Costs of Climate Policy when Pollution Affects Health and Labour Productivity. A general Equilibrium Analysis Applied to Sweden

Much of the debate over global climate change involves estimates of the direct costs of global climate change mitigation. Recently this debate has included the issue of ancillary benefits. These benefits consist mainly of health improvements. Although it is generally acknowledged that air pollution affects respiratory health, and that valuations of these impacts make up a significant proportion of the damage costs of air pollution, these impacts are often neglected when evaluating the costs of climate policy. Since reducing greenhouse gases has the effect of also reducing other pollutants affecting human health and labour productivity these effects should be taken into consideration. The analysis incorporates a linkage between air pollution and health effects into a general equilibrium model for Sweden through a theoretical consistent framework. Results from recent Swedish concentration-response and contingent valuation studies are used to model direct disutility and indirect health effects that negatively affects the productivity of labour. The costs of feedback effects on health and productivity are compared in three different scenarios for attaining the Swedish carbon dioxide target with alternative projected emission levels in the baseline scenario as well as alternative harmful emission levels. Results show that not including feedback effects could mean overstating the costs of climate policy. The magnitude of these effects are, however, very sensitive to projected emission levels and to the judgement of harmful emission levels.air pollution; ancillary benefits; climate policy; general equilibrium; health

The EMEC model: Version 2.0

The present paper introduces a new version of an applied general equilibrium model of the Swedish economy: Environmental Medium Term Economic Model (EMEC). The model is used at NIER for analysing economic implications for households and firms of the Swedish environmental policy. The economy and the environment interact in the model and thus, we can analyse the economic implica-tions of various environmental policy measures, such as a CO2-tax, a CO2-ceiling and CO2-trading. The model captures also ancillary benefits of climate policy for NOx, SO2, PM10 and PM20. This new version of EMEC, in addition, analyses the effects of road user charges and the economic impact of environmental policy measures on six types of households, as transport demand is represented in a much more detail and as households are distributed, by disposal income and residence. Furthermore, the model distinguishes 26 industries, 33 composite commodities, 26 consumer goods, two kinds of labour and eight pollutants. The model produces results for endogenous variables, which can be interpreted fully in terms of the model’s theory, data and the assumptions underlying the exogenous variables.CGE-model; Sectors; Pollutants; Factors of production; Substitution; Sweden

Nitrogen and Sulphur Outcomes of a Carbon Emissions Target Excluding Traded Allowances - An Input-Output Analysis of the Swedish Case

A cost-effective policy instrument to attain the Swedish carbon emission target, suggested by the Government’s commission on flexible mechanisms of the Kyoto protocol, is the purchase of emission allowances within the EU trading scheme, instead of reducing domestic CO2 emissions at higher costs. Also, proposed by the commission, is that only grandfathered, but not imported emission allowances, should be accounted for in the carbon emissions target. This formulation of the target is now under consideration by the Swedish Environmental Protection Agency as instructed in Sweden’s Budget Bill for 2007. The nitrogen and sulphur outcomes of these suggestions for the climate policy are here assessed in the view of Sweden’s official emission projections for 2010 and 2020. In view of the historical emission multipliers and the analysis presented here, the proposed climate policy does not conform to Sweden’s interim targets for nitrogen oxides (NOx) and sulphur dioxide (SO2). Although, the CO2 emission target could be attained at the least costs through emission trading, an environmental policy which brings also SO2 and NOx emissions to the acceptable levels requires additional policy instruments aiming at the exclusive reduction of these emissions. The findings here suggest that these reductions would correspond to decreases of the SO2/GDP and NOx/GDP ratios by 8 and 12 per cent, respectively. The emission multipliers of aggregate demand for CO2-permit trading and non-trading sectors, are calculated by exploiting the environmental accounting matrix of Sweden for 2000 within the framework of an inter industry model.Emission multipliers; carbon trading; emission/GDP ratio; environmental goals

