Recent Policy Interventions Research Articles

White tides: The plastic nurdles problem

The proliferation of plastic pollution, particularly from nurdles (small plastic pellets used in manufacturing), poses significant environmental and ecological risks. Originating with the invention of Bakelite in 1907 and escalating post-World War II with advanced petrochemical technologies, nurdles are the second largest source of primary microplastic pollution globally. Each year an estimated 445,970 tonnes of nurdles enter the environment worldwide. Nurdle spills, such as those along Spain's Galician coast and other global incidents, underline the need for improved spill response, preventive measures, and international regulatory coordination. The environmental impact of nurdles, compared to more visible oil spills, is insidious and long-lasting due to their persistence and widespread dispersion. Current regulations, like the International Maritime Organization’s (IMO) guidelines, reveal gaps in enforcement and fail to fully address the long-term consequences of spills. Recent technological innovations and policy interventions aim to mitigate risks, but there's an urgent need for coordinated global action, stricter controls, and investment in biodegradable alternatives to safeguard marine environments and ensure ecological sustainability.

Reassessing the role of urban green space in air pollution control

The assumption that vegetation improves air quality is prevalent in scientific, popular, and political discourse. However, experimental and modeling studies show the effect of green space on air pollutant concentrations in urban settings is highly variable and context specific. We revisited the link between vegetation and air quality using satellite-derived changes of urban green space and air pollutant concentrations from 2,615 established monitoring stations over Europe and the United States. Between 2010 and 2019, stations recorded declines in ambient NO2, (particulate matter) PM10, and PM2.5 (average of -3.14% y-1), but not O3 (+0.5% y-1), pointing to the general success of recent policy interventions to restrict anthropogenic emissions. The effect size of total green space on air pollution was weak and highly variable, particularly at the street scale (15 to 60 m radius) where vegetation can restrict ventilation. However, when isolating changes in tree cover, we found a negative association with air pollution at borough to city scales (120 to 16,000 m) particularly for O3 and PM. The effect of green space was smaller than the pollutant deposition and dispersion effects of meteorological drivers including precipitation, humidity, and wind speed. When averaged across spatial scales, a one SD increase in green space resulted in a 0.8% (95% CI: -3.5 to 2%) decline in air pollution. Our findings suggest that while urban greening may improve air quality at the borough-to-city scale, the impact is moderate and may have detrimental street-level effects depending on aerodynamic factors like vegetation type and urban form.

Navigating the Practical Complexities of Pay Transparency: Implications for Employers and Public Policy

While governments around the world have adopted policies and regulations making pay more transparent, pay transparency continues to be a contentious issue. Proponents argue that greater transparency is more consistent with the ethical underpinnings of humanistic societies and likely to benefit employees, employers, and/or society. In contrast, opponents highlight the ethical challenges that transparency may pose to personal privacy, as well as its potential social, psychological, and economic risks for stakeholders. Despite mixed beliefs, there may be some transparency-related shifts that most stakeholders welcome, or at least accept, as well as reforms whose benefits likely outweigh particularistic stakeholder costs, offering society-wide, longer term utility. We first discuss steps that policymakers and leaders may take that are likely to have positive implications for both labor and management while minimizing unintended, negative consequences and then review recent public policy interventions already adopted, as well as additional interventions to be considered for future adoption.

Do changes in distributors' incentive structure drive mutual fund flows?

PurposeThis study estimates the impact of changes in the mutual fund distributor incentive structure on distributor-advised mutual fund flows. The authors employ two recent major policy interventions by the Indian self-regulatory authority and the financial market regulator – one partial ban and another complete ban on upfront commissions – paid to mutual fund distributors on distributor-advised mutual fund flows.Design/methodology/approachThe authors use novel distributor-level data across the 198 largest distributors in India between 2013 and 2020 and a series of pooled panel random-effect generalized least squares models with robust standard errors to explore the effect of changes of distributor commissions on distributor assets-under-management (AUM), gross sales, commissions and changes (%) in the number of investors in alternate investment avenues like portfolio management services (PMS).FindingsChanges in the incentive structure have a significant negative effect on mutual fund flows at an aggregate level and within MF distributor categories. A significant diversion of investor funds toward PMS is noted, which paid higher upfront commissions to distributors during the same period.Practical implicationsThe authors posit that these two developments are not mutually independent and that both fall out of the aforementioned policy changes by Securities and Exchange Board of India and Association of Mutual Funds in India. The study findings have implications for all stakeholders in the Indian mutual fund industry and, by extension, for Indian and global alternative investment avenues.Originality/valueThis study is the first to explore the effects of these two major policy interventions by regulators on mutual fund flows in India.

