The Benefits of Achieving the Chesapeake Bay TMDLs (Total Maximum Daily Loads): A Scoping Study

Concerns about nutrient pollution in the Chesapeake Bay have led to the establishment of pollution limits—total maximum daily loads (TMDLs)—which, by 2025, are expected to reduce nitrogen loadings to the Bay by 25 percent and phosphorous loadings by 24 percent from current levels. This paper outlines how the benefits associated with achieving the Chesapeake Bay TMDLs could be measured and monetized. We summarize studies that measure the benefits of improved water quality in the Bay and evaluate whether these studies could be used to value the water quality benefits associated with the TMDLs.In cases where studies conducted in the Bay watershed either do not exist or are out of date, we discuss whether results from studies conducted elsewhere could be transferred to the Chesapeake Bay. We also discuss original studies that would be useful to conduct in the future.Chesapeake Bay restoration, total maximum daily loads, benefits of water quality improvements

Public choices between lifesaving programs : how important are lives saved?

In developing and industrial countries alike, there is concern that health and safety policy may respond to irrational fears - to the"disaster of the month"- rather than address more fundamental problems. In the United States, for example, some policymakers say the public worries about trivial risks while ignoring larger ones and that funding priorities reflect this view. Many public health programs with a low cost per life saved are underfunded, for example, while many environmental regulations with a high cost per life saved are issued each year. Does the existing allocation of resources reflect people's preoccupation with the qualitative aspects of risks, to the exclusion of quantitative factors (lives saved)? Or can observed differences in the cost per life saved of environmental and public health programs be explained by the way the two sets of programs are funded? The authors examine the preferences of U.S. citizens for health and safety programs. They confronted a random sample of 1,000 U.S. adults with choices between environmental health and public health programs, to see which they would choose. The authors then examined what factors (qualitative and quantitative) seem to influence these choices. Respondents were asked about pairs of programs, among them: smoking education or industrial pollution control programs, industrial pollution control or pneumonia vaccine programs, radon eradication or a program to ban smoking in the workplace, and radon eradication or programs to ban pesticides. The survey results, they feel, have implications beyond the United States. They find that, while qualitative aspects of the life-saving programs are statistically significant in explaining people's choices among them, lives saved matter, too. Indeed, for the median respondent in the survey, the rate of substitution between most qualitative risk characteristics and lives saved is inelastic. But for a sizable minority of respondents, choice among programs appears to be insensitive to lives saved. The interesting question for public policy is what role the latter group plays in the regulatory process.Health Monitoring&Evaluation,Public Health Promotion,Insurance&Risk Mitigation,Insurance Law,Water Conservation,Health Monitoring&Evaluation,Insurance&Risk Mitigation,Insurance Law,Water Conservation,Environmental Economics&Policies

Options for Energy Efficiency in India and Barriers to Their Adoption: A Scoping Study

We review the economics literature on energy efficiency in India, as a guide for further research in the area. The empirical literature has focused on four questions: How does energy efficiency in India compare with energy efficiency in other countries? What would be the energy savings (and cost savings) from adopting certain energy-efficient technologies? Why are these technologies being -- or not being -- adopted? What policies should be implemented to encourage their adoption? Most of the literature focuses on answers to the first two questions. Studies are needed that quantify factors affecting the rate of diffusion of energy-efficient technologies and rigorously evaluate reforms implemented by the Government of India, beginning in the 1990s, that could affect energy efficiency.energy efficiency, energy use, India

When is a life too costly to save? : evidence from U.S. environmental regulations

