The great outdoors
Voter Preferences and Political Change: Evidence from Shale Booms
Viktar Fedaseyeu, Erik Gilje & Philip Strahan
NBER Working Paper, December 2015
Abstract:
Local interests change sharply after the energy booms that began in 2003, when hydraulic fracturing spurred extraction of formerly uneconomic oil and gas reserves. Support for conservative interests rises and Republican political candidates gain votes after booms, leading to a near doubling in the probability of a change in incumbency. All of this change occurs at the expense of Democrats. Voting records of U.S. House members from boom districts become sharply more conservative across a wide range of issues, including issues unrelated to energy policy. At the level of the individual, marginal candidates skew their voting behavior somewhat toward more conservative causes, but generally not enough to maintain power. Thus, even when the stakes are high and politicians risk losing power, ideology trumps ambition.
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Air Pollution and Criminal Activity: Evidence from Chicago Microdata
Evan Herrnstadt & Erich Muehlegger
NBER Working Paper, December 2015
Abstract:
A large and growing literature documents the adverse impacts of pollution on health, productivity, educational attainment and socioeconomic outcomes. This paper provides the first quasi-experimental evidence that air pollution causally affects criminal activity. We exploit detailed location data on over two million serious crimes reported to the Chicago police department over a twelve-year period. We identify the causal effect of pollution on criminal activity by comparing crime on opposite sides of major interstates on days when the wind blows orthogonally the direction of the interstate and find that violent crime is 2.2 percent higher on the downwind side. Consistent with evidence from psychology on the relationship between pollution and aggression, the effect is unique to violent crimes – we find no effect of pollution on the commission of property crime.
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Impact of the Volkswagen emissions control defeat device on US public health
Steven Barrett et al.
Environmental Research Letters, November 2015
Abstract:
The US Environmental Protection Agency (EPA) has alleged that Volkswagen Group of America (VW) violated the Clean Air Act (CAA) by developing and installing emissions control system 'defeat devices' (software) in model year 2009–2015 vehicles with 2.0 litre diesel engines. VW has admitted the inclusion of defeat devices. On-road emissions testing suggests that in-use NOx emissions for these vehicles are a factor of 10 to 40 above the EPA standard. In this paper we quantify the human health impacts and associated costs of the excess emissions. We propagate uncertainties throughout the analysis. A distribution function for excess emissions is estimated based on available in-use NOx emissions measurements. We then use vehicle sales data and the STEP vehicle fleet model to estimate vehicle distance traveled per year for the fleet. The excess NOx emissions are allocated on a 50 km grid using an EPA estimate of the light duty diesel vehicle NOx emissions distribution. We apply a GEOS-Chem adjoint-based rapid air pollution exposure model to produce estimates of particulate matter and ozone exposure due to the spatially resolved excess NOx emissions. A set of concentration-response functions is applied to estimate mortality and morbidity outcomes. Integrated over the sales period (2008–2015) we estimate that the excess emissions will cause 59 (95% CI: 10 to 150) early deaths in the US. When monetizing premature mortality using EPA-recommended data, we find a social cost of ~$450m over the sales period. For the current fleet, we estimate that a return to compliance for all affected vehicles by the end of 2016 will avert ~130 early deaths and avoid ~$840m in social costs compared to a counterfactual case without recall.
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Gone with the Wind: Federalism and the Strategic Placement of Air Polluters
James Monogan, David Konisky & Neal Woods
University of Georgia Working Paper, September 2015
Abstract:
In federal systems both state governments and firms have incentives to strategically locate polluting facilities where the environmental and health consequences will be borne as much as possible by residents of other jurisdictions. We analyze air polluter location in the United States using a spatial point pattern model, which models where events occur in latitude and longitude. Our analyses indicate that major air polluters are significantly more likely to be located near a state’s downwind border than a control group of other industrial facilities, results that are robust to a wide variety of model specifications and measurement strategies. This effect is particularly pronounced for facilities with toxic air emissions. The observed pattern of polluter location varies systematically across states and time in ways that suggest it is responsive to public policy at both the national and state levels.
