Browsing by Subject "Environmental economics"

Now showing 1 - 12 of 12

Essays in applied microeconomics
(2019-05-03) Keisler, Mary Katherine; Youngblood, Sandra Black; Geruso, Michael; Abrevaya, Jason; Olmstead, Sheila
The first of paper provides an econometric estimates of the relationship between temperature and maternal mortality in the U.S. Exploiting the year-to-year variation in temperature within states, I use a semiparametic estimation strategy to capture non-linear effects in mortality risks at extreme temperatures. Whereas most of the existing literature uses dry-bulb (thermometer) temperature, I use wet-bulb temperature, a metric that accounts for both temperature and humidity. The analysis shows that an additional day with an average wet-bulb temperature above of 80°F (about 95°F with 50% relative humidity) is associated with roughly 2.2 additional maternal deaths per 100,000 births. These estimates suggest that climate change may generate up to an additional 3,700 maternal deaths per year by 2090 as a result of very hot and humid days. In the second paper, we examined the impact of a model that accelerates developmental math coursework in community colleges so that students can complete dev-ed and college math courses in their programs of study within one year. Using data from Texas and a propensity score matching approach, we tested the impact of the model on several college milestones. Results suggest that students in the accelerated model were more likely to persist and accumulate college-level credits during the first year than those in traditional dev-ed math. After three years, there was a strong positive relationship between participation in the accelerated model and important college milestones, like college math course completion and total accumulated college-level credits. The third paper estimates the relationship between temperature and maternal mortality in a developing region. Similar to the first paper, I study the effects of extreme temperatures on maternal mortality using wet bulb temperature. I find that, relative to day in a comfortable temperature range, an additional day with an average wet-bulb temperature above of 85°F is associated with roughly 0.61 additional maternal deaths per 100,000 births. An analysis of future warming due to climate change shows there may be as many as 6000 additional maternal deaths between 2050 and 2090 due to changes in temperature, especially additional hot and humid days
Essays on environmental and natural resource economics
(2010-08) Stafford, Teresa Michelle; Williams, Roberton C., 1972-; Abrevaya, Jason; Corsi, Richard; Fullerton, Don; Hamermesh, Daniel
In the first essay, I assess the effect of indoor air quality (IAQ) in school buildings on student test performance and attendance rates. Results indicate that performance on standardized tests significantly improves while attendance rates are unresponsive to improvements in IAQ. The improvement in math scores ranges from 0.102 - 0.189 standard deviations per $500,000 spent on IAQ-related renovations and is 35% - 50% greater than the improvement in reading scores. For the same budget, results suggest that the improvement in math scores following IAQ-related renovations is several times larger than the improvement associated with class size reductions. In the second essay, I examine the responsiveness of the daily labor supply of fishermen to transitory variations in the daily wage using data from the Florida spiny lobster fishery. The applicability of this research is both narrow and general. Understanding this relationship is key to determining the effectiveness of landing fees as a means to regulate fisheries. Tracing out the labor supply curve is also fundamental to labor economics and policy. I find that the wage elasticity of labor supply (participation) is positive and statistically different from zero, with a point estimate of 0.967. This suggests an upward slopping labor supply curve and refutes the notion of reference dependent preferences. In the third essay, I examine the bias associated with ignoring the multi-species aspect of labor supply decisions in spatially explicit bioeconomic fishery models. Using a complete 15-year panel of all fishing trips made by fishermen possessing a Florida spiny lobster license, including non-lobster trips, I show that the simplifying assumption of a dichotomous choice structure at the first node (i.e. participate in the target fishery or not) is not innocuous and that predicted participation rates can change substantially with the addition of another species as an outside alternative in the first decision node.
