Measuring Environmental Action and Economic Performance in Developing Countries

Significant advances have been made in measuring the stringency of environmental policies, and understanding the relationship between environmental action and economic dynamics, particularly in high-income countries. Despite this, unequivocal empirical evidence on the impact of environmental policies on economic performance remains elusive, with conclusions being highly dependent on the conceptual and methodological choices with respect to defining and measuring the stringency of environmental policies. Most importantly, the literature evaluating these issues in developing countries remains sparse and robust findings are even more difficult to extract. This study reviews the existing body of work in both developed, and, where available, developing countries. It provides a comprehensive assessment of how environmental policy stringency has been measured, outlining definitional and conceptual challenges. It discusses the advantages and disadvantages of different indicators, and their usefulness for application in developing countries. In an effort to improve our understanding of the impact of environmental policy stringency in middleand low-income countries, the study draws lessons for the prioritization of future data collection and measurement efforts. Through the study, two types of stringency indicators emerge as requiring the most attention: de facto enforcement indicators and de jure explicit measures that capture the stringency of specific environmental laws, rules and regulations. While there is no “best” conceivable measure of the stringency of environmental policies, a multidimensional approach to quantifying stringency in developing countries, with a focus on explicit direct measures, is advocated. Data collection and indicator-improvement efforts need, though, to be updated periodically and supplemented by other proxies for environmental stringency

MCA4climate: A Practical Framework for Planning Pro-Development Climate Policy

MCA4climate is a major new UNEP initiative providing 1 Introduction practical assistance to governments in preparing their climate change mitigation and adaptation plans and strategies. It aims to help governments, particularly in developing countries, identify policies and measures that are low cost, environmentally effective and consistent with national development goals. It does this by providing a structured approach to assessing and prioritizing climate-policy options, while taking into consideration associated social, economic, environmental and institutional costs and benefits. In doing so, it seeks to counter the widely held perception that tackling climate change is costly, highlight the potential developmental benefits of addressing climate change and encourage action to that end

An Inquiry into Model Validity When Addressing Complex Sustainability Challenges

Scientific modelling is a prime means to generate understanding and provide much-needed information to support public decision-making in the fluid area of sustainability. A growing, diverse sustainability modelling literature, however, does not readily lend itself to standard validation procedures, which are typically rooted in the positivist principles of empirical verification and predictive success. Yet, to be useful to decision-makers, models, including their outputs and the processes through which they are established must be, and must be seen to be “valid.” This study explores what model validity means in a problem space with increasingly interlinked and fast-moving challenges. We examine validation perspectives through ontological, epistemic, and methodological lenses, for a range of modelling approaches that can be considered as “complexity-compatible.” The worldview taken in complexity-compatible modelling departs from the more standard modelling assumptions of complete objectivity and full predictability. Drawing on different insights from complexity science, systems thinking, economics, and mathematics, we suggest a ten-dimensional framework for progressing on model validity when investigating sustainability concerns. As such, we develop a widened view of the meaning of model validity for sustainability. It includes (i) acknowledging that several facets of validation are critical for the successful modelling of the sustainability of complex systems; (ii) tackling the thorny issues of uncertainty, subjectivity, and unpredictability; (iii) exploring the realism of model assumptions and mechanisms; (iv) embracing the role of stakeholder engagement and scrutiny throughout the modelling process; and (v) considering model purpose when assessing model validity. We wish to widen the debate on the meaning of model validity in a constructive way. We conclude that consideration of all these elements is necessary to enable sustainability models to support, more effectively, decision-making for complex interdependent systems

Responding to Climate Change: The Economy and Economics - Part of the Problem and Solution

The Climate Change Starter’s Guide provides an introduction and overview for education planners and practitioners on the wide range of issues relating to climate change and climate change education, including causes, impacts, mitigation and adaptation strategies, as well as some broad political and economic principles. The aim of this guide is to serve as a starting point for mainstreaming climate change education into school curricula. It has been created to enable education planners and practitioners to understand the issues at hand, to review and analyse their relevance to particular national and local contexts, and to facilitate the development of education policies, curricula, programmes and lesson plans. The guide covers four major thematic areas: 1. the science of climate change, which explains the causes and observed changes; 2. the social and human aspects of climate change including gender, health, migration, poverty and ethics; 3. policy responses to climate change including measures for mitigation and adaptation; and 4. education approaches including education for sustainable development, disaster reduction and sustainable lifestyles. A selection of key resources in the form of publication titles or websites for further reading is provided after each of the thematic sections

Towards new thinking in economics

Terry Barker is a leading British economist in macroeconomics, climate economics and empirical analysis. For over 45 years, he has been involved in research at Cambridge on economic theory and applied economics, in areas such as: trade theory and space and time economics; structural macroeconomics; and the macroeconometric modelling of energy-environment-economy interactions. This has included trade theory, space-time economics, climate mitigation economics, and macro-econometric modelling. Though he can be considered a ‘descendant’ of Keynes, Barker defies any categorisation of belonging to a particular school of economic thought. A notable contribution has been his empirical modelling work showing how tougher climate mitigation policies may actually bring long-term socioeconomic benefits. Whilst at the conference on new economics as ‘mainstream’ economics that he initiated in January 2010 in Cambridge, we discussed at length his extremely interesting viewpoints and research. This interview takes the reader through the intellectual history and work of a determined man, who has never ceased encouraging new ideas and pushing forward fresh economic thinking for the benefit of societal progress. An interview with introduction by Şerban Scrieciu

Socioeconomic and Environmental Impacts on Agriculture in the New Europe: Post-Communist Transition and Accession to the European Union