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Can indifference make the world greener?
Johan Egebark & Mathias Ekströ
Journal of Environmental Economics and Management, March 2016, Pages 1–13
Abstract:
We conducted a natural field experiment to evaluate two resource conservation programs. One intervention consisted of a moral appeal message asking university employees to cut back on printing in general, and to use double-sided printing whenever possible. The other intervention tested whether people's tendency to stick with pre-set alternatives is applicable to resource use: at random points in time we changed the default setting on the university printers, from single-sided to double-sided printing. Whereas the moral appeal had no impact, the default change cut paper use by 15 percent. Further analysis adds two important insights. First, we show that defaults influence behavior also in the longer run. Second, we present results indicating that resource efficient defaults have the advantage of avoiding unintended behavioral responses. Overall, our findings send a clear message to anyone concerned about resource conservation: there are potentially large gains to be made from small interventions.
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Data contradict common perceptions about a controversial provision of the US Endangered Species Act
Jacob Malcom & Ya-Wei Li
Proceedings of the National Academy of Sciences, 29 December 2015, Pages 15844–15849
Abstract:
Separating myth and reality is essential for evaluating the effectiveness of laws. Section 7 of the US Endangered Species Act (Act) directs federal agencies to help conserve threatened and endangered species, including by consulting with the US Fish and Wildlife Service (FWS) or National Marine Fisheries Service on actions the agencies authorize, fund, or carry out. Consultations ensure that actions do not violate the Act’s prohibitions on “jeopardizing” listed species or “destroying or adversely modifying” these species’ critical habitat. Because these prohibitions are broad, many people consider section 7 the primary tool for protecting species under the Act, whereas others believe section 7 severely impedes economic development. This decades-old controversy is driven primarily by the lack of data on implementation: past analyses are either over 25 y old or taxonomically restricted. We analyze data on all 88,290 consultations recorded by FWS from January 2008 through April 2015. In contrast to conventional wisdom about section 7 implementation, no project was stopped or extensively altered as a result of FWS finding jeopardy or adverse modification during this period. We also show that median consultation duration is far lower than the maximum allowed by the Act, and several factors drive variation in consultation duration. The results discredit many of the claims about the onerous nature of section 7 but also raise questions as to how federal agencies could apply this tool more effectively to conserve species. We build on the results to identify ways to improve the effectiveness of consultations for imperiled species conservation and increase the efficiency of consultations.
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Valuation of Expectations: A Hedonic Study of Shale Gas Development and New York’s Moratorium
Andrew Boslett, Todd Guilfoos & Corey Lang
Journal of Environmental Economics and Management, May 2016, Pages 14–30
Abstract:
This paper examines the local impacts of shale gas development (SGD). We use a hedonic framework and exploit a discrete change in expectations about SGD caused by the New York State moratorium on hydraulic fracturing. Our research design combines difference-in-differences and border discontinuity, as well as underlying shale geology, on properties in Pennsylvania and New York. Results suggest that New York properties that were most likely to experience both the financial benefits and environmental consequences of SGD dropped in value 23% as a result of the moratorium, which under certain assumptions indicates a large and positive net valuation of SGD.
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The long-run consequences of Chernobyl: Evidence on subjective well-being, mental health and welfare
Alexander Danzer & Natalia Danzer
Journal of Public Economics, forthcoming
Abstract:
This paper assesses the long-run toll taken by a large-scale technological disaster on welfare, well-being and mental health. We estimate the causal effect of the 1986 Chernobyl catastrophe after 20 years by linking geographic variation in radioactive fallout to respondents of a nationally representative survey in Ukraine according to their place of residence in 1986. We exclude individuals who were exposed to high levels of radiation — about 4% of the population. Instead, we focus on the remaining majority of Ukrainians who received subclinical radiation doses; we find large and persistent psychological effects of this nuclear disaster. Affected individuals exhibit poorer subjective well-being, higher depression rates and lower subjective survival probabilities; they rely more on governmental transfers as source of subsistence. We estimate the aggregate annual welfare loss at 2–6% of Ukraine's GDP highlighting previously ignored externalities of large-scale catastrophes.