Essays on environmental and public economics
(2011-05) Monti, Holly Anne Odell; Williams, Roberton C., 1972-; Hamermesh, Daniel S.; Abrevaya, Jason; Fullerton, Don; Trejo, Stephen
This dissertation is a collection of three essays in the fields of environmental and public economics. The first essay assesses the effect of government spending on charitable donations to environmental causes. Using a theoretical model, I solve for changes in private donations due to increased government spending and contrast this with changes due to direct grants to nonprofit organizations. Depending on the nonprofit’s fundraising response, government spending may result in the crowding out or in of private giving. I empirically investigate this topic using data from the tax returns of environmental charities as well as a panel survey data set on the philanthropic behavior of individuals. My results indicate that government expenditures on the environment actually crowd in private giving, partly due to the increased fundraising response by charities. The second essay examines the incidence of a pollution tax scheme in which tax revenue is returned to low-income workers. Using a general equilibrium model with both skilled and unskilled labor, a decomposition of the real net wage effects shows the effect of the tax rebate, the effect on the uses side of income (higher product prices), and the effect on the sources side of income (relative wage rates). Numerical examples show that returning the revenue to the low-skilled workers is still not enough to offset the effect of higher product prices; in almost all cases, the rebate does not prevent a reduction in the real net wage. The third essay studies the distributional effects of the SO2 allowance market. Even if low-income households do not have large budget shares for the polluting good, grandfathered permit systems may still be regressive since the permit rents accrue disproportionately to wealthy shareholders in the polluting industry. I estimate the burden imposed on different income groups under a grandfathered permit policy and compare this with the burden under an auctioned policy. Using Monte Carlo techniques, I calculate the 5th and 95th percentiles of the distribution of possible results. I find evidence of regressivity for grandfathered permits whereas an emissions tax/auctioned permit system can be progressive if the scarcity rents are distributed in lump sums.
Essays on health economics and the early-life determinants of adult outcomes
(2022-05-05) Neller, Seth; Cabral, Marika; Geruso, Mike; Spears, Dean; Olmstead, Sheila
The three chapters of this dissertation explore topics in health economics, namely how early-childhood health circumstances affect long-run health and economic outcomes, as well as how insurance reimbursement impacts the nature of physician practices. The first chapter assesses the impact of in utero and early-childhood exposure to wildfire smoke on longevity. To identify areas that were exposed to wildfire pollution, we leverage mid-20th century (1930-1969) California wildfires and smoke dispersion modeling. We then combine these wildfire pollution data with comprehensive, restricted-use administrative data. These linked data allow us to measure childhood wildfire smoke exposure for four decades of birth cohorts and to observe a rich set of later-life outcomes. Using these data, we exploit plausibly exogenous variation in smoke exposure—which is a function of fire timing and size as well as wind direction and speed—to identify long-run effects. We find that moving from the 25th to 75th percentile of early-life wildfire smoke exposure results in 1.7 additional deaths before age 55 per 1,000 individuals, conditional on surviving past early childhood. Aggregating these effects across ages 30 to 80 translates to 46 life years lost per 1,000 persons. The second chapter considers the impact of in utero and early-childhood exposure to wildfire smoke on longevity as well as economic achievement, human capital accumulation, and disability in mid-to-late adulthood. To identify areas that were exposed to wildfire pollution, we leverage mid-20th century (1930-1969) California wildfires and smoke dispersion modeling. We then combine these wildfire pollution data with comprehensive, restricted-use administrative data from the Social Security Administration and Census Bureau. These linked data allow us to measure childhood wildfire smoke exposure for four decades of birth cohorts and to observe a rich set of later-life outcomes. Using these data, we exploit plausibly exogenous variation in smoke exposure—which is a function of fire timing and size as well as wind direction and speed—to identify long-run effects. We find that moving from the 25th to 75th percentile of early-life wildfire smoke exposure results in 1.7 additional deaths before age 55 per 1,000 individuals, conditional on surviving past early childhood. Aggregating these effects across ages 30 to 80 translates to 46 life years lost per 1,000 persons. We further find that smoke exposure results in unfavorable changes to a wide range of later-life outcomes across economic achievement, educational attainment, and disability measures. From these results, we estimate that each child born in California during our sample period sustained, on average, approximately $22,000 of discounted damages in lost life expectancy and lost earnings due to wildfire smoke. These findings suggest that warming temperatures, which exacerbate the duration and intensity of wildfire seasons, are already meaningfully affecting the life cycles of exposed children through increased smoke exposure. The third chapter exploits spatial discontinuities in Medicare payment rates to estimate the effect of reimbursements on primary care physicians’ choice of organizational structure. I find that a 1 percent increase in Medicare reimbursement leads to a 1.7 to 2.2 percentage point increase in primary care doctors who practice with a small group (defined as 25 providers or fewer). This effect is driven by changes in the tails of the practice size distribution: a 1.8 percentage point increase in physicians who are affiliated with the smallest (1- or 2-provider) practice groups with a corresponding decrease in physicians joining very large practices (≥ 150 providers). I do not, however, detect any evidence of physician sorting or bunching around the boundary in response to differential payment, supporting the underlying assumptions of my regression discontinuity design. Accordingly, my findings suggest that Medicare pricing may be a factor in the trend of consolidation in the physician and clinical services market.
