measure of the benefits of hazardous waste cleanup is average home price appreciation in a vacinity around the cleanup.

Recently there has been extensive media coverage of this benzene spill near China's Harbin City. Part of the costs of this disaster will be borne in nearby Russia. What is the dollar damage that the Chinese spill has imposed on Russia? This would require a lot more information concerning how many people live in this part of Russia, how much would they be willing to pay to avoid this pollution exposure, and how is industrial profitability in Russia affected by the spill.

Dora Costa and I are starting to write a book on social capital during war time. Our setting is the U.S Civil War. In particular, we have unique soldier level data for over 36,000 Union Army Soldiers (30,000 whites and 6,000 blacks). For these soldiers, we examine key outcome indicators such as desertion, survival in tough confederate POW camps, after war migration to test for evidence of the importance of social networks.

Can there be a large "silver lining" from environmental disasters? A Chinese city called Harbin offers another natural experiment today for thesting this hypothesis. A chemical plant exploded in Harbin and this has increased the local river's toxic benzene content. Clearly this city will need a new drinking water source.

Is Montana coal our nation's solution to achieving energy independence? The New York Times today sounds convinced. This article is quite interesting but I think it is a good example of why journalists needs to specialize and know the technical details of the subject they are studying.

While I hope that the boosters are right that with enough investment that in 10 years Montana's natural resources could be converted into an oil substitute, I had the sneaking suspicion that there must be a catch.

Ther Mercer Rankings for the year 2005 rank San Francisco as the 25th best city in the world and New York City is ranked as #39. None of the major cities in the United States cracks the world top 25! If this survey is to be believed, what does this really mean?

As described at the bottom of this blog entry, the Mercer Consulting group does try to quantify differences in each city's objective quality based on a variety of criteria ranging from schools to natural disasters.

Suppose there is sharp learning by doing in the renewable energy industry. As this article below discusses, China is getting ready to make a major investment in wind turbines. If the Chinese government creates the demand for renewables technology and rewards those who develop such technology, could this help the world make a "smooth" transition away from fossil fuels?

This article below suggests that government intervention is needed to give renewable energy a "fighting chance" to compete.