The Border-Development-Climate Change Nexus: Precarious Campesinos at the Selva Maya Mexico–Guatemala Border

Borderlands can be places of socio-economic tensions, development challenges, and ecological risks, now exacerbated by climate change. We investigate the border-development-climate change nexus using research from Calakmul, Mexico and Petén, Guatemala, to detail the lived experiences and vulnerabilities of campesinos in the Selva Maya cross-border region. Our mixed methods approach combines historical analysis and ethnographic interviews with 70 campesinos. We demonstrate how large scale development approaches result in local and specific policy interventions, but produce mixed outcomes for campesinos, neglecting the most marginalized. Despite the absence of any major border crossings, a porous border in this area allows flows of people, goods, and services to connect the region, but there are differential national outcomes. In Petén, many campesinos suffer from ‘irregularity’ (lacking rights to the lands where they live and cultivate), preventing access to state development benefits. In Calakmul greater climate change demands adaptations beyond the scope of recent policy interventions. We consider how the border region includes biophysical processes as well as socio-political and cultural ones, and we argue that policy interventions are required at global, national, and local scales to address structural inequalities and co-create local solutions to development, migration, and climate change challenges.

Keeping migrants at the margins. Governing through ambiguity and the politics of discretion in the post-2015 EUropean migration and border regime

This article deals with the roles of ambiguity and discretion in the governing of migration and how they contribute to the marginalisation of migrants at the borders of EUrope. Building on ethnographic research and interviews conducted in Sicily, it connects legal-institutional ambiguities of two recent policy interventions in the field of migration governance in Italy – the Security Decree-Law and the Hotspot Approach – to the discretionary practices by public officials tasked with their implementation. By theoretically and empirically tracing the co-constitutive relationship of ambiguity and discretion, the article draws on and contributes to recent inquiries into grey areas of governance, particularly in the field of (critical) border regime studies. Based on two distinct cases, it analyses how ambiguity and discretionary local practices are related both to each other and to the contemporary fragmentary reconfiguration processes of the EUropean Migration and Border Regime, and shows how they intersect to form spatio-juridical grey areas that foster the spatial and social marginalisation of migrants in EUrope.

Blockchain, climate damage, and death: Policy interventions to reduce the carbon emissions, mortality, and net-zero implications of non-fungible tokens and Bitcoin

The art industry has commercialised and popularised non-fungible tokens (NFTs), with the volume and value of NFT transactions rapidly growing to US$ 10.7 billion in Q3 2021. The increase in NFT transactions has drawn the attention of the art market to the consequent carbon emissions resulting from verifying transactions in proof-of-work blockchains supporting NFT transactions. With CO2-related deaths attributable to NFT transactions, social pressure from the art market has helped to progress the switch away from the deliberately polluting proof-of-work blockchains to more sustainable consensus protocols.Nonetheless, many popular types of blockchain have resisted the pressure to decrease their environmental impact, including Bitcoin, whose attributed 2021 annual emissions will produce emissions responsible for around 19,000 future deaths. In response, recent global policy interventions have employed legal and fiscal tools to reduce the carbon impact of some or all types of blockchains. Linking the damage caused by proof-of-work blockchains to climate change and human mortality, this study examines the recent policy interventions designed to motivate a shift in blockchain consensus protocols and promote miners' energy efficiency to mitigate environmental damage. This article further explores available policy intervention options that are currently not utilised.

Current and Future Food Insufficiency During Covid-19: Examining Disparities by Race/Ethnicity and Recent Work Loss

The Covid-19 pandemic, which began in early 2020, has eroded the previous decade’s reductions in food insecurity. Pandemic-related food insufficiency has been concentrated among Black and Hispanic households and those who have experienced a recent work loss. Households with children are particularly vulnerable. Using the first twenty-one weeks of the US Census Bureau’s Household Pulse Survey data from April 2020 through December of 2020, we examine the association between recent work losses and food insufficiency and document the extent to which the impact varies by race/ethnicity. Work loss is predictive of current and future food insufficiency, with the association most acutely experienced by Blacks and Hispanics and households with children. There is evidence of racial/ethnic disparities in current and future food insufficiency. The results provide insight into how the pandemic has widened racial/ethnic gaps in the experience of food insufficiency despite recent policy interventions.

