121 research outputs found
How are Green National Accounts Produced in Practice?
No full textDuring the last part of the twentieth century, the effect of human activity upon the environment became an important policy issue. There is now a growing concern about how economic activity affects the environment and it has become more and more recognised that economic growth is dependent upon the provision of environ-mental services. To be able to combine economic growth with a healthy environment in terms of a sustainable use of natural resources, a better understanding of the rela-tionships between economy and ecology needs to be developed.
Costs of Climate Policy when Pollution Affects Health and Labour Productivity. A general Equilibrium Analysis Applied to Sweden
No full textMuch of the debate over global climate change involves estimates of the direct costs of global climate change mitigation. Recently this debate has included the issue of ancillary benefits. These benefits consist mainly of health improvements. Although it is generally acknowledged that air pollution affects respiratory health, and that valuations of these impacts make up a significant proportion of the damage costs of air pollution, these impacts are often neglected when evaluating the costs of climate policy. Since reducing greenhouse gases has the effect of also reducing other pollutants affecting human health and labour productivity these effects should be taken into consideration. The analysis incorporates a linkage between air pollution and health effects into a general equilibrium model for Sweden through a theoretical consistent framework. Results from recent Swedish concentration-response and contingent valuation studies are used to model direct disutility and indirect health effects that negatively affects the productivity of labour. The costs of feedback effects on health and productivity are compared in three different scenarios for attaining the Swedish carbon dioxide target with alternative projected emission levels in the baseline scenario as well as alternative harmful emission levels. Results show that not including feedback effects could mean overstating the costs of climate policy. The magnitude of these effects are, however, very sensitive to projected emission levels and to the judgement of harmful emission levels.air pollution; ancillary benefits; climate policy; general equilibrium; health
Does remediation save lives? On the cost of cleaning up arsenic-contaminated sites in Sweden
No full textSwedish environmental policy is based on 16 environmental quality objectives (Gov. Bill 2000/01:130 and Gov.Bill 2004/05:150).1 One of the most challenging objectives,‘A non toxic environment’, has two interim targets that concern remediation of contaminated sites. In sum, they state that the highest priority should be given to sites posing the highest risks to human health and the environment.2 By eliminating pollutants in soil, groundwater and sediment, the interim targets aim to reduce risks to human health and the environment. In Sweden, 83,000 sites are potentially contaminated due to previous industrial activities. According to the Swedish Environmental Protection Agency (EPA), the administrator of the governmental funds for remediation, approximately 1500 of these sites contain contaminant concentrations that could seriously harm human health and the environment (Swedish EPA, 2008a). To reach the interim targets, all these sites need to be remediated by 2050. Remediation of contaminated sites has so far cost more than SEK 3,000 million.3 The approximated cost to mitigate the potential risks at the most harmful sites is estimated at SEK 60,000 million.4 The Swedish government’s funding for remediation presently comes in the form of a directed grant (sakanslag). The directed grant, administrated by the Swedish EPA, subsidises remediation of contaminated sites that were contaminated prior to modern environmental legislation (in 1969) or for which no liable party can be found. The directed grant amounts to approximately 455 millions annually, which corresponds to about 10 percent of the annual national funds for environmental protection (Gov. Bill 2007/08:1). To make it possible to prioritise among contaminated sites, the Swedish EPA has developed a method for risk assessment called the ‘MIFO’ (i.e. the Method for Inventory of Contaminated Sites). The risk assessment does not take into account the actual exposure at a contaminated site. Risk is instead assessed based on divergence from guideline values for acceptable concentrations given a standardised (i.e. worst case) exposure situation on an individual level. This means that a site can be remediated without any individuals actually being exposed. The expected risk reduction is consequently not quantified. This eliminates the possibility of valuing the risk reduction, which should be weighed against the remediation cost. The purpose of this paper is to analyse how health effects, in the form of cancer risks, from sites contaminated by arsenic are valued implicitly in remediation. By using an environmental medicine approach that takes exposure into account, and without underestimating the potential health consequences of arsenic exposure, our purpose is to place arsenic risk management in the overall picture of live-saving interventions. In the case of cancer prevention, it is necessary to recognise that focus on an environmental carcinogen like arsenic may draw public attention – and funding – away from mental health risks like ambient air pollution and indoor radon. Although environmental pollution accounts for less than ten percent of all cancer cases (Harvard Centre for Cancer Prevention, 1996; Saracci and Vineis, 2007), environmental factors are important to recognize since they may be preventable. We emphasise, however, the inefficiency in becoming overly concerned about small risks while, at the same time, losing sight of the large risks. If society’s spending on lifesaving measures with small effects (i.e. a small number of lives saved) crowds out spending on lifesaving measures with large effects, then remediation can, in fact, even be said to waste lives. By using data on 23 arsenic-contaminated sites in Sweden, we estimate the sitespecific cancer risks and calculate the cost per life saved by using the sites’ remediation costs. Our results show that the cost per life saved through remediation is much higher than that associated with other primary prevention measures, indicating that the ambition level of Swedish remediation may be too high.
