Talking to the US Senate

Letter of the week from US scientists to US Senate says climate change is happening - no discussion.

Tokenism

Why rational environmental policy is near impossible with climate change by David Pannell

Hockey stick

Hockey stick with new lines

1492 - good and bad impacts

The exchange of diseases and vegetables in 1492 onwards: Alfred Cosby 1972 classic, plus updated review from Yale.

via Chris Blattmann

Met Office report

Met Office conference and their own presentation about potential for huge temperature rises without action on emissions.

fallacy of common but differentiated responsibility

Why the South can't afford to shift the burden of responsibility solely onto the North for reducing emissions

Vision of hell from Jeffrey Sachs

Jeffrey Sachs gave a tour de force lecture this week about how we are going to hell. Although not correctly summarized on this link by UNCTAD, Sachs urged the need for a carbon tax and "public private partnership" to cut emissions.

Agriculture and climate change

Briefings on agriculture and climate change from IFPRI

Negotiating text agriculture

Updated UNFCCC negotiating text for agriculture

Adaptation costs 2-3 times underestimated

UN negotiations aimed at tackling climate change are based on substantial underestimates of what it will cost to adapt to its impacts.

The real costs of adaptation are likely to be 2-3 times greater than estimates made by the UN Framework Convention on Climate Change (UNFCCC), say Professor Martin Parry and colleagues in a new report....

Agriculture and climate change

Donor Platform conference on agriculture and climate change

Carbon offsetting dismissed

Will Day, new head of UK Sustainable Development Commission dismisses carbon offsets

He added: "Part of the difficult decision is going to be a rebalancing of what things cost. If we say we must pay the true price of the impact of carbon on the environment. The hard decision is do you price the impact of an aeroplane flying through the air properly, really properly, and not a kind of £1.20 carbon offset. The objective is to reduce the amount of carbon put into the upper atmosphere by planes by pricing it out."

He said: [Flights] will continue but there will be fewer of them, and they will be properly priced. And people will be able to make decisions based on their decision to afford. They're not being told they cannot go on holiday, they are being told this is what it costs."

via The Guardian

Travel books

Good travel books

Democrats propose carbon tariffs

Border tax adjustments, a.k.a., carbon tariffs

Organic - nutrition advantages?

More commentary on the FSA organic study from US Food Policy

Alinghi in Geneva

Today 1000s of people watched Alinghi 5, the largest catermeran in the world sail down from Lausanne to Geneva - it was awe inspiring... in front of the pic u will see a dinghy (RS500) that belongs to a club in Versoix I sail with...cooool

Carbon protection rackets

Carbon offsetting described as a protection racket by two economists Steven Stoft and Daniel Kirschner

Organic - healthier or not?

UK Food Safety Authority says organic is no healthier than non organic food.

The organic sector and academics criticize the methodology in the report.

An EU wide academic study coordinated by Carlo Leifert at Newcastle University found that levels of nutritionally desirable compounds, such as antioxidants and vitamins, were higher in organic crops, while levels of nutritionally undesirable compounds such as toxic chemicals, mycotoxins and metals such as cadmium and nickel, were lower in organic crops.

via The Guardian

Bangladesh flooded out

Photos from hell (caused by climate change)...

via the Guardian

Biodiversity business

Articles from IUCN on making $ out of biodiversity

The Age of Stupid

How to get the message about climate change to your colleagues and friends

Advertising and environment

Best adverts to save the planet, via The Guardian

AGRA on African agriculture

In Geneva this week, Akinwumi Adesina, the head of AGRA, the Rockefellar and Gates backed organization with a mission to bring a new "green revolution" to Africa was speaking. He described how the green revolution that had success in India did not get a foothold in Africa because of it was unsuitable for rainfed farming and diverse agro ecosystems.

He went on to describe how agriculture failed in Africa due to structural adjustment programmes combined with a downturn in assistance. SAPs removed some of the distortions and biases against agriculture (e.g. overvalued exchange rate) but they also led to an abandonment of support. The private sector was too weak to fill gaps. Farmers were abandoned.

This echoes similar finding of work by Andrew Dorward at SOAS who says that missing markets and high transaction costs characterize rural economies in Africa due for example to the removal of state marketing boards and withdrawal of extension services.

Links

1. Failed states photo gallery via Foreign Policy

2. Why reporting giving the complete picture on climate related phenomena is important

3. Classical music from the Kinshasa Symphony Orchestra

Travelling business in the aid business

How do you get a public organization to reduce its carbon footprint when 90% of its emissions come from travel. Options include:

1. Changes staff rules and make staff travel economy (less emission per km flown).
- productivity argument: staff will argue that productivity will suffer. Have to compute whether the higher cost of business is compensated by higher productivity on arrival from travelling in greater comfort. Example
Staff salary of USD700. Plus subsistence for day to recover: Lost productivity 1 day each way = 2000 USD. Extra cost of ticket in region of USD 1500 to 3000.
Therefore worth it in some cases.
- consider: travel east -west most lost productivity in subsequent days from jet lag. doesnt matter if business or economy.
- how do you measure lost productivity (minutes slept during meeting with a ministry official?)
problem: private incentives of business great (comforts, personal air miles accrued). considerable staff resistance to overcome.
- moral argument: we are paid to spend money helping the poorest of the poor. Therefore we must demonstrate we are taking all steps to ensure as much $ arrives with them as possible and not making bureaucrats lives easier.

