Positive Environmental Externalities Research Articles

Overview of Agricultural Subsidies in India and Its Impact on Environment

Agriculture is vital to India's economic development, providing food security to over 1.4 billion people and employing 58% of the population, while contributing 19-20% to GDP. The government's spending on the agricultural sector has been increasing annually, reaching Rs. 1,25,036 crores in 2023, up from Rs. 1,22,836 crores in 2022. The government provides various forms of agricultural subsidies, both direct and indirect, aimed at spurring growth in the sector. However, the efficacy of these subsidies in achieving intended outcomes remains questionable. This paper provides an overview of agricultural subsidies in India by examining the allocation of funds under different schemes. It also analyzes the different types of subsidies and impact on the environment. The study utilizes secondary data from government and research publications. The findings suggest that while agricultural subsidies help the sector, mismanagement hampers their reach and effectiveness for farmers and the environment. Subsidies have both positive and negative environmental externalities. The paper argues that improved targeting of subsidies is critical to maximize benefits for farmers and minimize unintended consequences. More focused allocation can enhance the efficiency of public expenditure on agricultural subsidies and make them more ecologically sustainable. The study provides insights into reforming India's agricultural subsidy regime to balance productivity, equity, and sustainability concerns.

POTENTIAL OF NO-TILL TECHNOLOGY FOR ENVIRONMENTAL PROTECTION

Reducing the negative impact of agricultural practices on the environment is essential. There is a growing need for the use and adoption of environmentally friendly and environmentally sound technologies in agriculture. Encouraging the adoption of agri-environmental practices will increase crop productivity, minimise labour time, improve biological control, reduce erosion, improve soil structure, increase infiltration and water retention properties and achieve environmental sustainability. The wide range of conditions under which the minimum tillage system works successfully worldwide are its economic, social and environmental advantages. No-till technology is often characterised as a means of tilling the soil and growing different crop species with positive environmental externalities. The purpose of this paper is to describe the importance of using the agroecological practice of no-till and its impact on land resources as well as its secondary environmental impacts. A literature review of the author's views related to the definitions of No-till technology is conducted. It is most commonly defined as no-till, minimum tillage or a technology such as planting in soil without prior preparation. The palette of benefits that agroecological practice brings to the soil, the environment, agriculture and farmers is rich, namely: ➢ does not disturb soil composition; ➢ improves the functions that occur in ecosystems; ➢ increases the availability of crop residues. Increased availability of crop residues and cover crops on cropland increases biomass production, with the maximized yield serving to store more C in the soil; ➢ improves water conveyance functions, moisture retention, and reduction of surface runoff and erosion, increases heat throughout the soil world; ➢ production quantities obtained are comparable to those of intensive tillage; ➢ reduces both labor time and the use of fuels and pesticides; ➢ minimizes depreciation of the equipment used; ➢ reduce investment in purchasing attachments; ➢ smaller capacity of the machinery and equipment used; ➢ reduce and simplify labour requirements; ➢ easy matching with crop rotation and improved nutrient cycling. Key words: JEL: Q00, Q01, O13

Analyzing consumer willingness to pay for organic extra virgin olive oil: A logit model approach

The present study examines the elements that influence Italians' willingness to pay a higher price for organic olive oil. As a result, a survey was conducted involving a heterogeneous sample of 332 consumers and their propensity to spend a surplus price was examined using a logit model. According to the study findings, consumers are willing to pay more for organic olive oil and this willingness to pay increases with age, education level, living in a smaller household, consumption of organic food and traditional sources such as producers, retailers and supermarkets. The empirical investigation demonstrates the convenience for farms of converting olive oil production from conventional to organic in order to fulfill customer needs. Companies are able to plan their medium-and long-term commercial activities when they can predict customer preferences. Indeed, consumer information may have a beneficial effect on the community as a whole due to the considerable quantity of positive environmental externalities associated with organic olive production.

