Pollution Stock Research Articles

Optimal Environmental Policy in a Dynamic Transboundary Pollution Game: Emission Standards, Taxes, and Permit Trading

Global environmental problems such as transboundary pollution and global warming have been recognized as major issues around the world. In practice, governments of all countries are actively exploring various environmental policies to control pollution. The government needs to consider the impact of neighboring regions when formulating environmental policies, especially in the context of transboundary pollution. However, the above problems are less studied, to bridge this gap and aim at solving problems in existing practices, we consider a differential game model of transboundary pollution control to examine which policy is more effective in promoting environmental quality and social welfare in a dynamic and accumulative global pollution context. Three alternative policy instruments, namely emission standards, emission taxes, and emission permit trading, are considered and compared. The results show that the social welfare of each region is the lowest and the total pollution stock is the highest under the emission tax policy due to the “rent-shifting,” “policy-leakage,” and “free-riding” effects. Moreover, the realized level of the environmental policy in the Nash equilibrium of the policy game is distorted away from the socially optimal level. The emission standards policy is found to be better than the emission tax policy and characterized by initiating the rent-shifting effect without the policy-leakage effect. Moreover, the pollution stock of two regions is found to be the lowest and the social welfare is found to be the highest under the emission permit trading policy, which is not associated with any of the three effects. Finally, a numerical example is used to illustrate the results, and a sensitivity analysis is performed in the steady state.

Optimal decision for multi-pollutants problem under ecological compensation mechanism and learning by doing

Multi-pollutants transboundary pollution is a complicated problem, for such problems, the research involves the attributes of pollutants, the degree of separability , whether the abatement cost is separable, etc. To address these challenges, this paper discusses the problem of multi-pollutant transboundary pollution based on differential game theory under the learning by doing and ecological compensation mechanism. Using the dynamic optimal control theory, we obtain the optimal equilibrium strategy under the noncooperation and cooperation model between the two regions and analyze the influence of multi-pollutants characteristics and other parameters on the optimal equilibrium strategy. In our model, the pollutants can be either technological substitutes or complements which are not necessarily separable, and the abatement costs of two pollutants are not separable. Through numerical simulation, the results show that (i) The two pollutants are substitutes or supplements which have no impact on the emission levels of these two pollutants, and as the degree of the inseparability of the two pollutants increases, the emission level decreases gradually; (ii) The abatement investment level of the two pollutants are substitutes is higher than the two pollutants are complements, and the abatement investment level increases with the degree of inseparable under the cooperation and noncooperation models; (iii) The pollution stocks of two pollutants are substitutes is higher than the two pollutants are complements. • Consider multiple pollutants and they are not necessarily separable. • The ecological compensation mechanism and learning by doing are considered. • Exploring and analyzing the optimal strategy between regions.

Reclamation of a resource extraction site: A differential game approach

AbstractWe study an extraction site reclamation problem in a two‐player differential game setting over a finite time horizon. Environmental regulation requires each firm to engage in reclamation efforts during the entire lifespan of the extraction site and to pay an abandonment reclamation fee at the end of its lease term for the unclaimed pollution caused by firms’ activities. Firms determine their reclamation efforts in order to minimize their reclamation cost. We analyze and compare individual firms’ choices and the pollution stock in the noncooperative and the cooperative cases by distinguishing between situations in which firms are homogeneous and heterogeneous. We study the case in which firms have different lease durations and different degrees of environmental liability. We show that the dynamics of the reclamation efforts may be substantially different under noncooperation and cooperation, and in both cases, it is mainly determined by how the rate of time preference and the growth rate of firms’ liabilities compare. Moreover, in all scenarios, the reclamation efforts generally rise with the degree of liability and fall with the lease duration, suggesting that in order to promote better environmental outcomes, the regulators should carefully determine the lease conditions by introducing intra‐term reclamation fees along with stringent environmental accountability.

Myopic vs. foresighted behaviors in a transboundary pollution game with abatement policy and emission permits trading

In this paper, we extend the model proposed in Benchekroun, H. and Martin-Herran, G. (2016). The impact of foresight in a transboundary pollution game. European Journal of Operational Research, 251(1), 300–309, to a more general one, in which emission permits trading and abatement policy are taken into consideration, to examine the effect of foresight on the optimal emission levels and optimal abatements in a transboundary industrial pollution game. In our model, a foresighted country chooses strategies to maximize the long-term payoff, while a myopic player ignores the impact of his decisions on the future evolutions of payoff and pollution stock. Considering the emission permits price and abatement costs, we obtain the abatement levels, the emission levels, the value functions, and the trajectories of pollution stocks of the farsighted and myopic countries, respectively. Consisting with the previous, our results show that the revenues obtained from farsighted behavior are larger than those from myopia, and the total emission of myopic countries is more than that of the farsighted ones. The total emissions will decrease with the increasing of abatement cost coefficients and emission permits price. New results are from two aspects. On the one hand, for a myopic country, the larger the abatement cost coefficients are, the smaller the willingness to acquire foresight is. On the other hand, when a myopic country acquires foresight, the other myopic countries still do not implement the abatement, while the farsighted countries should improve their abatement levels.