Surfing in Liberia

Surfing in Liberia, via Scarlett Lion

CC and development

Amartya Sen on how climate change changes the development debate (in French)
via Le Monde

Cows under the cosh again

Fun facts of global warming impact of beef production

Waxman cap and trade bill

New cap and trade. Who is for and against

via Greg Mankiw

Stern talking to

Nick Stern on climate change

Giving money to the poor

Letting the poor decide how to spend aid money - hand it to them directly:

"When USAID provides blankets, seeds and fertilizer to flood victims, they are doing their best to decide for the victims what their most urgent needs are. With the cash transfers, the people can decide for themselves how to meet their most urgent needs. This gives people who have lost their livelihoods, belongings or loved ones a new feeling of control over their lives, builds money-management skills, and restores to them their power to make economic decisions. If you were in their shoes, which would you prefer?"

via Aidwatch

Climate change and food safety

Impact of climate change on food safety from FAO

"It is likely that some of the first detectable changes of global
climate change on food safety will be seen as longer summertime peaks of foodborne disease
and/or increased geographic range"

More on cap and trade and carbon tax

1. Why cap and trade with auctions is the same as a carbon tax

2. Opinion on why advocating carbon tax is a waste of time

3. The politics of introducing US cap and trade

4. Nice pictures from Liberia

Links

1. How to ride in an SUV on aid work

2. How to outsource your own job

Workshop in Bonn on climate, agriculture and trade

Presentations from meeting on climate change, agriculture and trade organized by ICTSD

Black carbon

Black carbon : New rival to carbon dioxide as cause of global warming

Selling a carbon tax to the electorate

Tom Friedman of the NY Times argues for a carbon tax over cap and trade

"People get that — and simplicity matters. Americans will be willing to pay a tax for their children to be less threatened, breathe cleaner air and live in a more sustainable world with a stronger America. They are much less likely to support a firm in London trading offsets from an electric bill in Boston with a derivatives firm in New York in order to help fund an aluminum smelter in Beijing, which is what cap-and-trade is all about. People won’t support what they can’t explain".

Biofuels impact on water quality

The environmental impact of ethanol production, from University of Cornell

"The current focus on ethanol production is
centered on the food versus fuel debate.
While this is understandable, there are
serious environmental consequences from
the implementation of current ethanol
policies, throughout the world. Much of the
current environmental concern focuses
either on habitat loss or GHG emission
during land clearing and tillage operation.

We conclude that continuing the current
direction in ethanol production, particularly
with the focus remaining on grain and sugar
crops as primary feedstocks, has serious
implications for coastal water quality and
will almost certainly worsen, already serious
hypoxic conditions in many locations around
the world".

Killing fish with corn and cows

How does a US govt requirement to grow ethanol end up killing fish?

Put down that Quarter Pounder the fish get it, via WSJ

That’s a conclusion of a new scientific paper that looks at what it would take to produce the amount of ethanol required by the federal government in coming years.

To hit the 2015 ethanol mandate, a lot of land currently set aside in conservation programs and other land used for soybean cultivation would need to be converted to corn. Growing all that corn means more fertilizer, which will feed into the Mississippi River and end up in the Gulf of Mexico.

The increased use of nutrient-enriched crop production is a key cause of “harmful algal blooms … oxygen depletion … and overall fisheries habitat decline,” the authors point out. In other words, to grow enough corn to meet renewable fuel standards will mean increasing the “dead zone” in the Gulf of Mexico.

UK climate policy destined to fail

From the Tyndale Centre

"The CCC Report (UK Government Policy on climate change) is not in line with the level of global emissions cuts required to prevent breaching the 2°C threshold between ‘acceptable’ and ‘dangerous’ climate change".

Dealing with carbon leakage - rebates

US proposal to deal with competitiveness under a cap and trade programme

As part of the cap-and-trade program, the U.S. government would distribute rebates to manufacturing industries affected by foreign competition that doesn’t have to pay for emitting carbon. These rebates would be limited to U.S.-based manufacturing industries with globally traded products, including iron, steel, pulp, paper, cement, rubber, basic chemicals, glass, and aluminum, which meet specific eligibility criteria. In the event that an international agreement cannot be reached soon, the rebates are designed to compensate those industries that will incur additional compliance costs for direct and indirect carbon emissions under a U.S. cap-and-trade regime and face competition from overseas manufacturers located in countries without similar greenhouse gas-reduction requirements....

in the unlikely event that the rebate provisions are determined to be ineffective, then the proposed legislation authorizes the president to implement a so-called “border adjustment” program...

while the rebate provisions are not beyond WTO scrutiny, they are less likely than the border adjustments to raise trade or WTO issues as they do not involve potentially discriminatory treatment against imports.

via Climate Progress

Comparing cap and trade versus tax

From:

1. Bulletin of Atomic Scientists

2. From an academic viewpoint Environmental Economics blog

Bringing agriculture in climate negotiations

Agriculture for the first time discussed last Saturday in the UNFCCC climate change negotiations

Organic and food safety - II

According to an organic newsletter from Biofach

Conventionally grown food in Europe is still heavily contaminated with
pesticide residues. Of the 17,039 samples from monitoring programmes and
official food safety measures in Germany in 2007, only 39 % were not
contaminated. 57 % of all samples were contaminated up to the
permissible limit. 4.5 % of products from Germany, 5 % from other EU
member states and 9.5 % of fruit and vegetable samples from non-EU
countries were above the legally permitted limit. Right at the top of
the list in the “National Report on Pesticide Residues 2007” is paprika
powder, of which up to 80 % is contaminated with a cocktail of as many
as 30 different chemical residues.
Organic food contained pesticide residues much less frequently and in
smaller amounts than conventionally grown food, but as many as 0.9 % of
these products were also contaminated above the legal limits.

Carbon labels OpEd

My OpEd on carbon labels in the BBC Green Room today

Carbon taxes versus cap and trade II

1. My favorite read on carbon taxes from Greg Mankiw

2. Lovelock and industry figures on why cap and trade in Europe has been a failure

6C rise by 2100 without action to curb emissions

The Hadley Centre on their revised predictions on climate change. Without action to curb carbon use our grandchildren have nothing to look forward to.

via Climate Progress

Dirty dozen - foods to avoid

A new version of the Dirty Dozen is published citing the crops to avoid for pesticide residues. Another boost for the organic sector. So much for all those plump sweet smelling peaches in my local market in the summer.