Except for two relatively minor statutes, U.S. environmental laws do not permit the balancing of costs and benefits in setting environmental standards. The Clean Air Act, for example, prohibits the Environmental Protection Agency (EPA) from considering costs in setting ambient air quality standards. Similarly, the Clean Water Act does not allow consideration of benefits in setting effluent standards. When the EPA is allowed to balance benefits against costs, it has considerable discretion in defining"balancing."The authors ask two questions: Whether allowed to or not, has the EPA balanced costs and benefits in setting environmental standards? Where has the EPA drawn the line in deciding how much to spend to save a statistical life? Their answers are based on data about the costs and benefits of regulations involving three classes of pollutants: cancer-causing pesticides usedon food crops (1975-89); carcinogenic air pollutants (1975-90); and all uses of asbestos regulated under the Toxic Substances Control Act. The following are their findings. The EPA behaved as though it were balancing costs and benefits in its regulation of pesticides under Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) and of asbestos under Toxic Substance Control Act (TSCA), the two so-called balancing statutes. The higher the cost of the ban, the less likely the EPA was to ban the use of these products. The greater the number of lives saved, the more likely the EPA was to ban their use. But the amount the EPA was (implicitly) willing to spend to save a life was high: $52 million to prevent cancer among pesticide applicators, and$49 million to avoid cancer through exposure to asbestos. The value the EPA attached to saving a life was higher for workers than for consumers. The value attached to avoiding a case of cancer through exposure to pesticide resides on food was less than $100,000, in contrast with the$52 million value of preventing cancer among pesticide applicators - perhaps because workers are exposed to higher levels of pollution than consumers. After 1987, when the Natural Resources Defense Council sued the EPA for considering costs in setting emissions standards for vinyl chloride, the EPA considered costs in setting emissions standards only after an acceptable level of risk was achieved. Ironically, before the vinyl chloride decision, the value per cancer case avoided was only $15 million. The amount the EPA was willing to spend to save a life was thus less under the Clean Air Act than under the balancing statutes. But after this decision, the EPA did not consider costs at all if the risk of cancer to the maximally exposed individual was above one in 10,000.Environmental Economics&Policies,Health Monitoring&Evaluation,Economic Theory&Research,Health Economics&Finance,Montreal Protocol

The value of mortality risk reductions in Delhi, India

The authors interviewed commuters in Delhi, India, asking them to report their willingness to pay (WTP) to reduce their risk of dying in road traffic accidents in each of three scenarios that mirror the circumstances under which the majority of the road fatalities in Delhi occur. The WTP responses are internally valid, in the sense that WTP increases with the size of the risk reduction, income, and exposure to road traffic risks, as measured by length of commute and whether the respondent drives a two-wheeler. As a result, the"value of a statistical life"(VSL) is individuated-that is, it varies across groups of beneficiaries. For the most likely beneficiaries of road safety programs-the most highly exposed individuals-the VSL is about 150,000 PPP$.Transport Economics Policy&Planning,Roads&Highways,Airports and Air Services,Road Safety,Insurance&Risk Mitigation

The Value of Mortality Risk Reductions in Delhi, India

We interviewed commuters in Delhi, India, to estimate their willingness to pay (WTP) to reduce their risk of dying in road traffic accidents in three scenarios that mirror the circumstances under which traffic fatalities occur in Delhi. The WTP responses are internally valid: WTP increases with the size of the risk reduction, income, and exposure to road traffic risks, as measured by length of commute and whether the respondent drives a motorcycle. As a result, the value of a statistical life (VSL) varies across groups of beneficiaries. For the most highly exposed individuals, the VSL is about 150,000 Purchasing Power Parity (PPP) dollars.Health and Safety

Getting Cars Off the Road: The Cost-Effectiveness of an Episodic Pollution Control Program

Ground level ozone remains a serious problem in the United States. Because ozone non-attainment is a summer problem, episodic rather than continuous controls of ozone precursors are possible. We evaluate the costs and effectiveness of an episodic scheme that requires people to buy permits in order to drive on high ozone days. We estimate the demand function for permits based on a survey of 1,300 households in the Washington, DC metropolitan area. Assuming that all vehicle owners comply with the scheme, the permit program would reduce VOCs by 50 tons and NOx by 42 tons per Code Red day at a permit price of $75. Allowing for non-compliance by 15$9 million (2008 USD). This compares favorably with permanent methods of reducing VOCs that cost $645 per ton per year.Ground-Level Ozone, Episodic Pollution Control Schemes, Mobile Sources, Volatile Organic Compounds (Vocs), Cost Per Ton of Vocs Removed

The value of superfund cleanups : evidence from U.S. Environmental Protection Agency decisions

