Side Payments of Exceptions: The Implications for Equitable and Efficient Climate Control

The Kyoto Protocol prioritizes equity in international climate control by exempting developing countries from compulsory emissions reductions, though at a loss to efficiency. Using game theoretic models, this paper demonstrates that an efficient climate treaty must provide side payments to countries with lower marginal abatement costs and (or) benefits to induce their cooperation. Therefore, if an efficient treaty directs side payments to developing countries to induce their participation, the treaty may also achieve equity in climate control. Policy makers should remember the equity and efficiency implications of side payments as extensions and/or alternatives to the Kyoto Protocol are considered.

Economic Costs of Historic Overfishing on Recreational Fisheries: South Atlantic & Gulf of Mexico Regions

Ocean fish are a vital renewable resource for human populations, providing food, employment, and recreation. Many fish stocks worldwide, however, are in a state of serious decline due to overfishing, environmental degradation, climate change, and other stressors. Fishing effort worldwide has remained relatively constant with only slight increases recorded, while the global production of marine fisheries has decreased (Food and Agriculture Organization of the United Nations, 2010). The South Atlantic and Gulf of Mexico regions of the United States have witnessed significant declines in fish stocks that are important to recreational and commercial fisheries. As of 2011, nine fish populations across the two regions were officially classified as "overfished." An additional 12 populations were classified as "subject to overfishing." Biological overfishing occurs when harvest rates from fishing exceed the growth rates of fish stocks. The resulting declines in fish populations can impact the economy at large. This study examines an important component of the costs of overfishing in the South Atlantic and Gulf of Mexico regions -- recreational catch losses from historic overfishing and their associated economic impacts. Our analysis covers nine federally managed overfished stocks in these two regions over the period 2005–2009, the most recent years for which the necessary data were available prior to the 2010 Deepwater Horizon oil spill in the Gulf. Those stocks are black sea bass, red grouper, red porgy, red snapper, and snowy grouper in the South Atlantic; and gag, gray triggerfish, greater amberjack, and red snapper in the Gulf of Mexico. Recreational fishing has long been an important economic activity in these regions. The money spent by recreational fishermen on charter fishing excursions, tackle, bait, fuel, and other expenses supports employment and economic activity across those regions. Our analysis assumes that recreational fisheries could have contributed more to regional economic activity had the stocks been capable of producing greater yields over the study period of 2005–2009. We estimate the size of the recreational catch loss for each species for each year and the economic activity that could have resulted had that catch been available. To arrive at our estimates of recreational catch loss, we compared average annual recreational harvests and effort for each stock for each year over the study period to potential estimated harvests and effort had the stocks been producing at optimum yield. We sourced our measures of optimum yield and maximum sustainable yield for each individual stock from regional stock assessments and fishery management plans. We valued the resulting catch loss by using data on trip expenditures by recreational fishermen in the South Atlantic and Gulf of Mexico. Effort and expenditure data were sourced from the Marine Recreational Fisheries Statistics Survey and includes trips that caught, targeted, or caught and/or targeted the stocks in our analysis.1 Economic multipliers were used to estimate the total direct, indirect, and induced economic activity that could have been generated by those recreational fishing expenditures. Our estimates of catch loss and associated economic impacts are not additive across stocks since trips and their respective expenditures may be associated with multiple stocks. Our analysis finds that recreational fisheries in the South Atlantic and Gulf of Mexico could have contributed millions of dollars more in additional recreational expenditures and associated economic activity had the fish species been producing at optimum yield over the study period. The greatest direct losses were associated with South Atlantic black sea bass and South Atlantic red snapper. Recreational fishermen in the South Atlantic spent $41.7 million on average annually to realize 44$52.8 million greater each year over the five-year study period had the stock been producing at optimum yield. An additional $52.8 million in recreational expenditures each year could have generated an additional$138 million in economic output and $40.3 million in income, and supported 896 jobs annually for the region. In the case of South Atlantic red snapper, fishermen spent$9.2 million on average annually over the study period to catch 37% of the recreational catch that could have been available under optimum yield. We estimate that recreational expenditures on South Atlantic red snapper could have been $15.9 million greater each year and could have contributed an additional$41.6 million in economic output and $12.2 million in income, and supported 270 jobs for the region annually between 2005–2009. In the Gulf region, the greatest losses were associated with red snapper, where recreational fishermen spent$22.4 million to realize 64% of the optimal catch that could have been available. We estimate that recreational expenditures on Gulf red snapper could have been $12.7 million greater each year had the stock been producing at optimum yield. An additional$12.7 million in recreational expenditures each year could have generated an additional $33.2 million in economic output and$9.7 million in income, and supported 215 jobs annually for the region. Our findings support the conclusion that overfished stocks can lead to significant economic losses for regional economies through forgone recreational fishing expenditures. This is only one component of the cost of overfishing. Our analysis does not estimate the value of catch losses in commercial fisheries or the broader impacts on ecosystems and biodiversity. The total value of catch losses resulting from historic overfishing would be greater still if other impacts had been considered. Despite these limitations, this study provides strong economic evidence in support of maintaining healthy ocean fish populations and continuing efforts to rebuild stocks currently subject to overfishing or classified as overfished