Would also be good to have an idea on workers's exposure to chemicals. Cotton is particularly intensive in its use of pesticides and is not listed here as it is a food crop.

Shell drop renewables - another reason for pricing carbon

Economists predictions come true about investment in renewable energy falling with lower oil prices. Shell has just announced it is dropping renewables from its portfolio as it is not profitable.

Environmental groups are raging, but the reason for this is not corporate malice, but a lack of a sufficiently high price for carbon to interest investors. As their CEO Linda Cook says,

"If there aren't investment opportunities which compete with other projects we won't put money into it. We are businessmen and women. If there were renewables [which made money] we would put money into it."

Methane tax for burping cows

Livestock farmers in Europe are up in arms as governments have proposed methane taxes on cows. In Ireland, a tax of €13 per cow is proposed whilst the Danes are going for a tougher regime of €80 a cow.

The Danish Tax Commission estimates that a cow will emit four tonnes of methane (equivalent to 100 tonnes of CO2) a year in burps and flatulence, compared with 2.7 tonnes of CO2 for an average car.

Agriculture accounts for 50% of the world's methane emissions, around 5% of total man made CO2 equivalent emissions.

The problem with environmental taxes is that industries can relocate to avoid them thus undermining their effectiveness and strengthening domestic opposition to their imposition. EU farmers argue that they will lose sales to farmers in eastern Europe and Latin America. This problem of "leakage" could in theory be overcome by taxing meat that arrives from countries without a methane tax. However, in practice this is difficult and costly to set up and run a scheme.

The best way round this is to impose a methane tax globally. Negotiating this would be tricky to say the least....

Carbon tax proposed by Nordhaus

William Nordhaus backed a carbon tax instead of the Kyoto protocol approach.

To bet the world's climate system on the Kyoto approach is a reckless gamble", he told the climate change congress in Copenhagen. "Taxation is a proven instrument. Taxes may be unpopular, but they work. The Kyoto model is largely untested and the experience we have tells us it will not meet our objective — to stablise the world climate system."

via The Guardian

Organic and food safety

Having an organic certification tells consumers that the food product has no pesticides used on it. Consumers also tend to think this means the food is safer. A recent food safety scandal (reported by the NY Times) of a Georgia organic peanut butter company highlights that this may not necessarily be the case.

Internet and transaction costs

The internet and before it the telephone reduces transaction costs as finding the cheapest prices takes less time. Seth Gitter decided on an old fashioned way to save money, by walking to buy pop concert tickets instead of paying a commission to Ticketmaster over the phone. (See above the group in the greatest treadmill pop video ever too)

However the internet has also left us prone to short attention spans. Attention is thus the scarce commodity in the internet age..."So being able to capture someone’s attention at the right time is a very valuable asset".

Political and ecological tipping points

Al Gore is back!

At the WSJ Eco nomics conference this week, he describes how we are living in a "genuine political emergency". When asked by a BP Director why nothing seems to be getting done about climate change, he describes how there are "tipping points" in politics. He cites the example of the civil rights battle of the 60s in Alabama when young people started asking questions about race. This started a political process that lead to desegregation and equal rights.

"Tipping points" is thus the key phrase of the early 21st century, describing both the moment we slip into ecological catastrophe but also when used in a political context, the moment we decide to do something about it.

Development as a function of culture

Bill Easterly's excellent blog discusses the causal links between development and culture. He highlights research that shows a strong relationship between freedom/individual rights and growth and development. One interesting detail refers to:

"intriging clues about long run cultural values that are contained in linguistic structure within each culture (do you have to say the subject pronouns “I” and “he/she”, as in English, or can you drop them, as in Spanish, along with whether there are different forms of “you” depending on the status of the person you are addressing)."

Malcolm Gladwell explores a similar relationship between cultural values and economic performance. In Outliers his new book, he explains the disaster prone Korean Airlines of the 1980s and the Avianca (Colombian airline) crash in terms of the highly hierarchical cockpit relationships.

In the case of Korea, the language has 8 voices depending on which social class you are addressing. Aviation safety depends heavily on the ability of a co pilot to communicate key guidance to his superior in stressful situations. In hierarchical societies and languages, this is less likely to happen, leading to more likelihood of crashes.

Since the 1980s Korean Air has transformed its management and cockpit culture towards more equality and as a result the safety record has drastically improved.

Biochar

In the FT this Saturday, fab environmental correspondent Fiona Harvey writes about biochar a source of increasing interest for agriculture to hold onto more carbon in the soil.

"In Brazil’s Amazon basin, farmers have long sought out a special form of fertiliser – a locally sourced compost-like substance prized for its amazing qualities of reviving poor or exhausted soils. They buy it in sacks or dig it out of the earth from patches that are sometimes as much as 6ft deep. Spread on fields, it retains its fertile qualities for long periods.

They call it the terra preta do indio – literally, “the dark earth of the Indians”. Dense, rich and loamy, this earth forms a stark contrast with the thin, poor soils of the region. (It seems a paradox, but rainforest soils have low fertility. This is why farmers who cut down the forest for agriculture have to keep on felling – after a few years of cropping, yields collapse and they have to move on.) Patches of terra preta extend for many hectares in some places but until recently, no one really knew what the mysterious dark earth was. Some guessed it was volcanic, or the sediment of old lakes, or the residue of some long-rotted vegetation. Few imagined that it was man-made.

Terra preta, modern analysis has proved, is one of the last remaining traces of pre-Columbian agriculture in the Amazon basin. It was made more than 2,500 – and perhaps as long as 6,000 – years ago by people living by the river. These cultures survived and supported complex agriculture, despite poor soil, by making their own earth. They used dung, fish, animal bones and plant waste – the usual suspects. But the key ingredient in terra preta, and what gives it its dark colour, is charcoal.

