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REFERENCE LINKING PLATFORM OF KOREA S&T JOURNALS
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Environmental and Resource Economics Review
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Journal DOI :
Korean Resource Economics Association
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Volume & Issues
Volume 24, Issue 4 - Dec 2015
Volume 24, Issue 3 - Sep 2015
Volume 24, Issue 2 - Jun 2015
Volume 24, Issue 1 - Mar 2015
Selecting the target year
Potential Welfare Loss from Using Imperfect Environmental Taxes
Hong, Inkee ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 1~53
DOI : 10.15266/KEREA.2015.24.1.001
In environmental policy areas, a greater use of economic instruments (EIs) has recently been observed in many countries. However, EIs are heterogeneous policy tools. The textbook case of a Pigouvian tax is far from widely used, mainly due to the information requirements and other structural and institutional constraints. The successful implementation of EIs might heavily depend on pre-existing structural and institutional conditions. Moreover, these institutional conditions are particularly unfavorable in developing countries. Using a simple analytical general equilibrium model, this paper examines how these constraints affect the welfare gain from the introduction of environmental taxes in developing countries. First, this paper solves for the second-best optimal Pigouvian tax and output tax in the presence of a distortionary tax on market use of labor. The result confirms that an environmental output tax achieves a socially-efficient level of emissions in the least-cost manner only if the nature of the linkage between the tax base and the environmental damage is fixed. Second, incorporating structural and institutional constraints into the model through a set of parameter values from China and the US, this paper calculates the net welfare effects of either using the ideal Pigouvian tax or instead using an output tax. The numerical simulation results show that the net welfare gain from the use of an ideal Pigouvian tax could be more than six times larger than that of an output tax in developing countries. On the other hand, the welfare gain is only 50 percent in developed countries. This means that the potential welfare disadvantage from using output taxes instead emissions tax for environmental purposes could be much greater in the case of developing countries.
Can Index Decomposition Analysis Give a Clue in Understanding Industry's Greenhouse Gas Footprint?
Chung, Whan-Sam ; Tohno, Susumu ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 55~84
DOI : 10.15266/KEREA.2015.24.1.055
Korea is one of the few OECD countries having no binding Greenhouse gas (GHG) emissions reduction obligations under the Kyoto Protocol. Korea is going to enforce a powerful greenhouse gas emissions control to the industry from 2015. Current GHG reduction policies do not take into account the trade-off between economic growth and GHG mitigation, this approach will not be sustainable. Sectoral approach, considering industry by industry may be more eco-friend approach. This study verified the validity of the analysis results counted from whole procedure of energy input-output analysis and decomposition analysis to sector 'Organic basic chemical products' and 'Cement and concrete products'. Empirical test was performed using changes in energy consumption, production, process improvements and new facilities. Although the results showed unstable fluctuations from Divisia index decomposition analysis, it was verified that the entire procedure can provide a clue in understanding of the industry's energy and GHG footprint.
A study on Applying Hyperbolic Social Discount Rate onto the Benefit-Cost Analysis: Focused on Appropriate Analytical Time Span
Kim, Sang Kyum ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 85~107
DOI : 10.15266/KEREA.2015.24.1.085
This study analyzes the effect of applying hyperbolic social discount rate onto the results of benefit-cost analysis of environmental public investment projects in Korea. In order to check the application possibility to the actual feasibility study, the discount factors generated by hyperbolic function, rather than traditional exponential one, would be applied to the benefit and cost data from the pre-feasibility studies which peformed for environmental public investment projects. The results of this study shows that using hyperbolic social discount rate is effective for enhancing test results, only under the condition of which the full expansion of the time periods of analysis is satisfied. According to the simulation results of this study, to achieve higher benefit/cost ratio by using hyperbolic social discount rate, the period should be increased up to 120 to 150 years at least.