Essays on the economics of indoor and outdoor environments
(2009-08) Briggs, Ronald Joseph; Williams, Roberton C., 1972-
This dissertation consists of three chapters on questions in Environmental Economics, addressing policy and health issues in indoor and outdoor environments. In the first chapter, I explores price and quantity policy solutions to externalities that arise from private decisions made over time, focusing on resource extraction as a specific example. In the U.S., mining causes more pollution than any other single industry. I show how tax policy can optimally address a flow externality associated with resource extraction when the policymaker faces asymmetric information in the short run. Chapter 2 investigates whether ordinary exposure to a common indoor air pollutant—Nitrogen Dioxide (NO₂)—affects respiratory health. About 40 percent of occupied homes in the U.S. use gas stoves for cooking, which produce NO₂ as a byproduct of combustion (US Census, 2006), and peak concentrations in homes may reach above 900 ppb when a gas stove is used for cooking (Dennekamp et al., 2001). Permanent or fatal lung damage occurs at NO₂ concentrations greater than 1000 ppb (Samet and Utell, 1990). Previous studies find mixed evidence of negative effects from indoor NO₂ (Basu and Samet, 1999), but exposure may be endogenous in these analyses. I address this problem by developing a physical model of indoor NO₂ concentrations that depends on ventilation decisions and housing characteristics and estimate it using data from the third wave of the National Health and Nutrition Examination Survey. In every model I consider, I find no significant effects of gas stoves on respiratory outcomes. In the final chapter, I combine data on state and local tobacco control ordinances from Americans for Non-smokers Rights Tobacco US Tobacco Control Laws Database with a sample of 35 million births in the U.S. to examine the impact of smoking bans on birth weight and related outcomes. Using difference-in-difference techniques, I identify the effects of state bans net of local bans, as well as the effects of local bans net of state bans. The results suggest less restrictive bans do more to improve birth outcomes than “100% smokefree” bans do, particularly in urban settings.
Essays on the effects of government intervention in Texas' electricity market and the health insurance markets in Missouri and Oklahoma
(2015-12) McKearin, Tobin Knowles; Geruso, Michael; Abrevaya, Jason; Oettinger, Gerald S; Zarnikau, Jay; Wozny, Nathan N
This public economics dissertation examines the effects resulting from government intervention in the electricity and health insurance markets. The first chapter analyzes the impact on residential electricity prices by studying a once regulated market in which government regulators withdrew from in hopes of allowing a free and competitive market to flourish. The second chapter analyzes the resulting effects on employment and other forms of health insurance that occur when the government tightens the income limits to qualify for Medicaid. The third and final chapter studies employment, health insurance, health, and emergency room usage effects when the government gives subsidies to employers providing health insurance to their employees.
Essays on the optimal policy response to climate change
(2011-05) Kaufman, Noah; Wiseman, Thomas E., 1974-; Dusansky, Richard; Chiburis, Richard; Williams, Roberton C.; Palmer, Karen L.
