The Cost of U.S. Forest-Based Carbon Sequestration

Examines the economic and climate impacts of storing carbon in forests over long periods of time. Investigates the potential for incorporating land-use changes into climate policy

Benefit-Cost Analysis in Environmental, Health, and Safety Regulation: A Statement of Principles

Benefit-cost analysis can play a very important role in legislative and regulatory policy debates on improving the environment, health, and safety. It can help illustrate the tradeoffs that are inherent in public policymaking as well as make those tradeoffs more transparent. It can also help agencies set regulatory priorities. Benefit-cost analysis should be used to help decisionmakers reach a decision. Contrary to the views of some, benefit-cost analysis is neither necessary nor sufficient for designing sensible public policy. If properly done, it can be very helpful to agencies in the decisionmaking process. Decisionmakers should not be precluded from considering the economic benefits and costs of different policies in the development of regulations. Laws that prohibit costs or other factors from being considered in administrative decisionmaking are inimical to good public policy. Currently, several of the most important regulatory statutes have been interpreted to imply such prohibitions. Benefit-cost analysis should be required for all major regulatory decisions, but agency heads should not be bound by a strict benefit-cost test. Instead, they should be required to consider available benefit-cost analyses and to justify the reasons for their decision in the event that the expected costs of a regulation far exceed the expected benefits. Agencies should be encouraged to use economic analysis to help set regulatory priorities. Economic analyses prepared in support of particularly important decisions should be subjected to peer review both inside and outside government. Benefits and costs of proposed major regulations should be quantified wherever possible. Best estimates should be presented along with a description of the uncertainties. Not all benefits or costs can be easily quantified, much less translated into dollar terms. Nevertheless, even qualitative descriptions of the pros and cons associated with a contemplated action can be helpful. Care should be taken to ensure that quantitative factors do not dominate important qualitative factors in decisionmaking. The Office of Management and Budget, or some other coordinating agency, should establish guidelines that agencies should follow in conducting benefit-cost analyses. Those guidelines should specify default values for the discount rate and certain types of benefits and costs, such as the value of a small reduction in mortality risk. In addition, agencies should present their results using a standard format, which summarizes the key results and highlights major uncertainties.

Is There a Role for Benefit-Cost Analysis in Environmental, Health, and Safety Regulation?

Benefit-cost analysis has a potentially important role to play in helping inform regulatory decision-making, although it should not be the sole basis for such decision-making. This paper offers eight principles on the appropriate use of benefit-cost analysis.Environment, Health and Safety, Regulatory Reform

Carbon-dioxide emissions trading and hierarchical structure in worldwide finance and commodities markets

In a highly interdependent economic world, the nature of relationships between financial entities is becoming an increasingly important area of study. Recently, many studies have shown the usefulness of minimal spanning trees (MST) in extracting interactions between financial entities. Here, we propose a modified MST network whose metric distance is defined in terms of cross-correlation coefficient absolute values, enabling the connections between anticorrelated entities to manifest properly. We investigate 69 daily time series, comprising three types of financial assets: 28 stock market indicators, 21 currency futures, and 20 commodity futures. We show that though the resulting MST network evolves over time, the financial assets of similar type tend to have connections which are stable over time. In addition, we find a characteristic time lag between the volatility time series of the stock market indicators and those of the EU CO2 emission allowance (EUA) and crude oil futures (WTI). This time lag is given by the peak of the cross-correlation function of the volatility time series EUA (or WTI) with that of the stock market indicators, and is markedly different (>20 days) from 0, showing that the volatility of stock market indicators today can predict the volatility of EU emissions allowances and of crude oil in the near future.Comment: 4 figure

Dynamic Oligopoly Pricing: Evidence from the Airline Industry

We explore how pricing dynamics in the European airline industry vary with the competitive environment. Our results highlight substantial variations in pricing dynamics that are consistent with a theory of intertemporal price discrimination. First, the rate at which prices increase towards the scheduled travel date is decreasing in competition, supporting the idea that competition restrains the ability of airlines to price-discriminate. Second, the sensitivity to competition is substantially increasing in the heterogeneity of the customer base, reflecting further that restraints on price discrimination are only relevant if there is initial scope for price discrimination. These patterns are quantitatively important, explaining about 83 percent of the total within-flight price dispersion, and explaining 17 percent of the observed cross-market variation of pricing dynamics

Navigating environmental, economic, and technological trade-offs in the design and operation of submerged anaerobic membrane bioreactors (AnMBRs)

Anaerobic membrane bioreactors (AnMBRs) enable energy recovery from wastewater while simultaneously achieving high levels of treatment. The objective of this study was to elucidate how detailed design and operational decisions of submerged AnMBRs influence the technological, environmental, and economic sustainability of the system across its life cycle. Specific design and operational decisions evaluated included: solids retention time (SRT), mixed liquor suspended solids (MLSS) concentration, sludge recycling ratio (r), flux (J), and specific gas demand per membrane area (SGD). The possibility of methane recovery (both as biogas and as soluble methane in reactor effluent) and bioenergy production, nutrient recovery, and final destination of the sludge (land application, landfill, or incineration) were also evaluated. The implications of these design and operational decisions were characterized by leveraging a quantitative sustainable design (QSD) framework which integrated steady-state performance modeling across seasonal temperatures (using pilot-scale experimental data and the simulating software DESASS), life cycle cost (LCC) analysis, and life cycle assessment (LCA). Sensitivity and uncertainty analyses were used to characterize the relative importance of individual design decisions, and to navigate trade-offs across environmental, economic, and technological criteria. Based on this analysis, there are design and operational conditions under which submerged AnMBRs could be net energy positive and contribute to the pursuit of carbon negative wastewater treatment.This research work was possible thanks to project CTM2011-28595-C02-01/02 (funded by the Spanish Ministry of Economy and Competitiveness jointly with the European Regional Development Fund and Generalitat Valenciana GVA-ACOMP2013/203), and by the King Abdullah University of Science and Technology (KAUST) Academic Partnership Program (UIeRA 2012-06291), which are gratefully acknowledged. The authors would like also to acknowledge the Jack Kent Cooke Foundation for partial funding for B.D. Shoener.Pretel-Jolis, R.; Shoener, BD.; Ferrer, J.; Guest, J. (2015). Navigating environmental, economic, and technological trade-offs in the design and operation of submerged anaerobic membrane bioreactors (AnMBRs). Water Research. (87):531-541. https://doi.org/10.1016/j.watres.2015.07.002S5315418