Future Waste Scenarios for Sweden based on a CGE-model

Over the last decades, waste quantities have grown steadily in close relation to economic growth. To tackle the problem of continuing waste growth within the EU, waste prevention was listed among four top priorities in the EU Sixth environment Action Programme. A Computable General Equilibrium (CGE) model is here used for projecting future quantities of hazardous and non-hazardous waste in Sweden to 2030. The effects of driving forces behind waste generation are illustrated by comparing the results of waste projections for a Baseline scenario and four alternative scenarios. The scenarios differ mainly in GDP growth rates and in the assumptions about future waste intensities of the economic activities of firms and households. We use a high-resolution data set on waste flows of 18 various types of non-hazardous waste and 16 various types of hazardous waste attributed to six waste-generating sources for the base year 2006. Waste generated in the scenarios, thus, relate to firms’ material input, output, employees, capital scrapping and fuel combustion as well as households’ consumption. The impact of economic growth in increasing the generation of nonhazardous and hazardous waste is apparent when comparing the growth of waste from 2006 to 2030 in the five scenarios. On the contrary, technological change resulting in less waste intensive production processes and changed behaviour among households, making their activities less waste intensive, have a strong reducing effect, especially on generation of non-hazardous waste relating to firms’ material input.general equilibrium model; waste generation; decoupling; waste intensities waste scenarios.

The Excess Cost of Supplementary Constraints in Climate Policy: The Case of Sweden’s Energy Intensity Target

From the perspective of climate policy, a target for energy efficiency could imply costly overlapping regulation. We estimate, using a computable general equilibrium model of the Swedish economy, the potential economic cost of attaining the national 2020 energy intensity target by means of tax policy instruments. Our analysis shows that the efforts to meet the energy intensity target will also reduce carbon dioxide emissions, but at excessive costs compared to alternative climate policy instruments. Moreover, attainment of the energy intensity target will call for policy instruments additional to those needed for fulfilling the national climate policy target. The results are sensitive to the development of the nuclear energy production as the definition of energy intensity includes conversion losses in electricity productionclimate policy; energy efficiency; carbon tax; overlapping regulation; general equilibrium; Sweden

Analysing future solid waste generation - Soft linking a model of waste management with a CGE-model for Sweden

Parallel to the efforts of the EU to achieve a significant and overall reduction of waste quantities within the EU, the Swedish parliament enacted an environmental quality objective stating that ‘the total quantity of waste must not increase …’ i.e. an eventual absolute decoupling of waste generation from GDP. The decoupling issue is ad-dressed, in the present paper, by assessing future waste quantities, for a number of economic scenarios of the Swedish economy to 2030 with alternative assumptions about key factors affecting waste generation and waste management costs. We use an integrated top-down/bottom-up approach by linking a CGE-model of the Swedish economy with a systems engineering model of the Swedish waste management system. In this way, we can in more detail consider the interaction between waste generation and waste management costs (waste disposal prices) when assessing future waste quantities. A relative decoupling of waste generation takes place in all scenarios, i.e. total waste quantities increase at a lower rate than GDP. Absolute decoupling, which re-quire total waste quantities to stabilize or to reduce, does not take place in any of the scenarios. This means that the present Swedish Environmental quality objective of stabilizing waste quantities is not met in any of the scenarios with total waste genera-tion levels of 110 per cent up to nearly 200 per cent of that in 2006. The overall impression from our analysis is that costs are high for reducing waste generation irrespective of the type of waste reduced. In other words, the waste treat-ment costs are low compared to the costs for reducing waste. This situation also means that the use of policy instruments, which induce substitution by increasing the price of waste disposal services, will have very small reducing effects on the generation of all types of waste unless the price increase brings about an introduction of waste preventing techniques and affect households in the direction of a less waste intensive behaviour. For example, the policy instruments used must affect the pattern of household consumption pattern more directly, as a differentiation of the value added tax, rather than to be directed towards the waste management sector. Economic policy instruments introduced in the waste management sector are more likely to affect the choice of waste management solutions than prevent waste generation. Linking a macroeconomic and a systems engineering model for waste manage-ment, gives us a tool useful also for capturing the macroeconomic effects, such as GDP growth and structural changes, when designing policy instruments intended to prevent waste generation or take waste management in a more sustainable direction.general equilibrium model; systems engineering; solid waste; waste management; waste generation; decoupling; EMEC; NatWaste; top-down/bottom-up; waste policy instruments

