Economics ETDs

Publication Date

9-9-2010

Abstract

The first chapter explains the human causes of climate change and its costs, which is estimated to be about 3.6% of GDP by the end of 21st century (NRDC, 2008). The second chapter investigates how projected July temperatures will increase the demand for electricity in the U.S. by 0.8%, while projected January temperatures will decrease the demand for natural gas and heating oil by 1% and 2.3%, respectively. This chapter further examines effects of the energy-efficiency building codes: IECC 2003 and IECC 2006 in the U.S. in reducing the energy consumption in the U.S. households. This study finds that these state-level building codes are effective in reducing energy demand. Adoption of these codes reduces the electricity demand by 1.8%, natural gas by 1.3% and heating oil by 2.8%. A total of about 7.54 MMT per year emission reduction of CO2 is possible from the residential sector by applying such energy-efficiency building codes. This chapter further estimates an average of 1,342 kWh/Month of electricity consumption, 3,429 CFt/Month of natural gas consumption and 277 Gallon/Year of heating oil consumption per household. It also indentifies the existence of state heterogeneity that affects household level energy demand, and finds that assumption of independence of error term is violated. Chapter 3 estimates the implicit prices of climate in dollar by analyzing the hedonic rent and wage models for homeowners and apartment renters. The estimated results show that January temperature is a disamenity for which both homeowners and renters are being compensated (negative marginal willingness to pay) through U.S. by $16 and $25 at the 2004 price level per month, respectively. It also finds that the January temperature is productive, whereas the July temperatures and annual precipitation are amenities and less productive. This study suggests that households would be willing to pay for higher temperature and increased precipitation; the estimated threshold point for July temperature is 75oF and for annual precipitation is 50 inches. It further reports that homeowners pay more than renters for climate amenities in the Northeast and West with reference to the Midwest; where as in the South, these values do not differ much, suggesting that firms have incentive to invest in those regions. This chapter also identifies that both the housing and labor markets are segmented across the regions in the U.S. Chapter 4 uses meta-analysis to explore the environmental Kuznets curve (EKC) relationship for CO2 and several other environmental quality measures. Results indicate the presence of an EKC-type relationship for CO2 and other environmental quality measures in relative terms. However, the predicted value of income turning point for CO2 is both extremely large in relative terms (about 10 times the world GDP per capita at the 2007 price level) and far outside the range of the data. Therefore, this study cannot accept the existence of the EKC relationship for the CO2.

Degree Name

Economics

Level of Degree

Doctoral

Department Name

Department of Economics

First Advisor

Bohara, Alok

First Committee Member (Chair)

Berrens, Robert

Second Committee Member

Thacher, Jennifer

Third Committee Member

Hansen, Wendy

Language

English

Keywords

Climate, Marginal Willingness to Pay, Energy Efficiecy Policy, Environmetal Kuznets Curve

Document Type

Dissertation

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