Uncertain Evolution of the Pollution Stock and its Effect on the Environmental Regulation of a Polluting Oligopoly

Uncertain Evolution of the Pollution Stock and its Effect on the Environmental Regulation of a Polluting Oligopoly

Transboundary pollution control in asymmetric countries: do assistant investments help?

Transboundary pollution control usually requires the cooperation of neighboring countries due to the externality of pollution. However, countries at different levels of development, which are called asymmetric countries in this paper, may have different attitudes toward this cooperation. The developing countries would like to take a free ride and they can benefit from the cooperation with developed countries, but the developed countries may not be willing to afford this cooperation cost. This paper discusses the cooperation between two asymmetric countries that developed country may provide assistant investments to help the developing country reduce pollution stock. We consider a dynamic differential game to model the transboundary pollution control between two asymmetric regions and derive the optimal equilibrium of both regions using the Hamilton-Jacobi-Bellman (HJB) equation. To explore the impact of assistant investments, numerical illustrations and sensitivity analysis are implemented to compare the equilibrium strategies under two scenarios: that with or without assistant investments. We conclude that the common pollution stock will be reduced when the developed country is willing to provide assistant investments to the developing country. Besides, the equilibrium emission strategies of both countries increase with assistant investments, which means more economic benefits for both sides.

Ambient particulate air pollution and daily stock market returns and volatility in 47 cities worldwide

We studied globally representative data to quantify how daily fine particulate matter (PM2.5) concentrations influence both daily stock market returns and volatility. Time-series analysis was applied on 47 city-level environmental and economic datasets and meta-analysis of the city-specific estimates was used to generate a global summary effect estimate. We found that, on average, a 10 μg/m3 increase in PM2.5 reduces same day returns by 1.2% (regression coefficient: − 0.012, 95% confidence interval: − 0.021, − 0.003) Based on a meta-regression, these associations are stronger in areas where the average PM2.5 concentrations are lower, the mean returns are higher, and where the local stock market capitalization is low. Our results suggest that a 10 μg/m3 increase in PM2.5 exposure increases stock market volatility by 0.2% (regression coefficient 0.002, 95% CI 0.000, 0.004), but the city-specific estimates were heterogeneous. Meta-regression analysis did not explain much of the between-city heterogeneity. Our results provide global evidence that short-term exposure to air pollution both reduces daily stock market returns and increases volatility.

Photocatalytic Activity of S-Scheme Heterostructure for Hydrogen Production and Organic Pollutant Removal: A Mini-Review

Finding new technologies and materials that provide real alternatives to the environmental and energy-related issues represents a key point on the future sustainability of the industrial activities and society development. The water contamination represents an important problem considering that the quantity and complexity of organic pollutant (such as dyes, pesticides, pharmaceutical active compounds, etc.) molecules can not be efficiently addressed by the traditional wastewater treatments. The use of fossil fuels presents two major disadvantages: (1) environmental pollution and (2) limited stock, which inevitably causes the energy shortage in various countries. A possible answer to the above issues is represented by the photocatalytic technology based on S-scheme heterostructures characterized by the use of light energy in order to degrade organic pollutants or to split the water molecule into its components. The present mini-review aims to outline the most recent achievements in the production and optimization of S-scheme heterostructures for photocatalytic applications. The paper focuses on the influence of heterostructure components and photocatalytic parameters (photocatalyst dosage, light spectra and intensity, irradiation time) on the pollutant removal efficiency and hydrogen evolution rate. Additionally, based on the systematic evaluation of the reported results, several perspectives regarding the future of S-scheme heterostructures were included.

Agriculture's Contribution to Climate Change and Role in Mitigation Is Distinct From Predominantly Fossil CO2-Emitting Sectors.

Agriculture is a significant contributor to anthropogenic global warming, and reducing agricultural emissions—largely methane and nitrous oxide—could play a significant role in climate change mitigation. However, there are important differences between carbon dioxide (CO2), which is a stock pollutant, and methane (CH4), which is predominantly a flow pollutant. These dynamics mean that conventional reporting of aggregated CO2-equivalent emission rates is highly ambiguous and does not straightforwardly reflect historical or anticipated contributions to global temperature change. As a result, the roles and responsibilities of different sectors emitting different gases are similarly obscured by the common means of communicating emission reduction scenarios using CO2-equivalence. We argue for a shift in how we report agricultural greenhouse gas emissions and think about their mitigation to better reflect the distinct roles of different greenhouse gases. Policy-makers, stakeholders, and society at large should also be reminded that the role of agriculture in climate mitigation is a much broader topic than climate science alone can inform, including considerations of economic and technical feasibility, preferences for food supply and land-use, and notions of fairness and justice. A more nuanced perspective on the impacts of different emissions could aid these conversations.

