ECONOMISTS AND THE RESOLUTION OF NATURAL RESOURCE USE CONFLICTS

Resource /Energy Economics and Policy,

Optimal wildfire insurance in the wildland-urban interface in the presence of a government subsidy for fire risk mitigation

We investigate the effectiveness of a government subsidy and mitigation based insurance contracts at discouraging migration into the wildland interface and at inducing incentives for risk mitigation. We construct a model of the individual migration decision, where the individual maximizes expected utility defined over attributes of locations including cost of insurance and mitigation, wildfire damage, and the availability of a subsidy for reducing wildfire risks through fuel management. Our analysis shows that standard insurance policies provide inefficiently weak incentive for wildfire risk mitigation by offering a low insurance premium to high-risk landowners. We find on the other hand that in the presence of optimal government subsidy, contingent contracts provide an efficient solution where a homeowner chooses a mitigation level that maximizes social benefit and insurers provide actuarially fair contracts such that each individual is offered a premium of the exact value of her wildfire risk.Insurance; Insurance Companies, Government Policy and Regulation, General, Government Policy

Waiting for the Invisible Hand: Novel Products and the Role of Information in the Modern Market for Food

This paper places the modern spread of diet-related chronic disease in the United States within the context of more than a century of innovation in food processing technology, discovery in nutrition science, and corrective policy measures aimed at improving public health. We ask whether the current state of a airs represents a market failure, and if so what might be done about it. We argue that while today’s industrial food system has its advantages, the asymmetric information problems inherent to this system have resulted in a lemons-style break down in the market for processed foods. The appropriate policy response to such situations (namely, verifiable quality standards) is well known, but such policies are likely (in the short run) to reduce profit for existing large industrial producers of food. In light of the food industry’s long history of success at regulatory capture, we propose the formation of a new independent food standards agency devoted to protecting the interests of the American consumer.credence goods, history, food policy, certification

Waiting for the Invisible Hand: Market Power and Endogenous Information in the Modern Market for Food

In many ways, the modern market for food exemplifies the economist’s conception of perfect competition, with many buyers, many sellers, and a robust and dynamic marketplace. But over the course of the last century, the U.S. has witnessed a dramatic shift away from traditional diets and toward a diet comprised primarily of processed brand-name foods with deleterious long-term health effects. This, in turn, has generated increasingly urgent calls for policy interventions aimed at improving the quality of the American diet. In this paper, we ask whether the current state of affairs represents a market failure, and—if so—what might be done about it. We review evidence that most of the nutritional deficiencies associated with today’s processed foods were unknown to nutrition science at the time these products were introduced, promoted, and adopted by American consumers. Today more is known about the nutritional implications of various processing technologies, but a number of forces—including consumer habits, costly information, and the market power associated with both existing brands and scale economies—are working in concert to maintain the status quo. We argue that while the current brand-based industrial food system (adopted and maintained historically as a means of preventing competition from small producers) has its advantages, the time may have come to consider expanding the system of quality grading employed in commodity markets into the retail market for food.credence goods, history, food policy, certification

EMPIRICAL TAXONOMY OF ENVIRONMENTAL ETHICAL ARCHETYPES

Economists usually assume that the private ethical system of individuals is Utilitarian. However, one finds a much broader range of ethical positions in the environmental ethics literature. Moreover, environmental policy debates seem to elicit alternative ethical systems. It would therefore seem prudent to increase our understanding of the role played by alternative environmental ethical systems. In this study we follow some descriptive ethical studies in examining the empirical ethical position of people based on a broad cross section of the American public. We review some taxonomic literature in environmental ethics and develop a conceptual model of the formation of environmental values. We then use canonical correlation to investigate the existence of environmental values and their relationship to childhood experiences. We find four ethical systems linked to four different "types" of people. One of the ethical systems is decidedly spiritual and one seems rather ill-defined or indifferent towards nature. The other two systems show anthropocentric values, one more conservation minded, one more use minded.Environmental Economics and Policy,

Measuring the Quality of Life across Countries: A Sensitivity Analysis of Well-being Indices

quality of life, domains of quality of life, Borda rule, principal components analysis, well-being indices

A SENSITIVITY ANALYSIS OF QUALITY OF LIFE INDICES ACROSS COUNTRIES

This paper attempts to provide a comprehensive analysis of interrelationships among the determinants of the Quality of Life (QOL). We show that various measures of well-being are highly sensitive to domains of QOL that are considered in the construction of comparative indices, and how measurable inputs into the well-being indicators are aggregated and weighted to arrive at composite measures of QOL. We present a picture of conditions among the 43 countries of the world with respect to such interrelated domains of QOL as the relationship with family and friends, emotional well-being, health, work and productivity, material well-being, feeling part of one's community, personal safety, and the quality of environment. On the basis of Borda Rule and the principal components approach, we search for factor-indices that may function as QOL indices comparatively across countries. Such indices can be useful in making QOL comparisons and evaluations with reference to both time and place. Comparing and analyzing well-being conditions among countries in this way are aimed at facilitating the discovery of extant of problems with government policies impacting QOL.quality of life, domains, Borda rule, principal components, and rankings, Institutional and Behavioral Economics, I31, D60, D63,

Permanent Housing for Seasonal Workers? A Generalized Peak Load Investment Model for Farm Worker Housing

Many seasonal workers are housed in transitory accommodations, including tents and vehicles. In this study, we analyze the supply side of this problem by assuming that a public agent must house the workers through direct public investment. A peak load model is adapted to develop investment rules for the least-cost provision of seasonal worker housing, adding an interacting multi-season component to existing models. Based on this model and the data from three prototype projects, the majority of the least-cost investment would be in permanent, but seasonally occupied, housing.farmworker housing, investment rules, peak load model, public housing, seasonal labor, Farm Management, Labor and Human Capital, Public Economics, R31, H75, J43, G31,

Biofuel policy for the pursuit of multiple goals: The case of Washington State

Agricultural and Food Policy, Resource /Energy Economics and Policy,

Perceived Water Prices and Estimated Water Demand in the Residential Sector of Windhoek, Namibia. An Analysis of the Different Water Market Segments

We develop a demand model for the water market of Windhoek, Namibia, and segment the market by income. The model uses the perceived price concept developed by Shin (1985). Results confirm the Shin hypotheses that consumers dont know actual prices, but respond to perceived prices. The average price and covariates have the expected signs. However, marginal price (MP) coefficient is positive. Shins perception parameter (k) is negative in two of three income segments. In the Shin model, this implies that consumers respond to MP (through perceived prices). Ambiguities about prices warrant further investigation.Resource /Energy Economics and Policy,