Real Green
The Political Economic Determinants of Nuclear Power: Evidence from Chernobyl
Alexey Makarin, Nancy Qian & Shaoda Wang
Northwestern University Working Paper, July 2024
Abstract:
The rapid growth of nuclear power plants (NPP) declined dramatically after Chernobyl, especially in countries with democratic governments which had the highest number of NPPs at the time. To understand the mechanisms driving such change, we examine two case studies in detail: the United States and the United Kingdom. In the U.S., we document that: (a) after the Chernobyl accident, campaign contributions to House and Senate races from fossil fuel special interest groups became strongly associated with negative votes on nuclear-related bills, and such donations increased significantly; and (b) newspapers with more fossil fuel advertisements published more anti-nuclear articles after Chernobyl, while we do not observe significant changes in advertisement spending by the fossil fuel industry. In the U.K., MPs sponsored by mining unions were much more likely to give anti-nuclear speeches in parliament after Chernobyl. We examine air pollution as a downstream outcome of reduced nuclear investment. We estimate that the decline in NPP caused by Chernobyl led to the loss of approximately 141 million expected life years in the U.S., 33 in the U.K. and 318 million globally.
Do Carbon Offsets Offset Carbon?
Raphael Calel et al.
American Economic Journal: Applied Economics, forthcoming
Abstract:
We develop and implement a new method for identifying wasted subsidies, and use it to provide systematic evidence of the misallocation of carbon offsets in the Clean Development Mechanism -- the world's largest carbon offset program. Using newly constructed data on the locations and characteristics of over 1,000 wind farms in India, we estimate that at least 52% of approved carbon offsets were allocated to projects that would very likely have been built anyway. We estimate that the sale of these offsets to regulated polluters resulted in substantially higher global carbon dioxide emissions.
Do "Big" Liberalizations Hurt the Environment?
Justin Callais, Vincent Geloso & Alicia Plemmons
George Mason University Working Paper, July 2024
Abstract:
There is a large literature showing that liberalizations boost economic growth. Do these gains come with environmental costs? In this paper, we use 49 cases of large-scale liberalization-as proxied by large discrete jumps on the Economic Freedom of the World Index-to study the effects of liberalizations on greenhouse gas emissions (total, per capita and per dollar of GDP) and deaths from outdoor air pollution. Using matching methods between liberalizers and non-liberalizers, we find that liberalizations have no consistent effect on total emissions or emissions per capita. However, they do reduce emissions per dollar of GDP and reduce mortality from outdoor air pollution. We then employ synthetic control methods on the largest three liberalizers and the largest de-liberalizer and find the same pattern of results.
Party affiliation predicts homeowners’ decisions to install solar PV, but partisan gap wanes with improved economics of solar
Fedor Dokshin & Mircea Gherghina
Proceedings of the National Academy of Sciences, 16 July 2024
Abstract:
The perceived risk of climate change and the sense of urgency for an energy transition are both politically polarized, especially in the United States. Yet, we know relatively little about how political polarization affects consumer energy preferences and behaviors. Here, we use the case of residential solar photovoltaics (PV) in New York State to 1) measure the partisan gap in solar adoption rates and 2) test whether more favorable economics of solar PV mute the effect of political identity. Using household-level, longitudinal data that include nearly 63,000 completed residential PV projects, we find evidence of a partisan gap in PV adoption. Democratic homeowners are approximately 1.45 times as likely to adopt solar PV as Republican homeowners. Republicans’ rate of adoption is the lowest of all measured groups, behind Independents, unaffiliated voters, and homeowners not registered to vote. Crucially, however, Republicans in our sample appear to be the most attuned to the changing economics and financing options of solar PV. Our estimates suggest that 1) as homeowners’ electricity rate increases relative to its long-run average, the adoption gap between Democrats and Republicans narrows, 2) that Republican PV adopters obtain systems with higher expected economic value, and 3) Republicans take greater advantage of alternative financing models, like leases and power purchase agreements, especially when the upfront costs of solar are high. The results demonstrate that political identity affects consumers’ participation in the energy transition, but local context, including the local economics of solar, may mitigate the effect of personal politics.
