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Estimating Future Consumer Welfare Gains from Innovation: The Case of Digital Data Storage AgEcon
Austin, David H.; MacAuley, Molly K..
We develop a quality-adjusted cost index to estimate expected returns to investments in new technologies. The index addresses the problem of measuring social benefits from innovations in service sector inputs, where real output is not directly observable. We forecast welfare gains from two U.S. Advanced Technology Program innovations equaling 25%-50% of expected price, and aggregate consumer benefits of $1-$2 billion, relative to trends in existing technologies. Our model's probabilistic parameters reflect uncertainty about prospective outcomes and in our hedonic estimates of shadow values for selected product attributes. The index can be readily adopted by research and development (R&D) managers in industry and government.
Tipo: Working or Discussion Paper Palavras-chave: Quality-adjusted cost index; Consumer surplus; Innovation; Research and Development/Tech Change/Emerging Technologies; O32; H43; D60.
Ano: 2000 URL: http://purl.umn.edu/10814
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Dams AgEcon
Duflo, Esther; Pande, Rohini.
The construction of large dams is one of the most costly and controversial forms of public infrastructure investment in developing countries, but little is known about their impact. This paper studies the productivity and distributional effects of large dams in India. To account for endogenous placement of dams we use GIS data and the fact that river gradient affects a district's suitability for dams to provide instrumental variable estimates of their impact. We find that, in a district where a dam is built, agricultural production does not increase but poverty does. In contrast, districts located downstream from the dam benefit from increased irrigation and see agricultural production increase and poverty fall. Overall, our estimates suggest that large...
Tipo: Working or Discussion Paper Palavras-chave: Dams; Development planning; Program evaluation; India; Public Economics; O21; O12; H43; H23.
Ano: 2005 URL: http://purl.umn.edu/28373
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A Quality-Adjusted Cost Index for Estimating Future Consumer Surplus from Innovation AgEcon
Austin, David H.; MacAuley, Molly K..
This paper describes a model for estimating, in a probabilistic framework, expected future consumer surplus from planned new product innovations. The model has been applied to estimations of taxpayer benefits from NASA's New Millenium Program (NMP), which develops new technologies for space science, and to the digital data storage technologies being supported by the Department of Commerce's Advanced Technology Program (ATP). The model uses cost index methods based on consumers' estimated marginal valuation for quality improvements in the technology. Probabilistic values for performance increases are taken from the innovators' own expectations. The analysis reveals the sensitivity of welfare increases to these values, which are assumed to be biased upward....
Tipo: Working or Discussion Paper Palavras-chave: Quality-adjusted cost index; Consumer surplus; Innovation; Environmental Economics and Policy; O32; H43; D60.
Ano: 1998 URL: http://purl.umn.edu/10655
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Economics of Forest Ecosystem Carbon Sinks: A Review AgEcon
van Kooten, G. Cornelis; Sohngen, Brent.
Carbon terrestrial sinks are seen as a low-cost alternative to fuel switching and reduced fossil fuel use for lowering atmospheric CO2. In this study, we review issues related to the use of terrestrial forestry activities to create CO2 offset credits. To gain a deeper understanding of the confusing empirical studies of forest projects to create carbon credits under Kyoto, we employ meta-regression analysis to analyze conditions under which forest activities generate CO2-emission reduction offsets at competitive ‘prices’. In particular, we examine 68 studies of the costs of creating carbon offsets using forestry. Baseline estimates of costs of sequestering carbon are some US$3–$280 per tCO2, indicating that the costs of creating CO2-emission offset credits...
Tipo: Working or Discussion Paper Palavras-chave: Climate change; Kyoto Protocol; Meta-regression analysis; Carbon-uptake costs; Forest sinks; Environmental Economics and Policy; Resource /Energy Economics and Policy; Q2; Q25; H43; C19.
Ano: 2007 URL: http://purl.umn.edu/37037
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Sustainable Decision-making: The State of the Art from an Economics Perspective AgEcon
Toman, Michael.
