- Mardi 14 décembre 2021 - Léa Crépin (Economie Publique - AgroParisTech) - "Do forest conservation policies undermine the soybean sector in the Brazilian Amazon ? Evidence from the blacklisting of municipalities"
Minimizing the trade-offs between agricultural production, development and forest conservation is key to insure that conservation policies can achieve long-term impacts. Taking the case of the Brazilian Amazon, we estimate the impact of the blacklisting of municipalities with high deforestation risk on soybean production (a major driver of deforestation), exports and land use changes. Difference-in-difference regressions and matching techniques are first used to determine the impacts of the policy. Triple differences are then applied to explore heterogeneity in land use responses across municipalities. We find that, although effective to reduce deforestation, the policy is unlikely to have undermined the soybean production and exports. On the contrary, our results suggest that the soybean sector benefited from the changes in land use following the implementation of the blacklist. However, we do not find evidence that land restriction entailed triggered intensification of soybean, which suggest that the soybean sector benefited from intra crops reallocation.
- Mardi 7 décembre 2021 - Hélène Ollivier (PSE) - "Estimating the Effects of Incomplete Regulation on Regulated Firms and their Competitors: An Application to the EU ETS" (joint with Geoffrey Barrows, Raphael Calel & Martin Jegardz)
Shocks to demand and supply often apply unevenly across firms within an industry. When evaluating the impacts of such shocks, researchers often rely on statistical methods that compare directly-affected firms to “control” firms in the same industry, but in many cases, these “control” firms are affected by the shock itself via competition on the output market with directly-affected firms. While this point is widely acknowledged, there has been little effort to address it empirically. In this paper, we develop a new method for estimating both the direct effect and the indirect effect of a shock to marginal cost on some firms in an industry where products are differentiated. We apply our estimator to French manufacturers under the EU ETS regulation. We find that this regulation tended to increase sales of regulated firms and reduce CO2 emission intensity. The results are consistent with the Porter hypothesis: regulation induced cost-saving investments which both lowered emission intensity and increased sales.
- Mardi 30 novembre 2021 - Emeline Bezin (PSE) - "Connectedness to Nature, Urbanization and the Environment"
Some empirical studies find that early experiences in nature and social interactions are strong determinants of a kid’s and subsequently adult environmental attitude. The point is that if you don’t live close to nature, meaning in an urban region, then it is harder for you to be connected to nature than for someone who lives in a rural part. If you are not connected to nature, then you won’t care about nature. Thus, being disconnected from nature as a child translates into a low incentive to support the environment when adult. We model this transmission of preferences together with socialization from adults in an overlapping generations model including rural-urban migration. We characterize the long-run relationship between urbanization and environmental quality. We show that when connectedness to nature is initially low, stronger urbanization may have a positive impact on the long-run environment.
- Mardi 23 Novembre 2021 : Kelly Cobourn (Virginia Tech) - "Forest transitions and ecosystem collapse: an analysis of the role of substitutability between primary and secondary forests" (joint with Gregory Amacher, Philippe Delacote & Haoyu Wang)
Across the developing world, the deforestation of primary, native forests supports economic activity at the cost of environmental degradation with global, long-term consequences. Events like record-setting wildfires in the Amazon highlight the potential for deforestation to drive ecosystems past potentially irreversible tipping points, such as a shift from tropical forest into grassy savanna. Investments in reforestation with secondary forests are one potential tool to avert or delay tipping points, but the success of this strategy depends on the degree to which secondary and primary forests are substitutes in the production of ecosystem services. We develop a dynamic optimization model and numerical simulation to explore how deforestation, reforestation, and the degree of substitutability between forest types affects the likelihood that a forest system will cross a tipping point. We demonstrate that if the ecosystem services provided by secondary forests do not offset the losses from deforestation, collapse may occur despite ongoing investments in planting, especially if the costs of securing land tenure are high. Conversely, our results suggest that secondary forest management practices and species selection that increase the substitutability of secondary for primary forests can play an important role in avoiding or slowing costly ecosystem change.
- Mardi 16 Novembre 2021 : Jessica Meyer (UPEC & Chaire d'Economie du Climat) -"Do Forests Provide a Form of Insurance for Food Security and Nutrition in the Aftermath of a Weather Shock in Malawi?"