“It’s wonderful stuff,” says Simon Shackley, a social science lecturer at the University of Edinburgh. “We started to get to know about it when Dutch scientists began to look at it in the 1960s. They found these dark soils in this area of very poor soil, where it was being put on fields like compost. It’s really the product of slash-and-burn agriculture, and other organic waste, incorporated into the soils over hundreds or even thousands of years – and it does appear to be fertile indefinitely, which is really a very odd thing.”

This ancient product of the Amazon is now the subject of intense scrutiny by climate change scientists. The tenacity of the charcoal of terra preta – retaining its fertilising properties over centuries – has given them an idea. Charcoal is a form of carbon, the burnt remains of plant and animal material. If it can stay intact in the earth for so long, without being released as carbon dioxide gas, why not lock up more carbon in the earth in this manner?

Scientists have begun to refer to the charcoal made from plants for the purpose of storing carbon as “biochar”. The theory is that biomass – any plant or animal material – can be turned into charcoal by heating it in the absence of oxygen. By taking CO2 out of the atmosphere, the impact on climate change could be huge".

Smuggling incentives

A colleague of mine pointed out that free traders might think that smuggling is a good thing, in that you remove the deadweight costs to the economy of tariffs and increase consumer welfare as a result.

Roberto Saviano in "Gamorra" describes the huge economic incentive to smuggle.

" Fearing a customs inspection, Xian preferred unloading them on the open sea. That way the merchandise could be put on the market without the burden of taxes, and the wholesalers wouldn't have to pay import fees. You beat the competition on price. Same merchandise quality, but at a 4, 6,10 percent discount. Percentages no sales rep could offer, and percentages are what make or break a store, give birth to new shopping centres, bring in guaranteed earnings and, with them, secure bank loans. Prices have to be lower. Everything has to move quickly and secretly, be squeezed into buying and selling. Unexpected oxygen for Italian and European merchants. Oxygen that enters through the port of Naples"

Saviano talks earlier in the book about his appreciation of his classes on Keynes and marginal values of products (ice creams worth more next to the desert than in Greenland). Here is someone who studied economics and took his field work/writing to the extreme by immersing himself in the black economy. He is now paying the price by living in hiding from the Napoli mafia.

Photo by Mary Sesami, Flickr

Smuggling

Roberto Saviano writes famously in Gomorrah about the Camorra mafia but also gives insights on smuggling of goods into Europe:

"The port of Naples is an open wound. The end point for the interminable voyage that merchanise makes. Ships enter the gulf and come to the dock like babies to the breast, except they are here to be milked, not fed...

These days the merchandise unloaded in Naples is almost exclusively Chinese - 1.6 million tons annually. Registered merchandise that is. At least another million tons pass through without leaving a trace. According to the Italian Customs Agency, 60% of the goods arriving in Naples escape customs inspection, 20% of the bills of entry go unchecked, and fifty thousand shipments are contraband, 99% of them from China - all for an estimated 200 million euros in evaded taxes each semester. The containers that need to disappear before being inspected are in the first row. Every container is duly numbered, but on many the numbers are identical. So one inspected container baptizes all the illegal ones with the same number".

The book Economic Gangsters give further insight in how smugglers paid less duty on chicken exports to China from Hong Kong...by declaring the chickens as turkeys which qualify for lower tariffs and banking on the inspectors not noticing the difference.

Empty commitments on emissions

According to the Guardian, a new report highlights how the EU and US are effectively exporting their emissions commitments to China. The UK claims an 18% reduction in emissions since signing Kyoto. However, imports to the UK have produced substantial emissions in China. 9% of total Chinese emissions are the result of manufacturing goods for the US, and 6% are from producing goods for Europe.

Academics and campaigners argue that the responsibility for these emissions lies with the consuming countries

Dieter Helm, professor of economics at Oxford University, said "focusing on consumption rather than production of emissions is the only intellectually and ethically sound solution". "We've simply outsourced our production," he added."

However, a country's emissions and commitments are calculated on the basis of their production. To include levels of carbon "embedded" in imports would mean imposing a border tax on carbon products. This however is expensive and difficult to calculate and open to mis-use as a protectionist measure.

A more elegant solution would be a global carbon tax...

Internet and farming in Africa

Africa has an online community of 50 million people and growing, most of these in urban Egypt and Nigeria. Internet access in the countryside is still barely accessible. Most Africans still live in rural areas and derive their income from farming. Two projects from Uganda and West Africa attempt to bridge the digital divide.

via Global Advances

The internet and transaction costs

Technology like the internet and before it the telephone reduces transaction costs, but Seth Gitter decides walking to buy concert tickets are a lower transaction cost (plus the greatest treadmill pop video ever too)

However the internet has also left us prone to short attention spans. Attention is thus the scarce commodity in the internet age..."So being able to capture someone’s attention at the right time is a very valuable asset".

Emissions from India and China

1. Greenhouse gas emissions have grown very fast in last 7 years due to growth in India and China

2. Recession is appears to be slowing emissions growth in China

Links I like

1. The greenest way to be buried

2. Thomas Keneally on bush fires and climate change

Organic farming and climate change

1. The International Trade Centre and Swiss Research Institute for Organic Agriculture have published a study looking at the carbon sequestration benefits and lower emissions of organic agriculture.

2. Adrian Williams of Cranfield University finds:
Nitrous oxide is the single largest contributor to global warming potential (GWP) for most commodities, exceeding 80% in some cases.

Organic field crops and animal products generally consume less primary energy than non-organic counterparts owing to the use of legumes to fix N rather than fossil energy to make synthetic fertilisers. Poultry meat and eggs are exceptions, resulting from the very high efficiency of feed conversion in the non-organic sector.

Yields (t/ha) are lower for organic than for conventional production such that for a given amount of output more land is always required for organic production (65% to 200% extra).

