This paper investigates the role of additional regulation in mitigating the ‘adverse scale effect’ associated with daily driving restrictions, which has become a popular regulatory tool used to control episodic air pollution internationally, especially in developing countries. We find that although an annual vehicle registration tax reduces the incentive to purchase additional vehicles among households whose sole purpose for doing so is to ‘cheat’ the restriction (i.e., the ‘adverse scale effect’), it does so with an external cost. The cost occurs because households whose purpose for purchasing an additional vehicle is not to cheat the restriction are given the same disincentive with the tax. We show how simple one- and two-stage lotteries can be used to not only discriminate between cheater and non-cheater households (in particular, to avoid providing a disincentive to the latter type of household), but also to provide an even stronger disincentive to the former.

In this paper, we use a computable general equilibrium model to simulate the effects of drought and a decrease in agricultural productivity caused by climate change in Guatemala. A reduction in agricultural productivity would mean a considerable drop in crop and livestock production, and the resulting higher prices and lower household income would mean a significant reduction in the consumption of agricultural goods and food. The most negative effects of a drought would be concentrated in agriculture, given its intensive use of water. Because agricultural production is essential to ensuring food availability, these results suggest that Guatemala needs a proper water-distribution regulatory framework.

A discrete choice experiment, aiming to elicit public preferences for improvements in solid waste services, is carefully administered across socioeconomic zones in the city of Hawassa, Ethiopia. Observed and unobserved preference heterogeneity are analyzed using mixed logit choice models. The results show that there exists substantial willingness to pay to increase collection frequency and separate recyclable waste. A new issue is the focus on child labor in the waste management sector. Significant gender effects are found: women are more interested than men in increasing waste collection frequency and value the abolishment of child labor more highly, as do higher income households. As expected, respondents living in wealthier neighborhoods are more likely to pay higher service charges. Education indirectly influences preferences for waste separation. The study provides important insight into the social benefits of public investment decisions to improve the quality of solid waste management services in large cities in Ethiopia.

This paper investigates the benefits of international cooperation under uncertainty about global warming through a stochastic dynamic game. We analyze the benefits of cooperation both for the case of symmetric and asymmetric players. It is shown that the players’ combined expected payoffs decrease as climate uncertainty becomes larger, whether or not they cooperate. However, the benefits from cooperation increase with climate uncertainty. In other words, it is more important to cooperate when facing higher uncertainty. At the same time, more transfers will be needed to ensure stable cooperation among asymmetric players.

Recently a number of multi-country insurance schemes have been introduced to deal with short-term fiscal liquidity gaps after natural disasters. However, little is known about the actual underlying risk to the fiscal sector just after such events. In this paper, we estimate the risk of fiscal shortages due to tropical storms in the Caribbean. To this end, first we use a panel VAR and estimate that while government expenditure does not respond to damages due to tropical storms, there is a significant contemporaneous effect on fiscal revenue. The results also reveal that different components of expenditure and revenue respond differently to hurricane shocks. Then, employing a parametric bulk extreme value model on estimated losses due to historical events, we show that the fiscal shortage due to storms can potentially be sizeable depending on the rarity of the event, but varies considerably across islands. However, any risk assessment is fraught with considerable uncertainty, particularly for rare but potentially very damaging tropical storm strikes.

Most developing countries are increasingly depending on freshwater based aquaculture to supplement the declining catch from capture fisheries. Yet the competition between capture fisheries and cage culture for space, pollution generated by cage culture, and fish markets interaction effects are hardly conceptualized in a bioeconomic framework. Furthermore, the economic viability of cage culture depends on substantial investment thresholds, engendering foreign direct investment in the industry in developing countries. This paper develops a conceptual model for fresh-water-based aquaculture that accounts for these effects. We found that a Pigouvian tax (optimum ad valorem tax) that corrects the externalities depends on economic and biological parameters in both fisheries. Correcting for the externalities results in a reduction in aquaculture production but not optimum wild catch. Furthermore, with foreign capital in aquaculture, the Pigouvian tax equals the ratio of net to total benefit from aquaculture. Numerical values are used to illustrate the results.

The impact of oil governance on the extraction path of non-renewable resources is theoretically ambiguous. By employing field-level data in the South East Asia region, we utilize a change in the institutional design of oil governance in Indonesia to determine its impact on oil and gas extraction paths. From the empirical results, we infer that the move to create a separate regulatory agency and make the national oil company a purely business entity led to a reduction in the extraction path of oil, the size of which varies for different sizes of resource stock. This finding reiterates the importance of strengthening ownership rights for non-renewable resources to avoid over-extraction and facilitate more sustainable economic outcomes.

Livestock health is economically important for agropastoral households whose wealth is held partly as livestock. Households can invest in disease prevention and treatment, but livestock disease risk is also affected by grazing practices that result in inter-herd contact and disease transmission in regions with endemic communicable diseases. This paper examines the relationships between communal grazing and antimicrobial use in Maasai, Chagga and Arusha households in northern Tanzania. We develop a theoretical model of the economic connection between communal grazing, disease transmission risk, risk perceptions, and antimicrobial use, and derive testable hypotheses about these connections. Regression results suggest that history of disease and communal grazing are associated with higher subjective disease risk and greater antimicrobial use. We discuss the implications of these results in light of the potential for relatively high inter-herd disease transmission rates among communal grazers and potential contributions to antimicrobial resistance due to antimicrobial use.