Government, corporate and other decision makers are more and more often being urged to 'act sustainably' and to pursue policy paths toward 'sustainable development.' However, application of these concepts is hampered by serious interdisciplinary disagreements about the interactions of humans with their environment. Moreover, reducing disagreements about sustainability cannot be achieved solely through an improvement in scientific knowledge. These observations lead me to express skepticism about the capacity of any more or less mechanistic rule, economic, scientific or otherwise, to provide definitive and reliable answers about sustainable policies or conduct. However, there are processes and procedures that can help guide decision-making. I underscore the...
Tipo: Working or Discussion Paper Palavras-chave: Sustainable development; Cost-benefit analysis; Intergenerational equity; Multicriteria analysis; Social values; Institutional and Behavioral Economics; A12; A13; B41; D61; D63; H43; Q28.
Ano: 1998 URL: http://purl.umn.edu/10602
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What's the Rate? Disentangling the Weitzman and the Gollier Effect AgEcon
Traeger, Christian P..
The uncertainty of future economic development affects the term structure of discount rates and, thus, the intertemporal weights that are to be used in cost benefit analysis. The U.K. and France have recently adopted a falling term structure to incorporate uncertainty and the U.S. is considering a similar step. A series of publications discusses the following concern: A seemingly analogous argument used to justify falling discount rates can also be used to justify increasing discount rates. We show that increasing and decreasing discount rates mean different things, can coexist, are created by different channels through which risk affects evaluation, and have the same qualitative effect of making long-term payoffs more attractive.
Tipo: Working Paper Palavras-chave: Benefit cost analysis; Discounting; Term structure; Uncertainty; Weitzman-Gollier puzzle; Environmental Economics and Policy; Public Economics; D61; D81; H43; Q54.
Ano: 2012 URL: http://purl.umn.edu/121932
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Cost Savings, Market Performance, and Economic Benefits of the U.S. Acid Rain Program AgEcon
Burtraw, Dallas.
This paper reports on four areas of research concerning Title IV of the 1990 Clean Air Act Amendments that regulates emissions of SO2 from electricity generation. The first is the costs of the program over the long-run as estimated from the current perspective taking into account recent changes in fuel markets and technology. We compare projected costs with potential cost savings that can be attributable to formal trading of emission allowances. The second area is an evaluation of how well allowance trading has worked to date. The third area is the relationship between compliance costs and economic costs from a general equilibrium perspective. The fourth area is a comparison of benefits and costs for the program.
Tipo: Working or Discussion Paper Palavras-chave: Acid rain; Benefit-cost analysis; Air pollution; Permit trading; Clean Air Act; Environmental Economics and Policy; H43; Q2; Q4.
Ano: 1998 URL: http://purl.umn.edu/10885
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Using Environmental Benefit-Cost Analysis to Improve Government Performance AgEcon
Farrow, Scott; Toman, Michael.
In this paper we first describe the legal and administrative basis of mandates that variously require and eschew economic measures for environmental management. We then summarize the steps involved in benefit-cost analysis and what can and cannot be accomplished with such information. Our basic conclusion is that while the approach is not perfect, benefit-cost analysis has a solid methodological footing and provides a valuable performance measure for an important governmental function, improving the well-being of society. However, benefit-cost analysis requires analytical judgements which, if done poorly, can obfuscate an issue or worse, provide a refuge for scoundrels in the policy debate. We conclude the article with specific suggestions for both the...
Tipo: Working or Discussion Paper Palavras-chave: Benefit-cost analysis; Environmental regulation; Regulatory reform; Environmental Economics and Policy; Q28; D61; H43.
Ano: 1998 URL: http://purl.umn.edu/10598
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The Costs and Benefits of Reducing Acid Rain AgEcon
Burtraw, Dallas; Krupnick, Alan J.; Mansur, Erin T.; Austin, David H.; Farrell, Deirdre.
Title IV of the 1990 Clean Air Act Amendments initiated a dramatic reduction in emissions of sulfur dioxide and nitrogen oxides by electric power plants. This paper presents the results of an integrated assessment of the benefits and costs of the program, using the Tracking and Analysis Framework (TAF) developed for the National Acid Precipitation Assessment Program (NAPAP). Although dramatic uncertainties characterize our estimates especially with respect to the benefits of the program, many of which we have modeled explicitly, we find that the benefits can be expected to substantially outweigh the costs of the emission reductions. The lion's share of benefits result from reduced risk of premature mortality, especially through reduced exposure to...
