An Evolutionary Economic Analysis of Energy Transitions

Evolutionary economics offers clear insights into the mechanisms that underlie innovations, structural change and transitions. It is therefore of great value for the framing of policies aimed at fostering a transition to a sustainable development. This paper offers an overview of the main insights of evolutionary economics and derives core concepts, namely ‘diversity’, ‘innovation’, ‘selection environment’, ‘bounded rationality’, ‘path dependence and lock-in’, and ‘coevolution’. These concepts are subsequently used to formulate guidelines for the role of the government and the design of public policies, such as the learning from historical technological pathways and the creation of an extended level playing field. In addition, the developments of certain energy technologies are examined in detail within the adopted evolutionary economics framework. Three particular technologies received attention, namely fuel cells, nuclear fusion, and photovoltaic cells.

Subvencions holandeses ocultes, un risc mediambiental

En els debats sobre política mediambiental, la necessitat d'eliminar les subvencions mediambientalment nocives ha rebut poca atenció. Aquestes subvencions solen augmentar la grandària i la intensitat de la contaminació de les activitats econòmiques, sovint sense una clara compensació dels beneficis socials. L'impacte ambiental de les subvencions directes, o en el pressupost, ha estat àmpliament reconegut. Però les subvencions indirectes o fora de pressupost (no visibles en els pressupostos del govern) són almenys igual d'importants. La investigació realitzada sobre aquest tema és escassa, però aquest estudi mostra els resultats de les emissions de gasos d'efecte hivernacle (GEH) i dels acidificantes derivats de les subvencions fora de pressupost als Països Baixos i, en particular, mostren que els subsidis en l'agricultura, l'energia i els transports contribueixen de manera important a les emissions de GEH. Una política climàtica eficaç, per tant, ha de considerar l'eliminació de les subvencions fora de pressupost.En los debates sobre política medioambiental la necesidad de eliminar las subvenciones medioambientalmente dañinas ha recibido poca atención. Estas subvenciones suelen aumentar el tamaño y la intensidad de la contaminación de las actividades económicas, a menudo sin una clara compensación de los beneficios sociales. El impacto ambiental de las subvenciones directas, o en el presupuesto, ha sido ampliamente reconocido. Pero las subvenciones indirectas o fuera de presupuesto (no visibles en los presupuestos del gobierno) son al menos igual de importantes. La investigación realizada sobre este tema es escasa, pero este estudio muestra los resultados de las emisiones de gases de efecto invernadero (GEI) y de los acidificantes derivados de las subvenciones fuera de presupuesto en los Países Bajos y, en particular, muestran que los subsidios en la agricultura, la energía y los transportes contribuyen de manera importante a las emisiones de GEI. Una política climática eficaz, por tanto, debe considerar la eliminación de las subvenciones fuera de presupuesto.In debates on environmental policy the complementary need for removing environmentally harmful subsidies has received little attention. Such subsidies typically increase the size and pollution intensity of economic activities, often without clear, compensating social benefits. The environmental impact of direct or on-budget subsidies has been well recognized. Indirect or off-budget subsidies, not visible in government budgets, are at least as important. Research on this topic is scarce. This research reports findings on greenhouse gas (GHG) and acidifying emissions arising from off-budget subsidies in the Netherlands and show that subsidies particularly in agriculture, energy and transport contribute importantly to GHG emissions. Effective climate policy therefore needs to consider removal of off-budget subsidies

Abolishing GDP

Expectations and information about the growth of GDP per capita have a large influence on decisions made by private and public economic agents. It will be argued here that GDP (per capita) is far from a robust indicator of social welfare, and that its use as such must be regarded as a serious form of market and government failure. This article presents an update on the most important criticisms of GDP as an indicator of social welfare and economic progress. It further examines the nature and extent of the impact of GDP information on the economy, revisits the customary arguments in favour of the GDP indicator, and critically evaluates proposed alternatives to GDP. The main conclusion is that it is rational to dismiss GDP as an indicator to monitor economic progress and to guide public policy. As is clarified, this conclusion does not imply a plea against growth, innovation or national accounting

A procedure for globally institutionalizing a 'beyond-GDP' metric

Altres ajuts: Acord transformatiu CRUE-CSICUnidad de excelencia María de Maeztu CEX2019-000940-MIf governments are serious about meeting environmental and social goals, they should overcome dominance of the GDP indicator in political discourse. Institutionalizing a beyond-GDP metric would be an essential step, in interaction with a shift in the direction of an "agrowth" paradigm. For a significant step forward, a permanent UN panel could be charged to explore the options and prepare a metric for global implementation. This essay outlines the choice spectrum and provides criteria and guidelines for the metric-selection process. It is suggested that the panel considers four critical dimensions of potential alternatives, namely means versus ends, objective versus subjective information, aggregate index versus multiple indicators, and monetary versus other units. In deciding about each dimension, serious attention needs to be given to the psychological-communicative appeal of the resulting options, so as to guarantee a fluent uptake of the selected beyond-GDP metric in society, media and politics. The combined environmental and inequality crises at national and global scales make this the right time to finally translate a respectable history of beyond-GDP thinking into practical action