Navigating contract renegotiations with sustainability at the helm: Societal benefits and transaction costs

Public procurement and cross-sector collaborations in national economies offer the opportunity for advances in sustainability practices, including through sustainability-related renegotiations during the execution of public contracts. Using rich, granular data from contract modification notices made publicly available by the European Union (EU) tenders electronic daily (TED), we investigate whether sustainability-related renegotiations, apart from generating positive environmental externalities, also limit ex-post transaction costs associated with contract renegotiations. Transaction costs are assessed in our study by the sentiment of renegotiations (negative or conflictual) and potential red flags associated with overly costly adjustments. Our findings suggest that regardless of whether contracts were initially focused on sustainable issues or not, sustainability-related renegotiations could have the dual benefit of a priori reducing environmental externalities while further limiting ex-post transaction costs associated with contract execution. More generally, contract modifications (renegotiations) may be under-utilised in public procurement contracts given their possible ‘double dividends’.

Toward low‐carbon sustainable development: Exploring the impact of digital economy development and industrial restructuring

AbstractLow‐carbon sustainable development is considered an essential strategy for achieving economic growth and environmental protection, requiring a fundamental transformation of the industrial structure, including developing clean technologies, promoting energy efficiency, and adopting sustainable production and consumption patterns. Simultaneously, the evolving digital economy is acknowledged as an essential driver in optimizing the industrial structure. Therefore, can digital economy development reshape the industrial structure and lead to low‐carbon sustainable development? The main purpose of this paper is to examine the mediating role of industrial structure upgrading in the relationship between the digital economy and low‐carbon development. Its ultimate purpose is to explore more possible paths to achieve low‐carbon development. This paper builds a regression model based on the data of cities. We found that digital economic development can directly promote low‐carbon sustainable development, a conclusion that still holds after endogeneity discussion and robustness testing. Additionally, digital economy development can promote industrial structure upgrading and thus promote low‐carbon sustainable development, meaning that industrial structure upgrading is an effective mechanism for digital economy development to promote low‐carbon sustainable development. This paper provides empirical evidence for the positive environmental externalities of digital economic development and establishes a basic research framework of “digital economic development → industrial structure upgrading → low‐carbon sustainable development.”

ENVIRONMENTAL EXTERNALITIES OF URBAN AGGLOMERATION IN CHINA: NEW EVIDENCE FROM THE PERSPECTIVE OF ECONOMIC DENSITY

In order to capture the environmental externalities of urban agglomeration, we use an agglomeration indicator referred to as economic density, which can be decomposed into the average population density and the concentration of population distribution. Our benchmark regressions use the ordinary least squares method and grid-level panel data for China and for the period 2000–2016. We find that economic density is positively correlated with PM2.5 concentration, and the effects of the two components of economic density are opposite. To address the endogeneity issues, the causal effect of economic density on PM2.5 concentration is estimated with an instrumental variable method. Empirical results show that the PM2.5 concentration increases with economic density, and the associated elasticity is between 0.045 and 0.079. The findings of our benchmark regressions are also supported by a variety of robustness checks. Moreover, while economic growth, the development of secondary industry, and the presence of coal-driven power plants explain why cities with more dense population are more polluted, residential energy use is an opposite channel through which cities with higher economic density can reduce air pollution. Overall, the total effect is a trade-off, and the negative environmental externalities of agglomeration are larger than positive environmental externalities.

Tax equity, green innovation and corporate sustainable development

In the context of increasing resource scarcity and environmental pollution, achieving sustainable development with environmental friendliness at its core is essential for maintaining long-term economic growth. However, the positive environmental externalities associated with sustainable development impose an additional cost burden on enterprises. Internalizing those positive environmental externalities in the form of corporate benefits through tax policies is the key to incentivizing sustainable development. Using the reform of China’s tax enforcement agency and tax enforcement system as a quasi-natural experimental context, this paper investigates the impact of tax equity on sustainable development. The empirical findings show that tax equity can promote the sustainable development of enterprises, and this promotion is achieved by enhancing corporate green innovation. Furthermore, tax equity has a stronger effect on the sustainable development of enterprises in a favorable market environment because it is more conducive to the protection of intellectual property and transformation of green innovation into tangible output. The tax equities brought about by different types of tax reforms have different effects on the sustainable development of enterprises in different life cycle stages because the types of tax inequities suffered by enterprises of different ages vary.