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Productivity, Export, and Environmental Performance: Air Pollutants in the United States
Jingbo Cui, Harvey Lapan & GianCarlo Moschini
American Journal of Agricultural Economics, forthcoming
Abstract:
This paper studies the firm-level relationship among productivity, decision to export, and environmental performance. The emerging theoretical and empirical literature suggests that trade has an important role in determining firms' heterogeneity: increased openness to trade induces a reallocation effect that increases within-industry efficiency, thereby linking firms' decisions to export and adopt newer (and cleaner) technology. We argue that this framework provides the following empirically-relevant predictions: there is an inverse relationship between firm productivity and pollution emissions per unit output; exporting firms have lower emissions per unit output; and larger firms have a lower emission intensity. To examine these implications empirically, we have assembled a uniquely detailed dataset of the U.S. manufacturing industry for the years 2002, 2005, and 2008 by matching facility-level air emission data from the U.S. Environmental Protection Agency with the facility's economic characteristics contained in the National Establishment Time Series database. The strategy is to first estimate a facility-level total factor productivity parameter as a plant-specific fixed effect. We then investigate how this estimated productivity parameter correlates with emission intensity on a pollutant-by-pollutant basis. Our empirical findings support the hypotheses suggested by the conceptual model. For each criteria air pollutant considered, we find a significant negative correlation between estimated facility productivity and emission intensity. Conditional on a facility's estimated productivity and other controls, exporting facilities have significantly lower emissions per value of sales than non-exporting facilities in the same industry. We also find that plant size is negatively and significantly related to emission intensity for all pollutants.
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Dakshina De Silva, Robert McComb & Anita Schiller
Southern Economic Journal, forthcoming
Abstract:
The shift toward renewable forms of energy for electricity generation in the electricity generation industry has clear implications for the spatial distribution of generating plant. Traditional forms of generation are typically located close to the load or population centers, while wind- and solar-powered generation must be located where the energy source is found. In the case of wind, this has meant significant new investment in wind plant in primarily rural areas that have been in secular economic decline. This article investigates the localized economic impacts of the rapid increase in wind power capacity at the county level in Texas. Unlike input-output impact analysis that relies primarily on levels of inputs to estimate gross impacts, we use traditional econometric methods to estimate net localized impacts in terms of employment, personal income, property tax base, and key public school expenditure levels. While we find evidence that both direct and indirect employment impacts are modest, significant increases in per capita income accompany wind power development. County and school property tax rolls also realize important benefits from the local siting of utility scale wind power, although peculiarities in Texas school funding shift localized property tax benefits to the state.
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Does the housing market value energy efficient homes? Evidence from the energy star program
Chris Bruegge, Carmen Carrión-Flores & Jaren Pope
Regional Science and Urban Economics, forthcoming
Abstract:
The “Energy Star” certification of residential homes is a recent attempt in the United States to improve energy efficiency in the residential sector by incentivizing home builders to “build green.” We examine the effectiveness of this program by estimating homeowners' marginal willingness to pay for Energy Star residences in Gainesville, Florida. We use single-family residential property sales in Gainesville, Florida between 1997 and 2009. Using the hedonic method, we find that homeowners are willing to pay a premium for new Energy Star homes, but that this premium fades rapidly in the resale market.