Evolutionary macroeconomic assessment of employment and innovation impacts of climate policy packages

Climate policy has been mainly studied with economic models that assume representative, rational agents. Such policy aims, though, at changing carbon-intensive consumption and production patterns driven by bounded rationality and other-regarding preferences, such as status and imitation. To examine climate policy under such alternative behavioral assumptions, we develop a model tool by adapting an existing general-purpose macroeconomic multi-agent model. The resulting tool allows testing various climate policies in terms of combined climate and economic performance. The model is particularly suitable to address the distributional impacts of climate policies, not only because populations of many agents are included, but also as these are composed of different classes of households. The approach accounts for two types of innovations, which improve either the carbon or labor intensity of production. We simulate policy scenarios with distinct combinations of carbon taxation, a reduction of labor taxes, subsidies for green innovation, a price subsidy to consumers for less carbon-intensive products, and green government procurement. The results show pronounced differences with those obtained by rational-agent model studies. It turns out that a supply-oriented subsidy for green innovation, funded by the revenues of a carbon tax, results in a significant reduction of carbon emissions without causing negative effects on em ployment. On the contrary, demand-oriented subsidies for adopting greener technologies, funded in the same manner, result in either none or considerably less re- duction of carbon emissions and may even lead to higher unemployment. Our study also contributes insight on a potential double dividend of shifting taxes from labor to carbon

Methods to Assess Costs of Drought Damages and Policies for Drought Mitigation and Adaptation: Review and Recommendations

This article examines available methods for assessing all types of drought costs, including both damage costs and costs arising from adopting policy measures to encourage mitigation of, and adaptation to, droughts. It first discusses damage costs, distinguishing between direct, indirect and non-market costs. Then it examines the suitability of existing methods for estimating drought costs in different economic sectors, their underlying theoretical assumptions, complementarity between different methods, and conditions relevant for their application. The latter include precision, ability to deal with future climate change risks, data needs and availability, and required financial and human resources. The article further considers potential policies for drought mitigation and adaptation and different cost types associated with them. It ends with providing recommendations for good practices regarding the use of methods as well as drought mitigation and adaptation policie

Modeling Spatial Sustainability: Spatial Welfare Economics versus Ecological Footprint

A spatial welfare framework for the analysis of the spatial dimensions of sustainability is developed. It incorporates agglomeration effects, interregional trade, negative environmental externalities and various land use categories. The model is used to compare rankings of spatial configurations according to evaluations based on social welfare and ecological footprint indicators. Five spatial configurations are considered for this purpose. The exercise is operationalized with the help of a two-region model of the economy that is in line with the ‘new economic geography’. Various (counter) examples show that the footprint method is not consistent with an approach aimed at maximum social welfare.Agglomeration effects, Trade advantages, Negative externalities, Population density, Spatial configuration, Transport

Harvesting and Conversation in a Predator-Prey System

Optimal harvesting of prey in a predator-prey ecosystem is studiedunder the condition that the existence of the predator has value. Predators (birds) and humans (fishers) compete for prey (shellfish). The behavior of the system is studied and conditions for optimal control are deduced. Various optimal harvesting rates are identified for particular ecosystem characteristics, harvesting costs, the discount rate value, and value functions for birds. These optimal harvest rates are constant harvesting, at levels possibly leading to the extinction of birds, or oscillating harvesting, giving rise to oscillating stocks of birds and shellfish. The approach path towards an optimal regime is shown qualitatively and consists of alternating between harvesting maximally and not harvesting at all

Global environmental change, local land use impacts and socio-economic response strategies in coastal regions

This paper addresses the issue of possible land use strategies and responses in coastal zones as a consequence of global environmental change. It willfirst set out some key elements in global change that are of critical importance for the water and land management in such areas. Next, it will map outin more detail the various environmental and socio-economic repercussions of such megatrends. This will then be followed by a discussion of thenecessity to develop proper coastal zone management policy strategies in order to cope with uncertain challenges. In particular, the research needs will be addressed. The paper will then illustrate the potential of integrated coastal zone dynamic and spatial modelling and evaluation, on the basis of anempirical case study for a coastal region. Furthermore, a number of spatio-economic scenarios related to sea level issues in the Netherlands will bepresented. In this context also risk assessment is shortly discussed in relation to sea level rise