Robert Repetto

Economic incentives for sustainable production

Appropriate economic incentives for millions of households, farmers, and small producers are needed in the Third World to channel development activities into sustainable patterns that preserve the productivity of natural resource assets. Incentive problems now arise both from market failures, such as externalities and common property problems, and from policy failures, such as price distortions. Many opportunities are available to improve policies in ways that promote resource conservation, reduce environmental damage, and simultaneously raise economic productivity, decrease government budget deficits, and ameliorate rural poverty. Revising inappropriate pricing policies for agricultural output and such purchased inputs as pesticides and fertilizers would help. Reforming irrigation finance would improve the performance of public systems and promote better water use. Changing inappropriate forest revenue systems and incentives for the use of forest resources could discourage wastage of forest resources.

The policy implications of non-convex environmental damages: A smog control case study

Abstract Nitrogen oxides and hydrocarbons react to form atmospheric ozone, but, for given concentrations of either one, increasing amounts of the other give rise to declining increments of ozone. Thus, the damage functions from hydrocarbon and nitrogen oxide emissions are non-convex. A case study of control strategies in the New York metropolitan regions show that, because control costs rise so steeply for both pollutants, a cost-effective approach is to control emissions of both, despite the non-convexities. However, the loss function, for deviations from the least-cost strategy, lies well within the range of scientific uncertainty regarding precursor-ozone relationships, and the least-cost strategy choice is highly sensitive to small changes in the relative control costs. Therefore, decisions regarding controls on these emissions, especially nitrogen oxide emissions, should be based also on other considerations, such as the reduction in acid deposition.

Shifting taxes from value added to material inputs

All economists are familiar with the case for Pigovian taxes. However, this policy paradigm has proven to be inadequate in concept and in practice. Therefore, it has rarely been implemented in actual tax measures (OECD, 1994). Conceptually, the Pigovian paradigm treats market failures arising from waste discharges into the environment as exceptional and occasional, but the laws of thermodynamics dictate that virtually all materials drawn into industrial processes will sooner or later be dissipated as wastes (Georgescu-Roegen, 1971). In fact, as this paper demonstrates, most of these materials are very quickly discharged as wastes into the air, into surface and underground water, or onto land. Thus, environmental externalities are ubiquitous and inevitable and occur at all stages of the life-cycle of “production” and “consumption”, as the Resources for the Future pointed out in a classic article 25 years ago (Ayres and Kneese, 1969) . Nonetheless, economists have not yet incorporated this fundamental fact into their models and analyses.

Renewable resources and population growth: Past experiences and future prospects

The links between population growth, resource use, and environmental quality are too complex to permit straightforward generalizations about direct causal relationships. Rapid population growth, however, has increased the number of poor people in developing countries, thus contributing to the degradation of the environment and the renewable resources of land, water, and nonhuman species on which humans depend. Demands of the rich industrial countries have also generated environmental pressures and have been foremost in the consumption of the so-called nonrenewable resources: fossil fuels, metals, and minerals. On the other hand, population and economic growth have also stimulated technological and management changes that help supply and use resources more effectively. Wide variations in the possible ultimate size of world population and technological change make future interrelationships of population, resources, and the environment uncertain as well as complex. But those interrelationships are mediated largely by government policies. Responsible governments can bring about a sustainable balance in the population/resource/environment equation by adopting population and development policies that experience has shown could reduce future population numbers in developing countries below the additional five billion indicated in current United Nations medium projections, coupled with proven management programs in both developing and developed countries that could brake and reverse the depletion and degradation of natural resources.

Response to the ACPA's critique.

resents significant progress, despite its criticisms. The pesticide industry now acknowledges that this issue is an important area for future research and evaluation. This position is very different from the pesticide industrys initial reactions to the report. For the benefit of readers unfimiliar with this debate, we recapitulate the basic argument of the WRI report (2). It reviewed a large body of experimental research and wildlife studies, as well as the limited amount of human epidemiological research available