Reconsidering the calculation and role of environmental footprints

Following the recent Copenhagen Climate Change conference, there has been discussion of the methods and underlying principles that inform climate change targets. Climate change targets following the Kyoto Protocol are broadly based on a production accounting principle (PAP). This approach focuses on emissions produced within given geographical boundaries. An alternative approach is a consumption accounting principle (CAP), where the focus is on emissions produced globally to meet consumption demand within the national (or regional) economy1. Increasingly popular environmental footprint measures, including ecological and carbon footprints, attempt to measure environmental impacts based on CAP methods. The perception that human consumption decisions lie at the heart of the climate change problem is the impetus driving pressure on policymakers for a more widespread use of CAP measures. At a global level of course, emissions accounted for under the production and consumption accounting principles would be equal. It is international trade that leads to differences in emissions under the two principles. This paper, the second in this special issue of the Fraser Commentary, examines how input-output accounting techniques may be applied to examine pollution generation under both of these accounting principles, focussing on waste and carbon generation in the Welsh economy as a case study. However, we take a different focus, arguing that the ‘domestic technology assumption’, taken as something of a mid-point in moving between production and consumption accounting in the first paper, may actually constitute a more useful focus for regional policymakers than full footprint analyses

The electricity generation mix in Scotland : the long and windy road?

This article reports on research funded by the Engineering and Physical Sciences Research Council (EPSRC) at the University of Strathclyde

Analysing Stakeholder Consensus for a Sustainable Transport Development Decision by the Fuzzy AHP and Interval AHP

In any public service development decision, it is essential to reach the stakeholders&rsquo agreement to gain a sustainable result, which is accepted by all involved groups. In case this criterion is violated, the impact of the development will be less than expected due to the resistance of one group or another. Concerning public urban transport decisions, the lack of consensus might cause lower utilisation of public vehicles, thus more severe environmental damage, traffic problems and negative economic impacts. This paper aims to introduce a decision support procedure (applying the current MCDM techniques Fuzzy and Interval AHP) which is capable of analysing and creating consensus among different stakeholder participants in a transport development problem. The combined application of FAHP and IAHP ensures that the consensus creation is not only based on an automated computation process (just as in IAHP) but also on the consideration of specific group interests. Thus, the decision makers have the liberty to express their preferences in urban planning, along with the consideration of numerical results. The procedure has been tested in a real public transport improvement decision as a follow-up project, in an emerging city, Mersin, Turkey. Results show that by the application of the proposed techniques, decision-makers can be more aware of the conflicts of interests among the involved groups, and they can pay more attention to possible violations. Document type: Articl

Is public co-ordination of investment in information security desirable?

This paper provides for the presentation, in an integrated manner, of a sequence of results addressing the consequences of the presence of an information steward in an ecosystem under attack and establishes the appropriate defensive investment responses, thus allowing for a cohesive understanding of the nature of the information steward in a variety of attack contexts. We determine the level of investment in information security and attacking intensity when agents react in a non-coordinated manner and compare them to the case of the system’s coordinated response undertaken under the guidance of a steward. We show that only in the most well-designed institutional set-up the presence of the well-informed steward provides for an increase of the system’s resilience to attacks. In the case in which both the information available to the steward and its policy instruments are curtailed, coordinated policy responses yield no additional benefits to individual agents and in some case they actually compared unfavourably to atomistic responses. The system’s sustainability does improve in the presence of a steward, which deters attackers and reduces the numbers and intensity of attacks. In most cases, the resulting investment expenditure undertaken by the agents in the ecosystem exceeds its Pareto efficient magnitude

Valuation of public investment to support bicycling (FV-09)