Tipo: Working or Discussion Paper Palavras-chave: Acid rain; Sulfur dioxide; Nitrogen oxides; Cost-benefit analysis; Clean Air Act; Title IV; Environmental Economics and Policy; H43; Q2; Q4.
Ano: 1997 URL: http://purl.umn.edu/10692
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Tax Deductions, Consumption Distortions, and the Marginal Excess Burden of Taxation AgEcon
Parry, Ian W.H..
Certain types of expenditure--e.g. mortgage interest and medical insurance—- receive favorable tax treatment and are effectively subsidized relative to other (non-tax-favored) expenditures. Labor taxes (e.g. income taxes) can therefore produce efficiency losses by distorting the allocation of consumption, in addition to distorting the labor market. Using evidence on the responsiveness of taxable income to changes in tax rates, a seminal study by Feldstein (1999) estimates that the marginal excess burden of taxation (MEB) could exceed unity, when the effects of tax deductions are taken into account. This is several times larger than in previous studies of the MEB that focus exclusively on labor market effects. This paper develops a "disaggregated" approach...
Tipo: Working or Discussion Paper Palavras-chave: Welfare costs; Tax system; Tax deductions; Simulations; Political Economy; H21; H43.
Ano: 1999 URL: http://purl.umn.edu/10801
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The Precautionary Principle Revisited: Its Interpretations and their Conservation Consequences AgEcon
Tisdell, Clement A..
The precautionary principle was included in 1992 in the Rio Declaration on Environmental and Development and is a part of important international agreements and documents, for example, the Convention on Biological Diversity. Yet the interpretation of this principle is not straightforward as a guide for environmental policy – a variety of interpretations are possible. This paper identifies and examines various economic versions of the principle. Furthermore, it shows that different economic versions of the principle can give rise to conflicting policy recommendations for resource conservation. In addition, it demonstrates that applications of the principle do not always favour (natural) resource conservation (for example, biodiversity conservation) although...
Tipo: Working or Discussion Paper Palavras-chave: Biodiversity; Conservation; Climate change; Flexibility; Learning; Precautionary principle; Uncertainty; Environmental Economics and Policy; Q2; Q28; Q3; H43.
Ano: 2009 URL: http://purl.umn.edu/55339
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Evaluating the Impact on Market Performance of Investments in Market Information Systems: Methodological Challenges AgEcon
Staatz, John M.; Kizito, Andrew M.; Weber, Michael T.; Dembele, Niama Nango.
Evaluating the impact on market performance of investments in agricultural market information systems (MIS) face several methodological challenges. These fall into two broad categories: (a) defining the dimensions of market performance to measure (which is a function of whom the MIS is designed to serve) and identifying reliable indicators of those performance dimensions, and (b) identifying the causal effects of the MIS. The determination of causal effects in turn requires establishing a credible baseline, measuring “treatment effects” (i.e., the effects on economic behavior of receiving improved information from an MIS), dealing with problems of endogenous placement of treatment, and interpreting the validity of stakeholders’ statements and...
Tipo: Working or Discussion Paper Palavras-chave: Market information services; Impact assessment; Market transparency; Food policies; Agricultural and Food Policy; Food Security and Poverty; International Development; Marketing; Research and Development/Tech Change/Emerging Technologies; Research Methods/ Statistical Methods; C81; D80; H43; N57; 013; Q13.
Ano: 2011 URL: http://purl.umn.edu/108184
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Valoracion de activos ambientales mediante metodos multicriterio. Aplicacion a la valoracion del Parque Natural del Alto Tajo AgEcon
Bellver, Jeronimo Aznar; Guitart, Vicente Estruch.