Valuing the Future: Changing Time Horizons and Policy Preferences
Alexander Gazmararian
Political Behavior, forthcoming
Abstract:
The short time horizons of citizens are a prominent explanation for why governments fail to tackle significant long-term public policy problems. Evidence for the influence of time horizons is mixed, complicated by the difficulty of determining how attitudes would differ if individuals were more concerned about the future. This paper approaches the challenge by leveraging a personal experience that leads people to place more value on the future: parenthood. The analysis compares new parents with otherwise similar individuals using a matched difference-in-differences design with a three-wave panel. The results show that parenthood increases support for stopping climate change. Falsification tests and two survey experiments suggest that longer time horizons explain part of this shift in support. Not only are scholars right to emphasize the role of individual time horizons, but changing valuations of the future offer a new way to understand how policy preferences evolve.
How Much Will Global Warming Cool Global Growth?
Ishan Nath, Valerie Ramey & Peter Klenow
NBER Working Paper, July 2024
Abstract:
Does a permanent rise in temperature decrease the level or growth rate of GDP in affected countries? Differing answers to this question lead prominent estimates of climate damages to diverge by an order of magnitude. This paper combines indirect evidence on economic growth with new empirical estimates of the dynamic effects of temperature on GDP to argue that warming has persistent, but not permanent, effects on growth. We start by presenting a range of evidence that technology flows tether country growth rates together, preventing temperature changes from causing growth rates to diverge permanently. We then use data from a panel of countries to show that temperature shocks have large and persistent effects on GDP, driven in part by persistence in temperature itself. These estimates imply projected future impacts that are three to five times larger than level effect estimates and two to four times smaller than permanent growth effect estimates, with larger discrepancies for initially hot and cold countries.
Global decarbonization potential of CO2 mineralization in concrete materials
Justin Driver et al.
Proceedings of the National Academy of Sciences, 16 July 2024
Abstract:
CO2 mineralization products are often heralded as having outstanding potentials to reduce CO2-eq. emissions. However, these claims are generally undermined by incomplete consideration of the life cycle climate change impacts, material properties, supply and demand constraints, and economic viability of CO2 mineralization products. We investigate these factors in detail for ten concrete-related CO2 mineralization products to quantify their individual and global CO2-eq. emissions reduction potentials. Our results show that in 2020, 3.9 Gt of carbonatable solid materials were generated globally, with the dominant material being end-of-life cement paste in concrete and mortar (1.4 Gt y–1). All ten of the CO2 mineralization technologies investigated here reduce life cycle CO2-eq. emissions when used to substitute comparable conventional products. In 2020, the global CO2-eq. emissions reduction potential of economically competitive CO2 mineralization technologies was 0.39 Gt CO2-eq., i.e., 15% of that from cement production. This level of CO2-eq. emissions reduction is limited by the supply of end-of-life cement paste. The results also show that it is 2 to 5 times cheaper to reduce CO2-eq. emissions by producing cement from carbonated end-of-life cement paste than carbon capture and storage (CCS), demonstrating its superior decarbonization potential. On the other hand, it is currently much more expensive to reduce CO2-eq. emissions using some CO2 mineralization technologies, like carbonated normal weight aggregate production, than CCS. Technologies and policies that increase recovery of end-of-life cement paste from aged infrastructure are key to unlocking the potential of CO2 mineralization in reducing the CO2-eq. footprint of concrete materials.
The Economics of Biodiversity Loss
Stefano Giglio et al.