In this paper we develop a framework to value public investments with the purpose of increasing bicycling that explicitly accounts internal costs of bicycling, which are typically neglected in current established approaches that value bicycle spending by means of gross health benefits alone, as are inframarginal benefits to existing cyclists. By monetizing internal costs independent of health benefits, we can assess the degree of internalization of private benefits and/or the internalization of external benefits such as environmental improvements due to altruistic preferences by cyclists. Our framework further conceptualizes the complementarity between “hard” (investments in infrastructure) and “soft” measures (informational campaigns) in bicycle policy. Finally, we propose an empirical method for identifying internal costs using a latent variable approach and apply it to eight Swiss cities. Our results imply that Swiss cyclists internalize more than mortality-based benefits. However, because data for some important bicycle mode choice determinants are not available, our results cannot inform policy directly at the current stage. Instead, the contributions of our paper are the development of an economically consistent framework to value public bicycle investments and the identification of crucial data needs for the development of comprehensive assessments informing bicycle policy decisions

Livelihood strategies and risk behavior of cacao producers in Ecuador : effects of national policies to support cacao farmers and specialty cacao landraces

This thesis addresses the Ecuadorian cacao value chain through three interrelated chapters. Small producers linked to this chain face significant trade-offs between the two main available varieties for planting: the fine flavor variety (known as national cacao-CN) and the hybrid bulk variety (known as CCN-51), that is more productive and profitable but of lower quality than the former. In the first chapter, the behavior and characteristics of cacao production are analyzed both at worldwide and Ecuadorian level. Ecuador is the sixth producer of cacao in the world and the first of the CN variety. The global cacao value chain is generally characterized by asymmetric power relationships with increasing control by a few leading companies that have the ability to decide how and where value is created and distributed throughout the global chain. The Ecuadorian cacao value chain is fairly fractionated at the producer level, where approximately 79% of the producers develop their activity in plots of less than 5 hectares, while the production of CCN-51 is growing in comparison with the CN. In fact, in 2017 72% of the cacao produced in Ecuador corresponds to CCN-51, a variety that is sown by 54% of the producers. The second chapter identifies the livelihood strategies of small cacao producers located in the coastal region of the province of Guayas, Ecuador, where the two varieties of cacao are grown. For this purpose, theoretical frameworks for sustainable rural livelihood strategies and household livelihoods were adopted, and a detailed survey was conducted with a sample of188 households. Based on activity variables, four latent profiles of livelihood strategies were identified, which were related to the endowment of capital assets and income share variables. The results showed that there was no clear gap between the cultivation of CN and CCN-51, since 60% of the sampled households simultaneously cultivated both varieties. Furthermore, the lack of appropriate incentives could threaten the future cultivation of CN, since the National policy for CN rehabilitation has had little impact on the profiles most driven by cacao cultivation and that also have a lower endowment of assets. Finally, the third study analyzes risk attitude, risk perceptions and risk management strategies of Ecuadorian cacao producers, as well as the relationships between these risk components. Adopting the same sample of respondents as in the previous chapter, experimental lotteries were applied to measure risk attitudes, while perceptions and strategies were measured by means of Likert scales. The theoretical model to determine the relationships among risk components was tested using variance-based structural equation modelling (SEM) with the partial least squares (PLS) algorithm. The results show that risk perceptions are more important than risk attitudes when deciding risk mitigation strategies. In addition, perceptions play a mediating role between farmers' risk attitudes and the risk management strategies adopted by them. These results advocate for policy measures oriented towards targeting farmers' perceptions of risk in order to implement successful risk management strategies.En la presente tesis, se desarrollan tres estudios relacionados con la cadena de valor del cacao en Ecuador y su participación en ella de pequeños productores, quienes se ven enfrentados a la disyuntiva entre sembrar cacao fino de aroma o cacao híbrido, que presenta algunas ventajas sobre aquel, especialmente relacionadas con su mayor productividad. En el primero estudio, se analiza el comportamiento y las características de la producción de cacao a nivel mundial y de Ecuador en particular, país que es el sexto productor de cacao en el mundo y el primero de la variedad conocida como cacao fino de aroma. La cadena de valor del cacao a nivel global se caracteriza en general por una relación de poder asimétrica con un creciente control de unas pocas empresas líderes que son las que tienen capacidad de decisión sobre cómo y dónde se crea y distribuye el valor a lo largo de la cadena. La cadena de valor del cacao en Ecuador se encuentra bastante fraccionada en su eslabón de producción, donde alrededor del 79% de los productores desarrollan su actividad en parcelas de no más de 5 hectáreas y en la que la participación de la variedad híbrida, conocida como CCN-51, es cada vez mayor en comparación con la variedad nacional fino de aroma (CN). De hecho, en 2017 el 72% del cacao producido en Ecuador, corresponde a CCN-51, variedad que es sembrada por el 54% de los productores. El segundo estudio identifica las estrategias de subsistencia de los pequeños productores de cacao en la región costera de Guayas en Ecuador, donde se cultivan las dos variedades de cacao. Para ello se adopta el marco metodológica de estrategias de medios de vida y capitales, realizándose una encuesta detallada de 188 hogares. A través de un análisis de clases latentes realizado en tres pasos que permite incorporar de forma robusta y optimizada variables externas, se identifican cuatro perfiles de estrategias de medios de vida. Estos perfiles se relacionaron con la dotación de activos de capital y variables de ingresos. Los resultados mostraron que no existe una brecha clara entre el cultivo de CN y CCN-51, ya que el 60% de los hogares muestreados cultivaron simultáneamente ambas variedades. Los hogares con una baja proporción de la tierra asignada a CCN-51 mostraron estrategias de diversificación de ingresos más altas y viceversa. Este estudio también muestra que la falta de incentivos apropiados puede amenazar el futuro del cultivo de CN ya que la política nacional para la rehabilitación de CN ha tenido poco impacto en los perfiles que más dependen del cultivo de cacao y que tienen una menor dotación de activos. Finalmente, en el tercer estudio se analizan la actitud, percepciones y estrategias de gestión de riesgos de los agricultores de cacao ecuatorianos, así como las relaciones existentes entre estos componentes del riesgo. Con la misma muestra de agricultores del segundo estudio se aplican loterías experimentales para medir actitudes de riesgo, mientras que percepciones y estrategias se miden a través de escalas likert. Toda la información se integra en un modelo de ecuaciones estructurales y se analiza con a través de modelos PLS-SEM. Los resultados muestran que las percepciones de riesgo son más importantes que las actitudes ante el riesgo para decidir las estrategias de mitigación de riesgo. Además, las percepciones juegan un papel mediador entre las actitudes de riesgo de los agricultores y las estrategias de gestión de riesgo que aplican. Las consecuencias que de aquí se derivan para los diseñadores de política, se relacionan fundamentalmente con incidir en las percepciones de riesgo de los agricultores a fin que implementen las estrategias que resulten más adecuadas.Postprint (published version