Unchecked anthropogenic climate change has the potential to destroy human lives and wealth on an unprecedented scale. This dissertation analyzes from an economic perspective various public policy options to correct the market failures caused by climate change. The widespread adoption of environmentally friendly consumer products can reduce the impacts of climate change. The first chapter analyzes various methods of encouraging the market performance of these products. I build a model of observational learning in which a "green" consumer good enters a market to challenge an established "dirty" product. Among other results, I provide conditions for when financial incentives or informational campaigns should be more effective at encouraging the market performance of green products. I also provide a discussion and an empirical analysis of the performance of compact fluorescent light bulbs in the U.S. residential market, and compare the findings to the predictions of the theoretical model. The second chapter provides a critic of the macroeconomic models economists have used to determine optimal climate change abatement policies. I build a model that can incorporate more realistic ranges of uncertainty for both the occurrence of catastrophic events and societal risk aversion than economists have used in the past. Numerical simulations are then used to calculate a range of risk premiums, the magnitude of which display that previous calculations of optimal carbon dioxide taxes are too imprecise to support any particular policy recommendation. Government-backed energy-efficiency programs have become popular as components of local and national strategies to combat climate change. The effectiveness of such policies hinges on whether they provide the appropriate incentives to both energy consumers and program implementers. The third chapter analyzes evaluations of California's energy-efficiency programs to assess their effectiveness at improving our understanding of the programs' performance and providing a check on utility incentives to overstate energy savings. We find, among other results, that evaluations are useful tools to achieve both of these goals because the programs largely did not meet their energy-savings projections, and the utility savings estimates are systematically higher than the third-party savings estimates of the evaluations.
Essays on three looming policy crises in Latin America
(2022-08-12) Rojas Álvarez, Alfonso José; Ward, Peter M., 1951-; Waxman, Andrew R.; Stolp, Chandler; Powers, Dan; Garnier, Leonardo
This dissertation is structured as three papers which seek to contribute to the increasing body of literature on three looming crises in Latin America, in topics identified as the core of public policy debates in the region for the upcoming decade. The first paper explores the relationship between levels of air pollution and safety incidents in Medellín, Colombia, during the period 2017-2019. Using an empirical strategy, I find a positive relationship between PM₂.₅ pollution levels and both property and violent daily incidents at the neighborhood level, after accounting for weather and location characteristics. These findings constitute a valuable tool for cost-benefit analysis of the environmental crisis in Colombia that uses an approach focused on its effects on safety that is currently absent in the conversation. In the second paper, on the crisis of chronic disease, using the Mexican Health and Aging Study 2018 we compare total out-of-pocket expenses for physician visits and medication among older adults living with diabetes in Mexico, stratified between urban, semi-urban, and rural localities. We find that although the healthcare safety net program (Seguro Popular) has improved access to care, older Mexicans affiliated with it have far higher out-of-pocket expenditures for medications than those on employer-based plans in all localities. Across all groups, the uninsured bear the highest burden of expenditures, highlighting continued need to address health inequities for the most underserved populations. Finally, the third paper on the rental markets’ crisis, follows the need to increase research on the availability of non-ownership alternatives in the region. It explores the effectiveness of an ease-of-eviction policy in Costa Rica by using household surveys to explore rental volumes before and after changes in regulation, while putting the country’s rental markets in broader perspective compared to OECD countries and their varying levels of eviction restrictions. The salience of these papers is greater today than ever, as Latin American countries face both present and looming policy crises on multiple fronts. Tackling these issues effectively will require a combination of public innovation, rigorous academic research, and interdisciplinary approaches to complex policy challenges.
Oil, pollution, and crime: three essays in public economics
(2008-05) Crum, Conan Christopher, 1981-; Fullerton, Don; Williams, Roberton C., 1972-
The overall goal of this dissertation is to study important questions in public economics. In its three chapters, I look at peak world oil production and its implications for oil prices; cross-country pollution emission rates and implications for institutional quality; and finally, black-white arrest rates and implications for law enforcement discount factors. Each chapter of this dissertation combines new theory with robust empirical work to extend the quantitative frontier of research in public economics.
