Contenu du sommaire : Economie de l'environnement et des ressources naturelles

Economic Instruments for Climate Change by Claude Henry and Laurence Tubiana The 1997 Kyoto commitments to reduce greenhouse gas emissions are not enough to contend with the threats of climate change. Yet they already place such constraints on the European Union and the United States that they may well be renounced if they are not implemented with the greatest economic efficiency. This is only possible if instruments are mobilised to flexibly, but rigorously, implement these reductions at the lowest possible overall cost by more or less balancing out the different emitters' marginal reduction costs. In this paper, we study the various instruments - especially emissions trading - addressed by the international negotiations and how they are interlinked. Since the developing countries will gradually rank among the leading emitting countries, it is vital that they play a fully-fledged part in the efficient implementation of the instruments. Yet such participation is only feasible if the conditions of equity in the initial permit distribution (i.e. before trading) are satisfied. These conditions were overlooked in Kyoto, but are a core issue in the current negotiations, especially for The Hague in November 2000.

Beyond Kyoto: Issues of Equity and Efficiency in Climate Change Negotiations by Odile Blanchard, Patrick Criqui, Michel Trommetter and Laurent Viguier This paper develops some basic methodological principles which can be used to study two questions: firstly, equitable methods of integrating developing countries into a long-term global programme to limit growth in greenhouse gas emissions, and, secondly, the contribution, in terms of economic efficiency, of tradable emission-permit systems. With regard to the first question, it turns out that no operative rule of differentiation or single principle of equity seems able to obtain the approval of all countries in so far as their interests remain structurally different. We have therefore constructed a simple and pragmatic scenario of CO2 emission stabilisation by 2030 and then shown that it could lead to a relative convergence of laws and a greater regard for democratic equality. In terms of efficiency, the findings emphasise the benefit of introducing a market for tradable emission permits, since this would make it possible to restore ex post facto the efficiency which had not existed a priori in the initial distribution of rights. The utilitarian concept of equity would also be respected in this case.

Regulation of the Greenhouse Effect from Farming: Carbon Sinks and Second-Best Policies by Stéphane De Cara and Pierre-Alain Jayet . This article focuses on the comparative merits of various policies for regulating the greenhouse effect from farming. Separately and concurrently, it deals with second-best policies aimed at limiting methane emissions from livestock farming and incentives for reafforestation of land under fixed set-aside in the Common Agriculture Policy. Impact in terms of harm and social welfare are analysed using a techno-economic model of agricultural supply based on mathematical programming. Although the second-best policies for methane reduction, founded on taxation of animals and their feed, produces significant results, it is appreciably overshadowed, for both harm reduction and total welfare, by the policy of reafforestation.

The Role of Technological Progress in the Double Dividend of Carbon Taxes by Jean-Charles Hourcade and Frédéric Ghersi Modelling work on the macro-economic effects of carbon taxes has confirmed that a "weak" form of double dividend exists when the revenue raised is used to reduce the most distortionary taxes. However, it has also found restrictive conditions for a "strong" form of double dividend with a positive impact on both the environment and growth. This paper shows that the "strong" dividend is sensitive to assumptions about the labour market, energy consumption behaviour, substitution effects in the production process, and crowding-out effects resulting from the ratio of emissions-reducing investments to other investments. The paper starts with a brief review of the current debates on double dividends. It then presents a series of analytical tests to show how technological progress assumptions change the macro-economic parameters involved in the case of ploughing the revenue from the new taxes into reducing payroll deductions. Last but not least, numerical applications to France define the scope of validity for a strong second dividend (in terms of household consumption and employment) resulting from different assumptions about the adjustment of technology and consumer choices to new prices.

Optimum Growth of an Economy Facing the Risk of Ecological Disaster by Morgane Chevé In this paper we develop an optimum growth model for an economy whose economic activities generate pollution emissions which reduce household well-being. Furthermore, the build-up of pollution causes a risk of ecological disaster with irreversible consequences for economic activity. In this context we show that constant output and effective pollution abatement are no longer sufficient to guarantee that the economy will be able to achieve sustainable long-term growth. In addition, the risk of ecological disaster induces a more conservative attitude with pollution emissions being reduced. This reduction is all the greater if there is a high probability of disaster and/or its consequences will be serious.

