The Dismal Science

Getting to Net Zero

Eric Crampton • Apr 12, 2021

• climate change commission,
• emissions trading scheme,
• Environment,
• New Zealand stories

We have not been fans of the Climate Change Commission’s draft report. New Zealand has an Emissions Trading Scheme with a binding cap, and a declining path for net emissions in the covered sector. Measures taken within the covered sector cannot reduce net emissions. NZU not purchased by one sector get purchased and used by another. Regulatory measures around coal boilers … Read More

Important vaccination stats to keep in mind

Eric Crampton • Mar 13, 2021

• COVID-19,
• herd immunity,
• vaccination,
• vaccine hesitancy

Thomas Lumley runs the numbers on herd immunity and vaccination: Cutting transmission by 90% would need nearly everyone to be vaccinated. What if only 50% were vaccinated? Well, suppose someone with the virus would have passed it on to two people, but one of them is vaccinated. Instead of two new cases, we get one new case. Or, in … Read More

Vaccination priorities

Eric Crampton • Mar 10, 2021

• COVID-19,
• immunisation,
• vaccination

Chris Hipkins announced some of the government’s prioritisation for the coming vaccination campaign.  I don’t quite get it, given the situation here differs considerably from the situation abroad. Here and abroad, there’s been priority on those at most risk. But who’s at most risk differs. Here, it’s people working in the border system, and the government has been entirely correct … Read More

Border Costs

Eric Crampton • Mar 02, 2021

• America's Cup,
• COVID-19,
• immigration,
• MIQ,
• pcr testing

Cecile Meier walks us through some of the costs of a border system that has neither been able to safely scale up to meet need, nor able to find any reasonable way of prioritising entry into those scarce MIQ spaces. When Zane Gillbee hugged his family goodbye in South Africa before moving to Wellington, his daughter Lyla was still … Read More

Blessed are they that have not seen the model, and yet have believed

Eric Crampton • Mar 02, 2021

• climate change,
• Climate Commission,
• emissions trading scheme,
• government policy,
• New Zealand economy

The Climate Change Commission’s recommendations span the breadth of the economy. They are required to come up with sector-by-sector climate budgets consistent with getting New Zealand with net zero emissions under the Zero Carbon Act. The sector-by-sector budgets rest on underlying models. The models build predictions about what will happen as ETS prices rise, and what will happen when some … Read More

For a bigger carbon dividend

Eric Crampton • Mar 01, 2021

• carbon price,
• climate change,
• Climate Commission,
• emissions trading scheme

New Zealand has an excellent Emissions Trading Scheme covering everything except agriculture – a non-trivial exclusion, but we can come back to that later. The ETS has a cap. Net emissions from the covered sector cannot exceed the cap. So any other regulations that affect sectors covered by the cap only shift things around within the cap and affect the … Read More

Test, test, test

Eric Crampton • Feb 18, 2021

• COVID-19,
• managed isolation and quarantine facilities,
• MIQ,
• pcr testing,
• saliva testing

My column over at Newsroom this week points out the fairly obvious. The government can add daily saliva testing for everyone at the border to the existing testing regimen. If daily testing winds up proving the swab tests to be redundant, ditch the swab tests when we find that out. If it turns out they’re both useful, keep both. Read More

Forests and intertemporal equilibrium

Eric Crampton • Feb 17, 2021

• carbon pricing,
• Economics,
• emissions trading scheme,
• forestry,
• intergenerational equity

I’m a bit of an ETS-absolutist. Or at least a carbon-pricing absolutist, in a place the size of NZ. I think the Weitzman reasons for preferring a carbon tax to an ETS are second-order relative to political economy considerations, and any weight at all put on switching costs makes it ludicrous to want NZ to flip from an ETS to … Read More

JEEM

Eric Crampton • Jan 19, 2021

• Academic journals,
• Environmental Economics,
• environmental management,
• new research

Getting to Browser Tab Zero so I can reboot the computer is awfully hard when the one open tab is a Table of Contents for the Journal of Environmental Economics and Management, and every issue has more stuff I want to read. A few highlights: Gugler et al demonstrating the effectiveness of British carbon pricing over German regulatory interventions … Read More

Vaccines are cheap

Eric Crampton • Jan 19, 2021

• border control,
• COVID-19,
• lockdown,
• MIQ,
• vaccines

Israel chose to pay a bit over the odds for the Pfizer vaccine to get earlier access. Here’s The Times of Israel from 16 November. American government will be charged $39 for each two-shot dose, and the European bloc even less, but Jerusalem said to agree to pay $56. Israel has now vaccinated more than 80% of their elderly … Read More