On the economics of carbon capture
(2023-08-11) Stemmler, Joseph Augustin; Stinchcombe, Maxwell; Dorsey, Jackson; Olmstead, Sheila; Waxman, Andrew; Wiseman, Thomas
The four chapters of this dissertation study carbon capture, utilization, and sequestration (CCUS) in a variety of settings. In each chapter, I analyze the behavior that different carbon policy instruments elicit from a polluting firm with CCUS technology available to capture their emissions generated in the production process. In particular, I examine the difference in outcomes between a carbon tax on net emissions and a subsidy system for technologically sequestered carbon representative of recent carbon legislation in the United States (Internal Revenue Code 45Q). In the first chapter, I motivate the study of subsidies in the context of carbon sequestration by considering a dynamic setting in which a firm that sequesters generates future benefits through learning. These future benefits stem from own-learning effects (reducing the cost of sequestration) as well as demonstration effects (other firms learn by observing the viability and profitability of sequestration, and subsequently undertaking it). Using a simple framework, I illustrate the shortcomings of addressing an emerging climate technology solely with carbon-pricing initiatives. I show that when future benefits of these learning "spillovers" are not accounted for, there is a divergence in the societal and private benefits. The additional market failure of the positive learning externality can be accommodated fully by using both carbon pricing and a sequestration subsidy. When only a subsidy is available, as in the case of 45Q, I demonstrate that the early subsidization of sequestration is valuable due to these learning spillovers and the nascency of sequestration technology, and a regulator would be willing to subsidize sequestration even if the sequestration technology initially leads to an increase in net emissions (the technology is "perverse"), so long as the future benefits outweigh the damages from increased net emissions. This chapter establishes the notion of a "perverse" sequestration technology (causing a "cobra effect") and the importance of subsidies for nascent technologies, which is studied extensively in the subsequent chapters. In the second chapter, I study how a carbon tax and a sequestration subsidy alter a polluting firm's production decisions, as well as how much (if any) sequestration the firm decides to undertake. Using a static framework in which a firm imposes a negative emissions externality on society, I investigate which components of the ongoing debate about subsidizing sequestration hold water, and ask ``When subject to a sequestration subsidy, is it possible that net emissions may actually increase?" I find that the answer to this question is "yes," and provide conditions for the pollution intensity of the firm and the cost structure for sequestration technology necessary for this perverse outcome to arise. In the third chapter, I extend the setting of the second chapter by including two market failures: a negative emissions externality from production, and market power within the regulated industry. I characterize the production and sequestration behavior of imperfectly competitive firms subject to either a carbon tax or a sequestration subsidy, and determine whether emissions outcomes tend to worsen or improve when the industry in question is imperfectly competitive. I find that despite producing less aggregate net emissions than their more competitive counterparts, the oligopolists are just as (if not more) prone to the same perverse incentives to over-emit in response to a sequestration subsidy. In the fourth and final chapter, I survey the existing literature on carbon policy with a particular focus on CCUS and subsidy systems. I provide an overview of the current state of the subsidies literature in the realm of environmental economics, and enumerate gaps within the literature that serve as avenues for future research. I find that the literature on environmental subsidy systems beyond the domain of solar and wind energy is thin, and is primarily concentrated within rather dated theory papers. In contrast, the literature on CCUS is almost entirely restricted to engineering or engineering-economics due to large-scale commercial application of CCUS being relatively recent. As a result, there is ample work to be done on evaluating the impact of recent sequestration policy within the US, both in theory as well as empirically as the data from CCUS facilities currently in construction emerge as they are put to use.