Whatever it Takes to Save the Planet? Central Banks and Unconventional Green Policy

We study the effects of a temporary Green QE, defined as a policy that temporarily tilts the central bank’s balance sheet toward green bonds, i.e. bonds issued by firms in non-polluting sectors. To this purpose, we merge a standard DSGE framework with an environmental model. In our model, detrimental emissions produced by the brown sector increase the stock of pollution. We find that the imperfect substitutability between green and brown bonds is a necessary condition for the effectiveness of Green QE. Under the assumption of imperfect substitutability, we point out the following results. A temporary Green QE is an effective tool in mitigating detrimental emissions. However, Green QE has limited effects in reducing the stock of pollution, if pollutants are slow-moving variables such as atmospheric carbon. The welfare gains of Green QE are positive but small. Welfare gains increase if the flow of emissions negatively affects also the utility of households.

Equilibrium strategies in a multiregional transboundary pollution differential game with spatially distributed controls

We analyse a differential game with spatially distributed controls to study a multiregional transboundary pollution problem. The dynamics of the state variable (pollution stock) is defined by a two dimensional parabolic partial differential equation. The control variables (emissions) are spatially distributed variables. The model allows for a, possibly large, number of agents with predetermined geographical relationships. For a special functional form previously used in the literature of transboundary pollution dynamic games we analytically characterize the feedback Nash equilibrium. We show that at the equilibrium both the level and the location of emissions of each region depend on the particular geographical relationship among agents. We prove that, even in a simplified model, the geographical considerations can modify the players’ optimal strategies and therefore, the spatial aspects of the model should not be overlooked.

An Investigation into the Advancement of Polyethylene Terephthalate Beverage Bottle Recycling in Georgetown

The present state of improper disposal of waste and the use of traditional methods to deal with waste have resulted in risks to human health and the environment. These risks include air, water, and land pollution. This situation is compounded by the prevalence of polyethylene terephthalate beverage bottles, which are considered stock pollutants. Consequently, there is need for polyethylene terephthalate beverage bottle recycling in the capital city Georgetown.

Exploitation of a Productive Asset in the Presence of Strategic Behavior and Pollution Externalities

We study the strategic behavior of firms competing in the exploitation of a common-access productive asset, in the presence of pollution externalities. We consider a differential game with two state variables (asset stock and pollution stock), and by using a piecewise-linear approximation of the nonlinear asset growth function, we provide a tractable characterization of the symmetric feedback–Nash equilibrium with asymptotically stable steady state(s). The results show that the firm’s strategy takes three forms depending on the pair of state variables and that different options for the model parameters lead to contrasting outcomes in both the short- and long-run equilibria.

A Differential Game of Ecological Compensation Criterion for Transboundary Pollution Abatement under Learning by Doing

This paper studies a stochastic differential game of transboundary pollution abatement between two kinds of ecological compensation and the abatement policy, in which the learning by doing is taken into account. Emission and pollution abatement between upstream and downstream region in the same basin is a Stackelberg game, and the downstream regions provide economic compensation for pollution abatement in the upstream region. We discuss the feedback Nash equilibrium strategies of proportional compensation and investment compensation, and it is found that an appropriate ecological compensation ratio can improve the investment level of pollution abatement in the two regions by accumulating experience in the process of learning by doing. In the long term, the investment compensation mechanism is an effective transboundary pollution abatement measure that can continuously reduce the water pollution stock in the upstream and downstream.

Dynamic Optimal Control of Transboundary Pollution Abatement under Learning-by-Doing Depreciation

This paper analyzes a dynamic Stackelberg differential game model of watershed transboundary water pollution abatement and discusses the optimal decision-making problem under non-cooperative and cooperative differential game, in which the accumulation effect and depreciation effect of learning-by-doing pollution abatement investment are taken into account. We use dynamic optimization theory to solve the equilibrium solution of models. Through numerical simulation analysis, the path simulation and analysis of the optimal trajectory curves of each variable under finite-planning horizon and long-term steady state were carried out. Under the finite-planning horizon, the longer the planning period is, the lower the optimal emission rate is in equilibrium. The long-term steady-state game under cooperative decision can effectively reduce the amount of pollution emission. The investment intensity of pollution abatement in the implementation of non-cooperative game is higher than that of cooperative game. Under the long-term steady state, the pollution abatement investment trajectory of the cooperative game is relatively stable and there is no obvious crowding out effect. Investment continues to rise, and the optimal equilibrium level at steady state is higher than that under non-cooperative decision making. The level of decline in pollution stock under finite-planning horizon is not significant. Under the condition of long-term steady state, the trajectories of upstream and downstream pollution in the non-cooperative model and cooperative model are similar, but cooperative decision-making model is superior to the non-cooperative model in terms of the period of stabilization and steady state.

