- Mardi 8 Décembre - Lucille Noel Neumann (INRAE Economie Publique) - Le commerce bilatéral est-il un déterminant clé de l’allocation des aides climatiques ? (coécrit avec Basak Bayramoglu – INRAE -, Jean-François Jacques - Université Paris-Est Marne-la-Valléé - & Clément Nedoncelle -INRAE-)
In this paper, we combine theoretical and empirical analyzes to investigate how bilateral trade affects the allocation of climate aid by donor countries. In the theoretical analysis, we develop two models to help support our hypothesis that bilateral trade positively impacts climate aid transfers. The first model highlights the terms-of-trade effect and predicts a positive relationship between donors' imports from recipient countries and their climate aid transfers. The second model is a tournament model that illustrates the competition among recipient countries to gain climate aid through imports from the donor countries. It predicts a positive relationship between climate aid and the donors' exports to recipient countries. We then provide an empirical analysis based on bilateral climate aid data from 2002 to 2017. Using fixed effects and IV-2SLS estimations with a robust shift-share instrument to overcome endogeneity of trade, our preliminary empirical results show that donors' exports and imports have a positive and significant effect on climate aid transfers.
- Mardi 1er Décembre 2020 - Valentin Guye (INRAE Economie Publique & MCC Berlin) - "Heterogeneous price responsiveness of forest conversion to oil palm plantations in Indonesia"(coécrit avec Sebastian Kraus – MCC Berlin)
We estimate heterogeneous price elasticities of land use change from forest to oil palm plantations (LUCFP) in Indonesia. This is the first study to relate LUCFP to observations of the actual values paid at palm oil mill gates for fresh fruit bunches and crude palm oil. Mills are pivotal in the sustainable governance of the palm oil supply chain. We have merged the Indonesian manufacturing census and the Universal mill list in a novel, spatially explicit, 1998-2015 panel data set of palm oil mills with many micro-economic dimensions. Grounding on the plantation-mill proximity constraint, we approximate fine grain economic incentives at 3x3km parcels using inverse travel time weights. The causal identification relies on high resolution fixed-effects. We provide estimates of short and medium run LUCFP-price elasticities for Sumatra and for Kalimantan, for industrial plantations and for smallholders. We investigate the heterogeneity in the price responsiveness of LUCFP across ownership, competition, remoteness, legality, and transitional dynamics. Our results are relevant to designing effective, efficient and equitable market-based conservation schemes.
- Mardi 24 Novembre 2020 - Aliette Dequet (Ecole des ponts & INRAE) - "Are international transfers to combat climate change really climate-related ? An empirical analysis on the reporting of donor countries" (coécrit avec Basak Bayramoglu & Lucille Neumann-Noël - Economie Publique, INRAE)
During the COP 15 in Copenhagen and the COP 16 in Cancun, developed countries have committed to provide new and additional climate funding to developing countries, a commitment reaffirmed in the Paris Agreement in 2015. To declare the projects they financed to the OECD, donor countries used the methodology of the Rio markers, created after the 1992 Rio Summit to identify projects responding to this conference’s objectives. There are two Rio markers that are climate-related: a mitigation marker and an adaptation marker (the latter being introduced in 2010). From 1995 to 2012, this classification system often led donor countries to misclassify a significant number of their development projects as climate-related (Michaelowa and Michaelowa, 2011, Junghans and Harmeling, 2012, and Baum et al., 2017). In this paper, we investigate the extent of misclassification of climate projects in a more recent period from 2012 and 2018, and estimate the determinants of donor countries’ misreporting. We consider OECD Bilateral Development Aid Database which gathers 64 100 public bilateral projects from 2002 to 2018. Undertaking a textual analysis with Python programming, we first determine for each project if it is mitigation-related, adaptation-related or not climate-related. Then, we estimate the factors that may affect the number and amount of misreported projects by donor countries. Our estimation results show that some economic, environmental and political factors have an influence upon the number of projects misreported. These effects also depend on the type of misclassification, whether the misreporting concerns climate projects overall, or adaptation or mitigation projects separately.
- Mardi 17 Novembre 2020 - Marie Bessec (Université Paris Dauphine) - "Green Sentiment in Financial Markets: A Global Warning" (coécrit avec Julien Fouquau - ESCP Business School)
We use textual analysis to measure the growing concern about environmental issues and to assess its impact on stock prices in the United States. Using a dataset of 71,785 articles published in The Wall Street Journal from 2010 to 2019, we create several scores capturing media coverage of environmental news and investigate their influence on S&P500 constituents. We find a significant impact on the stock returns of one third of firms in the sectors exposed to environmental risks. An assessment of the results at company level shows that this impact is related to their environmental performance. The results are robust to the use of alternative lexicons and weighting schemes, various speci cations and sample periods.