Socioeconomic and Environmental Impacts of Tobacco Farming in Khyber Pakhtunkhwa, Pakistan

Tobacco production and curing cause a threat to the environment through injudicious use of pesticides, imbalanced use of chemical fertilizers, and excessive consumption of local firewood. Keeping all this in retrospect, this study has been designed to assess the impact of tobacco farming on family workers, and witness on spot involvement of children and nursing/ expecting mothers in tobacco-related health-hazardous tasks. General objective of the study is to document both the positive and negative environmental and socioeconomic externalities of tobacco production in the study area. It is based both on primary data and secondary statistics. Primary data has been collected from sixty farmers for the tobacco season 2021; including forty contract and twenty non-contract sample farmers. Farmers conceive that tobacco farming has a bad impact on human health (93 %), and causes degenerative deforestation and resource depletion (68 % each). Use of Green Tobacco Sickness gloves and Personal Precautionary Equipment was reported by eighty and sixty-two percent of the farmers, respectively. Impact of the disease on the workers’ health was reported by thirty-five percent of contracted farmers, and 90 percent of non-contracted ones. Thus, the impact of the disease on human health was severe on non-contracted farms, mainly due to little or no use of Personal Precautionary Equipment. Cost of Personal Precautionary Equipment per season at the contracted farms was much higher (US$ 18.0) than at non-contracted ones (US$ 2.0). While the treatment cost of Green Tobacco Sickness or other agrochemical-related diseases of contracted farming households was 2.5 times lower than non-contracted ones. As per the results of the double log Ordinary Least Squares regression model about medical treatment cost, the coefficient of age of household head and use of Personal Precautionary Equipment have negative expected signs and are statistically significant. Laboratory tests of soil and water samples have revealed hazardous levels of Sodium Chloride and Dissolved Oxygen in canal water, which indicate imbalanced use of fertilizers by the growers and leaching of excessive nutrients below the root zone. Tobacco companies’ contracted growers were found to have less occupational health hazards. Thus, raising awareness among tobacco growers about the importance of adopting precautionary measures and use of Personal Precautionary Equipment can reduce the negative effects of tobacco farming.

Collective smart innovations and corporate governance models in Italian wine cooperatives: the opportunities of the farm-to-fork strategy

European policies, especially the ‘farm-to-fork strategy’, address the challenge posed by the ecological transition in agriculture setting up a new technological paradigm. In this context, collective smart innovations may play a crucial role, enabling to meet current citizen-consumers’ needs as well as producing positive environmental and social externalities. Lately, wineries, in the attempt to improve the sustainability of production process and the creation of competitive advantages, reoriented their investments in research and development embracing smart innovations. The latter, when supported by appropriate models of corporate governance, can facilitate business decisions and create shared value. Despite its relevance, literature on the topic is still scarce. This study aims to investigate the role played by collective smart innovations and corporate governance in the sustainable and ecological transition of wineries and, specifically, wine cooperatives. The case study methodology was adopted investigating the collective innovation ‘I mille per l’Aglianico’ implemented by the Italian wine cooperative ‘La Guardiense’. Results show that the collective smart innovation experienced by ‘La Guardiense’ had impacts in terms of internal economies, such as increase in sales and costs reduction; and in terms of external social economies, such as local development and environmental protection.

Spatial temporal patterns and driving factors of industrial pollution and structures in the Yangtze River Economic Belt

