This paper analyzes the effect of different types of cookstoves on firewood demand at the household level. Using nationally representative household survey data from Nepal, we find that stove type significantly affects the firewood demand for household uses. Traditional mud-stove user households seem to use less firewood than the open-fire stove users. Surprisingly, households with the so-called ‘improved’ stoves seem to use more firewood than the households with mud stoves. Thus, converting traditional open-fire stoves to mud stoves may be a better conservation strategy in the short term rather than installing improved stoves, unless the technology improves. However, in the long run, making cleaner fuel more accessible to rural households is desirable to reduce indoor air pollution.

Using stream water polluted with untreated wastewater in agriculture is controversial due to its combination of benefits and negative health impacts. Using data from a household survey, ‘wastewater’ and ‘freshwater’ farmers were analysed comparatively to examine the perceived impacts of irrigation water quality on farmers' health and to evaluate the extent of health damage. Probability of illness was estimated using the theory of utility-maximising behaviour of households subject to the conventional farm household production model, augmented by adding a health production function. Reduced model and instrumental variable probit specifications both show that perceived illness prevalence is significantly higher for household members working on wastewater irrigation farms than for those working with freshwater. Our data entails econometric complications (e.g., endogeneity of farmers' behaviour, unobserved location-specific characteristics). Ignoring these will result in underestimation of the value of policy interventions designed to reduce potential health damage of wastewater use in irrigation.

This paper presents an econometric test of two hypotheses underlying the occurrence of non-indigenous species (NIS) at the global scale: openness of recipient nations which allows for international trade to act as a vector of NIS, and habitat fragmentation in recipient nations which facilitates establishment of introduced NIS. Explorative econometric methods have been utilised that combine the analysis of dimensionality with subset variable selection and multiple linear regression. Both NIS hypotheses are thereby supported, although slightly different in the cases of the mainland and island nations. It is concluded that expressions of openness have a larger impact on the number of NIS per unit territorial area in the mainland nations, whereas biota variables play a more dominant role in the case of the island nations. It is also concluded that different expressions of NIS occurrence affect the result, where NIS per area unit facilitates excellent explanatory performance.

This study investigates the effects of foreign direct investment (FDI) on emissions of five pollutants in China using a panel data set of 29 provinces over the period 1992–2004. The study applies a simultaneous equations estimation technique to estimate the scale, technique and composition effects of FDI on China's overall and regional pollution emissions. The estimation results show that FDI in general helps reduce pollution emissions in China, contributing largely to its technique effect. Capturing both the direct and indirect technique effects improves the accuracy in assessing the environmental impact of the FDI. The study also finds that the environmental impacts of FDI vary significantly among different regions and for different pollutants in China.

This paper extends the debate on the environmental performance of developing countries by focusing on a new factor. Theoretically, financial development has capitalization, technology, income, and regulation effects on the environment. Using the provincial panel data of China, the econometric analysis provides some evidence of a linkage between financial development and industrial pollution discharges. In recent years, the environmental performance of China has been significantly improved by financial development and some environmental protection schemes. This relationship offers new implications for policy makers in developing countries.

We estimate and quantify the fiscal consequences of natural disasters using quarterly fiscal data for a large panel of countries. In our estimations, we employ a panel vector autoregression framework that also controls for the business cycle. In developed countries, we find fiscal behavior in the aftermath of disasters that can best be characterized as counter-cyclical. In contrast, we find pro-cyclical decreased spending and increasing revenues in developing countries following large natural catastrophes. These pro-cyclical fiscal dynamics are likely to worsen the adverse consequences of natural disasters on middle- and low-income countries. We quantify these dynamics.