Declining levels of nutrients in food

Research from the Biochemical Institute at the University of Texas, cites three kinds of evidence that points towards the decline in the nutrient value of fruits and vegetables in the US and UK over the last 50 to 100 years.

1. fertilized plants contained larger absolute amounts of minerals than the unfertilized plants, but these amounts were sufficiently diluted by the increased dry matter that all mineral concentrations declined, except for phosphorus, which is the common fertilizer.

2. apparent median declines of 5% to 40% or more in some minerals in groups of vegetables and perhaps fruits

3. plantings of low- and high-yield cultivars of broccoli and grains found consistently negative correlations between yield and concentrations of minerals and protein, a newly recognized genetic dilution effect.

In conclusion,
"Over three billion of the world’s population is malnourished in nutrient elements and vitamin,including in developed countries. Vegetables and fruits are among the richest sources of many nutrients. Thus, declining nutrient concentrations in horticultural products are most unwelcome. Past and ongoing efforts to increase yields, combined with apparent broad tradeoffs between yield and the concentrations of perhaps half of all essential nutrients, work against recent efforts to increase one or a few micronutrients in individual foods."

via US Food Policy

Organic farming and food security in Africa

The UN Conference on Trade and Development issued a statement last week saying the organic agriculture is a promising food security option for Africa.

Organic agriculture which uses local resources, improves soil fertility and is environmentally friendly - is "equal or better than most conventional systems and more likely to be sustainable in the longer term". Demand for organic produce is also increasing worldwide, holding out "significant income possibilities for African organic farmers" and helping to speed progress towards the Millennium Development Goals. But the continent will have to overcome formidable challenges if it is to seize these opportunities, UNCTAD warns, including limited productive capacity, market access, government support, and certification.

Are carbon labels useful?

Last week I was in Singapore at a seminar organized for trade ministries from Asian countries. The programme included presentations on trade and environment issues.

Prior to my presentation on carbon labelling, I asked the 25 participants:

- if they knew what the carbon label on the Sapporo beer above meant,
- if they were more likely to buy the product because of the label and
- if they thought the label would help stop climate change. The results lead me to question the point of carbon labelling.
Just for good measure I asked if people knew what their countries average personal carbon footprint was.

Findings
Half the respondants were correct in knowing what the label meant. Half were incorrect.

Both those who were correct and those who were incorrect in knowing what the label meant felt that they would be more likely to buy this product than an equally priced and quality beer due to the label.

Most respondants felt that the label would help slow down climate change.

Noone knew how much CO2 was emitted per capita in their respective countries.

My observations are the following:

- There is limited understanding amongst consumers as to what carbon labels mean.
- Irrespective of whether a consumer understands its meaning or not, the label increases the product's marketability.
- Despite thinking that carbon labels will slow down climate change, consumers do not know what their carbon footprints are. How are they in a position to begin calculating what is the best strategy for reducing their footprint?

Full fare according to size of child

One of Milton Friedman's most enduring successes in economic policy has been the idea of pricing cars to enter cities.

Singapore favours the pedestrian more than in most European or US cities.

To buy a car will cost you 9,000 euros just in tax. To drive into town you must pay a congestion charge. The rate of the charge is set depending on the time of the day, so it goes up during the rush hour, as it the picture. (Just after I took the picture someone ran a red light. This must be risky given the authorities heavy fines for social trangressions and use of modern technology).

Getting the driver to pay for the social costs of congestion and pollution makes economic sense. However, drivers everywhere are fairly insensitive to price rises and need cheap public transport to get off the road. The metro in Singapore provides that in spades. It is fast, clean, safe and CHEAP.

There are strict rules on the metro governing both the size of a bicycle you can take on or the maximum size of a child - no longer can you fool the ticket office with baby face looks to get a half fare.

Links

1. How the US forces are losing ground against the Taliban

2. How Obama could lose the presidency

New predictions on climate change

A new report from Chris Field director of global ecology at the Carnegie Institute says that the Earth's temperature is likely to rise between 1.1C and 6.4C by 2100, depending on future global carbon emissions. "We now have data showing that from 2000 to 2007, greenhouse gas emissions increased far more rapidly than we expected, primarily because developing countries, like China and India, saw a huge upsurge in electric power generation, almost all of it based on coal.

via the Guardian

US Energy Secretary Chu on climate change

This week to the LA Times:

"I don't think the American public has gripped in its gut what could happen,"

"We're looking at a scenario where there's no more agriculture in California. I don't actually see how they can keep their cities going."

Chu said, up to 90% of the Sierra snowpack could disappear, all but eliminating a natural storage system for water vital to agriculture.

"I'm hoping that the American people will wake up."

Celebs and refugees - Ben Affleck

Ben Affleck video of refugees in the DR Congo for UNHCR was well received and showed respect to Africans in their terrible plight. Chris Blattman gives his take on it.

More celeb awareness raising

Here is UNHCR's awareness raising on Refugees at Davos this week. The concept is called Refugee Run. The participants of Davos are invited to "step into the world of conflict and experience life as a refugee" and then "a debrief will follow and discuss your experience". Bill Easterly author of seminal White Man's Burden gives his perspective.

Celebs pledge on development

Excerpt from commentary by Marbury:

The problem can be summed up in two pledges that comes hard on the heels of each other early on. We hear one from Courtney Cox and her stalker "to end hunger in America" OK - not bad. A little grandiose, but it's a clear enough goal and the relevant charity is namechecked. Next up, a pledge to "smile more." Smile more? If it's just about smiling more then anything counts. As if that weren't bad enough, it's closely followed by, "To laugh more and to love more." No, no, no.

Cameron Diaz pledges to give her neighbours a smile. Look, by all means, flash those perfect teeth to the bejewelled and befurred millionaires you pass in the lobby, but don't tell me that this is an act of service to your country. Don't you see, Cameron, that this devalues the very notion of service, of "pledges"? Cameron? Are you listening to me?