The conflict between industrial development and environmental pollution is global. This study quantitatively analyzes the temporal and spatial changes, spatial effects and determinants of industrial pollution discharge in the Yangtze River Economic Belt through two main indicators: wastewater and SO2. Analyze the spatial coupling relationship between industrial agglomeration and pollution emission and the characteristics of industrial structure in different regions. The analysis shows that industrial emissions in the Yangtze River Economic Belt first increased and then decreased during the period 2003-2019. Industrial pollution spread from large to small and medium cities and shifted from downstream to upstream. Moreover, a positive correlation exists between industrial pollution discharge and per capita GDP, secondary industry proportion, population density, and energy use. Meanwhile, scientific and technological progress and environmental regulations are associated with industrial pollution reduction. Since the Yangtze River Economic Belt was still in the industrialization stage and had not yet reached a turning point on the Environmental Kuznets Curve. The "pollution refuge" phenomenon was evident in the Belt, where underdeveloped areas in the central and western regions accommodated portions of highly polluting industries from the eastern areas through "regional competition" and "policy depression." The industrial agglomeration and pollution antagonistic zones were dominated by polluting industries; environmental risks were greatest in these areas. The upstream and downstream of the YREB play the negative and positive environmental externalities of industrial agglomeration, respectively. Thus, differential control measures should be formulated according to different regions, industrial pollutants, and polluting industries to improve environmental quality.

Externalities, entry bias, and optimal subsidy policy for cleaner environment

AbstractThis paper analyses alternative subsidy schemes and long‐run entry bias in a new industry that creates positive environmental externalities (both generation externalities and externalities associated with interindustry technology spillovers). It demonstrates that per‐unit subsidy scheme, despite attracting fewer firms, results in higher industry output and economic surplus in the equilibrium compared with the expenditure equivalent lump‐sum subsidy scheme. However, the later leads to higher total surplus, unless spillover externalities are sufficiently small. Further, the free‐entry equilibrium number of firms may be excessive or insufficient. A key finding of this paper is that the first‐best equilibrium outcome can be implemented through a unique combination of per‐unit subsidy and lump‐sum subsidy/tax, which involves positive government expenditure in the presence of positive externalities.

Green Credit of China’s Coal Power Enterprises during Green Transformation: A Tripartite Evolutionary Game Analysis

China’s green credit has mostly been invested in new energy areas with positive environmental externalities in recent years, while coal power enterprises have been neglected. This paper constructs a tripartite evolutionary game model among government, coal power enterprises, and banks to clarify the key factors and mechanisms for coal power enterprises undergoing green transformation. The research results show that: Firstly, to realize the spontaneous green transformation of coal power enterprises, spontaneous profitability must be achieved before the removal of policy incentives, which is reflected in the continuous increase in electricity price, carbon emission trading price, and decrease in green transformation cost. Secondly, the green credit adjustment factor cannot determine whether a company chooses to undertake green transition, but it provides a valuable window of green transition for companies. When the relative benefits of green transformation projects are greater than the relative costs, coal power enterprises will undergo green transformation spontaneously. Thirdly, lower green credit interest rates are not better. An optimal green credit interest rate exists, that allows coal power enterprises to obtain the longest transition window in which to achieve spontaneous profitability for green transition projects.

Impact factors to reduce carbon emissions. Evidences from Latin America

PurposeCarbon dioxide emissions affect the environment, presenting major implications for sustainable development and consequently model climate change policies. The main aim of the paper is to highlight the factors leading to CO2 emissions in Latin America.Design/methodology/approachThe analysis was performed using data for 1990–2020 and panel regression and STATA software.FindingsThe results highlighted that the variables have significantly influence CO2 emissions in case of the countries in the sample.Originality/valueThe novelty of the paper consists in using all financial inflows of together (foreign direct investment, official development assistance and remittences), Latin America heavily in-flowed with remittances from the USA. Since Latin America is enriched with forest areas, the authors also covered this variable in the estimations. Urbanization and transportation are induced by remittance inflows, thus wellbeing was incorporated in the model. The conclusion of the study demonstrates the need for complex measures involving public-private partnerships, public awareness of the need for energy transition and the involvement of foreign-owned companies that must not only pursue their own interests but also generate positive economic, environmental, and social externalities in host countries.