NBER Working Paper, July 2024
Abstract:
We explore the economic effects of biodiversity loss by developing an ecologically-founded model that captures how different species interact to deliver the ecosystem services that complement other factors of economic production. Aggregate ecosystem services are produced by combining several non-substitutable ecosystem functions such as pollination and water filtration, which are each provided by many substitutable species playing similar roles. As a result, economic output is an increasing but highly concave function of species richness. The marginal economic value of a species depends on three factors: (i) the number of similar species within its ecosystem function, (ii) the marginal importance of the affected function for overall ecosystem productivity, and (iii) the extent to which ecosystem services constrain economic output in each country. Using our framework, we derive expressions for the fragility of ecosystem service provision and its evolution over time, which depends, among other things, on the distribution of biodiversity losses across ecosystem functions. We discuss how these fragility measures can help policymakers assess the risks induced by biodiversity loss and prioritize conservation efforts. We also embed our model of ecosystem service production in a standard economic model to study optimal land use when land use raises output at the cost of reducing biodiversity. We find that even in settings where species loss does not reduce output substantially today, it lowers growth opportunities and reduces resilience to future species loss, especially when past species loss has been asymmetric across functions. Consistent with these predictions of our model, we show empirically that news about biodiversity loss increases spreads on credit default swaps (CDS) more for countries with more depleted ecosystems.
Temperature and Cognitive Performance: Evidence from Mental Arithmetic Training
Benjamin Krebs
Environmental and Resource Economics, July 2024, Pages 2035–2065
Abstract:
With rising average temperatures and extreme heat events becoming more frequent, understanding the ramifications for cognitive performance is essential. I estimate the effect of outside air temperature on performance in mental arithmetic training games. Using data from 31,000 individuals and 1.15 million games played, I analyze frequent engagement in a cognitively challenging task in a non-stressful and familiar environment. I find that, above a threshold of 16.5 ∘C, a 1 ∘C increase in outside air temperature leads to a performance reduction of 0.13%. The effect is mostly driven by individuals living in relatively cold areas, who are less adapted to hot temperatures.
Estimation of Property Value Changes from Nearby Carbon Capture, Utilization, and Storage Projects in the United States
Kaifang Luo et al.
NBER Working Paper, July 2024
Abstract:
Carbon capture, utilization, and storage (CCUS) techniques are vital to decarbonization goals. A CCUS supply chain captures CO₂ and delivers it to a suitable location where CO₂ can either be used or injected deep underground for long-term storage. CCUS projects reduce carbon emissions but also pose certain risks to local communities. Using nationwide CCUS data combined with property-level transaction records from 1990 to 2021 in the U.S., we quantify the net impact of proximity to CCUS projects on nearby housing prices in light of their positive and negative externalities. The results show that proximity to CCUS projects leads to a price premium on nearby house sales prices, but such effects disappear beyond the 4.2-km buffer. Compared to homes without CCUS projects nearby, houses with CCUS projects within 4.2 km typically command a price premium of 3.90% (or $8,582). CCUS deployment could be facilitated with a more detailed explanation of the housing price premium. The observed increase in property values near CCUS operations in the U.S. provides insights that could inform CCUS project development in other regions, though local regulatory and socio-economic factors must be carefully considered.
Accelerating glacier volume loss on Juneau Icefield driven by hypsometry and melt-accelerating feedbacks
Bethan Davies et al.
Nature Communications, July 2024
Abstract:
Globally, glaciers and icefields contribute significantly to sea level rise. Here we show that ice loss from Juneau Icefield, a plateau icefield in Alaska, accelerated after 2005 AD. Rates of area shrinkage were 5 times faster from 2015–2019 than from 1979–1990. Glacier volume loss remained fairly consistent (0.65–1.01 km3 a−1) from 1770–1979 AD, rising to 3.08–3.72 km3 a−1 from 1979–2010, and then doubling after 2010 AD, reaching 5.91 ± 0.80 km3 a−1 (2010–2020). Thinning has become pervasive across the icefield plateau since 2005, accompanied by glacier recession and fragmentation. Rising equilibrium line altitudes and increasing ablation across the plateau has driven a series of hypsometrically controlled melt-accelerating feedbacks and resulted in the observed acceleration in mass loss. As glacier thinning on the plateau continues, a mass balance-elevation feedback is likely to inhibit future glacier regrowth, potentially pushing glaciers beyond a dynamic tipping point.