Somebody else pledges to plant five hundred trees this year - ten out of ten. This, my friends, is what I'm talking about. Next up, P Diddy says he's going to turn the lights off - and then points at me and says, now you turn the lights off. OK Diddy, it's a deal - but only if you surrender your private jet.

Demi Moore: "I pledge to free one million people from slavery in the next five years." Hmm, specific and worthy - if a little over-ambitious for one person.

You see, I'm not being cynical. Quite the opposite. I admire the spirit of collective endeavour and public service. But this video does violence to that noble idea, by confusing public service with the trivial and the personal. If millions of Americans view this video and conclude that they can meet their president's rousing call to service by "smiling more" then it will have done far more harm than good, to the country and to his presidency.

Carbon pricing in a recession

Posner and Becker argue that raising tax on petrol in a recession is a bad idea

" A further weakening of the financial position of American carmakers would increase the size of the bailout of the American auto industry needed to prevent it from going bankrupt. This implies that higher gas taxes would have a multiplier effect on the tax burden facing American families and businesses- not only would they have to pay more for gas, but they also would at some point have to pay higher taxes to finance a larger bailout. "

Different effects of the stimulus package

How economists analyse the stimulus
It depends on which effect you think will prevail:
Keynes effect,
Galbraith effect,
a Housework effect
a Feldstein effect

Too many labels

Do you need 4 organic labels on a pot of jam?

In the picture you can see on the left the 2 blue EU organic logo (2 different languages). On the botton left you have the green AB label which in the national French organic logo and on the right you have the Carrefour supermarket chain's logo "Bio" showing that this is an organic product.

In the queue, if they could find space on the jar would potentially be a fair trade mark, a carbon label and a symbol saying the ingrediants werent airfreighted.

Carrion crows attacking Switzerland

Every year the Swiss anti immigration party UDC come out with an eye catching piece of advertising that is regarded by many as offensive. This year's effort sitting outside my office, and so far with no graffiti on it, shows two large crows pecking at the heart of Switzerland with a by line "Open the door to abuse? No!". This refers to the recent vote to open its borders to the EU Member States.

The crows apparently refer to Romanians and Bulgarians and preys on the usual fears about the loss of jobs/national/racial identity of the electorate.

Last year's poster from UDC showed three white sheep kicking a black sheep out of Switzerland with the words "To create security" - it was banned in Geneva open spaces because of its obvious racial provocation.

One question is how does the political class to the left of the extreme right react to this arguably rascist advertising. (Bird lovers were also angered, seriously) Outrage has not stemmed the growth of the UDC and even creates more interest in it. Perhaps satire is the way forward...

Understanding carbon labels

Do you understand what this means?

A till survey reported by ClimateChangeCorp has found that just 28 per cent of customers from UK pharmacist Boots knew that a product carbon footprint related to climate change. And 44 per cent confused it with fair trade.

But the survey showed a majority thought it was important that a figure was given on how much carbon was used during an item’s production. Another problem was that while few products carry the labels, even clued-up consumers cannot compare like with like.

Who survived the Titanic and why

Bruno Frey, David Savage, and Benno Torgler report:

This paper explores the determinants of survival in a life-and-death situation created by an external and unpredictable shock. We are interested in seeing whether pro-social behaviour matters in such extreme situations. We therefore focus on the sinking of the RMS Titanic as a quasi-natural experiment to provide behavioural evidence that is rare in such a controlled and life threatening event.

The empirical results support that social norms such as "women and children first" survive in such an environment. We also observe that women of reproductive age have a higher probability of surviving among women. On the other hand, we observe that crew members used their information advantage and their better access to resources (e.g. lifeboats) to generate a higher probability of surviving. The paper also finds that passenger class, fitness, group size, and cultural background matter.

Via Marginal Revolution

Marking up on fair trade

Is Fair Trade delivering as much as it could to farmers?

In my local supermarket today I bought some very tasty dried mangos. They help offset my chocolate urges.

They cost 3 swiss francs for 150g (20 francs per kg). Their texture is perfect and the colour a nice bright orange. They come from South Africa.

On the shelf above sits a smaller pack of fair trade dried mango from Burkina Faso costing 2 swiss francs from 100g (30 francs per kg). The fair traded product is thus 10 francs per kilo (50%) more expensive that an equivalent product. Given its lower quality (dark colour of the dried fruit), the mark up is arguably higher.

Is the higher price due to higher production and processing costs in the fair traded product or simply Coop exploiting the ethical shopper's insensitivity to price.

According to the fair trade standard, dried mango from West Africa gets an fair trade premium of 0.70 euro/kg. So all things being equal, the producer gets around 10% of the higher price that fair trade commands. Even less, if you take into account the lower quality of the fair trade product.

Shopping for shirts

Size 38s are cheaper than medium or large.

Yesterday I went to the sales to find some new shirts for work. In the two major chains here in Geneva the only shirts left were small size. Next time I will have to get to the shops on the first day of the sales.

Being a size 38 obviously appears to have its advantages at least in saving cash on the clothes budget. The first few days see medium and large sizes selling out leaving only small sizes. The retailer by then will be looking at the next round of reductions thus giving size 38s greater savings than for the rest of us. This give small size purchasers plenty of time to browse at heavily discounted prices.

Which means that other than emergency buys, purchasers of size 38 have almost no incentive to buy outside the sales.

Lord's Resistance Army

This week, the LRA commited another atrocity in the Congo. For a background on the LRA and the less-than-heroic characters in charge, go no further than the blog post from Wronging Rights.
Photo courtesy of Stoke Newington Quakers

Books on Africa

Over Christmas I zipped through The Reader by Bernard Schink, Northern Lights by Philip Pullman and JG Ballard's autobiography, Miracles of Life.

Next on my list is Shadow of the Sun, by Ryszard Kapuscinski.

On the subject of Africa, the 100 best books on Africa has been announced, via Chris Blattman. See also the Africa reading challenges on Siphoning off a Few Thoughts.