Changes of Gambling Patterns during COVID-19 in Sweden, and Potential for Preventive Policy Changes. A Second Look Nine Months into the Pandemic.

Gambling has been suggested as one of the potential mental health consequences of the COVID-19 pandemic. In earlier self-report studies, increased gambling has been reported by a limited proportion of respondents characterized with a high degree of problem gambling. The present study, carried out with the same methodology and in the same geographical setting, around seven months later in the pandemic, aimed to repeat and to extend the understanding of potential gambling changes in the population during COVID-19. An anonymous sample of web panel members was assessed, altogether 2029 individuals (52% women, 10% moderate-risk or problem gamblers). Results indicated that 6% reported increased gambling, and 4% reported decreased gambling during the pandemic. Having increased gambling was associated with more severe gambling problems (OR 2.78, 95% confidence interval 2.27–3.40), increased alcohol consumption (OR 2.92, 1.71–4.98), and psychological distress (OR 3.38, 1.83–6.23). In the group reporting increased gambling during COVID-19, moderate-risk/problem gambling was very common (62%). Recent governmental policy interventions in the area were known to a minority (30%) of respondents, but awareness of the regulations was markedly more common in individuals with at least moderate-risk gambling (56%) and in self-excluders (78%). Reporting of any perceived influence from policy changes was low (3%), and divided between those reporting an increasing and decreasing effect, respectively. Increased gambling may be a consequence of COVID-19-related changes in everyday lives of individuals with problematic gambling patterns. Thus, a vulnerable group demonstrates higher rates of gambling migration and psychosocial problems, and may require particular attention in screening and treatment contexts, and further scientific evaluations.

A model of endogenous direct and indirect asset liquidity

Economists often say that certain types of assets, e.g., Treasury bonds, are very ‘liquid’. Do they mean that these assets are likely to serve as media of exchange or collateral (a definition of liquidity often employed in monetary theory), or that they can be easily sold in a secondary market, if needed (a definition of liquidity closer to the one adopted in finance)? We develop a model where these two notions of asset liquidity coexist, and their relative importance is determined endogenously in general equilibrium: how likely agents are to visit a secondary market in order to sell assets for money depends on whether sellers of goods/services accept these assets as means of payment. But, also, the incentive of sellers to invest in a technology that allows them to recognize and accept assets as means of payment depends on the existence (and efficiency) of a secondary market where buyers could liquidate assets for cash. The interaction between these two channels offers new insights regarding the determination of asset prices and the ability of assets to facilitate transactions and improve welfare. We also use our model to study the efficacy of recent policy interventions in asset markets.

U.S. Banks and Global Liquidity

We characterize how U.S. global systemically important banks (GSIBs) supply short-term dollar liquidity in repo and foreign exchange swap markets in the post-Global Financial Crisis regulatory environment and serve as the "lenders-of-second-to-last-resort". Using daily supervisory bank balance sheet information, we find that U.S. GSIBs modestly increase their dollar liquidity provision in response to dollar funding shortages, particularly at period-ends, when the U.S. Treasury General Account balance increases, and during the balance sheet taper of the Federal Reserve. The increase in the dollar liquidity provision is mainly financed by reducing excess reserve balances at the Federal Reserve. Intra-firm transfers between depository institutions and broker-dealer subsidiaries within the same bank holding company are crucial to this type of "reserve-draining" intermediation. Finally, we discuss factors that contributed to the repo spike in September 2019 and the subseque nt response of U.S. GSIBs to recent policy interventions by the Federal Reserve.