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Air pollution emissions and damages from energy production in the U.S.: 2002–2011
Paulina Jaramillo & Nicholas Muller
Energy Policy, March 2016, Pages 202–211
Abstract:
This paper uses air pollution emissions data for the years 2002, 2005, 2008, and 2011 to estimate monetary damages due to air pollution exposure for PM2.5, SO2, NOx, NH3, and VOC from electric power generation, oil and gas extraction, coal mining, and oil refineries. In 2011, damages associated with emissions from these sectors totaled 131 billion dollars (in 2000$), with SO2 emissions from power generation being the largest contributors to social damages. Further, damages have decreased significantly since 2002, even as energy production increased, suggesting that, among other factors, policies that have driven reductions in emissions have reduced damages. The results of this analysis highlight the spatial heterogeneity of the impacts associated with the emissions of a given pollutant. In the past, environmental regulations have assumed that the benefits of air emissions reductions are homogenous across source location. This analysis suggests that policy designs that account for spatial differences in the impacts of air emissions could result in more effective environmental regulation. Accounting for such spatial heterogeneity in the benefits of policies would be akin to accounting for differences in compliances costs across states, which the EPA did when establishing the state emissions standards for the Clean Power Plan rule.
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Daniel Paul Scheitrum, Colin Carter & Amy Myers Jaffe
Energy Economics, forthcoming
Abstract
The U.S. Strategic Petroleum Reserve (SPR) was established in 1975 to mitigate major oil supply disruptions and to deter the use of energy as a geopolitical “weapon.” However, policies towards the utilization of strategic oil stocks have varied under different presidencies and the SPR has often not been used in sufficient quantity or soon enough to avoid the negative economic consequences that can follow oil supply outages. Economic theory suggests that the existence of public stockpiles of commodities will alter inventory management practices of private market participants. This paper models private crude oil storage in the United States and estimates the private storage response to presidential announcements regarding the SPR. We investigate the incidence of different kinds of announcement events including releases and test sales from the SPR, announced changes in fill rates, and changes of presidency and how these events impact private land-based storage in the United States by region (PADD) as well as floating storage. We find significant substitution between private and public stocks for crude oil and find that announcement events are associated with observable changes in private inventory levels, with implications for public policy choices and geopolitical strategies.
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George Thurston et al.
Environmental Health Perspectives, forthcoming
Background: Fine particulate matter (PM2.5) air pollution exposure has been identified as a global health threat. However, the types and sources of particles most responsible are not yet known. In this work, we sought to identify the causal characteristics and sources of air pollution underlying past published associations in the American Cancer Society’s Cancer Prevention Study-II cohort between long-term PM2.5 exposure and Ischemic Heart Disease (IHD) mortality.
Methods: Individual risk factor data were evaluated for 445,860 adults in 100 U.S. metropolitan areas followed from 1982 to 2004 for vital status and cause of death. Using Cox proportional hazard models, IHD mortality hazard ratios (HRs) were derived for PM2.5, trace constituents, and pollution source-associated PM2.5, as derived from air monitoring at central stations throughout the nation during 2000-2005.
Results: Associations with IHD mortality varied by PM2.5 mass constituent and source. A coal combustion PM2.5 IHD HR = 1.05 (95% CI=1.02, 1.08) per µg/m3, versus an IHD HR = 1.01 (95% CI=1.00, 1.02) per µg/m3 PM2.5 mass, indicated a risk roughly five times higher for coal combustion PM2.5 than for PM2.5 mass in general, on a per µg/m3 PM2.5 basis. Diesel traffic-related elemental carbon (EC) soot was also associated with IHD mortality (HR = 1.03; 95% CI: 1.00, 1.06 per 0.26 μg/m3 EC increase). However, PM2.5 from both wind-blown soil and biomass combustion were not associated with IHD mortality.
Conclusions: Long-term PM2.5 exposures from fossil fuel combustion, especially coal burning, but also from diesel traffic, were associated with increases in IHD mortality in this nationwide population. Results suggest that PM2.5–mortality associations can vary greatly by source, and that the largest IHD health benefits per µg/m3 from PM2.5 air pollution control may be achieved via reductions of fossil fuel combustion exposures, especially from coal-burning sources.