Snow and galaxies

Whilst the snow is still lying on the ground, here are some amazing pictures of snowflakes up close as you have never seen them from the New Scientist. Photos taken by Kenneth Libbreth of CalTech


At the other end of the spectrum here are photos of the galaxies on Wikisky

Carbon tax versus cap and trade

There is an endless stream of articles about the climate impact of our daily lives and shopping choices. Today, it transpires that surfing the internet is bad. This lengthens the list of daily activities that we are told is causing climate change. One minute you think you are doing the right thing (like buying local food) and then an expert points out that it depends what time of year you are buying it, what country is comes from, if it was grown in a greenhouse or not, what energy sources were used, whether it come it by road, rail or air, how you got to the shop and how you prepared it (oven, boiled or fried).

All this needless to say is a) disconcerting and b) a complete waste of our time c) ineffective way to deal with global warming.

The alternative promoted by economists and endorsed by some politicians is to price carbon. This means raising the price on carbon to account for its environmental damage. This will change the relative price of energy in favour of low carbon technologies and energy conservation measures. Whilst most agree that this is a good idea (some industry groups disagree), there is disagreement about whether a carbon tax or cap and trade emissions scheme is the best approach. I will leave it to the chief proponents of these respective economic instruments to argue which is the best approach.

Greg Mankiw of Harvard University on carbon taxes as the best approach to reduce carbon emissions and Robert Stavins also of Harvard on cap and trade.

Organic farming in a Nairobi slum

You dont get many farms in the middle of slums let alone organic ones. Here in Kibera, Africa second largest slum after Soweto, a community of people started growing their own organic food. The mover behind this scheme was Su Kahumba, founder of Green Dreams an organic vegetable retailer in Nairobi.
Photo courtesy of Green Dreams

Making sandwiches

Continuing on last week's weighty interface between the recession and the environment, here is a way to save money on lunch and reduce your environmental impact. Apparently, sales of lunch boxes are up 68% on last year at Robert Dyas, while Thermos are reporting a 30% sales increase over the last year.

Walking between the Twin Towers

I remember I got giddy whilst reading Philippe Petit's book about his incredible 1974 walk between the Twin Towers. It is an adventure that ranks with walking on the moon - however whilst there would be thousands in the queue to be an astronaut, surely noone other than this French maestro would ever have wanted to walk between the Twin Towers.

Here is a clip of the walk.

China power generation drops

China's strong growth in the last twenty years has been driven by cheap and plentiful coals supplies. Good news for growth, bad news for global warming. Dotearth reports that with the recession however,

China's carbon emissions will fall around 2 billion tons less carbon dioxide from 2008 to 2010 than it would have under “business as usual” if current recession continues.

To avoid going beyond 450 ppm we must stabilizing the world's (and China's) emissions by 2020. See more commentary and resume of the International Energy Authority's report on Climate Progress.

Recession = back to fossil fuels?

In 2008 when oil prices were at record levels, the conditions looked right for greater uptake of renewable energy technologies. Now the world is in recession and oil is at US$40 a barrel. Despite Obama's promises to invest in green technologies, what really are the prospects. At Freakonomics, three economists say what they think the prospects for green energy use in 2009 and beyond.
John Whitehead laments how close the US was in 2008 to what economists call the Hotelling switch point where high fossil fuel prices and falling renewable prices would cross paths and lead the economy to a switch to renewable energy sources. With the recession the gap between renewable and fossil fuel prices is now widening and as a result "most all large, private renewable-energy investments will be put on hold in 2009".
George Tolley also sees the recession as dampening demand for renewable energy with high oil prices key to bringing about its adoption, "this is a more powerful influence on clean technology adoption than any U.S. policy".
Ethan Zindler is more optimistic pointing out the clean-energy boom took off when crude traded at $50 per barrel or below, not $140 per barrel.

Japanese carbon label

Japan's Ministry of Industry, Trade and Economy has launched a carbon label for "daily items and food". According to MITE, they received 500 applications from companies to trial the label in 2009. I question how consumers will respond to the label - will they understand what it means? I don't!

Will it transpire that consumers simply feel assured to see the label without understanding what information it is conveying?

Whatever it does mean, it won't make much difference to reducing carbon emissions if you are driving (rather than biking or walking) to the supermarket to pick up a kilo of carbon labelled goods...

Challenges for WTO

The WTO announced this week that its Director General Pascal Lamy will run unopposed for a new tenure. The challenges facing Mr Lamy and the WTO are outlined by Dr Carolyn Deere of the Global Trade Governance Project at Oxford University.

She says:
"Amidst global debates on financial instability, on climate, on energy, on the massive explosion of private standards, technology transfer, and on food security as well as on development and the reduction of poverty, the WTO should not and cannot claim all global problems as its turf or demand to be the forum for their discussion, but to ensure trade policies and laws do not thwart solutions but supports them, governments do need to decide where and how to discuss inevitable linkages".

(Their link to trade resources)

Star economists of development

Two leading young economists identified by The Economist who are concerned with development.

Firstly, Ester Duflo of MIT Poverty Action Lab who:

"studies economic development as seen from the field, clinic or school, rather than the finance ministry. They might be called the “peace corps” of economists, bringing the blessing of their investigative technique to the neglected villages of India or the denuded farms of western Kenya.

Ms Duflo has made her name carrying out randomised trials of development projects, such as fertiliser subsidies and school recruitment. In these trials, people are randomly assigned to a “treatment” group, which benefits from the project, and a “control” group, which does not. By comparing the average outcome of each group, she can establish whether the project worked and precisely how well.

In one study, Ms Duflo and her colleagues showed that mothers in the Indian state of Rajasthan are three times as likely to have their children vaccinated if they are rewarded with a kilogram of daal (lentils) at the immunisation camp. The result is useful to aid workers, but puzzling to economists: why should such a modest incentive (worth less than 50 cents) make such a big difference? Immunisation can save a child’s life; a bag of lentils should not sway the mother’s decision either way.