Three essays on risk perception, flooding, and housing market outcomes
(2023-05-22) Plough, Julian; Olmstead, Sheila M.; Wrenn, Douglas; Stolp, Chandler; Waxman, Andrew
One of the impacts of a changing climate is the increase in frequency of extreme weather events, many associated with flooding. Flooding incidence can take various forms determined by individual contexts. These events can be highly localized nuisances or geographically ubiquitous, associated with coastal or inland storms, functions of local infrastructure or residential location, and more. Vulnerability to flooding is a product of these physical realities as well as social interactions. Wealth and federal and local administrative systems can provide resiliencies, and informational systems can mediate opportunities for individuals to assess and update their perceptions of risk. Poorer and lower lying localities and the individuals who reside in them often face different sets of constraints than wealthier and physically less-at-risk counterparts. Behavioral responses to flooding incidence are therefore responses to an amalgamation of realities, both constant and changing. Choices related to residential location provide key insight into the decision- making processes that individuals employ in these complex contexts. The policy-making context surrounding flooding and projected climate change revolves around not only projections of changes in physical incidence, but also the assumed behavioral response to that risk. It is crucial to assess now, in response to extant weather events and frequency changes, behavior that lends insight into the degree to which individuals and populations adapt and adjust. Current examples of resilience, vulnerability, and the lines upon which these determinations fall can provide instrumental inputs to guide forward-looking policy decisions. In this dissertation I focus on housing decisions in three major Gulf Coastal cities as a window into the updating and adaptation processes of individuals that scale into shared behavior. In my first paper I estimate the impact of hurricanes in Houston, TX and Tampa, FL on home transaction prices using a causal difference-in-difference strategy. In this paper I find inconsistent causal estimates of the impacts of flooding and flood risk by market and storm. In my second paper I employ a refined measure of flooding events using the National Flood Insurance Program’s redacted claims dataset and recover consistent causal impacts of localized flood damage claims in Houston, TX. In these first two paper I use transaction prices to make market-based welfare inferences, however the decision to sell or to remain in place presents a story of adaption to itself. In my final paper I employ a survival analysis of the home-sale decision post- Hurricane Katrina in New Orleans, LA where I find that income and race are linked to differential sale rates after the experience of the storm. In this dissertation I use three novel datasets, propose repeatable methods for future work, and employ several econometric and statistical lenses to lend insight into behavioral changes in flooding-related housing decisions that can inform policy.
Three essays on the economics of water pollution control
(2021-08-17) Zheng, Jiameng; Olmstead, Sheila M.; Fabregas robles gil, Raissa; Katz, Lynn; Waxman, Andrew
Water pollution poses important challenges worldwide. In developed countries, most of the challenges from water pollution have to do with recreational and amenity use of water, as well as the negative impact on ecosystems. For instance, in the United States, dead zones caused by nutrient pollution occur annually in many major coastal waters, including Tampa Bay, the Gulf of Mexico, Chesapeake Bay, and coastal North Carolina, causing large welfare effects in these regions. In developed countries like the United States, the aging drinking water infrastructure, such as the presence of lead pipes, is also a threat to human health. In developing countries, water pollution has a pronounced impact on human health given that safe drinking water is limited in many areas. Economic analysis plays a critical role in the making of environmental policy. In designing and assessing a water pollution control policy, it is important to understand the costs and benefits of such policies and be able to empirically evaluate their effectiveness. However, there are still important challenges in understanding the costs and benefits of water pollution control policies. Water quality improvement is a non-market good, so no direct price signal is available for valuing it. To overcome this problem, economists have developed several non-market valuation techniques, such as hedonic property models and recreation demand models. Each valuation method only captures a piece of the price consumers are willing to pay to improve water quality. This dissertation comprises three papers that answer some critical questions on the economic analysis of water pollution policies. In the first paper, I estimate the marginal willingness-to-pay of homeowners for water quality improvement in Florida,using a two-stage model that combines the recreational value and amenity value of both local and regional water quality improvement. This paper, which focuses on nutrient pollution problems related to the dead zones discussed earlier, generates a more comprehensive estimate of the benefits of water pollution reduction than that used in prior work. In the second paper, I estimate an important cost of water pollution by investigating the short-run and long-run educational impacts of lead pollution in drinking water. Using data from Texas, I find that drinking water lead exposure at birth has a significant negative impact on both 3rd-grade standardized test scores and the high school graduation rate. While many prior papers in environmental economics quantify short-run and long-run human capital costs of air pollution, this paper is one of only a few to do so for an important water pollution problem. Switching to the third paper, I examine the existing literature on the policy instruments that can be used to reduce water pollution. With a focus on developing countries, I describe the empirical evidence on the effectiveness of various water pollution control policies, identify the challenges for implementing and assessing such policies, and provide recommendations for future research.