Integrated economic and environmental assessment of waste policy instruments

The need for new policy instruments supporting the on-going transition from end-of-pipe waste treatment to resource management has been recognized in European policy. Instruments need to be carefully assessed before implementation to promote the desired changes and avoid problem shifting. Mathematical models may assist policy makers in such assessments. This paper presents a set of soft-linked models for assessing the economic and environmental impacts of policy instruments for both the prevention and management of waste and discusses its strengths and limitations. Consisting of (1) a macro-economic model, (2) a systems engineering model for waste management and (3) a life cycle assessment model for waste management, the set is primarily suited to assessing market-based instruments and environmental regulations. Considerable resources were needed for developing and using the set, and there are clear limits as to what can be addressed. However, if only one of the models had been used, neither the range of instruments nor the scope of impacts would have been possible to cover. Furthermore, soft-linked models allow many disciplines to contribute within one harmonized framework. Such integrated assessments may become increasingly useful for continuing the implementation of policy for sustainable governance of society’s material resources

Development and comorbidity of eczema, asthma and rhinitis to age 12 : data from the BAMSE birth cohort

BACKGROUND: Allergy-related diseases are a public health issue, but knowledge on development and comorbidity among children is scarce. The aim was to study the development of eczema, asthma and rhinitis in relation to sex and parental allergy, in a population-based cohort, during childhood. METHODS: At 1, 2, 4, 8 and 12 years, parental questionnaires were used to obtain data on allergy-related diseases. Complete data for all five follow-up occasions were available from 2916 children. Odds ratios for the risk of any allergy-related disease in relation to heredity and sex were calculated using generalized estimating equations. RESULTS: At 12 years, 58% of the children had had eczema, asthma and/or rhinitis at some time. Disease turnover was high for all three diseases throughout the study. Comorbidity increased with age, and at 12 years, 7.5% of all the children were affected by at least two allergy-related diseases. Parental allergy was associated with increased comorbidity and more persistent disease and increased the risk of having any allergy-related disease (adjusted OR 1.76; 95% CI 1.57-1.97) up to 12 years. Male sex was associated with an increased risk throughout childhood. Boys and girls did not differ in disease persistence, and for comorbidity, the differences were minor. CONCLUSIONS: Allergy-related diseases may affect a majority of children. Eczema, asthma and rhinitis develop dynamically throughout childhood, and allergic comorbidity is common. These findings indicate that allergy-related diseases should be neither seen nor studied as isolated entities.Stockholm County CouncilHjärt- och LungfondenVetenskapsrådetAstma- och allergiförbundetManuscrip

Strukturell förändring i svensk ekonomi_2

This survey is an attempt to exploit systematically information about past changes in the Swedish production structure gained from input-output investigations for the years 1957, 1968, 1975 and 1980. Imported and domestically produced intermediates measured in 1968 prices. The data files consists of coefficient matrices for the years 1957, 1968, 1975 and 1980 for 26 commodity groups and 72 commodity groups respectively.This survey is an attempt to exploit systematically information about past changes in the Swedish production structure gained from input-output investigations for the years 1957, 1968, 1975 and 1980. Imported and domestically produced intermediates measured in 1968 prices. The data files consists of coefficient matrices for the years 1957, 1968, 1975 and 1980 for 26 commodity groups and 72 commodity groups respectively

Strukturell förändring i svensk ekonomi

This survey is an attempt to exploit systematically information about past changes in the Swedish production structure gained from input-output investigations for the years 1957, 1968, 1975 and 1980. Imported and domestically produced intermediates measured in 1968 prices. The data files consists of coefficient matrices for the years 1957, 1968, 1975 and 1980 for 26 commodity groups and 72 commodity groups respectively.This survey is an attempt to exploit systematically information about past changes in the Swedish production structure gained from input-output investigations for the years 1957, 1968, 1975 and 1980. Imported and domestically produced intermediates measured in 1968 prices. The data files consists of coefficient matrices for the years 1957, 1968, 1975 and 1980 for 26 commodity groups and 72 commodity groups respectively