Randomised trials “give you the chance to be surprised”, Ms Duflo says. Had they arrived at this result using some other method, she and her colleagues would have assumed they had made a mistake. But randomisation removes such doubts, showing that it was indeed the lentils that made the difference. The result cannot be dismissed; it must be explained.

The approach has its critics. A randomised trial can prove that a remedy works, without necessarily showing why. It may not do much to illuminate the mechanism between the lever the experimenters pull and the results they measure. This makes it harder to predict how other people would respond to the remedy or how the same people would respond to an alternative. And even if the trial works on average, that does not mean it will work for any particular individual".

Secondly, Marc Melitz, a trade economist at Princeton University

"Mr Melitz is a pioneer of the “new, new trade theory”, which succeeds the “new” trade theory propounded by Mr Krugman almost 30 years ago. The source of its novelty is its recognition that firms differ, and only the best firms export. In America, for example, exporting factories are more than twice as big as plants that do not sell beyond their shores, and they squeeze 14% more out of their workers.

In Mr Melitz’s theory firms first prove themselves at home, discovering their own limits and abilities. Only the best then venture overseas. Entering a foreign market is an expensive endeavour, he points out, even before firms encounter the tariffs or transport costs that preoccupy most trade models. An exporter must find and introduce itself to distant customers, comply with alien regulations and set up distribution channels abroad. One study found that it cost Colombian chemical factories over $1m to enter a foreign market.

The gains from trade also differ in Mr Melitz’s model. In the new trade theory that preceded it, international commerce raises the productivity of firms by enlarging their market, allowing them to reap economies of scale. In Mr Melitz’s model, trade raises the productivity of industries, not by allowing firms to grow bigger, but by giving the better firms a bigger share of the market. Foreign competition sifts and sorts firms, winnowing out the weakest firms and leaving a greater share of the market to their stronger rivals".

50 years of taking pictures

My dad's pictures from a 50 year career

This one is of Harold Pinter who died last week. I met him once at a cricket match. He was umpiring at square leg.

Creating green jobs

Obama talked in his presidential campaign about mitigating climate change through stimulating green technologies and so creating millions of new jobs and at the same time energy independence - a "win win win".

What is the reality behind this comforting vision? Can environmental policies really work in stimulating the economy. Would the number of jobs created by expanding solar industry would be greater than the number lost through, say, a shrinking coal-mining industry. Professor Stavins at Harvard, via the Wall Street Journal offers the following analogy:

“Let’s say I want to have a dinner party. It’s important that I cook dinner, and I’d also like to take a shower before the guests arrive. You might think, Well, it would be really efficient for me to cook dinner in the shower. But it turns out that if I try that I’m not going to get very clean and it’s not going to be a very good dinner. And that is an illustration of the fact that it is not always best to try to address two challenges with what in the policy world we call a single-policy instrument.”
Photo by phault, flickr

Stimulus for a green economy

The calls for a stimulus for green technologies are getting louder. Obama himself said we need to fund them to have a win win of jobs and reducing greenhouse gas emissions. People are asking therefore why a bail out for a failed industry (US cars) and not for innovation. Joseph Stiglitz says in the NY Times:

“I’ve been a bit astonished that all the discussion around the private-sector stimulus has centered on infrastructure. Bailouts, too, are aimed at correcting mistakes of the past, so they are backward-looking. We would be much better off spending our money forward-looking. If we spend $700 billion on new technology and innovation, we’d have a stronger, new, real economy. Up to now, the discussion has focused on the sectors that have been mismanaged rather than the sectors that are creating our future.”

Maps illustrating development issues

World Mapper does a good job illustrating development issues through the use of maps. Territories are re-sized on each map according to the subject of interest.

This one shows the paucity of doctors working in Africa - The most concentrated 50% of doctors live in territories with less than a fifth of the world population. The worst off fifth are served by only 2% of the world’s doctors.

Who is causing the most global warming per capita - the West of course, plus Qatar equivalent to 86 tonnes of carbon dioxide per year, around 160 greater than the average for African countries.

Links

Links of interest...

1. 10 leading economists under 40

2. 10 most influential thinkers under 40

3. ...and worth a look to see the mood of President Bush who is not shaking hands with the world's leaders.

Climate letter to Obama

Let's hope Obama finds the time to read this letter from Colombia/NASA Professor James Hansen and his wife in which they highlights the "disconnect" between science (we are going to hell fast) and policy (do nothing substantial about climate change) - (my brackets). They say that it is still "feasible" to save the planet but three actions are needed fast:

• Moratorium on and phasing out of coal power stations without carbon capture, what he calls the "sine qua non for solving the climate problem".

• Raising the price of emissions via a "carbon tax and 100% dividend".

• Urgent research on "fourth generation" nuclear power with international co-operation.

At the heart of the response lies taxation on carbon.

A carbon tax, he says "is the essential underlying support needed to make all other climate policies work... and essential to decarbonize society".
- A carbon tax will be accepted by the public if it is returned to them. No bureaucracy is needed.
- The tax will spur innovation as entrepreneurs compete to develop and market low-carbon and no-carbon energies and products.
- A carbon tax is honest, clear and effective

With oil prices low now is a good time to introduce a tax.

He trashes the idea of cap and trade emissions schemes as these "generate special interests, lobbyists, and trading schemes, yielding non productive millionaires"

In this rich letter, he highlights the urgency of the situation which "derives from the nearness of climate tipping points, beyond which climate dynamics will cause rapid changes out of humanity's control". He also says that we are already past the safe level of 350 ppm of carbon dioxide in the atmosphere. This is pretty alarming given policy makers are saying we have to level off emissions at 450ppm - which a likely scenario being 550ppm. Pre industrial levels were 280ppm...