The valuation of these goods can be a relevant element for the conservation and improvement, though the intangible and inmaterial aspects of environmental asseets difficult the utilisation of the traditional methods of valuation. This work presents a methodology for the valuation of those assets combining multi-criteria methods, the Analytic Hierarchy Process and the Goal Programming and traditional method the Discounted Cash Flows. The combinatio of both techniques allows extracting and indicator of the Total Economic Value (TEV) of an environmental asset, as well as of each partial value which make up the TEV, including tangible and intangible elements. The proposed methodology is applied to the valuation of the Alto Tajo Natural Park RESUMEN Calcular...
Tipo: Journal Article Palavras-chave: Economic valuation; Environmental assets; Analytic hierarchy process; Goal programming; Environmental Economics and Policy; Q29; C52; H43.
Ano: 2007 URL: http://purl.umn.edu/7999
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State-Level Policies and Regulatory Guidance for Compliance in the Early Years of the SO2 Emission Allowance Trading Program AgEcon
Lile, Ronald D.; Burtraw, Dallas.
The Clean Air Act Amendments (CAAA) of 1990 instituted a historic experiment in emission allowance trading for sulfur dioxide (SO2). A necessary requirement for evaluating this experiment is an understanding of how the cost recovery rules and other guidance given to firms by state-level public utility commissions (PUCs) and elected bodies has affected compliance behavior. From the onset of the CAAA, there has been varied response by state policy-makers toward SO2 compliance. This paper presents a compilation of these actions as they took shape in states that were affected by the SO2 program. Our primary interest is on the proposals that emerged during the embryonic years of the allowance program, from 1990 to 1993, when investment plans for utilities...
Tipo: Working or Discussion Paper Palavras-chave: Clean Air Act Amendments; Sulfur dioxide; Allowance trading; Regulation; Electricity; Public utility commissions; Environmental Economics and Policy; H43; Q2; Q4.
Ano: 1998 URL: http://purl.umn.edu/10828
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Cairo Evaluation Clinic: Thoughts on Randomized Trials for Evaluation of Development AgEcon
Karlan, Dean S..
We were asked to discuss specific methodological approaches to evaluating three hypothetical interventions. This article uses this forum to discuss three misperceptions about randomized trials. First, nobody argues that randomized trials are appropriate in all settings, and for all questions. Everyone agrees that asking the right question is the highest priority. Second, the decision about what to measure and how to measure it, i.e., through qualitative or participatory methods versus quantitative survey or administrative data methods, is independent of the decision about whether to conduct a randomized trial. Third, randomized trials can be used to evaluate complex and dynamic processes, not just simple and static interventions. Evaluators should aim...
Tipo: Working or Discussion Paper Palavras-chave: Program evaluation; Randomized control trial; Agricultural Finance; Community/Rural/Urban Development; Consumer/Household Economics; Financial Economics; Food Consumption/Nutrition/Food Safety; Food Security and Poverty; Institutional and Behavioral Economics; Labor and Human Capital; Public Economics; Research Methods/ Statistical Methods; B41; O12; H43; J08; H54; D73; D12.
Ano: 2009 URL: http://purl.umn.edu/51913
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The Effects of Trading and Banking in the SO2 Allowance Market AgEcon
Burtraw, Dallas; Mansur, Erin T..
The 1990 Clean Air Act Amendments initiated a dramatic reduction in emissions of sulfur dioxide and nitrogen oxides by electric power plants. This paper provides an evaluation of the environmental and public health consequences of the trading and banking provisions of Title IV. A sizable shift in the geographic location of emissions under Title IV (in some states of over 20 percent of emissions after Title IV is implemented) is attributable to trading and/or to banking. There has been considerable concern that this shift in emissions would cause harm to downwind areas due to long-range transport of pollution. We find the resulting change in atmospheric concentrations and deposition of pollutants, and the change in monetized health benefits, are most...
Tipo: Working or Discussion Paper Palavras-chave: Acid rain; Sulfur dioxide; Trading; Benefit-cost analysis; Clean Air Act; Environmental Economics and Policy; H43; Q2; Q4.
Ano: 1999 URL: http://purl.umn.edu/10630
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Uncertainty Discounting for Land-Based Carbon Sequestration AgEcon
Kim, Man-Keun; McCarl, Bruce A..
