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“Labor Response to Climate Variation in Eastern Africa”
Abstract: Knowledge of how changing climate affects workers is crucial to designing effective adaptation policy. Nonetheless, temperature impacts on labor markets are poorly understood, especially in Africa. We address this gap by analyzing panel surveys of labor participation by activity, contractual arrangement, and migration status in four East African countries. We develop a multi-sector labor allocation model to understand the complex relationship between climate productivity impacts and micro-level occupational responses. Using high-resolution climate data, we apply the model to assess labor responses to local temperature anomalies. In rural areas, high temperatures induce a decline in participation in non-agricultural self employment. Urban areas likewise see a decline in non-agricultural self employment, accompanied by a decline in temporary migration. Unlike in rural areas, other sectors are unable to absorb the excess workers leading to an increase in urban unemployment.
“The Local Environmental Consequences of Coal Procurement at U.S. Power Plants”
Abstract: There are known to be significant environmental costs associated with burning coal in order to generate electricity. However, there are also sizable local environmental health costs associated with power plants’ coal purchase and storage behavior. We find that a 10% increase in coal stockpiles (number of deliveries) is associated with a 0.02% (0.07%) increase in the concentration of fine particulates on average. Local populations exposed to these fine particulates (PM2.5) have increased risk of lung and heart conditions. Translating the increase in PM2.5 associated with plants’ coal procurement behavior into mortality risk and monetizing this mortality risk, we calculate local environmental costs between $0.004-$0.02 per KWh. Finally, we show that the average increase in mortality rates associated with an increase in PM2.5 are substantially higher when we instrument using coal stockpiles and number of deliveries relative to OLS specifications; this result provides both a new identification strategy for the link between mortality rates and PM2.5 as well as further empirical evidence of the link between PM2.5 and plants’ coal procurement behavior.
Abstract: We consider analytically the non-cooperative behavior of many private property owners who each controls the stock of a public bad such as an invasive weed species, infectious disease, fire, or agricultural pest. The stock of the public bad can grow and disperse across a spatial domain of arbitrary size. In this setting, we characterize the conditions under which private property owners will control or eradicate, and determine how this decision depends on property-specific environmental features and on the behavior of other landowners. We show that high mobility or lower control by others result in lower private control. But when the marginal dynamic cost of the bad is sufficiently large, we find that complete eradication may be privately optimal (despite the lack of consideration of others’ welfare) — in these cases, eradication arises in the non-cooperative game and is also socially optimal so there is, in effect, no externality. Finally, when property harboring the bad is not owned, or is owned in common, we derive the side payments required to efficiently control the mobile public bad.
“Consumer Valuation of Fuel Costs and the Effectiveness of Tax Policy: Evidence from the European Car Market”
Abstract: To what extent do car buyers undervalue future fuel costs, and what does this imply for the effectiveness of alternative tax policies? To address both questions, we show it is crucial to account for consumer heterogeneity in mileage and other dimensions.We use detailed product-level data for a long panel of European countries, and exploit variation in fuel prices by engine type. Although we find there is modest undervaluation of fuel costs, fuel taxes are still more effective in reducing fuel usage than product taxes based on fuel economy. The reason is that fuel taxes better target the right consumers, those with a high mileage, to purchase more fuel efficient cars.
“Cash for Carbon: A Randomized Controlled Trial of Payments for Ecosystem Services to Reduce Deforestation”
Abstract: This paper evaluates a Payments for Ecosystem Services (PES) program in western Uganda that offered forest-owning households cash payments if they conserved their forest. The program was implemented as a randomized trial in 121 villages, 60 of which received the program for two years. The PES program reduced deforestation and forest degradation: Tree cover, measured using high-resolution satellite imagery, declined by 2% to 5% in treatment villages compared to 7% to 10% in control villages during the study period. We find no evidence of shifting of tree-cutting to nearby land. We also use the estimated effect size and the “social cost of carbon” to value the delayed CO2 emissions, and compare this benefit to the program’s cost.