This article looks at forests’ ability to mitigate detrimental impacts of a weather shock on several aspects of household food security and nutrition in Malawi. In addition, it investigates the safety net role of forests relative to other insurance mechanisms that could potentially be adopted by households during adversity. To do so we mobilize the World Bank's Living Standard Measurement Study-Integrated Surveys on Agriculture (LSMS-ISA) for Malawi across several survey rounds, to which we overlay geospatial data on forest cover as well as a drought index based on both precipitation and temperature. Our preliminary results indicate that the occurrence of an adverse weather event has a negative and significant impact on all nutrition indicators, and that higher percentages of forest cover allow to offset the detrimental effects of a wet or dry spell on nutrition. Moreover, we find that forests play an important role in protecting nutrition especially for households who own a smaller number of assets and who partake in informal off-farm labor in times of need. Furthermore, communities who own livestock appear not to suffer from damages in terms of the quality and diversity of the food consumed, but rather in terms of food sufficiency. Nevertheless, in this case also, forests allow to mitigate such negative impacts.
- Mardi 19 Octobre 2021 : Rotem Zelingher (Economie Publique - AgroParisTech) -"Agricultural Commodity Price Forecasting Using Comprehensive Machine-Learning Techniques"
- Mardi 12 octobre 2021 : Benjamin Ouvrard (GAEL - INRAE) - "Distributive justice in the field: How Indian farmers share water?"
We propose a framed-field experiment to understand how Indian farmers share water and to assess whether or not it is possible to induce them to share it more efficiently, using a gain and a loss framing. Farmers play a dictator game behind a veil of ignorance in which they decide the quantity of water to allocate between two farmers. We vary the equity/efficiency trade-off introducing a heterogeneity between farmers' productivity (most productive farmer located upstream or downstream). We are able to characterize most farmers behaviors: very few of them play as pro fit maximizers and, instead, adopt efficient or egalitarian (in quantity or in payoff s) behaviors. We show that the loss framing can induce farmers to share efficiently the water resource, but only when the most productive farmer is located downstream. On the contrary, we find mild evidence that farmers choose less often the efficient solution with the gain framing.
- Mardi 5 octobre 2021 : Anouch Missirian (TSE) - "Yes, in Your Backyard: Forced Technological Adoption and Spatial Externalities"
Diffusion of new technologies in competitive markets is often thought to be too slow relative to an optimal adoption trajectory due to learning-by-doing, learning-by-using, or network externalities. In this paper, in contrast, I study a phenomenon of hastened technology adoption facilitated by a negative spatial externality imposed by adopters on non-adopters. Focusing on new herbicide-tolerant seeds for soybean and cotton, I show that adoption by U.S. farmers was partly caused by wind carrying the drift-susceptible herbicide across plots. I estimate that being in the same wind corridor as an adopter increased the probability of adopting by about 29%. The externality also led to defensive adaptation: cropland was converted to crops able to withstand the herbicide, suggesting a form of protective land-use change to prevent damage. I then turn to broader consequences of the widespread adoption of the technology, including its overall effect on yields. A priori, the effect on yields is ambiguous. I find that overall, yields remained practically unchanged, despite increased crop failure. The rapid diffusion of this new technology and the consequences highlighted here call for the careful consideration of policies to address such inventions and of their accompanying side-effects.
- Mardi 28 septembre 2021 : Gwenolé Le Velly (CEE-M - Institut Agro) - "Designing Agri-Environmental Schemes to cope with uncertainty" (co-écrit avec Margaux Lapierre, Douadia Bougherara, Raphaële Préget & Alexandre Sauquet)
One of the factors that discourages farmers from enrolling in agro-environmental schemes (AES) is the uncertainty of the costs and benefits associated with the adoption of the new practices. In this study, we distinguish between the "internal uncertainty" that is related to the characteristics of the farmer and his/her parcels and "external uncertainty", which is related to the occurrence of external events. We propose three innovations to better account for uncertainty in AES design and test their attractiveness through a choice experiment. We find that proposing contracts that allow suspending the conditions of the contract for one year enhances participation.
- Mardi 21 septembre 2021 : Julien Wolfersberger (Economie Publique - AgroParisTech) - "Roads and Deforestation" (co-écrit avec Douglas Gollin)
We build a quantitative spatial model to study the impact of changes in transportation infrastructures on spatial development and deforestation in Brazil. We examine how new roads (or the modernization of existing ones) change the spatial equilibrium of agriculture, modify market access and cause deforestation. For this purpose, we develop a novel data-set combining agricultural census data and satellite-data on both forest cover and road networks. Our results show how decreasing trade frictions within a country may lead to economic gains but may also weaken natural resource conservation. We highlight the general equilibrium effects of this trade-off and examine several important outcomes related to structural transformation.
