Agricultural and Applied Economics—Without Apology
What happens to economic growth when governments tinker with prices in order to ensure higher prices to producers or, as is more common in developing countries, lower prices to consumers?
The University of Adelaide’s Kym Anderson and Markus Brückner, who both do excellent work, answer this question in a recent VoxEU column:
I had been meaning to introduce this new environmental economics blog, courtesy of my colleague Lori Bennear, who is an Assistant Professor in the Nicholas School of the Environment here at Duke.
In one of her first posts, Lori looks at the externalities from fracking in relation to the Coase Theorem:
There are many potential externalities associated with fracking. An excellent analysis of potential externalities from methane contamination of groundwater by Osborn, Vengosh, Warner, and Jackson, all from Duke, can be found in this paper. Today’s blog will focus on a different aspect of the fracking debate — the negative externalities associated with radioactive wastewater.
You read that right: Eye disease and development. I was intrigued when I saw that it was the title of a new working paper (the link opens a .pdf document) on the NEP-DEV mailing list. After reading the abstract, the title made a lot more sense:
This research advances the hypothesis that cross-country variation in the historical incidence of eye disease has influenced the current global distribution of per capita income. The theory is that pervasive eye disease diminished the incentive to accumulate skills, thereby delaying the
fertility transition and the take-off to sustained economic growth. In order to estimate the influence from eye disease incidence empirically, we draw on an important fact from the field of epidemiology: Exposure to solar ultraviolet B radiation (UVB-R) is an underlying determinant of several forms of eye disease; the most important being cataract, which is currently the leading cause of blindness worldwide. Using a satellite-based measure of UVB-R, we document that societies more exposed to UVB-R are poorer and underwent the fertility transition with a significant delay compared to the forerunners. These findings are robust to the inclusion of an extensive set of climate and geography controls. Moreover, using a global data set on economic activity for all terrestrial grid cells we show that the link between UVB-R and economic development survives the inclusion of country fixed effect.
I have not had a chance to read the paper yet, but I wonder just how unpredictable UVB-R is within a given society, and so whether it is truly exogenous to economic growth. This is a compelling finding nevertheless.