Household Adoption of Water-Efficient Equipment : The Role of Socio-economic Factors, Environmental Attitudes and Policy

Using survey data of around 10,000 households from 10 OECD countries, we identify the driving factors of household adoption of water-efficient equipment by estimating Probit models of a household's probability to invest in such equipment. The results indicate that environmental attitudes and ownership status are strong predictors of adoption of water-efficient equipment. In terms of policy, we find that households that were both metered and charged for their water individually had a much higher probability to invest in water-efficient equipment compared to households that paid a flat fee.Attitudes, metering, residential water use, technology adoption.

Household Adoption of Water-Efficient Equipment: The Role of Socio-Economic Factors, Environmental Attitudes and Policy

Using unique survey data of 10,000 households from 10 OECD countries, we identify the driving factors of household adoption of water-efficient equipment by estimating Probit models of a household's probability to invest in such equipment. The results indicate that the adoption of water-efficient equipment is the most strongly affected by ownership status, by being metered and charged a volumetric charge on water consumption, and by behavioural factors. Environmental attitudes are strong predictors of adoption of water-efficient equipment, with a marginal effect that exceeds ownership status in some cases. In terms of policy, we find that households that were both metered and charged for their water individually had a much higher probability to invest in water-efficient equipment compared to households that were not charged for their water.attitudes, metering, residential water use

The French Tax on Air Pollution: Some Preliminary Results on its Effectiveness

Empirical evidence evaluating the efficiency of economic instruments is still rare, despite significant theoretical advances over the last decades. The objective of this paper is to evaluate one form of environmental taxation, the French tax on air pollution from 1990-99. While starting out in 1985 as a tax levied only on emissions of sulphur dioxide (SO2 ), the tax base was subsequently extended to encompass also emissions of nitrogen oxides (NOx), hydrochloric acid (HCl), and volatile organic compounds (VOC). The revenues of the French tax on air pollution were earmarked for abatement subsidies and the financing of air quality surveillance systems. Using a plant-level database, we find a negative, significant effect of the tax on emissions of SO2, NOx, and HCl. The abatement elasticity with regard to the tax is quite small, however.Environmental tax, emissions regulation, earmarking, air quality

La taxation énergie-climat en Suède

Ce texte résume l'expérience de la taxe carbone en Suède : son efficacité environnementale, ses effets distributifs, et les recettes générées par le dispositif.taxe carbone ; émissions de CO2 ; taxation énergie ; politique environnementale ; instruments économiques

Collective penalties and inducement of self-reporting

Random accidents can be contained by collective penalties. These penalties are not likely to be enforced but rather induce self-reporting that enhances welfare due to early containment. Self-reporting under collective penalties increases overall welfare, but may increase expected environmental cost. Even when regulation is constrained by an upper limit on the acceptable collective penalty, the threat of collective penalties can induce an incentive-compatible mutual insurance scheme under which a side-payment is made to the agent that self-reports an accident. This self-reporting mechanism is welfare-improving, but first-best outcomes can only be obtained when the collective penalty is unconstrained, or when an honor system applies. In cases when there is a new externality that requires fast response (avian flu), collective penalties can compliment or substitute for monitoring.Ambient tax, collective penalties, enforcement, self-reporting.

Collective reputation with stochastic production and unknown willingness to pay for quality

In many cases, consumers cannot observe a single firm\u2019s investment in environmental quality or safety, but only the average quality of the industry. The outcome of the investment is stochastic, since firms cannot control perfectly the technology or external factors that may affect production. In addition, firms do not know consumers\u2019 valuation of quality. We characterize the solution of the firms\u2019 investment game and show that the value of stopping investments when firms are already investing in quality can be negative when the free-riding incentives dominate. The existence of systematic uncertainty on the outcome of investment slows down investment in quality, compared to a situation without uncertainty. The uncertainty on consumers\u2019 willingness to pay for quality can speed up or slow down investment. We also obtain the counterintuitive result that information acquisition may decrease the overall level of quality

Environmental Taxes: A Comparison of French and Swedish Experience from Taxes on Industrial Air Pollution

Umweltabgabe, Ökosteuer, Luftverunreinigung, Vergleich, Frankreich, Schweden, Environmental charge, Environmental tax, Air pollution, Comparison, France, Sweden

Pollution Control Instruments in the Presence of an Informal Sector

We examines the challenges faced by the regulator in managing pollution when there is a linkage between a formal and an informal industrial sector across the stages of production. The formal sector is more productive than the informal sector and the latter saves cost by evading pollution regulation due to incomplete monitoring. This creates a natural tendency for the more polluting processes to be concentrated in the informal sector. We show the unintended effects of the standard Pigouvian tax (emission fee), which might lead to further deterioration by encouraging the shift of stages in favour of the informal sector. Instead, we propose a second-best hybrid instrument, comprised of a tax on polluting input and a subsidy on proper disposal of residual waste.Emissions tax, informal sector, pollution control, vertical production.