Towards representing human behavior and decision making in Earth system models. An overview of techniques and approaches

Today, humans have a critical impact on the Earth system and vice versa, which can generate complex feedback processes between social and ecological dynamics. Integrating human behavior into formal Earth system models (ESMs), however, requires crucial modeling assumptions about actors and their goals, behavioral options, and decision rules, as well as modeling decisions regarding human social interactions and the aggregation of individuals’ behavior. Here, we review existing modeling approaches and techniques from various disciplines and schools of thought dealing with human behavior at different levels of decision making. We demonstrate modelers’ often vast degrees of freedom but also seek to make modelers aware of the often crucial consequences of seemingly innocent modeling assumptions. After discussing which socioeconomic units are potentially important for ESMs, we compare models of individual decision making that correspond to alternative behavioral theories and that make diverse modeling assumptions about individuals’ preferences, beliefs, decision rules, and foresight. We review approaches to model social interaction, covering game theoretic frameworks, models of social influence, and network models. Finally, we discuss approaches to studying how the behavior of individuals, groups, and organizations can aggregate to complex collective phenomena, discussing agent-based, statistical, and representative-agent modeling and economic macro-dynamics. We illustrate the main ingredients of modeling techniques with examples from land-use dynamics as one of the main drivers of environmental change bridging local to global scales