This book looks at agriculture and the environment, placed within the dynamic context of post-communist societal change and entry into the European Union (EU). Scrieciu explores developments in eleven Central and Eastern European (CEE) countries and argues for agriculture’s natural place in these societies. The history of these countries is significant in how it has shaped the institutions and influenced the outcomes. In many cases, during communism, agriculture was not considered a strategic branch for a nation's development. An ecological consciousness did not figure high on the agendas of authoritarian regimes. After 1990, some post-communist farm economies progressed slower than others, and environmental pressures mostly diminished with agricultural restructuring. In parts of CEE, increases in numbers of low-input small farms have resulted in some, though largely unintended, ecological benefits. A dual environmental challenge has nevertheless surfaced. On one hand, environmentally unsustainable practices have been attributed to some low-input farming. On the other hand, risks of farm over-intensification and resource over-exploitation are on the rise. Also, environmental regulatory and institutional frameworks are not always effectively in place. EU membership is not creating the anticipated benefits for farm growth. There are a number of systemic structural barriers preventing many farmers from drawing on Common Agricultural Policy incentives and support. The presence of many vulnerable poor farms is clearly problematic, particularly economically. However, small-scale farms could be made more acceptable and profitable by ensuring EU policies acknowledge their value and by building institutions to support alternative farm growth strategies, aside from the traditional European model of individual corporate farm expansion. The voluntary uptake of grassroots rural cooperation and farm associations may represent such an alternative. Future European farm policy reforms need to reach the small and vulnerable, and better tackle issues of farm equity, poverty, and agricultural sustainability in the new Europe. This is a timely contribution as this type of "transition" has just begun. This book should be of use to students and researchers looking at agricultural and environmental economics, post-communist rural societal change, European integration and the Common Agricultural Policy. It may be also useful and of high relevance to policy analysts and those involved in agricultural and rural development policy-making in the region or in other countries facing similar problems

Economic impacts of adopting the Common Agricultural Policy of the European Union: a CGE approach to the case of Romania

This paper evaluates potential economic impacts of incorporating Romania into EU's Common Agricultural Policy. A CGE model of Romania is employed to model likely changes in trade, production and welfare patterns with a focus on fifteen local agro-food activities. Three main findings emerge. First, the adoption of the CAP expands agro-food output and trade, promotes higher farm incomes, and increases economic welfare. Second, CAP application results in production specialisation effects, particularly for sugar and sugar beet, bovine meat products, ruminant live animals, dairies, and cereal grains. Third, the identified impacts are driven by changes in trade-related measures, particularly enhanced access to EU markets, and less by alterations in production-related domestic support. The paper concludes that EU accession and CAP adoption may bring potentially realisable growth in Romania's agro-food sector, though in practice this will depend on producers' ability to respond to the supply incentives being offered

The inherent dangers of using computable general equilibrium models as a single integrated modelling framework for sustainability impact assessment. A critical note on Böhringer and Löschel (2006)

The search for methods of assessment that best evaluate and integrate the trade-offs and interactions between the economic, environmental and social components of development has been receiving a new impetus due to the requirement that sustainability concerns be incorporated into the policy formulation process. A paper forthcoming in Ecological Economics [Böhringer, C., Löschel, A., in press. Computable general equilibrium models for sustainability impact assessment: status quo and prospects, Ecological Economics.] claims that Computable General Equilibrium (CGE) models may potentially represent the much needed “back-bone” tool to carry out reliable integrated quantitative Sustainability Impact Assessments (SIAs). While acknowledging the usefulness of CGE models for some dimensions of SIA, this commentary questions the legitimacy of employing this particular economic modelling tool as a single integrating modelling framework for a comprehensive evaluation of the multi-dimensional, dynamic and complex interactions between policy and sustainability. It discusses several inherent dangers associated with the advocated prospects for the CGE modelling approach to contribute to comprehensive and reliable sustainability impact assessments. The paper warns that this reductionist viewpoint may seriously infringe upon the basic values underpinning the SIA process, namely a transparent, heterogeneous, balanced, inter-disciplinary, consultative and participatory take to policy evaluation and building of the evidence-base

Can economic causes of tropical deforestation be identified at a global level?

This paper contributes to the literature on the macro-scale economic determinants of the increase in global forest depletion, by performing a regression analysis based on a panel dataset for fifty tropical countries over an eighteen-year period. While the initial findings appear at first to confirm a common causality pattern of selected macroeconomic variables in influencing tropical deforestation, subsequent statistical tests question the significance of the results. More specifically, testing for autocorrelation, which has been downplayed in previous studies, appears to represent a critical issue. When the initial results are corrected for autocorrelation, the significance of the parameters declines substantially below statistically acceptable levels. The implications are twofold. First, regression analyses that seek to explain deforestation at the global level need to be carefully scrutinised and checked to ensure that they meet standard statistical tests. Second, tropical deforestation might ultimately depend upon case-specific factors and further research may render more effective policy suggestions if conducted at a more disaggregated, local level

Modelling low stabilization with E3MG: towards a ‘New Economics’ approach to simulating energy-environment-economy system dynamics

The literature on climate stabilization modeling largely refers to either energy-system or inter-temporal computable general equilibrium/optimal growth models. We contribute with a different perspective by deploying a large-scale macro-econometric hybrid simulation model of the global energy-environment-economy (E3MG) adopting a “New Economics” approach. We use E3MG to assess the implications of a low-stabilization target of 400ppm CO2 equivalent by 2100, assuming both fiscal instruments and regulation. We assert that if governments adopt more stringent climate targets for rapid and early decarbonisation, such actions are likely to induce more investment and increased technological change in favor of low-carbon alternatives. Contrary to the conventional view on the economics of climate change, a transition towards a low-carbon society as modeled with E3MG leads to macroeconomic benefits, especially in conditions of unemployment, with GDP slightly above a reference scenario, depending on use of tax or auction revenues. In addition, more stringent action can lead to higher benefits