Despite complex interlinkages, insights into the multifaceted relationship between environmental risks and poverty can be gained through an analysis of different risks across space, time and scale within a single context using consistent methods. Combining geo-spatial data on eight environmental risks and household survey data from 2010–2014 for the case study of Vietnam, this paper shows: (i) at the district level, the incidence of poverty is higher in high risk areas, (ii) at the household level, poorer households face higher environmental risks, (iii) for some risks the relationship with household-level consumption varies between rural and urban areas, and (iv) environmental risks explain consumption differences between households, but less so changes over time. While altogether these analyses cannot establish a causal relationship between environmental risks and poverty, they do indicate that Vietnam's poor are disproportionally exposed. Given growing pressures due to climate change, addressing such risks should be a focus of poverty reduction efforts.

This study analyzes a public-spending option from mining and oil resources and its impact on Niger's economy. The windfall gain from mining and oil revenues provides an opportunity for the country to reinvest natural resource rents, enhance economic development, and address infrastructure gaps. Drawing on the country's recent and expected mining and oil exploitation, we evaluate the effects of a reinvestment policy in road infrastructure using a dynamic computable general equilibrium (CGE) model. We find that investment in road infrastructure brings positive spillover effects to other sectors of the economy and benefits to the economy in the long run. Our analysis additionally shows that reinvestment in road infrastructure, given the initial state of infrastructure in Niger, could help mitigate the resource curse.

People living in poverty are particularly vulnerable to shocks, including those caused by natural disasters such as floods and droughts. This paper analyses household survey data and hydrological riverine flood and drought data for 52 countries to find out whether poor people are disproportionally exposed to floods and droughts, and how this exposure may change in a future climate. We find that poor people are often disproportionally exposed to droughts and floods, particularly in urban areas. This pattern does not change significantly under future climate scenarios, although the absolute number of people potentially exposed to floods or droughts can increase or decrease significantly, depending on the scenario and region. In particular, many countries in Africa show a disproportionally high exposure of poor people to floods and droughts. For these hotspots, implementing risk-sensitive land-use and development policies that protect poor people should be a priority.

Coal has fueled China's rapid growth in recent decades, but it also severely pollutes the air and causes many health issues. The magnitude of the health damage caused by air pollution depends on the location of emission sources. In this paper, we look into the spatial distribution of coal-fired power plants, which are the major emission sources in China, and investigate the determining factors behind the distribution. We find that the driving factors are economic development and expansion of electricity grid coverage; the latter factor plays a key role in provinces that are less developed but have abundant coal resources. This suggests a way to reduce health damages caused by air pollution without harming the economy: attracting coal-fired plants to less populated areas by developing trans-province electricity trade and grid coverage.

Low-income urban neighborhoods in developing countries receive low levels of public services, often not supplemented by community provision due to low rates of informal tax compliance. This paper presents evidence from low-income neighborhoods in Quito, Ecuador using an IV empirical strategy that the global titling of neighborhoods sustains informal taxation. The estimates reveal a sizable average effect of global titling on in-kind labor household that is drawn from a broad base. Evidence is also found which suggests that the possession of a global title provides a neighborhood organisation with tools that deter free-riding behavior even among the individually-titled residents.

To foster the adoption of sustainable intensification practices amongst Ghana's farmers, they are widely promoted through training sessions provided by development organizations, companies, and the public extension service. We investigate whether these training sessions are effective and find that they are effective only for the diffusion of organic fertilizers but not for mulching. We suggest that this comes from the complexity of the innovations. Mulching is one of the simplest sustainable intensification technologies. It diffuses easily through peer learning and, after an initial training delivered to a critical mass of farmers, does not require training anymore. The use of organic fertilizers, in contrast, requires more specific knowledge and adaptation, which limits the effectiveness of peer learning and increases the effectiveness of training. This suggests that to achieve a widespread diffusion of sustainable intensification amongst Ghana's farmers, training sessions should focus on those practices that are complex and thus difficult to learn from peers.

This paper uses two recent household surveys, together with data from the College for Control and Monitoring of Oil Revenues, to analyse the impact of oil revenues on wellbeing in Chad. Following a multiple-correspondence analysis to estimate a synthetic household-based multidimensional wellbeing (MDW) index, we used the difference-in-difference approach to assess the impact of oil revenues on average MDW at the department level. We found evidence that departments in Chad that received significant oil transfers have a higher MDW compared to those disadvantaged by the oil-revenue-redistribution policy. We conclude that, in order to promote economic inclusion, the government of Chad should better develop oil-revenue-redistribution policies according to local development needs and target the poorest departments.

Recent research documents the adverse causal impacts on health and productivity of extreme heat, which will worsen with climate change. In this paper, we assess the current distribution of heat exposure within countries, to explore possible distributional consequences of climate change through temperature. Combining survey data from 690,745 households across 52 countries with spatial data on climate, this paper suggests that the welfare impacts of added heat stress may be regressive within countries. We find: (1) a strong negative correlation between household wealth and warmer temperature in many hot countries; (2) a strong positive correlation between household wealth and warmer temperatures in many cold countries; and (3) that poorer individuals are more likely to work in occupations with greater exposure. While our analysis is descriptive rather than causal, our results suggest a larger vulnerability of poor people to heat extremes, and potentially significant distributional and poverty implications of climate change.