School of Natural Resources & Environment
University of Michigan
Ann Arbor, MI 48109-1041
Institutional Affiliation: University of Michigan
NBER Working Papers and Publications
|October 2018||Farming Under Weather Risk: Adaptation, Moral Hazard, and Selection on Moral Hazard|
with Hsing-Hsiang Huang
in Agricultural Productivity and Producer Behavior, Wolfram Schlenker, editor
Farmers in the American Midwest decide on agricultural land use (cropping pattern) and crop insurance in springtime after observing pre-plant precipitation. We examine cropping-pattern adaptation to pre-plant precipitation as a natural experiment. In tandem with the weather experiment, we also exploit a quasi-experiment created by a federal program that sharply reduced insurance deductibles to examine both risk-taking in cropping pattern as a moral hazard of insurance and selection of insurance coverage in response to the risk-taking. Using a 2001-2014 panel of high-resolution spatial data on land use and weather, we present evidence of heterogeneous adaptation in cropping pattern across the large agricultural states of Illinois, Iowa, Nebraska, and North Dakota. We also find evidence ...
|May 2012||Market Design in Cap and Trade Programs: Permit Validity and Compliance Timing|
with Stephen P. Holland: w18098
Cap and trade programs have considerable heterogeneity in permit validity and compliance timing. For example, permits have different validity across time (e.g., banking, borrowing, and seasons) and space (e.g., zonal restrictions), and compliance timing can be annual, in overlapping cycles, or in multi-year periods. We compare and contrast nine prominent cap and trade programs along these dimensions and construct a general model of permit validity and compliance timing. We derive sufficient conditions under which abatement is invariant to compliance timing, i.e., compliance timing cannot smooth abatement cost shocks. Under these conditions, i) expected compliance costs are invariant, ii) the variance of compliance costs increases with delayed compliance, iii) equilibrium prices may not...
Published: Holland, Stephen P. & Moore, Michael R., 2013. "Market design in cap and trade programs: Permit validity and compliance timing," Journal of Environmental Economics and Management, Elsevier, vol. 66(3), pages 671-687. citation courtesy of
|August 2008||When to Pollute, When to Abate? Intertemporal Permit Use in the Los Angeles NOx Market|
with Stephen P. Holland: w14254
Intertemporal tradability allows an emissions market to reduce abatement costs. We study intertemporal trading of nitrogen oxides permits in the RECLAIM program in Southern California. A theoretical model captures the program's key intertemporal features: two overlapping permit cycles, two compliance cycles for facilities, and tradable permits. We characterize the competitive equilibrium; show that it is cost effective; and demonstrate the firms' incentive to delay abatement, i.e., to trade intertemporally. Using model extensions to explore market design issues, an arbitrage condition implies that the equilibrium is invariant to overlapping compliance cycles, but depends crucially on overlapping permit cycles. We empirically investigate intertemporal trading of permits using panel data...
Published: Stephen P. Holland & Michael R. Moore, 2012. "When to Pollute, When to Abate? Intertemporal Permit Use in the Los Angeles NOx Market," Land Economics, University of Wisconsin Press, vol. 88(2), pages 275-299. citation courtesy of
|December 2007||Conservation: From Voluntary Restraint to a Voluntary Price Premium|
with Matthew Kotchen: w13678
This paper investigates how concern for the environment translates into predictable patterns of consumer behavior. Two types of behavior are considered. First, individuals who care about environmental quality may voluntarily restrain their consumption of goods and services that generate a negative externality. Second, individuals may choose to pay a price premium for goods and services that are more environmentally benign. A theoretical model identifies a symmetry between such voluntary restraint and a voluntary price premium that mirrors the symmetry between environmental policies based on either quantities (quotas) or prices (taxes). We test predictions of the model in an empirical study of household electricity consumption with introduction of a price-premium, green-electricity program....
Published: Matthew Kotchen & Michael Moore, 2008. "Conservation: From Voluntary Restraint to a Voluntary Price Premium," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 40(2), pages 195-215, June. citation courtesy of