This special issue contains a selection of six articles in the field of environmental and resource economics, which were presented in INFER workshops and supported events over the last two years. The topics include the effects of income inequality and freedom of the press on environmental stringency; the trade-environment nexus in China; the behavior of cross-country growth rates with respect to resource abundance and dependence; a stochastic frontier analysis to show that technological change is biased more towards energy rather than labor; how recycling and environmental taxes can affect the imbalances between the availability of and the demand for rare earth elements; and the interaction between demographic features and environmental constraints in Caribbean small island developing states. The papers include three empirical contributions and three methodological approaches, which help to improve our understanding of these topics.

This paper contributes to the literature on the determinants of environmental standards by studying the role of income inequality and freedom of the press. Given that evidence of the environmental Kuznets curve has only been found for some countries, it is thus crucial to investigate whether other factors besides income per capita levels may be affecting countries' decisions to pass environmentally-friendly legislation. We investigate the effects that inequality and freedom of the press have on environmental stringency for a sample of OECD and BRIICS countries and a global sample of 82 countries using data over the period 1994–2015. We hypothesize that the more unequal a society is, and the greater the oppression of the press is, the less stringent environmental policies are. The results partially confirm our hypothesis. In particular, lack of press freedom is negatively correlated with environmental stringency, whereas inequality shows a non-linear effect only for non-high-income countries.

This paper studies the impact of trade openness and the proportion of exporters on environmental quality through the scale, composition and technique effects from 1998 to 2007 using firm- and city-level data for 287 Chinese cities. Our results reveal that, on average, trade openness has a detrimental impact on the environment in Chinese cities, but this impact remains heterogeneous across regions. A higher proportion of exporters improves the environment in central and eastern cities while generating nevertheless more pollution in western cities. As regards the sector-specific impact, we find that the higher proportion of exporters in the mining and less-polluting manufacturing sectors in eastern cities diminishes the emissions of particulate matter 2.5 (PM2.5). Our finding also suggests that a pollution haven effect emerges in China at the city level. Finally, our results confirm the presence of an environmental Kuznets curve effect for the PM2.5 pollutant across Chinese cities.

This paper analyzes the behavior of cross-country growth rates with respect to resource abundance and dependence. We reject the linear model that is commonly used in growth regressions in favor of a multiple-regime alternative. Using a formal sample-splitting method, we find that countries exhibit different behaviors with respect to natural resources depending on their initial level of development. In high-income countries, natural resources play only a minor role in explaining the differences in national growth rates. On the contrary, in low-income countries, abundance seems to be a blessing but dependence restricts growth.

Reliance of modern economic activities on the use of energy, most of which still comes from non-renewable sources, provokes concerns regarding the most efficient utilization of energy inputs in production. While most theory expects directed technological change to be biased towards the non-renewable input, there is rare macro-level evidence that technological change is actually biased towards energy rather than other main inputs. To fill this gap, we apply stochastic frontier analysis to country data regarding output produced with capital, labor and energy, and estimate a set of indicators for technological change. Findings show that technological change is biased the most towards energy in general. In particular, although different groups of countries exhibit various patterns, there is strong evidence that technological change favors energy more than labor. This is in line with the theoretical expectation that technological change ought to be biased towards the non-renewable input rather than the renewable ones.

Rare earth element extraction induces environmental damages and the balance problem. In this article, we show that recycling can challenge both problems in a two-period framework. We also find other results depending on the amount of scrap that can be recycled. If the recycling activity is not limited by available scrap, it does not change extraction in the first period. Environmental taxes on extracted quantities reduce extraction and favor recycling. But if the recycling is limited, the extractor reduces extraction in period one, adopting a foreclosure strategy, and environmental taxes can decrease recycling. In all cases, environmental taxes are never equal to the marginal damage from pollution, in order to take into account the recycling effect.

This work examines the interaction between demographic features and environmental constraints in Caribbean small island developing states. Specifically, it aims to clarify human capital dynamics when migration and environmental quality matter. To do so, two main ingredients are introduced in an overlapping generations model: countries may benefit from migration through a brain gain or remittances, and production emits pollution that hinders the accumulation of human capital. Two cases emerge from the analysis. In the first case, an environmental policy is sufficient to correct the externality, and migration should stay at a relatively low level. In the second case, if pollution emissions are high relative to the effectiveness of environmental policy, migration leads to an increase in per capita output and human capital. This only happens if the emigration rate is already high, because it leads to a reduction in demographic pressure on the environment.