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Institut
Using unique recently released nationally representative high-quality data at the plant level, this paper presents the first comprehensive evidence on the relationship between productivity and size of the export market for Germany, a leading actor on the world market for manufactured goods. It documents that firms that export to countries inside the euro-zone are more productive than firms that sell their products in Germany only, but less productive than firms that export to countries outside the euro-zone, too. This is in line with the hypothesis that export markets outside the euro-zone have higher entry costs that can only by paid by more productive firms.
We analyze the optimal dynamic scale and structure of a two-sectoreconomy, where each sector produces one consumption good and one specific pollutant. Both pollutants accumulate at di_erent rates to stocks which damage the natural environment. This acts as a dynamic driving force for the economy. Our analysis shows that along the optimal time-path (i) the overall scale of economic activity may be less than maximal; (ii) the time scale of economic dynamics (change of scale and structure) is mainly determined by the lifetime of pollutants, their harmfulness and the discount rate; and (iii) the optimal control of economic scale and structure may be non-monotonic. These results raise important questions about the optimal design of environmental policies.
Agro-biodiversity can provide natural insurance to risk averse farmers. We employ a conceptual ecological-economic model to analyze the choice of agrobiodiversity by risk averse farmers who have access to financial insurance. We study the implications for individually and socially optimal agro-ecosystem management and policy design when on-farm agro-biodiversity, through ecosystem processes at higher hierarchical levels, generates a positive externality on other farmers. We show that for the individual farmer natural insurance from agro-biodiversty and financial insurance are substitutes. While an improved access to financial insurance leads to lower agro-biodiversity, the e_ects on the market failure problem (due to the external benefits of on-farm agro-biodiversity) and on welfare are determined by properties of the agro-ecosystem and agro-biodiversity’s external benefits. We derive a specific condition on agro-ecosystem functioning under which, if financial insurance becomes more accessible, welfare in the absence of regulation increases or decreases.
We use comparable micro level panel data for 14 countries and a set of identically specified empirical models to investigate the relationship between exports and productivity. Our overall results are in line with the big picture that is by now familiar from the literature: Exporters are more productive than non-exporters when observed and unobserved heterogeneity are controlled for, and these exporter productivity premia tend to increase with the share of exports in total sales; there is strong evidence in favour of self-selection of more productive firms into export markets, but nearly no evidence in favour of the learning-by-exporting hypothesis. We document that the exporter premia differ considerably across countries in identically specified empirical models. In a meta-analysis of our results we find that countries that are more open and have more effective government report higher productivity premia. However, the level of development per se does not appear to be an explanation for the observed cross-country differences.
Strong sustainability, according to the common definition, requires that different natural and economic capital stocks have to be maintained as physical quantities separately. Yet, in a world of uncertainty this cannot be guaranteed. To therefore define strong sustainability under uncertainty in an operational manner, we propose to use the concept of viability. Viability means that the different components and functions of a dynamic, stochastic system at any time remain in a domain where the future existence of these components and functions is guaranteed with sufficiently high probability. We develop a unifying and general ecological-economic concept of viability that encompasses the traditional ecological and economic notions of viability as special cases. It provides an operational criterion of strong sustainability under conditions of uncertainty. We illustrate this concept and demonstrate its usefulness by applying it to livestock grazing management in semi-arid rangelands.