- Mardi 14 septembre 2021 : Charles Regnacq (BRGM) - "Climate Change and the Water Capability to Export Agricultural Goods" (coécrit avec Fabien Candau et Julie Schlick)
This article analyzes how climate change by affecting the water capabilities of nations to export agricultural goods plays on comparative advantages. Using rich micro-level data on hydrological conditions, we estimate the agricultural trade elasticity of water for countries with diffrent level of vulnerability to climate change. Non-linear effects are observed, both the most and the less vulnerable countries have higher water elasticities of trade than emerging countries. By simulating the effect of climate change in 2050 on trade flows, we find substantial reduction in the exports of African, Southeast Asian, and South American countries which are not compensated by the growing exports of other nations. Many countries lose their specialization while a handful of nations strengthening their comparative advantages. We illustrate the origin of these variations, by describing how the local hydrological conditions evolve inside countries for different production such as coffee in South America, wheat and maize in the USA, rice in Asia, cassava in Africa and potatoes in Europe.
- Mardi 6 juillet 2021 : Philipp Richter (TU Dresden) - "Emissions Taxes, Redistribution Schemes, and the Impact on Occupational Choices"
This paper focuses on the distributional effects of emissions pricing and tax revenue redistribution in a general equilibrium model with heterogeneous agents. For this purpose, we set up a model based on the occupational choice decisions of individuals and highlight selection effects in response to policy changes. We present two applications. Application I analyses the impact of a unilateral increase in the emissions tax of an economy open to international trade. We find a tax-induced change in occupational choices, an increase in average productivity of domestic firms, negative emissions leakage and an increase in the reforming country’s income inequality. We derive as key mechanism the change in the relative market sizes of the reforming and non-reforming country. Application II analyses the impact of a progressive redistribution scheme with transfers only to low-income individuals in a closed economy. We find that for a given emissions tax a progressive redistribution scheme leads to a shift in the factor allocation towards more employees and fewer but more productive firms compared to a uniform per capita transfer scheme. This distortion leads to reduced aggregate emissions but increased income inequality between managers and employees.
- Mardi 15 juin 2021 : Carlo Fezzi (University of Trento & LEEP) - "Estimating risk preferences integrating insurance choices with subjective beliefs" (joint with Luisa Menapace and Roberta Raffaelli)
This paper combines real-world decisions with experimental elicitations to estimate risk preferences by incorporating individuals’ subjective beliefs in the analysis of insurance data. Unlike most studies estimating risk preferences “in the field”, we refrain from making specific assumptions regarding expectations; rather, we elicit them directly from the respondents. This approach yields risk aversion estimates compatible with a variety of deviations from rational expectations, such as biased subjective risk perceptions. Our results reveal that agents tend to overestimate the probability of recent rare events happening again in the recent future, and that the standard assumption of rational beliefs can lead to biased estimates and policy recommendations. Our empirical application offers new insights into the current debate on crop insurance subsidies. Correcting biased beliefs appears to be an effective strategy to reduce government support and, at the same time, maintain a high level of enrollment.
- Mardi 8 juin 2021 : Ondine Berland (Economie Publique - INRAE) - "The Effects of Gasoline Prices on Food Purchases: Quantity, Quality and Heterogeneity" (coécrit avec Fabrice Etilé)
Carbon taxes can hinder households' welfare as commuting spending is inelastic. When facing increasing gasoline prices, households react by curbing expenditures on non-gas budget items. In this context, food has been shown to be a key adjustment margin. We use household scanner data to examine the effects of gasoline prices on the food purchases of a representative sample of French households. The estimated elasticity of food spending is approximately -0.2 with most of the effect coming from an adjustment in the unit price of goods. An analysis by food categories reveals that households adjust more on fresh products than on processed ones, which may have consequences for nutritional health. When investigating heterogeneity across households characteristics, we find that the demand response of the poorest income category is stronger than that of the rest of the population. Taken together, our findings suggest that households, especially poor ones, curb food expenditures to preserve gasoline consumption when gasoline prices increase, with ambiguous but potentially detrimental effects on nutritional quality
- Mardi 1er juin 2021 : Christophe Gouel (Economie Publique - INRAE) - "Trade in Agricultural and Food Products" (coécrit avec Carl Gaigné)
This chapter reviews how the literature on trade in agricultural and food products has developed over the last twentyyears. Its evolution has been heavily influenced by recent developments in the international trade literature. First,related to trade theories that connect closely with observables: new Ricardian models and firm-level analysis. Second,related to a shift toward applied work involving estimated gravity models and counterfactual simulations. Anotherkey source of evolution relates to the emergence of new policy questions, such as biofuels, climate change, qualitystandards, and nutrition transition, for which even though trade may not be at the center of the issues it mediates mostof the effects. This chapter reviews how the articulation between recent theoretical developments and applications havecontributed to make agricultural trade a very active research field.