Industrial coagglomeration, technological innovation, and environmental pollution in China: Life-cycle perspective of coagglomeration

The coagglomeration of manufacturing and producer service industries and technological innovation plays an essential role in China's booming economy. Considering the coordinated development goal of the environment and the economy, from the life-cycle perspective of industrial coagglomeration, this study empirically examines whether industrial coagglomeration has dynamic influences on environmental pollution and verifies the direct and indirect impact mechanisms based on the panel threshold model and mediation model. Panel data for China's 30 provinces from 2008 to 2019 are employed. The results suggest that the impact of industrial coagglomeration on environmental pollution is positive and has significant threshold effects. As industrial coagglomeration deepens, its aggravating effect on environmental pollution presents an inverted S-shaped trend. The impact of industrial coagglomeration on technological innovation is negative. With the deepening of coagglomeration, the adverse effect gradually decreases. Additionally, technological innovation is conducive to the reduction of environmental pollution. It acts as a vital mediator between industrial coagglomeration and environmental pollution, and its mediating effect varies with the dynamic evolution of industrial coagglomeration. These conclusions show the importance of increasing industrial coagglomeration efficiency and stimulating the effective play of positive environmental and innovative externalities to realize the sustainable pursuit of economic and ecological benefits.

Does the development of China's high-speed rail improve the total-factor carbon productivity of cities?

China's high-speed rail (HSR) has developed expeditiously since the beginning of the 21st century, exerting significant influences on many aspects, such as economic development and residents' travel mode. Improving carbon productivity is one of the necessary measures to realize China's carbon neutrality goal, considering economic growth. However, previous researches have not dealt with the exact impact of HSR opening on carbon emission performance. This study seeks to fill this gap. Through the difference-in-differences (DID) model, we discover that the opening of HSR significantly improves the city's total-factor carbon productivity in China. In addition, the influencing mechanism and heterogeneity of the impact are discussed, and the polarization effect is also analyzed. Overall, this study strengthens the idea that HSR construction has positive environmental externalities. The insights gained from this study may be of assistance to accurately formulate policies related to HSR planning and construction in the future.

Sugar-energy bioelectricity in energy trading environments: reasons for the lack of competitiveness

PurposeRenewables such as sugar-energy biomass can contribute to national electrical security, job creation and mitigation of greenhouse gas emissions. However, after the auction of reserve energy, in 2008, exclusive biomass, in the regulated contracting environment (RCE), the authors observe that this energy environment has lost competitiveness in the auctions. Thus, a study on the present theme is justified, based on the problem: What are the reasons for the lack of competitiveness of sugar-energy bioelectricity in the Auctions of the RCE of the National Electric Energy Agency? The purpose of this study is to understand the situation of sugar-energy bioelectricity in the Brazilian market.Design/methodology/approachLiterature review was conducted through the Scientific Electronic Library Online database, as well as the survey of primary documents at Sugarcane Industry Union and Electric Energy Trading Chamber.FindingsThe reasons for lack of competitiveness in RCE electricity auctions are: distant location of transmission lines; difficulties in obtaining licensing; delay in responses from environmental agencies; difficulties in securing financing for electricity generation projects for distilleries; non-pricing of positive environmental externalities as adequate disposal of waste; and the non-recovery of the cost of retrofit of the plants. The present situation may create economic, social and ecological circumstances adverse for Brazilian development, such as a lack of employment and income generation, loss of international currencies from imports of technologies not developed and produced in the country and more significant inefficiency greenhouse gas mitigation.Originality/valueThe originality of this study is in the contribution to the scarce literature on the understanding of the reasons for the lack of competitiveness of the Brazilian sugarcane sector in auctions of the regulated energy environment, based on SWOT analysis and, based on this understanding, to propose solutions for the expansion of this important matrix energy.

Optimization Model for Sustainable End-of-Life Vehicle Processing and Recycling

The aim of this paper is to provide a mathematical programming model for sustainable end-of-life vehicle processing and recycling. Environmental benefits and resource efficiency are achieved through the incorporation of a processing and recycling network that is based on industrial symbiosis whereby waste materials are converted into positive environmental externalities aimed at decreasing pollution and reducing the need for raw materials. A mixed-integer programming model for optimizing the exchange of material flows in the network is developed and applied on a real case study. The model selects the components that maximize reusable/recyclable material output while minimizing network costs. In addition, GHG emissions are calculated to assess the environmental benefits of the network. The model finds the optimal processing routes while maximizing the yield of the components of interest, maximizing profit, minimizing cost, or minimizing waste depending on which goals are chosen. The results are analyzed to provide insights about the network and the utility of the proposed methodology to improve sustainability of end-of-life vehicle recycling.