The Recent Coronavirus (COVID-19) Pandemic: A Review of Issues for Indian Pharmaceutical Exports

The world today is facing a major challenge in adjusting to the adverse effects of the Coronavirus (COVID-19) spread. Meeting the demand for several key drugs and preventive medical supplies has emerged as major concern in many countries. India has over the years consolidated its position as a major producer and exporter of not only bulk drugs and formulations but also other medical provisions and equipment. The present commentary makes an attempt to understand the possible trade opportunities for India’s pharmaceutical sector in light of the recent export policy interventions. An analysis of the recent export policy adjustments reflects the evolving attitude of the country towards domestic risk perception and commitment to support other countries. The trade opportunities for India are analysed next with the help of select trade indices, and it appears that there is significant scope for enhancing India’s global competitiveness in several product groups. The evolving trends have then been judged by exploring their plausible implications from a theoretical standpoint. It has been concluded that in order to meet the growing world demands for these products, India needs to enhance productivity of the upstream segments through a rigorous policy framework. JEL: F10, F13, I18

Environmental policy and innovation in Norwegian fish farming: Resolving the sea lice problem?

In Norway, the world's largest salmon-producing country, reducing sea-lice levels in fish farms has been an overarching goal of government policy since 2013. However, industry innovation has not yet succeeded in significantly reducing the sea lice problem.We identify two main types of radical environmental innovation that could potentially resolve the sea-lice problem: in-shore closed-cage production technology, and a genetically lice-resistant salmon. Furthermore, we provide an analytical framework that shows how radical environmental innovations with a “public good” character are least likely to receive private R&D funds. This leads us to conclude that neither in-shore closed cage technology nor targeted breeding towards lice-resistance will succeed in the market unless backed by targeted government intervention.Closer examination shows that these two types of innovation have been less prioritized, if at all, in recent policy interventions. First, the government has geared most of financial support towards relieving the risk of investment in offshore innovation projects, although inshore projects might be better suited for accommodating public and environmental needs. Second, this study underscores the need and potential for stimulating sustainable innovation through the genetic route—a point overlooked in Norway's current policy mix.

Agricultural sector value chain and government policy in Nigeria: issues, challenges and prospects

PurposeThis paper systematically reviewed the contributions of the recent Nigerian government agricultural policies and the impacts on the agricultural value chain system in line with the structural transformation of the sector and the Nigeria's vision 20:2020. The study also suggest strategies to upgrading various segments of the agricultural value chain and argue that Nigeria's agricultural sector requires huge investments and innovative ideas to increase production and create value addition across the most profitable areas of the value chain.Design/methodology/approachThe authors systematically present evidences and data from the Central Bank of Nigeria (the apex monetary authority of Nigeria) and Nigerian Bureau of Statistics (oversees and publishes statistics for Nigeria) to estimate the impact of Government agricultural policies on the value chains system.FindingsThe study discovers that the various recent government policy interventions to tackle the austere challenges in the agricultural sector are yet to yield much significant solution. Given to the dwindling performance of the sector, the Nigerian agricultural value chain is somewhat affected with systemic and services gaps which underpin the market failures (missing markets and weak markets), although the agricultural value chain has the potential of triggering economic growth in a higher scale with a trickle-down effect to other sectors of the Nigerian economy.Practical implicationsOverall, the findings indicate strategies to upgrading the production and processing segments of the agricultural value chain and argues that Nigeria's agricultural sector requires huge investments and innovative ideas to increase production and create value addition across the most profitable areas of the value chain.Social implicationsThe study proves that enhancing value addition in the agricultural sector is imperative to achieving triple-benefits of increasing productivity by building resilient systems that leverage on finance opportunities, deepening economic inclusive growth and achieving great milestones.Originality/valueThis study is the first attempt to focus on agricultural value chain system in line with the structural transformation and the Nigeria's vision 20:2020.

Want to Improve Math Scores? An Empirical Assessment of Recent Policy Interventions in Canada

The Canadian provinces have implemented various strategies aimed at improving kindergarten through 12th-grade mathematics performance. There is no clear evidence which, if any, of these strategies improve achievement scores. We apply hierarchical linear modelling to the 2012 Program for International Student Assessment data to isolate the effects of policy interventions. We find that efforts to improve learning conditions can be worthwhile, but their effects are not as substantial as a school’s socio-economic status composition, which elevates or depresses the academic achievements of all students. As barriers to school choice come down, ambitious parents will resort to active school choice, a strategy that may reduce social equity.