- Mardi 13 Octobre 2020 - Christophe Gouel (INRAE - Economie Publique) - "The Impact of Global Warming on Agriculture: A Critique of the Ricardian Approach from a General Equilibrium Perspective"
"The Ricardian approach is a popular reduced-form approach for estimating climate change impacts on agriculture. This approach focuses on how farmers and agricultural land market react to changes in climatic conditions, under the implicit assumption that crop prices stay constant. To test whether this assumption is innocuous, I use a quantitative trade model of global agricultural markets to emulate the findings of a Ricardian approach as well as to calculate exact welfare changes. The model shows that both welfare measures are weakly correlated and can be of opposite signs, and that the Ricardian approach tends to underestimate the cost of climate change. The main drivers of these differences are the neglects of the imperfect substitutability of crops in demand and of terms-of-trade changes. The Ricardian approach provides a valid approximation of the welfare cost of climate change only if crops are almost perfectly substitutable in demand and trade costs are neglected, a situation in which it is reasonable to assume constant prices.
- Mardi 6 Octobre 2020 - Cloé Garnache (Université d'Oslo) -"Environmental Policy in General Equilibrium: New Insights from a Canonical Model" (coécrit avec Pierre Mérel, Dept. Of Agricultural and Resource Economics, University of California, Davis)
"This paper derives the incidence of a pollution tax in a stylized general equilibrium framework, building on previous work by Fullerton and Heutel (2007a). Using the CPI as numeraire, we show that tax incidence is a simpler problem than previously thought, and that general insights can be derived without the need to restrict the parameter space. In addition, the counterintuitive possibility that an increase in the tax could increase the pollution level vanishes. The choice of the CPI as numeraire is further justified by the fact that environmental taxes, notably carbon taxes, are typically indexed on inflation."
- Mardi 8 Septembre 2020 - Karine Constant (ERUDITE - Université Paris-Est Créteil) - "Pollution, children's health and the evolution of human capital inequality"
"This article examines how pollution and its unequal health effects on children can affect the dynamics of inequalities among households. In a model in which children’s health is endogenously determined by pollution and the health investments of parents, we show that the economy may exhibit inequality in the long run and be stuck in an inequality trap with steadily increasing disparities, because of pollution. This is the case even if we do not assume differences in terms of abilities and despite diminishing returns to human capital that favors convergence among agents. Given the key role of pollution in the intergenerational transmission of inequality, we investigate if an environmental policy, consisting in taxing the polluting production to fund pollution abatement, can address this issue. We find that it can decrease inequality in the long run and enable to escape from the trap if the emission intensity is not too high. Otherwise, we reveal that a policy mix with an additional subsidy to health expenditure may be a better option, at least for not too large initial disparities."
- Mardi 23 Juin 2020 - Basak Bayramoglu (Economie Publique - INRAE) - "Interactions between Nutritional and Climate Policies at the International Level"
"Developed countries and emerging economies face two major challenges, climate change and chronic diseases related to unhealthy diets. These two major challenges are linked since changes in diets impact public health, but also climate change through global greenhouse gas (GHG) emissions. The aim of this paper is to analyze in a global public good game the link between nutritional and climate mitigation policies at the international level. Changes in diets induced by a nutritional policy lead to health benefits at the national level. They can also increase or decrease the GHG emissions of the country, with related externalities to other countries. Our modelling framework thus highlights a novel indirect leakage effect through the nutritional policy, which complicates the public good problem. In this context, we ask whether countries should negotiate an agreement on climate policies only (climate agreement), or an agreement on both climate and nutritional policies (full agreement). In terms of global emissions, our theoretical results show that it is better to cooperate both on climate mitigation and nutritional policies when healthy changes in diets have a large impact on emissions, whatever the direction of this impact. We also assess the welfare implications of two diet recommendations in Denmark, Finland and France.”
- Mardi 16 Juin 2020 - Elodie Letort & Fabienne Femenia (SMART-LERECO - INRAE) - "Farmers’ heterogeneous responses to price variations: identification of livestock farms flexibility based on a panel smooth transition regression approach"
"We propose a model of farm input use decisions that accounts for the potential existence of adjustment costs incurred by farmers when adjusting their variable inputs in response to price variations. This model allows characterizing the heterogeneity in the short run flexibility of farms. It is estimated on a sample of dairy farms located in the West of France. Our estimation procedure relies on a panel smooth transition regression approach that allows estimating individual parameters of the transition function. The estimation results show non-linear responses of dairy farmers’ acreages and feed input use decisions to input and output prices, suggesting the existence of input adjustment costs. Our results also reveal an heterogeneity of adjustment costs among farms which translates into an heterogeneity in their degree of reaction to large price variations, the more flexible farms being generally less indebted and showing better environmental performances than the sample average."
