Caroline Saunders

Transaction costs for SSSIs and policy design

Abstract Agri-environmental good provision has been stimulated in recent years by various schemes based on compensation payments to landowners. The transaction costs of implementing these schemes can be expected to vary according to the design of the scheme, but little empirical analysis has been done to calculate transaction costs and to assess their impact. This paper compares the scheme-related transaction costs of individually negotiated and standard management agreements under the Wildlife Enhancement Scheme (WES) for sites of special scientific interest in the North of England. The findings are of international interest with regard to the future development of nature conservation policy, particularly in European countries. The results show that WES agreements are more expensive with regard to both compensation and transaction costs over the whole agreement life-cycle than individually negotiated agreements.

Process versus product: which determines consumer demand for genetically modified apples?

One debate in the literature regarding consumers reactions to genetically modified food (GMF) centres on whether consumers react to the process of gene technology or to the specific GMF products. Results from a choice experiment survey in New Zealand indicate that consumers are heterogeneous with regard to GMF and that some modifications are viewed more positively than others. These findings suggest that for some consumers the process of gene technology is the decisive factor in evaluating GMF, while for others the different potential GMF products are valued according to their enhanced attributes.

Trade liberalisation and greenhouse gas emissions: the case of dairying in the European Union and New Zealand*

The link between trade and the environment has aroused considerable interest both in terms of the impact of trade liberalisation on the environment, and also the impact of environmental policy on production and trade. Of key environmental concern at present is global warming and its association with greenhouse gas emissions. Agriculture is a sector of the economy that both contributes to, and will be affected by, climate change. This paper models the impact of agricultural trade liberalisation on greenhouse gas emissions from agriculture around the world, focusing particularly on the effects on New Zealand, a small economy highly dependent on agricultural trade. A partial equilibrium agricultural multicountry, multicommodity trade model is used for the analysis, extended to include physical production systems and their greenhouse gas emissions. Two simulations are performed: removal of agricultural policies in the EU and in all OECD countries. The results indicate that although producer returns in New Zealand increase, greenhouse gas emissions also increase significantly. EU producers face lower returns but also lower greenhouse gas emissions.

Do consumers of manufactured cigarettes respond differently to price changes compared with their Roll-Your-Own counterparts? Evidence from New Zealand

Background Price-based mechanisms are an important tobacco cessation policy tool in New Zealand (NZ) and so measurement of smokers’ reaction to price changes is crucial in determining efficacy of this approach. Although approximately two-thirds of NZ tobacco demand is for manufactured cigarettes (MC) and one-third is for Roll-Your-Own (RYO) tobacco, previous price elasticity estimates have ignored differences between RYO tobacco and MC consumers. Methods We employ a seemingly unrelated regression econometric approach applied to quarterly data over the period 1991–2011 to estimate price elasticities of demand separately for MC and RYO tobacco. Results Estimate of price elasticity of demand for MC is −1.033, and −0.441 for RYO tobacco. RYO tobacco is an inferior good; a 1% increase in average weekly income is associated with a 0.8% reduction in demand. RYO tobacco is a substitute for MC; a 1% increase in the price of MC is associated with a 0.867% increase in demand for RYO tobacco. Conclusions There is significantly different price responsiveness across the two tobacco product types. MC smokers react far more strongly to price increases compared with RYO tobacco smokers. These findings suggest that pricing mechanisms may be more effective for reducing MC demand than for RYO tobacco. However, substitution between products means that this pricing effect is muted by the uptake of RYO tobacco use. Cessation policy specific to RYO use should be designed to target this growing group.

Households, Families and Cultural Capital

This chapter focuses on wellbeing within households and families, paying careful attention to child development. This is important from the perspective of the child, of the child’s parents, of wider society and globally. Investment in cultural capital enhances wellbeing by creating opportunities for persons to express, develop, transform and pass on to the next generation their cultural inheritance. Men and women can have equal capabilities for wellbeing; yet studies show that significant sacrifices of time and financial costs for parents are carried disproportionately by women, who are also more vulnerable to intimate violence. After accounting for housing costs, nearly one in three children in the United Kingdom are growing up in households with income below 60 per cent of the country’s median equivalised income. Thus, the chapter reveals serious problems that can be overlooked when policy advice focuses on economic growth rather than on wellbeing.

The Global Community and Diplomatic Capital

This chapter examines how persons can collaborate for the common good of the global community through participation in international non-governmental organisations, multinational corporations and intergovernmental organisations. It also explains the collaboration of researchers globally to develop knowledge by following well-established norms and protocols to build an interconnected corpus of publications that offer evidence for falsifiable propositions. An example of researchers contributing to global efforts for wellbeing is the Intergovernmental Panel on Climate Change. The chapter introduces the metaphor of diplomatic capital to represent institutions and norms designed to foster cross-cultural collaborations in order to strengthen capabilities of the global community to act together for the common good.

Persons and Human Capital

The wellbeing economics framework begins with individual persons seeking to create the kinds of lives they value, and have reason to value. These persons are able to make time-use choices they reason will promote wellbeing, influenced by cultural values, personal abilities and social capabilities. The attention to choices about time-use is because persons have equal time to allocate each day, and because time-use choices influence monetary values recorded in market transactions. Persons can expand capabilities through formal education and through relevant experience, which are time-use choices that economists describe as investment in human capital. Progress in wellbeing can be monitored using measures of subjective and objective wellbeing, exemplified in the Organisation for Economic Co-operation and Development’s Better Life Initiative.

From Economic Growth to Wellbeing Economics

The primary purpose of economics is to contribute to enhanced wellbeing of persons. Economists have often assumed this is best achieved through high economic growth. Nevertheless, experience shows that the pursuit of growth for its own sake can result in policies that harm the wellbeing of large numbers of people. Threats of global climate change, as well as other environmental and social damage caused by current patterns of economic growth, intensify this concern. This first chapter argues for a new framework—wellbeing economics—to guide private and public sector efforts for expanding the capabilities of persons to lead the kinds of lives they value and have reason to value. The wellbeing economics framework focuses on seven types of capital investment at seven levels of human choice. This typology provides the structure for the book’s remaining chapters.

Wellbeing Economics: The Capabilities Approach to Prosperity

Economists have long sought to maximise economic growth, believing this to be their best contribution to improving human welfare. That approach is not sustainable in the face of ongoing issues such as global climate change, environmental damage, rising inequality and enduring poverty. Alternatives must be found. n nThis open access book addresses that challenge. It sets out a wellbeing economics framework that directly addresses fundamental issues affecting wellbeing outcomes. Drawing inspiration from the capabilities approach of Nobel Prize winner Amartya Sen, the book demonstrates how persons can enhance prosperity through their own actions and through collaboration with others. n nThe book examines national public policy, but its analysis also focuses on choices made by individuals, households, families, civil society, local government and the global community. It therefore offers important insights for anyone concerned with improving personal wellbeing and community prosperity.