Handbook of Bioenergy Economics and Policy: Volume II, 2017
The United States has established various policies to support a transition to biofuels from fossi... more The United States has established various policies to support a transition to biofuels from fossil fuels as part of its strategy to achieve energy security and independence. These policies include mandates, tax credits, and import tariffs aimed at developing the nascent biofuel industry. To compare the impact of various energy sources requires a comprehensive understanding of both direct and indirect effects. This chapter discusses some of the indirect effects, including land use change, fuel rebound effect, and balance of trade effect. It finds that due to the ubiquity of energy, indirect effects impact numerous markets and that an already noncompetitive energy market that is capital intensive exacerbates the challenge of introducing biofuels. While first-generation biofuels contributed to rural development and reduced dependency on imported fuel sources, they have failed to reduce GHG emissions significantly. Introduction of advanced biofuels is challenged by the blend wall in the US and high costs, there is much opportunity for them to contribute significantly to energy security but also reducing GHG emissions.
Optimal environmental taxation in response to an environmentally-unfriendly political challenger
Journal of Environmental Economics and Management, 2021
Abstract Different political parties place different values on the environment. In considering a ... more Abstract Different political parties place different values on the environment. In considering a two-party democratic system and capital-intensive technologies, we find that forward-looking governments incorporate the probability of losing power into their policy design. When the party in power values the environment, it may levy an optimal dynamic tax that is larger than the Pigouvian tax. We investigate the parameters that affect the magnitude of this gap and assess the effect of the gap on the adoption of clean technologies overtime.
The Effect of Landscape-level Pesticide Applications on California Citrus Growers’ Decisions for ... more The Effect of Landscape-level Pesticide Applications on California Citrus Growers’ Decisions for California Red Scale Management.Analysis of the Influence of Open Space on Residential Values.Why Are Outside Investors Suddenly Interested in Farmland
In this report, we investigate the biofuel potential of South Korea and the implications of the i... more In this report, we investigate the biofuel potential of South Korea and the implications of the introduction of biofuels for the Korean fuel market. Our biomass assessment suggests that (theoretically) biomass can be used to produce a significant portion of the fuel consumed annually in South Korea, with the most promising feedstock being forestry residues. And out of all the technologies considered, the production of cellulosic ethanol from forestry residues could potentially impact the fuel market the most. The key novelty of our study lies in that we consider a broad portfolio of biofuel technologies and carefully examine their potential economic and environmental implications for South Korea given its biomass availability (which we actually estimate).
The introduction of GE to agriculture has encoun-tered strong resistance, reflecting conflicting ... more The introduction of GE to agriculture has encoun-tered strong resistance, reflecting conflicting groups within and between countries. This has resulted in a regulatory environment that has limited the application of GE mostly to feed and fiber and practically restricted its application in food. While agricultural biotechnology has already provided significant benefits, much of its potential has not been reached. Regulation of agricultural biotechnology reflects conflicting interests and varying political power of different groups. The relatively supportive regulation of biotechnology in the U.S. reflects that it is an American technology, and supporting groups like the farm lobby, technology manufacturers, and U.S. consumers outweigh the objections of environmentalists and other opposition to the technology. In Europe, growing concern about environmental side-effects of agriculture, the fact that GE technology was imported, and the power of environmental groups has resulted in restr...
Book Publisher International (a part of SCIENCEDOMAIN International), May 24, 2021
In this chapter, we describe a political economic framework of an economy following transition to... more In this chapter, we describe a political economic framework of an economy following transition to private ownership. The transition, characterized by massive privatization, is accompanied by a change in the legal system, which is influenced by the elite who may be described as either corrupt or non-corrupt. The ability of the corrupt elite to influence the ruling party may lead to weak legal institutions, which cause underinvestment, corruption, and capturing of lucrative industries by corrupt investors. By introducing heterogeneity among industries, we show that the corrupt investors corrupt the more lucrative industries, and in corrupt economies corrupt investors may separate themselves from the non-corrupt investors. Furthermore, we identified two methods used by the corrupt investors to siphon profit – output stealing and profit stealing – and illustrate that corrupt investors may substitute between the two methods to alleviate the constraints created by stronger institutions. To this end, strengthening the institutions only in one dimension may, at the end of the day, cause output, as well as investment, to decline.
Corn Ethanol and US Biofuel Policy Ten Years Later: A Systematic Review and Meta-analysis
2016 Annual Meeting, July 31-August 2, Boston, Massachusetts, 2016
We use data and estimates on biofuel impacts reported in the literature to assess some of the con... more We use data and estimates on biofuel impacts reported in the literature to assess some of the controversy surrounding the introduction of biofuels by conducting meta-analyses on the impacts of corn ethanol on food and fuel prices, greenhouse gases, employment, rural income, balance of trade, the United States government budget, and learning-by-doing. The meta-analyses suggest that corn ethanol has had a relatively significant impact on the income of agricultural and related agribusiness industries, employment in farm states, fuel security in terms of reducing the import of oil from abroad, and the overall balance of trade. These effects are likely the main drivers behind biofuel policies.