- Mardi 2 Juin 2020 - Adélaïde Fadhuile (GAEL - Université de Grenoble) - "Intrinsic Motivation to Promote the Development of Renewable Energy:A Field Experiment from Household Demand"
- Mardi 26 Mai 2020 - Elizavetta Dorinet (Economie Publique & EconomiX - INRAE & Université Paris Nanterre) - "Electrification and Agricultural Transformation: Evidence from Ethiopia"
"While energy infrastructure is fundamental to development, rural areas in developing countries still lack electricity access. These regions mostly depend on traditional agriculture for livelihood. This paper investigates how electricity access affects agriculture using a GIS dataset with census data of rural households in Ethiopia for the period 2011-2016 and power plant localization.”
- Mardi 19 mai 2020 - Sébastien Desbureaux (Banque mondiale) - "Shedding light on an invisible water crisis: Global hotspots of water quality (1992-2010)"
"Clean water is key for sustainable development. However, large data gaps limit our understanding of global hotspots of water quality and their evolution over time. We use a data-driven approach to provide monthly estimates of surface water quality globally between 1992 and 2010 at a 0.5° spatial resolution. We assess water quality hotspots for six indicators relevant for the Sustainable Development Goals. Poor water quality is a global problem that impacts low- and high-income countries with different pollutants: past economic developments have not solved the problem of water pollution but have transformed it. Low-income countries are particularly exposed to organic pollution while high-income countries are particularly exposed to high nitrate levels (pollutants of prosperity). Water quality is also directly impacted by climate variables. A drier climate with higher temperature has a negative impact on water quality. Climate change will therefore further exacerbate water quality problems.”
- Mardi 12 mai 2020 - Louis-Gaëtan Giraudet (CIRED - Ecole des Ponts) - "How to regulate procurement markets for externality-generating goods? a refreshing perspective on Pigovian taxation"
We consider an externality-generating good in an imperfectly competitive market: a finite set of firms with convex production costs decide in an uncoordinated way whether to incur a visiting cost and participate in separate procurements each organised by consumers willing to buy a personalized good. We find that when the ex post first best involves mixed participation (resp. full participation), then it is implemented through a Pigovian (resp. super-Pigovian) subsidy coupled with no visit subsidies. We then analyse the ex post optimal regulation in terms of ex ante incentives and also discuss how our results extend or not to different auction rules, ad valorem instruments or with heterogeneous consumers. Our results give a large support for Pigovian subsidies possibly coupled with a regulation on firms' entry.
- Mardi 5 mai 2020 - Kamel Louhichi (Economie Publique - INRAE) - "IFM-CAP, an EU-wide Individual Farm level Model for Common Agricultural Policy: overview and illustrative results"
Over the last two decades, the Common Agricultural Policy (CAP) has undergone a gradual change from market intervention instruments (e.g. price support) to farm-specific measures designed to satisfy a diverse portfolio of EU policy objectives including rural development, preserving the environment and promoting the competitiveness of European agriculture. This became more evident in the last CAP reform of 2013 with the introduction of: (i) the three ‘greening’ measures with the aim of supporting agricultural practices beneficial to the climate and environment, (ii) the new system of direct payments aimed to create a more equitable support system and (iii) the targeted income support to farmers most in need, particularly small and young farmers, farmers in low-income sectors and farmers in areas with natural constraints. The eligibility and the uptake of these measures differ significantly between farms depending, among others, on their size, specialisation, resource endowment, location and socioeconomic characteristics. Current aggregate agent models (farm-types, regions and countries) are not able to deliver impacts of such measures without imposing strong ad hoc assumptions. The main aim of this paper is to present the first EU-wide individual farm level model (IFM-CAP) designed to capture the full heterogeneity of EU farms in terms of policy representation and impacts. IFM-CAP is a static positive programming model applied to each individual farm (83,292 farms) in the Farm Accountancy Data Network (FADN) to guarantee the highest possible representativeness of the EU agricultural sector. In this presentation we briefly show some illustrative results of model application to assess the economic impacts of the greening requirements (Louhichi et al., 2018), the 2013 CAP direct payment reform (Espinosa et al., 2019) and the abolishment of CAP support (Ciaian et al., 2020).