Green Accounting, Air Pollution and Health
No full textHuman capital is an important component of economic growth. The article extends a theoretical model for comprehensive national accounting to the welfare effects of pollution on human capital. The model includes a production externality in the form of a flow of air pollutants that cause both direct disutility and indirect welfare effects by negatively affecting the productivity of labor. We show that defensive medical expenditures or healthcare costs allocated to mitigating the disutility of air pollution should not be deducted from conventional net national product (NNP), whereas the value of the percieved disutility of illness episodes caused by pollution should be subtracted from NNP. We derive a marginal cost-benefit rule for an optimal level of pollution given its negative health effects. The rule can be used for determining an optimal tax on harmful emissions. Finally, we outline a scheme for empirical comprehensive accounting and for estimation of an emissions tax.
Future Waste Scenarios for Sweden based on a CGE-model
No full textOver the last decades, waste quantities have grown steadily in close relation to economic growth. To tackle the problem of continuing waste growth within the EU, waste prevention was listed among four top priorities in the EU Sixth environment Action Programme. A Computable General Equilibrium (CGE) model is here used for projecting future quantities of hazardous and non-hazardous waste in Sweden to 2030. The effects of driving forces behind waste generation are illustrated by comparing the results of waste projections for a Baseline scenario and four alternative scenarios. The scenarios differ mainly in GDP growth rates and in the assumptions about future waste intensities of the economic activities of firms and households. We use a high-resolution data set on waste flows of 18 various types of non-hazardous waste and 16 various types of hazardous waste attributed to six waste-generating sources for the base year 2006. Waste generated in the scenarios, thus, relate to firms’ material input, output, employees, capital scrapping and fuel combustion as well as households’ consumption. The impact of economic growth in increasing the generation of nonhazardous and hazardous waste is apparent when comparing the growth of waste from 2006 to 2030 in the five scenarios. On the contrary, technological change resulting in less waste intensive production processes and changed behaviour among households, making their activities less waste intensive, have a strong reducing effect, especially on generation of non-hazardous waste relating to firms’ material input.general equilibrium model; waste generation; decoupling; waste intensities waste scenarios.
Interpreting Wage Bargaining Norms
No full textFrom the mid-1990s onwards, Swedish wage bargaining has been characterised by informal co-ordination of the wage claims of big unions and bargaining cartels. In particular, it has been understood that the manufacturing sector should lead by first agreeing on a pay increase, whereafter the service sector and public sector unions choose a similar increase. We analyse his setup with two possible theoretical interpretations: (i) the manufacturing sector as a tackelberg leader and (ii) a normative role for the manufacturing sector’s pay increase, upported either by unmodelled social pressure or a modeled loss aversion (envy) of the heltered sector unions. The conclusion of the analysis is that the normative or leading role of one sector – in the Swedish case the manufacturing sector – can potentially bring big benefits for employment and output. Generalising an idea suggested by Lars Calmfors and Anna Larsson, our analysis also generates a rudimentary theory of why the wage increase norm sometimes binds and sometimes not. A comparison of the model predictions and the observed outcomes of the last five wage bargaining rounds in Sweden suggests that the model is generally consistent with the empirical observations: wage moderation and norm observance are stronger when the manufacturing industry’s initial relative wage is low.wage bargaining; bargaining co-ordination
Labor-Force Participation Rates and the Informational Value of Unemployment Rates: Evidence from Disaggregated US Data
No full textThe informational value of the aggregate US unemployment rate has recently been questioned be-cause of a unit root in the labor-force participation rate; the lack of mean reversion implies that long-run changes in unemployment rates are highly unlikely to reflect long-run changes in jobless-ness. This paper shows that this critique also extends to unemployment rates for sub-populations, such as prime-aged males.Unit-root test;
Unemployment and Labour Force Participation in Sweden
No full textThis paper investigates the relationship between Swedish unemployment and labour-force participation. Cointegration analysis supports a robust long-run relationship between the two variables, regardless of whether aggregate or gender-specific rates are used. This finding puts the empiri-cal relevance of the unemployment invariance hypothesis into question.Cointegration; Discouraged worker
The Properties of Survey-Based Inflation Expectations in Sweden
No full textThis paper assesses the properties of survey-based inflation expectations in Sweden. The survey is conducted by Prospera once every quarter and consists of respondents from businesses and labour-market organisa-tions. The paper shows that inflation expectations measured in this sur-vey tend to be biased and inefficient forecasts of future inflation. Results also indicate that long-run inflation expectations are overly adaptive with respect to actual inflation. Finally, evaluations of forecast accuracy show that these inflation expectations are worse predictors of inflation than those of a professional forecasting institution and also typically outper-formed by a simple autoregressive model. Overall, our results indicate that economic agents’ expectations formation process is suboptimal and/or the survey fails to capture the true inflation expectations.Survey data; Inflation targeting
The Forecasting Properties of Survey-Based Wage-Growth Expectations
No full textIn this paper, we evaluate survey-based wage-growth expectations in Sweden. Results show that the expectations are neither unbiased nor efficient forecasts. Evaluating out-of-sample forecasting performance, we find that the survey participants generally perform worse than a con-stant forecast based on reasonable assumptions regarding the inflation target and productivity growth. Our findings indicate that caution should be exercised when relying on these data for policymaking.Survey data;
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