The effect of stochastic factors on soil carbon makes the quantity of carbon generated under a sequestration project uncertain. Hence, the quantity of sequestered carbon may need to be discounted to avoid liability from shortfalls. We present a potentially applicable uncertainty discount and discuss difficulties that might arise in empirical use. We insist that the variance in historical crop yields across geographical areas is used to derive a proxy variance for forming an uncertainty discount for carbon projects. Application of our approach suggests that project level uncertainty discounts would be 15–20% for the East Texas region.
Tipo: Journal Article Palavras-chave: Carbon sequestration; Discount; Uncertainty; Agribusiness; Land Economics/Use; Research and Development/Tech Change/Emerging Technologies; H43; Q54.
Ano: 2009 URL: http://purl.umn.edu/48754
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Impacto del programa Juntos sobre nutrición temprana AgEcon
Jaramillo, Miguel; Sánchez, Alan.
Desde fines del 2005, el programa Juntos brinda transferencias monetarias condicionadas a los hogares ubicados en los distritos pobres del Perú. En el año 2010, había alrededor de 420 mil hogares beneficiados. Si bien se evidencian mejoras en los indicadores nutricionales de los niños afiliados al programa, la pregunta de la investigación es: ¿hasta qué punto estas mejoras serían consecuencia de Juntos? Esta pregunta es válida dado que durante el periodo de estudio existe una tendencia clara hacia la reducción en los niveles de desnutrición crónica a nivel nacional. Según cifras oficiales, la desnutrición crónica disminuyó de 28.5% en 2007 a 23.2% en 2010. Los resultados evidencian que Juntos habría favorecido a aquellos niños ubicados en los percentiles...
Tipo: Working Paper Palavras-chave: Evaluación de programas; Programas sociales; Nutrición; Salud infantil; Perú; Programme evaluation; Social programmes; Nutrition; Child health; Peru; Food Consumption/Nutrition/Food Safety; H43; I12; I38; O15.
Ano: 2011 URL: http://purl.umn.edu/120319
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The Social Discount Rate under Intertemporal Risk Aversion and Ambiguity AgEcon
Traeger, Christian P..
The social discount rate crucially determines optimal mitigation policies. This paper examines two shortcomings of the recent debate and the models on climate change assessment. First, removing an implicit assumption of (intertemporal) risk neutrality reduces the growth effect in social discounting and significantly amplifies the importance of risk and correlation. Second, debate and models largely overlook the difference in attitude with respect to risk and with respect to non-risk uncertainty. The paper derives the resulting changes of the risk-free and the stochastic social discount rate and points out the importance of even thin tailed uncertainty for climate change evaluation.
Tipo: Working or Discussion Paper Palavras-chave: Ambiguity; Discounting; Expected utility; Intertemporal substitutability; Intertemporal risk aversion; Recursive utility; Risk aversion; Social discount rate; Uncertainty; Political Economy; Risk and Uncertainty; D61; D81; D90; H43; Q00; Q54.
Ano: 2009 URL: http://purl.umn.edu/55785
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The Preferences of Trieste Inhabitants for the Re-use of the Old Port: A Conjoint Choice Experiment AgEcon
Massiani, Jerome; Rosato, Paolo.
In many developed countries, abandoned (derelict or underused) industrial areas often occupy important parts of the cities. This raises issues about the possibilities of reusing these areas as well as on the conservation of industrial heritage they often entail. Conjoint Analysis (CA) can shed light on these issues as it can elicit the preferences of inhabitants for different scenarios of reuse. So far, only a limited number of applications of CA have been made on this topic. In this article, we present the results of a CA experiment on the reuse of a large, mainly abandoned, port area in Trieste (Italy) featuring buildings with some historical and industrial heritage value. Three hundred computer assisted interviews have been made on a representative...
Tipo: Working or Discussion Paper Palavras-chave: Land Use; Port; Trieste; Conjoint Analysis; Land Economics/Use; Community/Rural/Urban Development; H43; R52; R10.
Ano: 2008 URL: http://purl.umn.edu/44224
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