Emissions Trading and Asymmetric Oligopoly by Ngo Van Long and Antoine Soubeyran We show that when polluting firms are Cournot competitors, they may have an incentive to use emissions trading to indirectly co-ordinate their production. If the firms are initially identical, emissions trading can create an asymmetric oligopoly. The case of initially asymmetric firms is also considered.

Agricultural Management of Nitrogen Surpluses and Implicit in Pollution Rights Market: Application to Intensive Livestock Farming by Pierre Rainelli and Dominique Vermersch The problem of pollution originating from intensive rearing is analysed through a general welfare economics model. The policy option chosen to avoid this situation relies chiefly on command and control measures, with a limited amount of livestock manure which can be applied to the land (170 kg of nitrogen in the 1991 EC directive). When the standards are defined, the producers will maximise their profit under this constraint. This leads to a market of manure spreading rights, between farmers having land available for spreading manure and farmers having a high disposal rate per unit of land. An empirical illustration concerning Brittany is presented.

Regulation of Polluting Firms in the free Market: Consequences of Asymmetric Information and Pressure Groups by Marie-Françoise Calmette Our object is to analyse the consequences of opening up the borders between two regulated polluting monopolies in the absence of any strategic environment policy. The main question is whether the free market allows a satisfactory reallocation of global output from the most polluting country to the least polluting country or whether, on the contrary, the "size effect" is confirmed. We then assume asymmetric information in each country between the firm and the agency, and we study the effects of this asymmetry on pollution levels. Finally, we bring in the role of pressure groups by supposing that regulation is performed not by a benevolent agency but by a majority representing the interests of certain economic agents.

Integrity and Environmental Compliance by Philippe Bontems and Gilles Rotillon We here study how the existence of conscientious attitudes affects the working of compliance between an environmental agency and polluting firms, where the supervision policy may or may not include firms' self-reporting of discharges. Two main findings have been made. Firstly, non-interference may be the best policy for the agency if there is a high enough proportion of conscientious firms. Secondly, contrary to what we might expect, an exogenous increase in the number of conscientious firms does not necessarily lead to a decrease in pollution. We show that it is in fact possible that, given the number of conscientious firms, the optimum probability of inspection is low enough to entail a growth in fraud and therefore pollution. Moreover, with the system of self-reporting, which is the optimum option, an increase in the number of conscientious firms may also in some cases involve an increase in the total cost of inspection and, ultimately, welfare losses.

Mining Concessions and Asymmetric Information by Jean-Christophe Poudou and Lionel Thomas We study a concession contract for exploiting an exhaustible resource when a mining firm has private information about its costs. We show that the "traditional" balance between revenue and efficiency, which results in a lower level of production than with symmetric information, is not systematic in this contract. This is due to the specific depletion cost of non-renewable resources.

Information Gains of the Policy Maker Option Value of Major Public Infrastructure Projects by Laurent Denant-Boèmont and Sabrina Hammiche This paper analyses the risk of dynamic irreversibility for major public infrastructure projects using the theory of quasi-option value (Henry, 1974; Arrow, Fisher, 1974) in cost-benefit analysis. The case study compares two competing public infrastructure projects: an irreversible motorway project and a flexible rail project. The latter allows the motorway investment decision to be deferred. Quasi-option value is then applied for a risk environment in which information increases over time, changing the balance between the two projects. The monetised value of the environmental externalities, upon which today's transport policy tends to focus, might then be viewed as secondary to projects' irreversibility costs.

Optimum Charging and Pumping for Coastal Aquifers in Danger of Saline Intrusion: Basic Principles by Bernard Caussade, Michel Moreaux and Arnaud Reynaud The intrusion of salt water into coastal aquifers is now one of the main causes of deterioration in their water quality. Sea water, which is denser than fresh water, invades these aquifers as soon as pumping is heavy enough to change the hydrostatic equilibrium. The object of this paper is to identify the specific problems posed by optimum management of this type of resource. We show that the effect of heavier pumping is to move further from the coast the boundary beyond which sustainable abstraction is possible inland. This relationship between volumes pumped and the siting of boreholes generates a specific externality, whose effects on optimum use of resources we analyse.

