Stavins, Robert N. “
The Problem of the Commons: Still Unsettled After 100 Years.” Cambridge, Massachusetts, {USA}: Harvard Environmental Economics Program, 2010.
AbstractThe problem of the commons is more important to our lives and thus more central to economics than a century ago when Katharine Coman led off the first issue of the American Economic Review. As the U.S. and other economies have grown, the carrying-capacity of the planet— in regard to natural resources and environmental quality — has become a greater concern, particularly for common-property and open-access resources. The focus of this article is on some important, unsettled problems of the commons. Within the realm of natural resources, there are special challenges associated with renewable resources, which are frequently characterized by openaccess. An important example is the degradation of open-access fisheries. Critical commons problems are also associated with environmental quality. A key contribution of economics has been the development of market-based approaches to environmental protection. These instruments are key to addressing the ultimate commons problem of the twenty-first century — global climate change.
dp22_stavins.pdf Kremer, Michael, Amrita Ahuja, and Alex Peterson Zwane. “
Providing Safe Water: Evidence from Randomized Evaluations.” Cambridge, Massachusetts, {USA}: Harvard Environmental Economics Program, 2010.
AbstractEach year, 1.6 million children die from diarrheal diseases; unsafe drinking water is a major cause. This paper reviews evidence from randomized trials on domestic water access and quality in developing countries, interpreting the results through a public economics framework. It argues that subsidies for water treatment are likely warranted, while more evidence is needed to assess the case for subsidizing programs to improve access to water. Multiple randomized trials show that water treatment can cost-effectively reduce reported diarrhea. However, many consumers have low willingness to pay for cleaner water, with less than 10% of households purchasing household water treatment under existing retail models. Provision of information on water quality can increase demand, but only modestly. Free point of collection water treatment systems designed to make water treatment convenient, salient, and public, combined with a local promoter, can generate take up of more than 60 percent. The projected cost is as low as \$20 per year of life saved, comparable to vaccines. In contrast, the limited existing evidence suggests many consumers are willing to pay for better access to water, but it does not yet demonstrate that this improves health. Randomized impact evaluations have also generated a number of methodological insights, suggesting that: at least in some contexts, merely surveying households can lead them to change their behavior; separately randomizing offer and transaction prices does not yield evidence of sunk cost effects; revealed preference measures of clean water valuation are much lower than contingent valuation estimates; and randomized evaluations can be used to estimate parameters for structural policy simulations.
dp23_kremer-ahuja-petersonzwane.pdf Matheny, Andrew Philip. “
Reducing the impact of price shocks in energy-intensive economies.” Cambridge, Massachusetts, {USA}: Harvard Environmental Economics Program, 2010.
dp16_matheny.pdf Kremer, Michael, Edward Miguel, Jessica Leino, and Alex Peterson Zwane. “
Spring Cleaning: Rural Water Impacts, Valuation, and Property Rights Institutions.” Cambridge, Massachusetts, {USA}: Harvard Environmental Economics Program, 2010.
AbstractUsing a randomized evaluation in Kenya, we measure health impacts of spring protection, an investment that improves source water quality. We also estimate households’ valuation of spring protection, and simulate the welfare impacts of alternatives to the current system of common property rights in water, which limits incentives for private investment. Spring infrastructure investments reduce fecal contamination by 66%, but household water quality improves less, due to recontamination. Child diarrhea falls by one quarter. Travel-cost based revealed preference estimates of households’ valuations are much smaller than both stated preference valuations and health planners’ valuations, and are consistent with models in which the demand for health is highly income elastic. We estimate that private property norms would generate little additional investment while imposing large static costs due to above marginal-cost pricing, private property would function better at higher income levels or under water scarcity, and alternative institutions could yield Pareto improvements.
dp24_kremer-etal.pdf Olmstead, Sheila M, and Robert N Stavins. “
Three Key Elements of Post-2012 International Climate Policy Architecture.” Cambridge, Massachusetts, {USA}: Harvard Environmental Economics Program, 2010.
AbstractWe describe three essential elements of an effective post-2012 international global climate policy architecture: a means to ensure that key industrialized and developing nations are involved in differentiated but meaningful ways; an emphasis on an extended time path of targets; and inclusion of flexible market-based policy instruments to keep costs down and facilitate international equity. This architecture is consistent with fundamental aspects of the science, economics, and politics of global climate change; addresses specific shortcomings of the Kyoto Protocol; and builds upon the foundation of the United Nations Framework Convention on Climate Change.
dp18_olmstead-stavins.pdf