Complex Pricing and Consumer-Side Attention

This paper analyzes a market in which two horizontally differentiated firms compete by setting menus of two-part tariffs, and in which some consumers are not informed about the linear per-unit price component. We consider two regulatory interventions that limit firms’ ability to price discriminate: (i) diminishing the range of contracts via a reduction in the number of two-part tariffs offered (which prohibits inter-group price discrimination), and (ii) a reduction in tariff complexity via the abolishment of linear fees (which prohibits inter- and intra-group price discrimination). We characterize the effects of these interventions on firm profits and (informed and uninformed) consumer welfare, and identify conditions for the optimal policy. Our results provide insights for the evaluation of recent policy interventions (e.g., the regulation of roaming charges in the EU market).

U.S. Banks and Global Liquidity

We characterize how U.S. global systemically important banks (GSIBs) supply short-term dollar liquidity in repo and foreign exchange swap markets in the post-Global Financial Crisis regulatory environment and serve as the lenders-of-second-to-last-resort. Using daily supervisory bank balance sheet information, we find that U.S. GSIBs modestly increase their dollar liquidity provision in response to dollar funding shortages, particularly at period-ends, when the U.S. Treasury General Account balance increases, and during the balance sheet taper of the Federal Reserve. The increase in the dollar liquidity provision is mainly financed by reducing excess reserve balances at the Federal Reserve. Intra-firm transfers between depository institutions and broker-dealer subsidiaries within the same bank holding company are crucial to this type of reserve-draining intermediation. Finally, we discuss factors that contributed to the repo spike in September 2019 and the subsequent response of U.S. GSIBs to recent policy interventions by the Federal Reserve.

Shadow Bank Runs

Short-term debt is commonly used to fund illiquid assets. A conventional view asserts that such arrangements are run-prone in part because redemptions must be processed on a first-come, first-served basis. This sequential service protocol, however, appears absent in the wholesale banking sector—and yet, shadow banks appear vulnerable to runs. We explain how banking arrangements that fund fixed-cost operations using short-term debt can be run-prone even in the absence of sequential service. Interventions designed to eliminate run risk may or may not improve depositor welfare. We describe how optimal policies vary under different conditions and compare these to recent policy interventions by the Securities and Exchange Commission and the Federal Reserve. We conclude that the conventional view concerning the societal benefits of liquidity transformation and its recommendations for prudential policy extend far beyond their application to depository institutions.

Presidential Address: Aspirations, Social Norms, and Development

Abstract I study the role of aspirations in economic development drawing on the existing theoretical and empirical literature and provide some new empirical findings using individual level data on aspirations across countries. After discussing the relationship between aspirations and individual investments, I present estimates on the correlates and determinants of students’ aspirations in the OECD’s Programme for International Student Assessment data. I focus in particular on socioeconomic status, inequality, and institutional features that lead to horizontal segregation of education systems. I then address the question of whether and how aspirations can be changed, covering recent policy interventions that leverage psychological factors, stereotypes and norms, and material endowments.

Risk-based licensing of alcohol venues and emergency department injury presentations in two Australian states

BackgroundRisk-based licensing (RBL) is among the more recent policy interventions to reduce alcohol-related harm in and around licensed venues. RBL sets licence fees to reflect the venue’s propensity to cause harm as a means of encouraging operators to improve their practices. We assessed whether the introduction of RBL in the Australian states of Queensland and Victoria was associated with a reduction in the incidence of emergency department (ED) injury presentations. MethodsWe employed an interrupted time series design using Prais-Winsten and Cochrane-Orcutt regression modelling to estimate step and slope parameters in injury incidence rates in each state. We defined the population as residents of the state, aged 15–54 years, the age group we considered most likely to be exposed to the night-time economy. To reduce noise, we confined cases to presentations during times previously identified as correlated with a high probability of alcohol involvement, namely ‘high alcohol hours’ (HAH). We adjusted our models for the alcopops tax, implemented shortly before RBL, and for assaults during low alcohol hours (LAH) as a proxy for other risk factors for assault. ResultsRBL was not associated with an overall reduction in the incidence of ED injury presentations during HAH in Queensland (β = 0.003; 95% CI: −0.010, 0.003, p = 0.318) or Victoria (β=−0.010; 95% CI: -0.021, 0.001, p = 0.087). Post-hoc subgroup analyses showed a reduction in ED injury presentations among men aged 20–39 years in Victoria (β=−0.026; 95% CI:-0.012, −0.040, p-0.0003) but this was not replicated in Queensland. ConclusionThere was little evidence that RBL affected the incidence of ED presentations for injury. This may be due to weak financial penalties being applied to venues assessed as high-risk.