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Abstract:
In this paper, we analyze the question of membership in a non-renewable resource cartel, with specific application to OPEC. Using a simple model of a non-renewable resource market, we show that the benefits of cartel membership are related to the size of remaining reserves. Domestic petroleum consumption will also influence the incentives to join the cartel if countries care about consumer interests. Using data on reserves and consumption for all oil producing countries, we show econometrically that larger reserves and lower consumption are positively associated with OPEC membership. Our regressions correctly predict membership for the vast majority of oil-producing countries.

Abstract:
We analyze a model of environmental regulation with learning about environmental damages and endogenous choice of emissions abatement technology by a polluting firm. We compare environmental policy under discretion, in which policy is updated upon learning new information, versus under rules, in which policy is not updated. When investment in abatement technology is made prior to the resolution of uncertainty, neither discretion nor rules with either taxes or standards achieve an efficient solution except in special cases.

When there is little uncertainty, rules are superior to discretion because discretionary policy gives the firm an incentive to distort investment in order to influence future regulation. However, when uncertainty is large, discretion is superior to rules because it allows regulation to incorporate new information. Taxes are superior to standards under discretion regardless of the relative slopes of marginal costs and marginal damages for the case of quadratic abatement costs and damages.

Environmental regulation, Emissions taxes and standards, Rules versus discretion, Technology adoption

Abstract:
Over the past decade, efforts to value and protect ecosystem services have been promoted by many as the last, best hope for making conservation mainstream - attractive and commonplace worldwide. In theory, if we can help individuals and institutions to recognize the value of nature, then this should greatly increase investments in conservation, while at the same time fostering human well-being. In practice, however, we have not yet developed the scientific basis, nor the policy and finance mechanisms, for incorporating natural capital into resource- and land-use decisions on a large scale. Here, we propose a conceptual framework and sketch out a strategic plan for delivering on the promise of ecosystem services, drawing on emerging examples from Hawai‘i. We describe key advances in the science and practice of accounting for natural capital in the decisions of individuals, communities, corporations, and governments.

Abstract:
No abstract available.

Abstract:
A common assumption is that ecosystem services respond linearly to changes in habitat size. This assumption leads frequently to an all or none choice of either preserving coastal habitats or converting them to human use. However, our survey of wave attenuation data from field studies of mangroves, salt marshes, seagrass beds, nearshore coral reefs, and sand dunes reveals that these relationships are rarely linear. By incorporating nonlinear wave attenuation in estimating coastal protection values of mangroves in Thailand, we show that the optimal land use option may instead be the integration of development and conservation consistent with ecosystem-based management goals. This result suggests that reconciling competing demands on coastal habitats should not always result in stark preservation-versus-conversion choices

Abstract:
Environmental regulators often have imperfect information about regulated firms' abatement costs. In this paper we compare taxes and emissions permits in a dynamic setting in which firms behave strategically. The regulator updates policy over time based upon previous aggregate industry performance, assuming that firms are not strategic. We find that strategic firms facing an emissions tax have an incentive to overabate in order to obtain a lower tax in the future. Firms that trade emissions permits have a strategic incentive to reveal an artificially high permit price to obtain more permits in the future. Whether permits or taxes are preferred from a welfare standpoint depends upon how permit prices are determined. Taxes generate higher welfare when the low-cost firm sets the permit price but permits generate higher welfare when the high-cost firm sets the permit price.

Environmental policy; Dynamics; Emissions taxes; Emissions permits

Abstract:
In this paper, we analyze the question of membership in a non-renewable resource cartel, with specific application to OPEC. One would expect the benefits of cartel membership to be positively related to the size of remaining reserves, while domestic petroleum consumption should be negatively related to membership if countries care about consumer interests. Our econometric analysis indicates that larger reserves and lower consumption are positively associated with OPEC membership. On the other hand, membership does not appear to be systematically related to countries' religious makeup. Our regressions correctly predict membership for the vast majority of oil-producing countries.

Non-renewable resources; Cartel; OPEC

Abstract:
This paper delineates circumstances in which a first-best cooperative solution can be supported as a subgame perfect equilibrium in a dynamic common property renewable resource game. In a game with nonlinear resource stock effects on cost, we characterize a worst perfect equilibrium that supports cooperation for the widest range of parameter values for the discount rate, resource growth rate, harvest price, and the number of resource exploiters. The strategy profile that we propose is consistent with human behavior observed in experiments and common property resource case studies.

Common property resource, cooperation, dynamic game

Abstract:
We use a two-period model to analyze the short run and long run profitability and welfare consequences of horizontal mergers, where the equilibrium responses to a merger can differ over time. Although firms can anticipate the merger, they can only adjust their capacity in the long run.

We find a greater range of profitable mergers than in static models. For a merger to raise welfare, it is sufficient that the short run welfare effects are positive and necessary that the long run effects are positive.

We relate these conditions to the inside firms? market shares and the Herfindahl index.

Abstract:
This paper analyzes the effect of alternative institutional arrangements on the conservation of endangered species and economic activity on private land. Because a landowner does not capture the full value of species conservation, her preferences on land use will not coincide with social preferences. Under current law, the landowner has incentives to invest in lowering conservation value and to deny access to regulators in order to prevent collection of information. Paying compensation corrects many of these perverse incentives. An alternative approach is to limit the ability of landowners to affect the regulatory outcome. Whether it is better to entice landowners to make socially efficient decisions by paying compensation or to limit the ability of landowners to affect outcomes through changes in the regulatory regime depends on both practical implementation difficulties and distributive justice considerations.