- Mardi 28 avril 2020 - Wolfram Schlenker (Columbia University) - "Coase, Hotelling and Pigou: The Incidence of a Carbon Tax and CO2 Emissions"
We use field-level cost estimates of all oil and natural gas fields to highlight dynamic aspects of a global carbon tax. Some of the initial reduction in consumption will be offset through higher consumption later on. Only high-cost reserves will be priced out of the market, e.g., at 200 dollars per ton of CO2 cumulative emissions decrease by 4%. The tax incidence initially falls on consumers under a constant tax but eventually becomes negative as the lifetime of the resources is extended. If the tax equals the social cost of carbon, which increases over time, the incidence is hill-shaped
- Mardi 14 avril 2020 - Clément Nedoncelle (Economie Publique, INRAE) & Julien Wolfersberger (Economie Publique, Agroparistech) - "Effets des températures sur le commerce dans les pays en développement : preuves microéconomiques et conséquences macroéconomiques"
- Mardi 31 Mars 2020 - Gilbert Giacomini (Agroparistech) - "Searching for a great digital strategy with A.I. to create new markets"
How firms reconceptualize existing structures to create new ones is key as in the field of strategy and in A.I. Our search is grounded in the pharmaceutical industry with a commitment to theoretical generality. The empirical part states, through the story of a high-growth startup facing change in representation, from serendipity (chance discovery) to drug repositioning (old drugs for new uses), how this industry works and deals with A.I. to provide relevant applications, interpretations, explanations and predictions. While assuming that great strategies will come from theories, they are still at processing big data and at developing open source partnerships. The theoretical part makes explicit an underlying foundational framework leading to a novel representation generalizing the structure and the identity of things while including any prior representation as a sub-one. For firms, this makes it possible to efficiently anticipate, hence adapt to the most general types of change in representation or taking place in the environment. It extends capabilities to serve a new market, hybridize domains heretofore dissociated and build organizational fit with prior and novel core elements. But A.I. cannot work without any specific pre-defined research space where to explore. This highlights a major obstacle to shape successful digital strategies.
- Mardi 24 Mars 2020 - José De Sousa (Université Paris-Saclay) - "Maritime Piracy and Local Development"
La piraterie moderne a émergé dans les années 1990 dans les eaux bordant la corne de l’Afrique et en Asie du Sud-Est, et s’est développée à partir de 2010 au large de l’Afrique de l’Ouest. D’après le Bureau maritime international (IMB), il s’est produit en moyenne une attaque par jour entre 1995 et 2017. Récemment, l’IMB note une augmentation alarmante des attaques dans le Golfe de Guinée, et en particulier des enlèvements d'équipage, passés de 78 en 2018 à 121 en 2019. Si la littérature a identifié les principales causes de la piraterie, et tenté d’en évaluer les conséquences sur le commerce international, rien n’est connu sur son impact micro-économique. D’après l’ONU, en 2011, environ 40% des revenus de la piraterie étaient conservés par les pirates et 10% transférés aux communautés côtières, le reste revenant aux commanditaires et intermédiaires. Quels sont les impacts de ces revenus sur le développement local ? La piraterie induit-elle un effet Robin des Bois, ou contraire aggrave-t-elle les conditions de développement ?
- Mardi 25 février 2020 - Julie Subervie (CEE-M, INRAE) - "Providing technical assistance to peer networks to reduce pesticide use in Europe: Evidence from the French Ecophyto plan"
Can agricultural extension policies be improved by leveraging the power of peer influence? In this study, we evaluate the performance of the French Ecophyto plan aimed at reducing pesticide use, focusing on its flagship scheme, which has provided technical assistance to 3,000 volunteer pilot farms enrolled as peer groups since 2011. We use panel data collected from a representative sample of vineyards, known to be among the heaviest consumers of pesticides. We apply a variety of quasi-experimental approaches to estimate the impact of program participation on pesticide use and crop yields of enrolled vineyards. We find that participants have used 8 to 22 percent lesser pesticides than they would have used in the absence of the program. Moreover, we find that this change of practices resulted in a decrease in yields for only a fraction of enrolled peer farms, while others appear to have maintained their yields. Altogether these results suggest that providing technical assistance to peer groups can be effective in significantly reducing pesticide use in France, and presumably in developed countries more generally, for a cost per hectare that is not greater than that of the average European agri-environmental scheme.
- Mardi 21 janvier 2020 - François Libois (PSE INRAE) - "Man Overboard! Industrial Fishing as Driver of Out-Migration in Africa."
Environmental drivers of migration attract more and more attention. This article focuses on the effect of fish stock depletion on migration in Africa and uses a novel dataset on fishing intensity (Kroodsma et al., 2018). First, based on a panel of the 37 African countries with access to the sea over the period 2012-2016, we show that within country variation in fishing intensity increases migration to OECD countries. Then, we opt for a micro approach in six countries for which we have geocoded household data. We show that industrial fishing is reducing household size in coastal villages. We find that, at the 3rd quartile of fishing conditions, a 1% increase in the past industrial fishing hours decreases a household by 0.073 member, and by 17% the average proportion of young men aged between 15 and 30 years old within each household. This gap signals a departure, plausibly caused by the competition created by industrial fishing vessels overfishing their nearby seas and depleting fish stocks.