Political Connections, Productivity and Firm Sales
Social Science Research Network, 2020
We explore the significance of political connections vs. productivity for firms’ domestic sales a... more We explore the significance of political connections vs. productivity for firms’ domestic sales and export performance in developing countries, using the data from the listed firms in China’s Shanghai and Shenzhen stock markets. We estimate firms’ total factor productivity and manually build a detailed dataset on firm’s political connections using public information released by firms. We find that more productive firms have larger sales in both domestic and international markets, but the effect of political connections differ. Political connections matter in a positive way for domestic sales, and employing a current member of a political body in China is more significant for domestic sales than employing a former government official. However, political connections are not significant for firm’s export sales.
Supplementary material from "Total cost of carbon capture and storage implemented at a regional scale: northeastern and midwestern United States
We model the costs of carbon capture and storage (CCS) in subsurface geological formations for em... more We model the costs of carbon capture and storage (CCS) in subsurface geological formations for emissions from 138 northeastern and midwestern electricity-generating power plants. The analysis suggests coal-sourced CO<sub>2</sub> emissions can be stored in this region at a cost of $52–$60 per ton, whereas the cost to store emission from natural-gas-fired plants ranges from ∼$80 to $90. Storing emissions offshore increases the lowest total costs of CCS to over $60 per ton of CO<sub>2</sub> for coal. Since there apparently is sufficient onshore storage in the northeastern and midwestern US, offshore storage is not necessary or economical unless there are additional costs or suitability issues associated with the onshore reservoirs. For example, if formation pressures are prohibitive in a large-scale deployment of onshore CCS, or if there is opposition to onshore storage, offshore storage space could likely store emissions at an additional cost of less than $10 per ton. Finally, it is likely that more than 8 Gt of total CO<sub>2</sub> emissions from this region can be stored for less $60 per ton, slightly more than the $50 per ton Section 45Q tax credits incentivizing CCS.
In this report, we investigate the biofuel potential of South Korea and the implications of the i... more In this report, we investigate the biofuel potential of South Korea and the implications of the introduction of biofuels for the Korean fuel market. Our biomass assessment suggests that (theoretically) biomass can be used to produce a significant portion of the fuel consumed annually in South Korea, with the most promising feedstock being forestry residues. And out of all the technologies considered, the production of cellulosic ethanol from forestry residues could potentially impact the fuel market the most. The key novelty of our study lies in that we consider a broad portfolio of biofuel technologies and carefully examine their potential economic and environmental implications for South Korea given its biomass availability (which we actually estimate).
2016 Annual Meeting, July 31-August 2, Boston, Massachusetts, May 16, 2016
‡ The authors thank Kathleen Segerson for the conversations they had and comments she made on ear... more ‡ The authors thank Kathleen Segerson for the conversations they had and comments she made on earlier drafts, which significantly improved this work and its presentation. Any remaining errors are the authors' doing. 3 The presumption of this paper is that some governments value the environment, but others do not. Assuming political uncertainty and capital-intensive technologies, this circumstance yields a political economic process that emphasizes the effect of using current policy to influence future outcomes. The result of the analysis suggests that the optimal dynamic tax is larger than the Pigovian tax and that a standard results in more employment and output and yields higher adoption rates, thus achieving a predetermined pollution target with a lower political economic cost than a tax-with policy outcomes being more resilient to political change.
Agriculture biotechnology applies modern knowledge in molecular and cell biology to produce new a... more Agriculture biotechnology applies modern knowledge in molecular and cell biology to produce new and improved varieties. It has transformed the production system of major field crops, such as soybeans, corn, cotton, and canola, and has experienced a high rate of adoption, reflecting product with benefits of herbicide tolerance and insect resistance. It improved product quality. Such benefits come from increased yields, lower risk, reduced use of chemical pesticides, gains from reduced tillage and other modified production practices, and saving in management, labor, and capital improvement (Kalaitzandonkes 2003; Just, Alston, and Zilberman 2006; among others). Notably, however, the adoption of biotechnology has varied across location, and was initially concentrated in a small number of countries, partly due to regulatory regimes (Zilberman 2006; James 2008), but has recently began to expand. Differences in regulation laws, and in interpretation of laws governing the use of agriculture biotechnology, pesticides and eventually bio-fuels, affect the evolution of agriculture production and the (global) environment. It affects production practices in developing countries, with both the US and the EU attempting to influence those choices. The US regulatory regime, for example, is based upon the 'substantial equivalence' approach, which is an internationally recognized standard that measures whether a biotech food or crop shares similar health and nutritional characteristics with its conventional counterpart. Biotech foods that are substantially equivalent have been determined to be as safe as their conventional counterparts. Products that are not substantially equivalent may still be safe, but must undergo a broader range of tests before they are allowed to enter commercial channels.
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Papers by Gal Hochman