Comparative Analyses of Korean Energy Balance Tables from KEEI and IEA (in 2009)
Sohn, Joongchan ; Kim, Suduk ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 109~139
DOI : 10.15266/KEREA.2015.24.1.109
Referring to many previous research on the statistical differences in the figures of energy balance table between that of KEEI and IEA, a study is conducted to provide with a framework for proper comparison, followed by the actual calculation of the differences. Major differences are found for energy oil with its size of over 32% differences in primary energy supply and in energy transformation sectors. In final energy consumption sector, naptha consumption for petro-chemical industry shows 14.58% differences. Overall final energy consumption figure of KEEI after its adjustment to net calorific value as is the case of that of IEA is 3.58% larger than that of IEA. Considering the fact that energy balance table provides the basic information for the understanding of energy sector, further studies seem to be necessary for proper adjustment of current status.
The Carbon Content and Chain Embodied in Exports of Korea with Major Trading Partners : The Multi-Regional Input-Output Analysis
Shin, Dong Cheon ; Lee, Hyeok ; Kim, Yong Kyun ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 141~164
DOI : 10.15266/KEREA.2015.24.1.141
The concept of consumption-based greenhouse gas (GHG) inventory is directly related with the carbon content of international trade. Along the lines of the consumption-based GHG inventory, we investigate domestic and foreign carbon contents embodied in sectoral exports of Korea. In addition to the analysis of carbon content of exports, it is investigated how much share of responsibility for carbon emissions of Korea belongs to each major trading partner of Korea. We also compute the carbon intensities of Korean exports in carbon chain with other trading partners and find some characteristics revealed in Korea's carbon emissions embodied in its exports.
Relationship Between Environmental Infra Operating Cost and Polluter Pay Principles
Kang, Heechan ; Kang, Sung Won ; Kim, Minjoon ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 165~187
DOI : 10.15266/KEREA.2015.24.1.165
In this paper, we tested if the sewage subsidy from Korean Water Management Fund discourage sewage fee increase by Korean local governments, and consequently hinder water quality improvement. To examine this counter-incentive effect of Water manage Fund sewage subsidy, we estimated the effect of sewage subsidy on the ratio of sewage fee revenue to environmental treatment facilities' operation cost of local governments in 2009-12, using two-stage least square estimation. We found that the sewage subsidy has negative effect on the sewage fee revenue to sewage operation cost ratio. But, the statistical significance of this effect was sensitive to model specification. And the size was too small to conclude that the counter-incentive effect was economically significant.
Decomposition Analysis of Energy Consumption and GHG Emissions by Industry Classification for Korea's GHG Reduction Targets
Park, Nyun-Bae ; Shim, SungHee ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 189~224
DOI : 10.15266/KEREA.2015.24.1.189
To meet sectoral emission target by 2020 and prepare for the emission trading scheme from 2015, decomposition analysis of energy consumption and GHG emission is required by 18 subsectors in industry sector where emission targets are established. Log Mean Divisia Index decomposition method was used to analyze factors' effects on energy and emission in the industry sector and by 18 subsectors from 2004 to 2011. Industrial energy consumption was increased due to the production effect and energy intensity effect. However structure effect contributes to the decrease of energy consumption. In terms of emissions (including indirect emission due to electricity consumption) in the industry sector, only structure effect contributed to the emission reduction. Factors' effects by subsectors were different. Cement industry, which is included at Nonmetal shows different results from those of Nonmetal industry and machinery industry, which is a subsector of Fabricated Metal, was also similar. In this regard, we should not apply the policy implications from decomposition analysis of aggregated industry such as Nonmetal or Fabricated Metal to its subsectors uniformly and develop a differentiated policy for each subsector industry.
An Agent-Based Model Analysis on the Effects of Consumers' Demand Response System
Park, Hojeong ; Lee, Yoo-Soo ;
Environmental and Resource Economics Review, volume 24, issue 1, 2015, Pages 225~249
DOI : 10.15266/KEREA.2015.24.1.225
There are growing interests in the introduction of consumer's selective electricity tariff systems in order to enhance demand response in electricity market in Korea. Real time pricing (RTP) and Time of Use (TOU) are typical examples of demand response system through which electricity price is linked to real time demand. This paper adopts an agent-based model to analyze the effects of such demand system on the counsumers' electricity costs. The result shows that real time pricing system is effective to reduce electricity costs of consumers by providing more flexible tariff system, depending on each consumer's demand pattern. This finding could be used as a basis for supporting smart grid system in the presence of responsive demand environment.