This paper studies the intergenerational welfare effects of climate change and a control policy within a decentralized overlapping generations framework, including endogenous abatement activities. The model incorporates a profit stimulated R&D with realistic market distortions to create an induced innovation structure. In this setting, a control policy has the dual role of discouraging emissions and triggering new abatement technologies. The results from numerical simulations show that the omission of entrepreneurial response to a control policy is likely to result in overestimation of costs associated with this particular policy. Although induced innovation has the potential to reduce the compliance costs with the control policy, current and near-future generations will bear some net costs. The higher the damage projected from climate change, the earlier the net benefit will arrive.

The policy discussions for sharing the global responsibility for abatement of greenhouse gas (GHG) emissions by individual countries take account neither of the pattern of their final consumption nor of the role of globalization through trade in the leakage of GHGs across national boundaries. This paper gives the methodology of estimating the total emissions of a GHG, which is imputable to the consumption pattern of a country and the effect of trade on the net leakage of such gas. The paper estimates the effect of trade on the net leakage of carbon dioxide and methane from India. It shows a significant net leakage of carbon dioxide from India for the observed consumption pattern in the 1990s. In spite of the difficulty of application of the method of estimating the leakage due to data constraints regarding regularly updated input–output tables for the different countries, the results point to the necessity of using some policy measure to influence globally the preference structure of the people in favour of eco-friendly consumption patterns.

Share contracts are the dominant remuneration system in artisanal fisheries. Introducing regulations based on collective use rights may affect the way profits are distributed. The literature on the effect of regulatory reform on factor income distribution, however, is scarce. In this paper, we look at differences in the implementation of the Extractive Artisanal Regime in Chilean hake artisanal fisheries to test its effect on share contracts. We estimated a switching regression model using census data to calculate the average treatment effect. Our results show that crewmembers in communities regulated by some form of collective use rights receive, on average, 6 per cent more of total net incomes compared to those regulated by a limited access with global quota regime. Differences in the relation between crew size and labor rewards, as well as in the negotiating power of crewmembers under different regimes, may explain the results.

This study examines whether voting by individuals of different income levels affects the stringency of environmental policy if their residential proximity to a pollution source is considered. A location model with heterogeneous agents is extended to include a single environmentally hazardous site at the edge of a linear city and the degree of damage from pollution is assumed to depend on the distance from this emissions site. The analysis demonstrates through majority voting that the equilibrium emissions tax rate is higher when the income level of the median voter is lower, because residents with low incomes reside near the hazardous site and thus benefit more from pollution abatement than residents with higher incomes.

This paper presents the operational procedures involved in incorporating the environmental costs in the cost–benefit analysis of a hydro-electric project. The proposed project, if implemented, would result in the loss of 2,800 hectares of tropical forests and dislocation of two settlements of about 200 families who are currently dependent on the forests for their livelihood. The forests are mainly used for extracting reed – a material used both by traditional artisans and the paper-pulp industry. The potential environmental costs and benefits of the project are identified and approximate estimates of some of these costs are made for items such as carbon sequestration, bio-diversity, and so on, based on similar estimates made elsewhere. These estimated environmental costs are incorporated into the analysis, and the hypothetical estimate of the non-use value, which would make the project's net benefit zero, is estimated under different discount rates. The analysis brings into sharp focus some crucial factors that have a direct bearing on the social trade-off involved in the project choice.

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.

Climate change is one of the most significant and complex challenges facing the world's economies. The necessity to enlarge the knowledge base regarding climate change and its impacts and to design efficient policies is widely accepted by the scientific community, the decision makers and the general public. This special issue, which will be published in two parts in the current and subsequent issue of Environment and Development Economics, is a selection of papers related to the topic of the international workshop on ‘The Economics of Climate Change and Sustainability’ organized by the Economics Department of the University of Bologna in April 2018. The papers in this special issue cover a wide range of climate-change-related topics, which include endogenous growth and overlapping generation models; climate-related financing and green bonds; demographics; location decisions; technology diffusion; quantitative relationships and experimental approaches. We hope that this special issue will provide some new insights into the economics of climate change and help to identify new directions for future research.

This article reviews the history of the Environment for Development (EfD) initiative, its activities in capacity building and policy-oriented research, and case studies at its centres in Chile, China, Costa Rica, Ethiopia, Kenya, South Africa and Tanzania. EfD promotes research-based policies to manage natural resources as engines of development. Since 1991, the Swedish International Development Cooperation Agency (Sida) has provided funding for students from developing countries to earn a PhD at the Environmental Economics Unit (EEU) of the University of Gothenburg. Returning home, these economists face institutional and academic gaps that limit the adoption of research-based policies. In response, the first EfD centre was founded in 2004, and six more followed. Research focuses on agriculture, climate, fisheries, parks, wildlife, forestry, energy and policy design. This has yielded 200 peer-reviewed articles. Successful policy outcomes depend on relationships with policy makers, community involvement in livelihood strategies, strengthened institutional support, interdisciplinary approaches, and dissemination of research results.

This paper combines population and climate data to estimate the volume of migration induced by the drought events that have hit Mali since the late 1980s. The results show that droughts have had the effect of decreasing net migration rates in the affected localities. This is true for both men and women, regardless of their age. The effect of drought episodes, however, is found to differ according to localities and households’ capacity to adapt to climatic constraints: it fades in localities characterized by more diversified crops and in areas that receive more rainfall on average. Climate shocks also had an impact on international mobility: over the 2004–2009 period, around 2300 additional departures per year can be attributed to the droughts that hit Mali during the 2000s. We forecast that, under different climate scenarios and population growth projections, mobility induced by drought events will substantially grow in the next decades.

The purpose of this paper is to analyse the effects of natural resources on income inequality conditional on economic complexity in 111 developed and developing countries from 1995 to 2016. The system-GMM results show that economic complexity reverses the positive effects of natural resource dependence on income inequality. Furthermore, results are robust to the distinction between dependence on point resources (fossil fuels, ores, and metals), dependence on diffuse resources (agricultural raw material), and resource abundance. Finally, there are significant differences between countries, depending on the level of ethnic fragmentation and democracy.

This paper investigates the design of environmental regulation under different regimes: flexible and inflexible policies. We analyze under which settings strict emission fees can be used as an entry-deterring tool, and become socially optimal. Furthermore, we demonstrate that the incentives of the social planner and the incumbent firm are aligned regarding policy regimes ifentry can be easily deterred by setting a stringent regulation. Their incentives, however, can bemisaligned when entry becomes more costly to deter, leading the incumbent to actually preferenvironmental policies that attract entry.

Levin et al. give us a sweeping vision of the notion of resilience and the response of management. In these comments I wish to discuss the daunting task of quantification of the resilience-based management issues raised by Levin et al. I also wish to suggest directions of future research.