Wildlife trade and endangered species protection

Markets for endangered species potentially generate incentives for both legal supply and poaching. To deter poaching, governments can spend on enforcement or increase legal harvesting to reduce the return from poaching. A leader–follower commitment game is developed to examine these choices in the presence of illegal harvesting and the resulting impacts on species stocks. In addition, current trade restrictions imposed under the Convention on International Trade in Endangered Species of Wild Fauna and Flora are examined. With Cournot conjectures among poachers, the model details the subgame perfect equilibrium interactions between poaching levels, enforcement and legal harvesting.Resource /Energy Economics and Policy,

A Cross-Country Study of Waste Prevention and Recycling

With worldwide concern for how and where to dispose of household waste, policy-makers are increasingly looking for tools to efficiently and effectively reduce the amount of waste households produce. Using a comprehensive household-level data set involving 10,251 respondents from a cross-section of ten countries (Australia, Canada, Czech Republic, France, Italy, Korea, Mexico, Netherlands, Norway, and Sweden), we examine waste policy, recycling behavior, and waste prevention. Unlike previous work, we empirically make comparisons across countries, incorporate attitudinal characteristics, and allow for potential correlation between the decisions of recycling different materials.waste management; recycling; waste prevention; environmental policy

Implications of Uncertainty and Spillovers for Access and Benefit Sharing Agreements

One of the objectives of the 1992 Convention on Biological Diversity is to create access to genetic resources and benefit-sharing (ABS) systems that incorporate the environmental, social, and economic aspects of sustainable development. Under the Convention, governments have sovereignty over their genetic resources but also the responsibility of using them sustainably. This provision is particularly relevant for biologically-abundant developing countries as it offers a direct means of reducing the financial pressures against conservation of ecosystems and natural habitats, particularly in light of recent. This paper examines the impacts of a benefit-sharing system involving royalties and governmental ownership of genetic resources in a two-firm research and development (R&D) market with uncertainty and information spillovers. Royalties are shown to reduce the research output of the taxed firm, which results in much lower expected government revenues when the research output of a competing rm is a strategic subsitute relative to when it is a strategic complement. Further, taxation alone is generally inferior to a combination of taxation/subsidization of successful products and research costs. The paper shows that subsidization rather than taxation of successful products may even be optimal under particular types of uncertainty.Biodiversity prospecting; research and development (R&D); uncertainty; spillovers; imperfect competition.

Wealth effects in a cash-in-advance economy

This paper examines the monetary growth implications of combining Stockman's cash-in-advance constraint on consumption and capital goods and an endogenous rate of time preference that is an increasing function of real wealth. The cash-in-advance constraint imposes an investment tax that reduces steady state consumption and capital. However, endogenous time preference wealth effects link the real and monetary sectors to yield a Mundell-Tobin effect. Cash-in-advance constraint effects dominate endogenous time preference wealth effects so that monetary growth reduces steady state capital and consumption.cash-in-advance constraints

TRANSBOUNDARY RENEWABLE RESOURCE MANAGEMENT: A DYNAMIC GAME WITH DIFFERING NONCOOPERATIVE PAYOFFS.

Recent conflicts over fish stocks, such as salmon and turbot, have revived public interest in the optimal management of transboundary renewable natural resources. Given that enforcement of binding contracts is often a major obstacle, dynamically consistent or self-enforcing contracting, as proposed by Vislie (1987), must be relied upon. A more general model is developed which recognizes that, in the absence of a cooperative agreement, two countries may enjoy differing economic payoffs. The predictions of the model are consistent with, and provide insights into, the particulars of recent disputes.Resource /Energy Economics and Policy,

Inter-regional Competition, Comparative Advantage, and Environmental Federalism

In this paper, we compare endogenous environmental policy setting with centralized and decentralized governments when regions have comparative advantages in different polluting goods. We develop a two-region, two-good model with inter-regional environmental damages and perfect competition in product markets, where both regions produce both goods. Despite positive spillovers of pollution across regions, the model predicts that decentralization may lead to weaker or stricter environmental standards or taxes, depending on the degree of regional comparative advantage and the extent of transboundary pollution. This suggests that federalism can lead to either a "race to the bottom" or a "race to the top," without relying on inefficient lobbying efforts or capital competition.environmental policy; federalism; centralism; public economics

