Research With Impact

Federal Coal Program Reform, the Clean Power Plan, and the Interaction of Upstream and Downstream Climate Policies, American Economic Journal: Economic Policy 12, 1, February 2020

Summary: Coal mined on federally managed lands accounts for approximately 40% of U.S. coal consumption and 13% of total U.S. energy-related CO2 emissions. The U.S. Department of the Interior is undertaking a programmatic review of federal coal leasing, including the climate effects of burning federal coal. This paper studies the interaction between a specific upstream policy, incorporating a carbon adder into federal coal royalties, and downstream emissions regulation under the Clean Power Plan (CPP). After providing some comparative statistics, the authors present quantitative results from a detailed dynamic model of the power sector, the Integrated Planning Model (IPM). The IPM analysis indicates that, in the absence of the CPP, a royalty adder equal to the social cost of carbon could reduce emissions by roughly 3/4 of the emissions reduction that the CPP is projected to achieve. If instead the CPP is binding, the royalty adder would: reduce the price of tradeable emissions allowances, produce some additional emissions reductions by reducing leakage, and reduce wholesale power prices under a massbased CPP, but increase them under a rate-based CPP. A federal royalty adder increases mining of non-federal coal, but this substitution is limited by a shift to electricity generation by gas and renewables. These findings highlight the importance of information spillovers on individual performance in knowledge-based industries.

Headshot of Todd D. Gerarden in front of a backdropTodd D. Gerarden

Assistant professor, Charles H. Dyson School of Applied Economics and Management

Elena Belavina

Associate Professor, Cornell Nolan School of Hotel Administration

Karan Girotra

Charles H. Dyson Family Professor of Management, SC Johnson Graduate School of Management

Bike-share systems: Accessibility and Availability, Management Science 66, September 2020

Summary:  The cities of Paris, London, Chicago, and New York (among many others) have set up bike-share systems to facilitate the use of bicycles for urban commuting. This paper estimates the impact of two facets of system performance on bike-share ridership: accessibility (how far the user must walk to reach stations) and bike availability (the likelihood of finding a bicycle). The authors obtain these estimates from a structural demand model for ridership estimated using data from the Vélib’ system in Paris, and they find that every additional meter of walking to a station decreases a user’s likelihood of using a bike from that station by 0.194% (±0.0693%), and an even more significant reduction at higher distances
(>300 m). These estimates imply that almost 80% of bike-share usage comes from areas within 300 meters of stations, highlighting the need for dense station networks. The authors find that a 10% increase in bike availability would increase ridership by 12.211% (±1.097%), three-fourths of which come from fewer abandonments and the rest of which comes
from increased user interest. They illustrate the use of their estimates in comparing the effect of adding stations or increasing bike-availabilities in different parts of the city, at different times, and in evaluating other proposed improvements.

Emerging human infectious diseases and the links to global food production, Nature Sustainability 2, June 2019

Summary: As global food demand rises sharply, infectious diseases emerge at unprecedented rates. Feeding 11 billion people will require increases in crop and animal production, agricultural use of antibiotics, water, pesticides and fertilizer, and contact between humans and wild and domestic animals. Evidence suggests that this activity contributes to the emergence and spread of infection. Barrett et al synthesize literature indicating that, since 1940, agricultural drivers were associated with significant proportions of all disease –and nearly half of all zoonotic infections– emerging in humans, and that these numbers are likely to grow. The authors identify agricultural, disease management, and policy actions, along with additional research, to address this public health challenge.

Christopher B. Barrett

Stephen B. and Janice G. Ashley Professor, Charles H. Dyson School of Applied Economics and Management


Sachin Gupta

Henrietta Johnson Louis Professor of Management, Editor in Chief, Journal of Marketing Research

Spillover Effects of Mission Activities on Revenues in Nonprofit Health Care: The Case of Aravind Eye Hospitals, IndiaJournal of Marketing Research, 55, 6, November 2018

Summary: In 2020 this paper was one of 14 recipients of the inaugural American Marketing Association’s AMA-EBSCO Annual Award for Responsible Research in Marketing, which honors outstanding research that produces credible and useful knowledge that benefits society. Gupta et al examine cross-subsidization business models employed by non-profit health care organizations in low- and middle-income countries. The Aravind Eye Hospitals in India deliver free eye care services to the needy as mission activities which are subsidized by charging other patients market prices. This approach allows Aravind and other non-profit organizations to fulfill both their mission-oriented and revenue-generation goals. Examining this dependence in the context of Aravind, Gupta et al measure nine years of marketing outreach camps, and find that although these are marketed only to poor patients, the camps attract paying patients as well, in effect acting as advertising for Aravind. Using model estimates, the authors’ findings challenge conventional beliefs about the subsidies required by mission activities, as the incremental revenue accruing to Aravind from a camp exceeds the camp’s cost.

