Jing Cao, Richard Garbaccio, and Mun S Ho. 2009. “
China's 11th Five-Year Plan and the environment: Reducing SO2 emissions.” Review of Environmental Economics and Policy, 3, 2, Pp. 189-208.
Publisher's VersionAbstractChina's rapid economic growth has been accompanied by a high level of environmental degradation. One of the major sources of health and ecosystem damages is sulfur dioxide (SO2). Reducing SO2 emissions is a priority of China's environmental authorities, and the 11th Five-Year Plan (2006–2010) includes the target of reducing total SO2 emissions by 10 percent from the 2005 level. Given the rapid increase in SO2 emissions that is expected to occur in absence of intervention, attaining this target will require a significant effort. This article examines the two major policy measures the government is taking to achieve the SO2 target: a shutdown of many small, inefficient power plants and the installation of desulfurization equipment on existing and new coal-fired plants. We present results from a joint U.S.–China study that we participated in, which estimated the costs and benefits of these policies. We then estimate the economy-wide impacts of the two policies using a multisector model of the Chinese economy. We find that in the aggregate, the economic benefits of the shutdown of the small power plants are large enough to offset the costs of the desulfurization equipment, even without considering the substantial environmental benefits from the reduction of emissions of SO2 and other pollutants.
Xiaoqi Guo and James K Hammitt. 2009. “
Compensating wage differentials with unemployment: Evidence from China.” Environmental and Resource Economics, 42, 2, Pp. 187-209.
Publisher's VersionAbstractWe estimate the economic value of mortality risk in China using the compensating-wage-differential method. We find a positive and statistically significant correlation between wages and occupational fatality risk. The estimated effect is largest for unskilled workers. Unemployment reduces compensation for risk, which suggests that some of the assumptions under which compensating wage differentials can be interpreted as measures of workers’ preferences for risk and income are invalid when unemployment is high. Workers may be unwilling to quit high-risk jobs when alternative employment is difficult to obtain, violating the assumption of perfect mobility, or some workers (e.g., new migrants) may be poorly informed about between-job differences in risk, violating the assumption of perfect information. These factors suggest our estimates of the value per statistical life (VSL) in China, which range from approximately US$30,000 to US$100,000, may be biased downward. Alternative estimates adjust for heterogeneity of risk within industry by assuming that risk is concentrated among low-skill workers. These estimates, which are likely to be biased downward, range from US$7,000 to US$20,000.
This study developed a new approach to the valuation of health risk in China, for monetizing health damages of environmental degradation.
Jing Cao, Mun S Ho, Dale W Jorgenson, Rouen Ren, Linlin Sun, and Ximing Yue. 2009. “
Industrial and aggregate measures of productivity growth in China, 1982-2000.” Review of Income Wealth , 55, s1, Pp. 485-513.
Publisher's VersionAbstractWe estimate productivity growth for 33 industries covering the entire Chinese economy using a time series of input–output tables covering 1982–2000. Capital input is measured using detailed investment data by asset and labor input uses demographic information from household surveys. We find a wide range of productivity performance at the industry level. We then show how these industry growth accounts may be consistently aggregated to deliver a decomposition of aggregate GDP growth. For the 1982–2000 period aggregate TFP growth was 2.5 percent per year; decelerating from a rapid rate in the early 1980s to negative growth during 1994–2000. The main source of growth during the 1982–2000 period was capital accumulation, with a small negative contribution from the reallocation of factors across industries.
Jing Cao, Mun S Ho, and Dale W Jorgenson. 2009. “
The local and global benefits of green tax policies in China.” Review of Environmental Economics and Policy, 3, 2, Pp. 231-250.
Publisher's VersionAbstractThis article describes a multidisciplinary study of market-based policies for controlling air pollution in China. While previous studies have examined the costs and benefits of pollution control separately, this approach determines them together using an economy–environment model for China. We employ air dispersion simulations and population maps to calculate health damages due to air pollution. This provides estimates of incremental damages for industry output and fuel use. Based on these marginal damages, we simulate the effect of “green taxes” on the economy and show that the environmental benefits exceed the aggregate costs, ignoring adjustment costs for individual sectors.
Rui Wang. 2009. “
The structure of Chinese urban land prices: Estimates from benchmark land price data.” Journal of Real Estate Finance and Economics, 39, 1, Pp. 24-38.
Publisher's VersionAbstractTaking the recent benchmark land prices published by the Chinese city governments, the paper estimates commercial and residential land price curves of Chinese cities using cross-sectional data, controlling for urban population size and income level. The urban land leasing price–distance relationship is estimated based on the argument that monocentric urban structure is representative for Chinese cities. Both population size and income level are found to positively affect urban land price and price–distance gradients. Commercial land prices are higher than residential land prices except in suburbs or outer central urban areas, where the land prices of different uses converge. In most situations, commercial use price gradients are larger than those of residential use.