- Mardi 11 mai 2021 : Alessandro Tavoni (University of Bologna) - "Representation, Peer Pressure, and Punishment in a Public Goods Game Experiment" (coécrit avec Hyoyoung Kim, Doruk İriş and Jinkwon Lee)
“Examples of public goods dilemmas abound: environmental protection, international security, pandemic diseases and team production, to name a few. In such contexts decisions are usually delegated to a representative. Group members typically express their preferences to the representatives with varying degrees of formality, ranging from signaling (dis-)approval about a colleague’s decision to formal voting on referendum topics. Our experiment is designed to study public good provision choices in such situations of hierarchical decision-making, i.e. when decisions are taken at different levels: at a lower level the constituency elects a representative, while at a higher level elected representatives decide on the provision level. Specifically, using an otherwise standard repeated linear public goods game, we investigate how delegation and punishment affect provision. Our treatments are designed to shed light on the following questions: (i) Does representative behavior differ from that of self-representing individuals in terms of contributions to the public good and punishment of others? (ii) What is the impact of non-binding peer pressure (in the form of payoff-immaterial messages from the constituency to their representative) on the representatives’ public good contributions and punishment decisions?”
- Mardi 4 mai 2021 - Julie Lochard (UPEC) - "Global Value Chains: do they impact the allocation of foreign aid?" (coécrit avec Basak Bayramoglu et Jean-François Jacques)
The rise of Global Value Chains (GVCs) in recent decades has induced significant changes in the organization and geography of world production, with consequences for bilateral and multilateral trade relations. In this paper, we investigate whether GVC-related bilateral trade is a driver of foreign aid allocation to developing countries. Using panel data on bilateral foreign aid from 22 donors to 127 recipient countries over the period 2002-2018, we find that a rise in the share of foreign value-added from a recipient country in donors' exports increases the amount of aid allocated to that country. We also undertake a country and sectoral decomposition to analyze whether dependence on foreign value added is stronger for some countries or in specific sectors. Our results, robust to endogeneity, suggest that donors allocate aid strategically, especially in some sectors, in order to secure supplies of specific goods and services or to negotiate lower prices and better bilateral contracts.
- Mardi 13 avril 2021 - Obie Porteous (Middlebury College) - "Reverse Dutch Disease with Trade Costs: Prospects for Agriculture in Africa’s Oil-Rich Economies"
Low world oil prices since 2014 are stimulating tradable sectors in oil-exporting countries. I use a three-location open economy model to investigate the prospects for reverse Dutch disease in African countries with a comparative advantage in agriculture but large internal and external trade costs. While falling resource revenues lead factors of production to shift into agriculture, remote farmers can lose when trade costs make agricultural goods behave like non-tradables. Household survey data from Nigeria show a significant agricultural supply response that is correlated with exposure to international markets. Lowering trade costs and boosting agricultural productivity can help offset the lost income from oil.
- Mardi 6 Avril 2021 - François Bareille (INRAE, Economie Publique) - Decomposing Weather Impacts on Crop Profits (avec Raja Chakir)
The costs of climate change on agriculture depends critically on farmers' adaptation. In this paper, we investigate how farmers adapt their input mix in response to weather fluctuations during the growing season using individual panel data from Meuse (France) between 2006 and 2012. Specifically, we estimate structural models of profit-maximizer farmers with crop-specific yields and input-specific demand functions, conditionally on farm and year fixed effects. The results show that climate change affects crop yields but that farmers adapt their fertilizers and pesticides applications to limit the negative impacts. The effects are heterogeneous among crops and inputs. Temperatures and precipitations affect also the inputs productivity and reduce the substitution between the inputs. Overall, we find that farmers' profits in Meuse will reduce under a RCP 4.5 scenario, principally due to a direct effect on plant growth. Society could however benefit from adaptation as the reduction in damages due non-point source pollution represent twice the private costs bared by the farmers.
- Mardi 30 Mars 2021 - Damien Dussaux (OECD) - What drives emission reductions? Carbon offshoring vs. environmental policy impacts in French manufacturing companies (avec Francesco Vona & Antoine Dechezleprêtre)
This paper analyses carbon offshoring combining information on carbon emissions, imports, imported emissions and energy prices for French manufacturing firms between 1997 and 2014. We estimate the impact of imported emissions on domestic emissions and emission intensity using a shift-share instrumental variable strategy. We find that carbon offshoring has no effect on total emissions, but emission efficiency improves significantly in companies offshoring emissions abroad. A 10% increase in carbon offshoring causes a 4% decline in emission intensity. However, emission offshoring is not primarily driven by a pollution haven motive and energy price impacts on emission efficiency are much larger.