Limitations of integrated assessment models of climate change

The integrated assessment models (IAMs) that economists use to analyze the expected costs and benefits of climate policies frequently suggest that the “optimal” policy is to go slowly and to do relatively little in the near term to reduce greenhouse gas emissions. We trace this finding to the contestable assumptions and limitations of IAMs. For example, they typically discount future impacts from climate change at relatively high rates. This practice may be appropriate for short-term financial decisions but its extension to intergenerational environmental issues rests on several empirically and philosophically controversial hypotheses. IAMs also assign monetary values to the benefits of climate mitigation on the basis of incomplete information and sometimes speculative judgments concerning the monetary worth of human lives and ecosystems, while downplaying scientific uncertainty about the extent of expected damages. In addition, IAMs may exaggerate mitigation costs by failing to reflect the socially determined, path-dependent nature of technical change and ignoring the potential savings from reduced energy utilization and other opportunities for innovation. A better approach to climate policy, drawing on recent research on the economics of uncertainty, would reframe the problem as buying insurance against catastrophic, low-probability events. Policy decisions should be based on a judgment concerning the maximum tolerable increase in temperature and/or carbon dioxide levels given the state of scientific understanding. The appropriate role for economists would then be to determine the least-cost global strategy to achieve that target. While this remains a demanding and complex problem, it is far more tractable and epistemically defensible than the cost-benefit comparisons attempted by most IAMs

The neural correlates of emotion regulation by implementation intentions

Several studies have investigated the neural basis of effortful emotion regulation (ER) but the neural basis of automatic ER has been less comprehensively explored. The present study investigated the neural basis of automatic ER supported by ‘implementation intentions’. 40 healthy participants underwent fMRI while viewing emotion-eliciting images and used either a previously-taught effortful ER strategy, in the form of a goal intention (e.g., try to take a detached perspective), or a more automatic ER strategy, in the form of an implementation intention (e.g., “If I see something disgusting, then I will think these are just pixels on the screen!”), to regulate their emotional response. Whereas goal intention ER strategies were associated with activation of brain areas previously reported to be involved in effortful ER (including dorsolateral prefrontal cortex), ER strategies based on an implementation intention strategy were associated with activation of right inferior frontal gyrus and ventro-parietal cortex, which may reflect the attentional control processes automatically captured by the cue for action contained within the implementation intention. Goal intentions were also associated with less effective modulation of left amygdala, supporting the increased efficacy of ER under implementation intention instructions, which showed coupling of orbitofrontal cortex and amygdala. The findings support previous behavioural studies in suggesting that forming an implementation intention enables people to enact goal-directed responses with less effort and more efficiency

Situation selection is a particularly effective emotion regulation strategy for people who need help regulating their emotions

Situation selection involves choosing situations based on their likely emotional impact and may be less cognitively taxing or challenging to implement compared to other strategies for regulating emotion, which require people to regulate their emotions “in the moment”; we thus predicted that individuals who chronically experience intense emotions or who are not particularly competent at employing other emotion regulation strategies would be especially likely to benefit from situation selection. Consistent with this idea, we found that the use of situation selection interacted with individual differences in emotional reactivity and competence at emotion regulation to predict emotional outcomes in both a correlational (Study 1; N = 301) and an experimental field study (Study 2; N = 125). Taken together, the findings suggest that situation selection is an effective strategy for regulating emotions, especially for individuals who otherwise struggle to do so