Dynamics of Household Drinking- Water Consumption: Study of a Sample Group of French Communes by Cécile Nauges and Alban Thomas The early 1990s was a turning point for household consumption of water. In addition to a surge in price, a decline in domestic consumption was recorded for the first time. This paper demonstrates that users were not unresponsive to the increase in the price of water, since long-term elasticity is calculated to be -0.6 over the 1988-1993 period. Moreover, estimation from a dynamic model with non-stationary individual effects reveals the influence of specific phenomena in 1990 and 1991. The droughts during this period and the discussion on the entry into force of new regulations unquestionably raised the awareness of consumers, who altered their consumption behaviour.

A Bioeconomic Model for Valuation of the Social Cost of Discards in a Complex Fishery by Jean Boncoeur, Spyros Fifas and Bertrand Le Gallic Exploitation offish stocks is associated with externalities (affecting the fishermen) which are a source of inefficiency and dispute. Analysis of the gulf between individual and collective rationality, together with a consideration of how it may be bridged, is at the heart of economic theory relating to fishing. The practical scope of the bioeconomic models advanced by this theory is nonetheless limited by a number of factors. Failure to take into account the complexity of fisheries - nevertheless the cause of the "inter-industry" externalities which compound the intra-branch externalities generally characteristic of fishing - is one of them. This paper presents a bioeconomic model simulating one aspect of the operation of a complex fishery: the phenomenon of discards. The model, by describing this particular form of fishery interaction, can be used to calculate the social cost of engaging in an activity which produces negative externalities and to draw up an overall economic assessment of interaction. This assessment is immediately applicable in any discussion of fishery management.

Agriculture and Environment: An Assessment of Dairy Farms' Technical and Environmental Performance by Isabelle Piot-Lepetit and Monique Le Moing Inefficient use of inputs remains one of main causes of pollution. Data envelopment analysis, which sets a best-practice frontier and evaluates the distance between each observation and this empirical benchmark, is used to measure the potential for reducing variable inputs, in particular the quantity of fertiliser and the volume of animal manure, on a set of dairy farms in Brittany and the Loire valley in 1997. A non-parametric statistical study is then used to identify the farms which are most efficient in technical and environmental terms.

Natural Resources and Endogenous Growth in a Horizontally Differentiated Goods Model by André Grimaud A number of authors such as P. Shou, P. Aghion and P. Howitt have defined optimal growth paths in a Schumpeterian model with non-renewable resources. The main aim of this paper is to show how these optimal paths can be applied in a decentralized economy. We also analyse the effects of intervention instruments on the economy's long-run trends, especially the product growth rate and the rate of resource extraction.

Analysing Responses at Zero in Contingent Valuation by Dominique Ami and Brigitte Desaigues Contingent valuation is often used to put a price on natural assets. Econometric analysis of values obtained by this direct method of preference revelation raises problems due to the high proportion (generally around 50%) of zero values. Various methods of analysing responses at zero can be considered in the case of open-ended questions. Here three models are studied, tested econometrically and compared: the linear regression model, the Heckman model, and the Tobin model. The microeconomic attitudes underlying each of these models are also examined. The object of the paper is to show that use of the Tobin model is not relevant since zero values cannot be treated uniformly in the same way as censored values.

WTP Revelation: Open-Ended or Dichotomous-Choice Questions? An Application to the Biodiversity of the Garonne River Forests by Caroline Gauthier This paper offers a contingent valuation of individuals' willingness to pay for preservation of biodiversity. It is the first study of its kind to be carried out in France. It has been conducted according to the rules proposed by the NOAA Panel, with the exception of the revelation method. The sample of 402 individuals interviewed was divided into those who declared their WTP on the basis of an open-ended question and those who declared it on the basis of a dichotomous-choice question. The two formats were then compared. The paper offers two tests demonstrating that the WTPs calculated by each method are not significantly different. Although the NOAA Panel recommends use of the closed format, this paper shows that use of the open-ended question is equally relevant and less expensive given the level of information required.

An Economic Valuation of the Morbidity Benefits Induced by an Improvement in Air Quality by Anne Rozan From the public decision-maker's point of view, a policy combating air pollution is justified if the benefits generated are greater than the costs. Most studies value the benefits of improved air quality in terms of avoided health costs, thus disregarding annoyance and self-treatment. Our study offers an estimation of morbidity benefits using the contingent valuation method. Not only does morbidity affect the whole population, but it is also the most frequent health effect of air pollution. However, a cost-based method underestimates these benefits. The study was conducted on a representative sample of the residents of Strasbourg.