- Mardi 9 Mars 2021 - Laure Kuhfuss (James Hutton Institute) - Nudging Participation and Spatial Agglomeration in Payment for Environmental Service Schemes
The environmental benefits from Payment for Ecosystem Services (PES) schemes can often be enhanced if private land managers are induced to enrol land in a spatially coordinated manner. One incentive mechanism which has been proposed to achieve such spatial coordination is the agglomeration bonus, a two-part payment scheme which offers a pecuniary (financial) reward for decisions that lead to greater spatial coordination of enrolled land. However, farmers respond to a range of motives when deciding whether to participate in such schemes, including non-pecuniary motives such as a concern for the environment or social comparisons. This study implements a laboratory experiment to test the effectiveness of the agglomeration bonus when non-pecuniary motives are explicitly incorporated into the decision-making environment. We capture intrinsic preferences for the public good dimension of environmental improvement through a real donation to environmental charities and examine the relative impact of a group-ranking nudge. The experimental results show that the agglomeration bonus does indeed improve participation and spatial coordination when non-pecuniary motives are accounted for, but that the performance of the agglomeration bonus is not enhanced by the nudge.
- Mardi 2 Mars 2021 - Alessandro Sforza (University of Bologna & CESifo) - The Weather Effect: estimating the effect of voter turnout on electoral outcomes in Italy
- Mardi 9 Février 2021 - Mamadou Gueye (LEDa – Université Paris Dauphine) - Contracting Under Spatial Effects
While incentive contracts are extensively used to tackle environmental issues such as biodiversity losses, their efficiency remains understudied so far. This paper considers a principal-agents model to study how spatial characteristics – retention effects and diffusion effects –, which occur in certain public good provisions (environmental goods for instance), influence the efficiency of the contract outcome. The theoretical finding suggests that an optimal contracting scheme is always inefficient from a social viewpoint. Furthermore, this study helps to identify the agent who drives the inefficiency of an optimal contract approach. Considering each bilateral interaction, it is the agent who creates a higher diffusion effect for his neighbor while receiving a low diffusion effect that is more likely to drive the inefficiency of the contracting outcome. My results suggest that bilateral contracts may not be the most appropriate instrument to solve the issues raised by spatial externalities.
- Mardi 2 Février 2021 - Emmanuel Paroissien (ALISS – INRAE) - Reckoning climate change damages along an envelope (coécrit avec Pierre Mérel et Matthew Gammans)
- Mardi 26 Janvier 2021 - Alexis Louaas (EIT & Climate-KIC) - Morality and equality from rationality alone: A repeated game approach of contractarianism
This paper highlights the role that equality and reciprocity play in preserving peace and cooperation among individuals with conflicting interests. Following the contractarian tradition, I model a mutually beneficial interaction as a prisoner’s dilemma. Using repeated game theory, I show that cooperation may arise only if the final distribution of incomes is sufficiently egalitarian. From a pre-moral context, the model allows to derive endogenous bounds on the income of each individual that reproduce Moehler (2018)’s weak universalisation principle. The model explains how individual's aspirations for equality and equity, acknowledged in the most prominent theories of justice, come to arise. Contrasting with the well-known equity-efficiency trade-off, justice is presented as a Pareto-improving social arrangement, hence producing an equity-efficiency complementarity.
- Mardi 19 Janvier 2021 - Marion Leroutier (CIRED - PSE & Paris 1) - Tackling Transport-Induced Pollution in Cities: A case study in Paris (coécrit avec Philippe Quirion, CIRED - CNRS)
Urban road transport is an important source of local pollution and greenhouse gas emissions, and local governments are deploying diverse policies to tackle these emissions. To ensure the social acceptability of these policies, it is crucial to understand who would bear their costs and what are the alternatives to high-emission trips. We bring together a travel demand survey and emission data to estimate individual contributions to transport-induced emissions in the Paris area. We nd that 20% of individuals contribute 80% of nitrogen oxide (NOx) emissions and 70% of carbon dioxide (CO2) emissions on a representative weekday. These top emissions result mainly from individuals travelling higher distances and choosing high-emission modes, and only moderately from di erences in cars' emission intensities. We investigate the feasibility of low-emission alternatives for drivers using counterfactual travel times with low-emission modes. 53% of current car drives could be shifted to regular, electric cycling or public transport with a time increase of less than 10 minutes per trip and 20 min per day, with associated emission reductions of 18% for NOx and 19% for CO2.