The Environmental Kuznets Curve and the Energy Mix: A Structural Estimation

The Environmental Kuznets Curve (EKC) hypothesis establishes the existence of an inverted U-shaped relationship between income and environmental deterioration. This paper studies the relationship between the energy mix and pollutant emissions and uses an environmental dynamic general equilibrium model to carry out a structural estimation of the EKC hypothesis. The model considers a three-input production function, including energy. Energy is a composite of fossil fuels and renewable energy sources. The flow of pollutant emissions depends on fossil fuels’ consumption, which accumulates in a pollution stock, resulting in a negative externality that adversely impacts aggregate productivity. Simulations of the model support the existence of a steady-state EKC relationship between Gross Domestic Product (GDP) and the stock of pollution, where the negative slope side of the curve is very flat. We find that (i) the EKC hypothesis is only fulfilled when the elasticity of substitution between fossil fuel and renewable energy is high enough; (ii) the higher the elasticity of the productivity to the stock of pollution, the lower the optimal stock of pollution as a function of output; and (iii) emissions efficiency has a positive impact on the environment in the short-run, but negative in the long-run.

Green Stock: A Mini-Review

Purpose: The purpose of this paper is to analyze the literature related to green stock preservation and factors, which affect it. The growing importance of energy resources due to its depletion has increased the interest of researchers. They are trying to find out how to maintain sustainability in the utilization of such resources. Methodology or design: Content analysis has been used to examine the literature and to drive the current situation of research. 25 papers from the high-class journal have been shortlisted for this purpose. 20% of the publication shows the importance of financial management in the preservation of energy resources. 80% of the paper showing that alternative resources must be created, processes should be introduced by which increase soil fertility, forest, and emission of harmful gases like carbon must be decreased. Limitations: The small sample size was the limitation of the research. Future research direction: However, the case of developing countries has not discussed much. Future research can cover developing countries to find out the scenario in them. Originality value: This research will contribute to the literature available on the green stock, it preservation, adverse factors affecting it and its alternate sources. Practical implication: This research will give several suggestion to the business and government in perspective of the management of green stock. Also on the basis of results pollution and green stock wastage control steps can be suggested.

NUMERICAL MODELLING OF COOPERATIVE AND NONCOOPERATIVE THREE TRANSBOUNDARY POLLUTION PROBLEMS UNDER LEARNING BY DOING IN THREE GORGES RESERVOIR AREA

In this paper, we investigate cooperative and noncooperative three transboundary pollution problems in Three Gorges Reservoir Area where emission permits trading and abatement costs under learning by doing are considered. The abatement cost depends on two key factors: the level of pollution abatement and the experience of using pollution abatement technology. We use the optimal control theory to study the optimal emission paths and the optimal pollution abatement strategies under cooperative and noncooperative three transboundary pollution problems, respectively. By using the actual economic data of Wanzhou District, Kaizhou District and Yunyang County, we obtain the abatement level and the pollution stock of cooperative and noncooperative three transboundary pollution problems based on the four order Runge-Kutta method. We also discuss the influence of the change of parameter μi(i = 1,2) for the abatement level and the pollution stock.

Enforcing regulatory standards in stock pollution problems

We analyze optimal pollution standards and enforcement strategies in settings where environmental damages depend on accumulated pollution, and enforcement is socially costly. We assume that a regulator and a representative polluting firm interact in a Stackelberg differential game, and we specifically allow the firm to pollute above the limit, and pay the corresponding fine. A crucial element is how progressive the fine is with respect to the degree of non-compliance. Some of our results contradict the related literature on the control of stock pollutants under full-compliance. In particular, we find that setting standards dependent on the pollution stock (setting quantities) is preferred if fines are sufficiently non-linear; while setting fines dependent on the pollution stock (setting prices) is preferred if fines are linear or almost linear, and specially when the environmental problem is particularly harmful.

Adaptation for Mitigation

This paper develops a two-region (North and South) dynamic model in which regional stocks of effective labor are negatively influenced by the global stock of pollution. By characterizing the equilibrium strategy of each region we show that the regions’ best responses can be strategic complements through a dynamic complementarity effect. The model is then used to analyze the impact of adaptation assistance from North to South. It is shown that North’s unilateral assistance to South (thus enhancing South’s adaptation capacity) can facilitate pollution mitigation in both regions, especially when the assistance is targeted at labor protection. Pollution might increase in the short run, but in the long run the level of pollution will decline. The adaptation assistance we propose is incentive compatible and Pareto improving.