Under the Superfund law, the U.S. Environmental Protection Agency (EPA) is responsible for inspecting hazardous waste sites and for putting those with the most serious contamination problems on a national priorities list. The EPA then oversees the cleanup of these sites, suing potentially responsible parties for the costs of cleanup when possible, and funding the cleanup of"orphaned"sites out of the Superfund, money raised taxing chemical and petroleum products. The Superfund program is controversial. Cleanups are costly and it is unclear whether the benefits of cleanup, especially the relative benefits of more permanent clenanup, are worth the costs. At many sites, imminent danger of exposure to contaminants can be removed at low cost. What raises the cost of cleanup is the decision to clean up the site for future generations - to incinerate contaminated soil, for example, or to pump and treat an aquifer for 30 years. To shed light on this debate, the authors infer the EPA's willingness to pay (or have others pay) for more permanent cleanups at Superfund sites. They do so by analyzing cleanup decisions for contaminated soils at 110 Superfund sites. They find that, other things being equal, the EPA was more likely to choose less expensive cleanup options. But, holding costs constant, the EPA was more likely to select more permanent options, such as incinerating the soil instead of capping it or putting it in a landfill. The EPA was willing to pay at least twice as much for onsite incineration of contaminated soil as it was for capping the soil. Has the EPA chosen more permanent Superfund cleanups in areas where residents are predominantly white and have high incomes? The authors find no evidence that the percentage of minority residents near a site influences the choice of cleanup selected. But offsite treatment was more likely at sites with higher incomes.General Technology,Environmental Governance,Sanitation and Sewerage,TF030632-DANISH CTF - FY05 (DAC PART COUNTRIES GNP PER CAPITA BELOW USD 2,500/AL,Environmental Economics&Policies

Why Have Traffic Fatalities Declined in Industrialized Countries' Implications for Pedestrians and Vehicle Occupants

Previous research suggests that the death rate due to traffic fatalities at first increases as countries develop and motorization increases, but eventually declines as incomes grow and fatalities per vehicle decrease (Kopits and Cropper, 2005). This paper examines whether the relationship between traffic fatalities and income is the same for different classes of road users and investigates the factors underlying the decline in fatalities per vehicle kilometer traveled (VKT) observed in high-income countries over recent decades. Formal models of traffic fatalities are developed for vehicle occupants and pedestrians. Reduced-form approximations to these models are estimated using panel data for 32 high-income countries over 1964-2002. The results suggest that the downward-sloping portion of the curve relating traffic fatalities per capita to per capita income is due primarily to improved pedestrian safety. Our more detailed models shed light on some factors influencing pedestrian fatalities per VKT but much of the reduction in pedestrian fatalities remains unexplained; however, increased motorization and a reduction in the proportion of young drivers in the population clearly played a role. Occupant fatalities, however, do not show a significant decline with income. What does explain declines in occupant fatalities per distance traveled are reductions in alcohol abuse and improved medical services, and a reduction in young drivers. The importance of demographic factors suggests that in countries where young persons (between 15 and 24 years of age) comprise an increasing share of the driving population, adopting policies to improve young driver education and reduce speeds will be crucial.

Valuing mortality reductions in India : a study of compensating wage differentials

Conducting cost-benefit analyses of health and safety regulations requires placing a dollar value on reductions in health risks, including the risk of death. In the United States, mortality risks are often valued using compensating-wage differentials. These differentials measure what a worker would have to be paid to accept a small increase in his risk of death-which is assumed to equal what the worker would pay to achieve a small reduction in his risk of death. The authors estimate compensating-wage differentials for risk of fatal and nonfatal injuries in India's manufacturing industry. They estimate a hedonic wage equation using the most recent Occupational Wage Survey, supplemented by data on occupational injuries from the Indian Labour Yearbook. Their estimates of compensating-wage differentials imply a value of statistical life (VSL) in India of 6.4 million to 15 million 1990 rupees (roughly $150,000 to$360,000 at current exchange rates). This number is between 20 and 48 times forgone earnings-the human capital measure of the value of reducing the risk of death. The ratio of the VSL to forgone earnings implied by the study is larger than in comparable U.S. studies but smaller than the ratio implied by the only other compensating-wage study for India (Shanmugam 1997). The latter implies a ratio of VSL to forgone earnings of 73! The authors caution that in India, as in the United States, compensating-wage differentials in the labor market may overstate what individuals would themselves pay to reduce the risk of death. They suggest using their estimates as an upper boundon willingness to pay to reduce risk of death, and forgone earnings as a lower bound.Labor Policies,Water and Industry,Public Health Promotion,Environmental Economics&Policies,Banks&Banking Reform,Banks&Banking Reform,Health Monitoring&Evaluation,Health Economics&Finance,Water and Industry,Environmental Economics&Policies