Foreign Direct Investment and the Choice of Environmental Policy

We use a simple two-country oligopoly model of intra-industry trade to examine the implications of foreign direct investment for the pollution haven hypothesis and environmental policy. Countries which lower environmental standards to be more competitive in world markets generate pollution havens if environmental policy is exogenous. However, if FDI is a viable option as a mode of entry, profit-shifting considerations weaken in favour of environmental considerations and FDI recipients tighten environmental policy, reducing incentives to relocate production. Interestingly, when countries are sufficiently similar in their environmental awareness, "grey" countries can become greener than originally "green" countries but firms in the latter still engage in FDI in the former, in spite of the stricter standard they face, in order to level the playing field. We derive conditions under which FDI-receiving countries have incentives to manipulate their environmental standards to prevent or attract FDI, potentially eliminating or creating pollution havens.Environmental policy; Foreign Direct Investment; Pollution Haven Hypothesis.

Transboundary Renewable Resource Management and Conservation Motives

A simple, two-country theoretical model of transboundary fishing conflicts in which one country has a nonlucrative incentive to conserve the fish stock is presented to examine the effect of such a conservation motive on the steady state stock level and to analyze how this stock level is affected by the division of the harvest. It is demonstrated that a conservation motive for one or both countries serves to increase the stock level and that this level is dependent on the harvest share of the country with the motive. A brief application to the Canada-European Union turbot and Canada-United States salmon disputes suggests consistency between the principles of the model and reality

Effective Speed Enforcement and Photo Radar: Evidence from Australia

This paper briefly examines the effectiveness of photo radar, or the use of automatic camera-equipped traffic monitoring devices, in reducing road fatalities and collisions. Photo radar has become a controversial subject among the driving public, largely due to its tendency to produce substantially increased revenues for the implementing governments. From the road safety literature, there appears to be a causal link between driving at excessive speeds and traffic accidents (and fatalities). Photo radar is designed to reduce speeding by increasing the likelihood of catching those drivers over some predetermined speed threshold, but can be limited in certain circumstances by the inability to identify the driver. A simplified driver-choice model is provided to demonstrate the effects of photo radar on speeding when the driver can be identified (and demerit points applied) and when the vehicle owner is applied a monetary fine alone. Raw data from Victoria, Australia, suggest that photo radar has significantly reduced both fatalities and collisions after its introduction in 1990, and controlling for other factors, including proxies for weather conditions and drunken driving, we find that photo radar can indeed be an effective road safety device

Reduce, Reuse or Recycle? Household Decisions over Waste Prevention and Recycling

Households have choices when it comes to reducing waste sent to landfills: reduction of consumption or packaging, reuse of goods purchased, or recycling. In this paper, we adopt a holistic approach to the analysis of these choices as separate but related facets of households' waste management behaviour. Theoretically, households produce waste as a by-product of their consumption and must then deal with it either by curbside disposal or by recycling. To the extent that managing additional waste is costly even if only in terms of time, households may also engage in waste prevention, that is, produce less waste by reducing their consumption level and/or changing their consumption patterns in favour of less waste-intensive products. As curbside disposal, waste prevention and recycling relate to the same problem and are linked via several constraints, we employ a three-equation mixed process estimation strategy which allows for the error terms of the three equations to be correlated. For the study, we rely on an original data set that permits defining waste prevention comprehensively from a list of 19 waste prevention activities, that provides for a more balanced policy representation (in terms of presence versus absence of unit pricing), and that covers a wide range of attitudinal elements, values, and norms. Given the richness of the data set, we also examine individuals' decisions over recyclable items that carry a refundable deposit in terms of both purchasing and returning habits, with particular attention to the interaction between a refundable deposit system and unit pricing