Reducing greenhouse gas emissions of Amazon hydropower with strategic dam planning, Nature Communications, 10, 1, September 2019

Summary: Hundreds of dams have been proposed throughout the Amazon basin, one of the world’s largest untapped hydropower frontiers. While hydropower is a potentially clean source of renewable energy, some projects produce high greenhouse gas (GHG) emissions per unit electricity generated (carbon intensity). Here the authors show how carbon intensities of proposed Amazon upland dams are often comparable with solar and wind energy, whereas some lowland dams may exceed carbon intensities of fossil-fuel power plants. Based on 158 existing and 351 proposed dams, they present a multi-objective optimization framework showing that low-carbon expansion of Amazon hydropower relies on strategic planning, which is generally linked to placing dams in higher elevations and smaller streams. Ultimately, basin-scale dam planning that considers GHG emissions along with social and ecological externalities will be decisive for sustainable energy development where new hydropower is contemplated.

Carla Gomes

Professor of Computer Science, Charles H. Dyson School of Applied Economics and Management

Miguel I. Gómez

Associate professor, Charles H. Dyson School of Applied Economics and Management

The economics and ecology of shade-grown coffee: a model to incentivize shade and bird conservation, Ecological Economics, 159, May 2019

Summary: The cultivation of shade-grown coffee is a production system widely regarded as environmentally sustainable and useful for biodiversity conservation. In this method, the crop is grown under a forest-like canopy of trees, enhancing pest control from birds; however, the process produces lower coffee yields. Gómez et al study this tradeoff here, along with the economic incentives required for smallholders (people managing agricultural holdings smaller than farms) to adopt shade practices rather than conventional systems, in which coffee is grown in sunnier settings. Formulating a dynamic optimization problem, the authors show that smallholders have incentives to allocate more land to shade-grown coffee under the appropriate market conditions.

Wind Turbine Shutdowns and Upgrades in Denmark: Timing Decision and the Impact of Government Policy

Summary  For policymakers, an important long-run question related to the development of renewable industries is how government policies affect decisions regarding the scrapping or upgrading of existing assets. This paper develops a dynamic structural econometric model of wind turbine owners’ decisions about whether and when to add new turbines to a pre-existing stock, scrap an existing turbine, or replace old turbines with newer versions (i.e., upgrade). Lawell et al apply their model to owner-level panel data for Denmark between 1980-2011 to estimate the underlying profit structure for small wind producers (the vast majority of turbine owners in the Danish wind industry during this time period), and evaluate the impact of technology and government policy on wind industry development. Explicitly taking into account the dynamics and interdependence of shutdown and upgrade decisions, and generating parameter estimates with direct economic interpretations, results from the model indicate that the growth and development of the Danish wind industry were driven primarily by government policies as opposed to technological improvements.

C.-Y. Cynthia Lin Lawell, Associate Professor, Robert Dyson Sesquicentennial Chair in Environmental, Energy, and Resource Economics, Charles H. Dyson School of Applied Economics and Management

Better Business: How the B Corp Movement Is Remaking Capitalism, Yale University Press, 2020 (Order Here)

Summary: Informed by Chris Marquis’ decade-plus of research on B Corps and animated by interviews with the movement’s founders and leading figures, Better Business tells the story of the rise of the B Corporation, a new corporate structure whose companies commit to putting social benefits and environmental stewardship on equal footing with financial shareholders. Marquis not only explores the rapid growth of global companies choosing to certify as B Corps, but also how B Lab’s systems and processes create more resilient and sustainable stakeholder-focused economic systems.

Better Business is the book to read if you want to put values and purpose at the center of your company. It’s an inspiring book with great insights to share.”

– Jerry Greenfield, co-founder, Ben & Jerry’s

Christopher Marquis

Samuel SC Johnson Professor in Sustainable Global Enterprise, Professor of Management and Organizations, Samuel Curtis Johnson Graduate School of Management