The dynamic nexus among financial development, renewable energy and carbon emissions: Moderating roles of globalization and institutional quality across BRI countries

Belt and Road (BRI) countries are trying to realize the potential of financial resources and renewable energy in order to mitigate the effects of carbon dioxide (CO2) emissions and to attain the Sustainable Development Goals (SDGs). However, prevailing structural issues have been found to stymie the environmental outcome. This issue calls for a policy reorientation in the BRI countries, and therein lies the role of the present study. This study examines how the environmental impacts of financial development and renewable energy respond to exogenous moderation. Using a second-generation methodological approach on the data of the 64 BRI countries over 2003–2019, findings reveal that globalization enhances the negative environmental externality exerted by financial development, while institutional quality suppresses it. Both globalization and institutional quality augment the positive environmental externalities exerted by renewable energy and human capital. Using dynamic elasticity measures, the evolutionary impacts of the moderators are also captured. An SDG-oriented policy framework is recommended based on the study outcomes.

Investigating the Hedonic Housing Price Model for Lagos Residential Market

The conundrum on what exactly consumers are willing to pay for when demanding for housing remains a concern in the developing world. This study investigates the hedonic housing price for Lagos residential market with a view to determine the willingness to pay for housing quality traits. The hedonic pricing model is one way through which willingness to pay is being measured. The data employed was obtained from adult residents in the urban centers of the state (Lagos Metropolitan city). Specifically, Lagos State has 20 Local Government Areas (LGAs), out of which 16 constitute the Lagos Metropolitan City. Multistage sampling technique was used to select a sample of 677 housing consumers from the population. The Ridge Regression (RR) was used to estimate the multifactorial model that formed the hedonic housing price model. This method overcomes the problem of multicollinearity in the model and produce unbiased estimates. The findings show that house type has a higher impact on the willingness to pay for a house. Flooring condition of a house is more considered by the consumers than its roofing and walling. Besides, availability of clean water is the most important variable that consumers consider in the basic attribute as relates to life essentials. The next to it is the availability of fence in the apartment. In essence, security of life and property remains a concern to living in Lagos and Nigeria by extension. This underscores the need for Nigerian government to sincerely tackle insecurity in the nation. Essentially, government must strengthen its intelligent mechanisms so as to unravel and deal with internal and external sponsors of insecurity in the country. Closeness to bank and commercial centres stands to be the variable with the greatest impact on willingness to pay among the positive environmental externalities. Meanwhile, a unit increase in travel distance to hospital, market and water facility decrease willingness to pay by 6.1 percent, 3.4 percent and 0.6 percent, respectively. In all, house consumers in the city are willing to pay different prices for different housing quality traits.

Heterogeneous Spatial Effects of FDI on CO2 Emissions in China

AbstractAs the world’s largest CO2 emitter, China’s emission reduction is the key to mitigating global climate change. Global investment capital, as a significant influencing factor of emissions, greatly contributes to China’s economic growth and stimulates frequent interprovincial trade since the reform and opening. However, the spatial correlation of foreign investment and CO2 emissions across Chinese provinces is rarely considered. This paper explores the role of foreign direct investment (FDI) in emission reduction in China during 2004–2015 using the spatial Durbin economic models with two‐way fixed effects. Then, the partial differential equations decomposition of the local and spatial spillover effects is conducted for capturing the marginal effects of influencing factors. Results show that FDI contributes to emission reduction for the whole country, whereas interprovincial transmission and intra‐provincial transmission show significant heterogeneity. Specifically, FDI increases emissions in host areas, while FDI provides positive environmental externalities to adjacent areas through spatial spillovers. Our findings provide a new perspective to explain the coexistence of the “Pollution Haven” and “Pollution Halo” theories in a country. Also, the exploration of spatial spillover effects of FDI on emissions can provide a reference for other countries with rising trade and investment flows to promote collaborative emission reduction.