BALANCING POLICY FOR ENVIRONMENT AND ECONOMIC DEVELOPMENT

Environmental Economics and Policy,

A BARGAINING FRAMEWORK FOR THE GLOBAL COMMONS

The global commons represents a class of environmental problems that require international cooperation. Global environmental problems arise because the actions of some individuals or governments in one location hold serious implications for individuals and governments in other locations. There are global environmental policy problems because adversely-affected individuals (and governments) attempt to alter the behaviors of those responsible for global pollution. We develop a framework with which to analyze such global environmental problems. Our goal is to craft a resource management policy that will satisfy both those who seek a change and those who prefer the current situation. This environmental incentive policy will align the interests of the two parties. Incentive alignment is the policy problem in the global commons. That is, we must find ways to align interests through realigning incentives for individual and group behaviors.Environmental Economics and Policy,

Land Use Policy as Volitional Pragmatism

Land-use conflicts highlight several myths about property rights. The central myth is that property rights are linked to natural rights, that property rights are durable and unchanging, and that any interference with these property rights requires public compensation. However, particular settings and circumstances lead to conflicting rights claims which the courts must sort through to determine where the more compelling rights claim resides. Situations are not protected because they have property rights. Rather, those situations found worthy of protection by the courts acquire the status of a property right. Property rights are not discovered, but are created by the courts. Applied economists must build models of property rights conflicts predicated upon an epistemology of volitional pragmatism.Land Economics/Use,

CONTRACTING FOR NONPOINT-SOURCE POLLUTION ABATEMENT

This study presents an incentive scheme to control agricultural nonpoint-source pollution. The analysis is based on a principal-agent framework with two parties: farmers and a regulating authority. Our incentive scheme proposes collective penalties as a way to control pollution. Unlike previous analyses of incentive schemes to control agricultural pollution, we suggest nonindividual contracts between farmers and a regulating authority, where farmers can trade pollution abatement efforts. Findings show that the information requirement of a regulatory agency can be substantially reduced if contracts can be made nonindividual.Environmental Economics and Policy,

UNDERSTANDING THE GLOBAL COMMONS

We want to clarify the way in which we think about the global commons, particularly the problem of global warming caused by greenhouse gas emissions and tropical deforestation. We develop a policy framework in which the policy goal is the sustainability of the earth's ability to absorb greenhouse gases. The framework considers the unequal incidence of benefits and costs of particular policies. We identify several resource management regimes and suggest that management under a common property regime is most appropriate. We conclude by identifying and briefly discussing types of policies that can achieve sustainability.Environmental Economics and Policy,

12 The Benefit-Cost Dilemma

Previous speakers have discussed the water resource situation from several perspectives. We have heard about the expected conflicts over water use, we have heard about water quality and quantity issues, and we have heard from a distinguished legal scholar about the institutional environment of water allocation in the West. It is my task to turn your attention to the evaluation process wherein changes in the status quo would be considered. I come with a message quite unlikely to gladden your heart. To be blunt, I come to remind you of the conceptual and empirical difficulties inherent in a benefit-cost analysis. This is not a tirade against agency benefit-cost practices-though I will take a friendly jab from time to time. Rather it is a reminder to economists and politicians that one of our favorite analytic devices is not only theoretically weak, but operationally deficient in several important respects

Ilmu Ekonomi Dan Pembangunan Indonesia (a Development Manifesto for Indonesia)

Economic development must be thought of as a process in which a gradual and self-reinforcing evolution of institutions (“working rules”) gets underway, all the while being informed and guided by the explicit purpose of: (1) encouraging economic growth; (2) enhancing the equality with which the benefits of that growth are shared; and (3) assuring that natural assets are not degraded in a manner that will compromise in the future either continued growth, or continued sharing of the benefits of growth. We see that institutions are central to growth, poverty alleviation, and sustainability. We also see that economic growth – increases in per capita GDP (or GNP) – is not sufficient unless it is also accompanied by a simultaneous and plausibly sustainable decrease in social inequality, and unless growth is not destructive of future growth and development.The process of economic development must incorporate three central ideas. These concepts concern ethics, law, and economics. Ethics concern collective perceptions of what is good and just not only in the present, but in terms of objectives to be pursued in the future. Law concern the application of the collective power to mediate and to enforce that ethical consensus – always with an eye to the future. Economics concerns the calculation of profit and loss predicated upon: (1) the ethical base of the nation state as a going concern; and (2) upon the legal foundations that give substance and content to the prior ethical foundations of that nation state

ILMU EKONOMI DAN PEMBANGUNAN INDONESIA (A DEVELOPMENT MANIFESTO FOR INDONESIA)

Economic development must be thought of as a process in which a gradual and self-reinforcing evolution of institutions (“working rules”) gets underway, all the while being informed and guided by the explicit purpose of: (1) encouraging economic growth; (2) enhancing the equality with which the benefits of that growth are shared; and (3) assuring that natural assets are not degraded in a manner that will compromise in the future either continued growth, or continued sharing of the benefits of growth. We see that institutions are central to growth, poverty alleviation, and sustainability. We also see that economic growth – increases in per capita GDP (or GNP) – is not sufficient unless it is also accompanied by a simultaneous and plausibly sustainable decrease in social inequality, and unless growth is not destructive of future growth and development.The process of economic development must incorporate three central ideas. These concepts concern ethics, law, and economics. Ethics concern collective perceptions of what is good and just not only in the present, but in terms of objectives to be pursued in the future. Law concern the application of the collective power to mediate and to enforce that ethical consensus – always with an eye to the future. Economics concerns the calculation of profit and loss predicated upon: (1) the ethical base of the nation state as a going concern; and (2) upon the legal foundations that give substance and content to the prior ethical foundations of that nation state.Keywords: Poverty Alleviation, Institutional Economics, People’s Economy