Human Dimensions of the Ecosystem Approach to Fisheries: An Overview of Context, Concepts, Tools and Methods

This document aims to provide a better understanding of the role of the economic, institutional and sociocultural components within the ecosystem approach to fisheries (EAF) process and to examine some potential methods and approaches that may facilitate the adoption of EAF management. It explores both the human context for the ecosystem approach to fisheries and the human dimensions involved in implementing the EAF. For the former, the report provides background material essential to understand prior to embarking on EAF initiatives, including an understanding of key concepts and issues, of the valuation of aquatic ecosystems socially, culturally and economically, and of the many policy, legal, institutional, social and economic considerations relevant to the EAF. With respect to facilitating EAF implementation, the report deals with a series of specific aspects: (1) determining the boundaries, scale and scope of the EAF; (2) assessing the various benefits and costs involved, seen from social, economic, ecological and management perspectives; (3) utilizing appropriate decision-making tools in EAF; (4) creating and/or adopting internal incentives and institutional arrangements to promote, facilitate and fund the adoption of EAF management; and (5) finding suitable external (non-fisheries) approaches for financing EAF implementation

Insurance mechanisms for the reliability of electricity supply

In the context of rapid shifts in the energy supply mix and the onset of climate change, tail risk in power systems presents an emergent threat to system reliability. Flexible resources like load control, storage and distributed energy resources are potent tools to alleviate system strains during extreme events. However, market participants need appropriate economic incentives to exploit the value of such resources. While spot prices serve as robust indicators of real-time scarcity, a complex challenge lies in translating short-term signals to long-term investment decisions. This is especially pertinent in the context of markets marked by incompleteness, and agents with pronounced aversion to risk. The financial technology of insurance is targeted at the assessment, pricing, and management of extreme and catastrophic risks. This thesis proposes the novel application of insurance contracts and risk architectures to modern electricity markets, extending existing approaches to reliability risk management. This leads to the central research question of this thesis: Can the delivery of electricity service to consumers be made more reliable through the application of insurance mechanisms? The thesis investigates this question through three main streams of research: This first stream proposes the novel application of insurance contracts and capital reserving frameworks on the procurement of strategic reserves in electricity markets. A strategic reserve is a reliability mechanism in electricity markets that seeks to contract generation capacity incremental to that incentivised by short-term spot markets, for use in times of critical supply shortage. The insurance contracts allow consumers to elect differentiated reliability preferences, and align the financial interests of the insurer with such preferences. Application to a case study suggests the potential for improved consumer and social welfare while maintaining insurer viability and solvency. The design is also robust to non-transparent market parameters such as generator risk aversion. The second stream develops a locational insurance model to value resilience in power systems exposed to high-impact low-probability common-mode events. It is demonstrated that the implementation of this scheme in a large-scale power system could reduce load losses via investment in resilient distributed energy resources. However the cost of such insurance may be expensive, and appropriate calibration of consumer expectations and preferences is important. The final stream examines the interaction between the design of contracts between central agencies and storage resources, and the operation of the resources in the market. Five principles for central agency contracting are proposed, focusing on incentive compatibility with existing spot dispatch and limiting distortions to long-term hedging markets. The principles are applied specifically to contracts with storage resources. It is demonstrated that many early designs for storage auctions may be inconsistent with the identified principles. A novel storage contract ‘yardstick’ is proposed, which is shown to align participant dispatch incentives, while maintaining revenue support

Economic Growth and the Environment: A Review of Theory and Empirics

This paper reviews both theory and empirical work on economic growth and the environment. We develop four simple growth models to help us identify key features generating sustainable growth. We show how some combination of technological progress in abatement, intensified abatement, shifts in the composition of national output and induced innovation are necessary for sustainable growth, and then demonstrate how growth models employing any one of these mechanisms generate other potentially refutable predictions on abatement costs, pollution levels, or emission intensities.