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Environmental Institutions

Environmental Institutions. Econ 373 Feb 22, 2012. Various environmental organizations. Intergovernmental organizations Government organization Nongovernment organization International Country specific. Intergovernmental organizations. United Nations Environment Programme (UNEP)

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Environmental Institutions

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  1. Environmental Institutions Econ 373 Feb 22, 2012

  2. Various environmental organizations • Intergovernmental organizations • Government organization • Nongovernment organization • International • Country specific

  3. Intergovernmental organizations • United Nations Environment Programme (UNEP) • IPCC (Intergovernmental Panel on Climate Change) [1988] • World Bank- Environment and natural resources management • International Energy Agency (IEA) • Earth System Governance Project [2009] • Global Environment Facility  [1991]

  4. Intergovernmental organizations • International Maritime Organization • A special program under UN founded in 1948 • Bring the regulation of the safety of shipping into an international framework • Regional fishery management organizations (RFMOs) • International organization dedicated to the sustainable management of fishery resources in a particular region of international waters, or of highly migratory species.

  5. International Treaties • United Nations Framework Convention on Climate Change (UNFCCC): 1992. To stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system • Legally no-binding • Updates are the protocols • Annex I countries: industrialized countries and economies in transition • Annex II countries: developed countries which pay for costs of developing countries • Non Annex I countries: Developing countries.

  6. Kyoto Protocol (1997) Brown = Countries that have signed and ratified the treaty              (Annex I & II countries in dark brown)Blue = No intention to ratify at this stage.Dark blue = Canada, which withdrew from the Protocol in December 2011. Grey = no position taken or position unknown

  7. International Treaties • Stockholm Conference in 1972: UN's first major conference on international environmental issues • Montreal Protocol 1987: Designed to protect the ozone layer by phasing out ozone depleting chemicals.

  8. Montreal Protocol 1987 • The main provisions • Requirement for individual countries to phase out the production and consumption of designated substances • A multilateral fund into which industrialized countries could contribute funds that would be used to help developing countries achieve the control measures specified in the agreement • A provision for trade restrictions in designated ozone-depleting chemicals. Also bans trade in products containing these substances.

  9. Excess profits associating with production ceiling Demand for CFCs P2 $ a Marginal production costs P1 Q2 Q1 Quantity

  10. Designing International Environmental Agreements • Transboundary pollutant: CFCs, CO2 • Issues: • Has to be self-enforcing • Sufficiently appealing for the initial agreement • Similar to cartel • Self-enforcing • Voluntary participation • Effective restriction on output • Basic characteristics • Cheating and nonparticipation deterred • Individually rational • Environmentally improving

  11. The Size of International Environmental Agreements • N identical countries • Each country iemits • Each country chooses either to pollute or to abate • Payoff to the country • is the average damage of 1 unit of emissions,

  12. The Size of International Environmental Agreements • The cooperative solution • If all pollute • All abate => choose abate • The noncooperative solution • => choose pollute

  13. The size of International Environmental Agreements • IEA: M countries get together to form an agreement. • Stage 1 countries sort into agree to form members and fringes • Stage 2 act cooperatively and make a decision of abate of not • Fringe will always pollute • If members choose to pollute: • If members choose to abate: • Abate if >

  14. The Size of International Environmental Agreements • The bigger the problems, the more difficult it is to hold a group together! Defection to Fringe pays off Fringe 1 Payoff Member payoff M+-1 M+ M* M (IEA size)

  15. Government organization • U.S. • Environmental Protection Agency [1970] • Department of Energy [1977] • Fish and Wildlife Service (Department of Interior) [1871] • Forest Service (Department of Agriculture) [1876] • E.U. • European Environment Agency • China • Ministry of Environmental Protection • Arizona • Arizona Department of Environmental Quality

  16. Nongovernmental Organization • The Nature Conservancy [1951] • preserve diversity of life on Earth by protecting the lands and waters they need. It’s the largest environmental nonprofit by assets and by revenue. • World Wide Fund for Nature (WWF) [1961] • Working on issues regarding the conservation, research and restoration of the environment • World's largest independent conservation organization with over 5 million supporters worldwide, working in more than 100 countries. • Greenpeace [1971] • Known for its direct actionsand has been described as the most visible environmental organization in the world.

  17. US nonprofit organizations • Center for Climate and Energy Solutions (C2ES), formerly Pew Center on Global Climate Change  • providing credible information, straight answers, and innovative solutions in the effort to address global climate change, top environmental think tank • Resources For the Future (RFF) [1952] • conducts independent research into environmental, energy, and natural resource issues, primarily via economics and other social sciences. Widely recognized as a pioneer in the field of environmental economics.

  18. US nonprofit organizations • Unions of Concerned Scientists (UCS) [1969] • initiate a critical and continuing examination of governmental policy in areas where science and technology are of actual or potential significance • Environmental Defense Fund (EDF) [1967] • issues including global warming, ecosystem restoration, oceans, and human health. It is nonpartisan, and its work often advocates market-based solutions to environmental problems. • Sierra Club [1892] • To explore, enjoy, and protect the wild places of the earth; To practice and promote the responsible use of the earth's ecosystems and resources; To educate and enlist humanity to protect and restore the quality of the natural and human environment; and to use all lawful means to carry out these objectives.

  19. Group Project • Group 1 (Feb 29) on General Motor • John Casey • Alex Goetting • Blake Davey • Sheng Hao • Group 2 (Feb 29) on Danone • Pedro Valecia • Chloe Mackey • Stephen Jakubowski • Frank Willis • Group 3 (Feb 29) on Coca Cola • Joseph Wilson • XiXi Mo • Paul Rockwell • Timothy Dreschler • Group 4 (Feb 29) on Walmart • Mega Schmitt • Scott Russell • Yongqi Lu • Aaron Uribe • Antonio Roca • Group 5 (Feb 29) on Intel • Ray Siu • Xiayu Zhang • Jorge Flores • Alex Ruane • Group 6 (Feb 29) on Raytheon • Isaac Marcor • Trevor Brady • Zimiao Liao • Hua Yan

  20. Group Project • Group 8 (March 5) on McDonalds • Cameron Haddad • Brandon Deveny • Yingjie Liu • Li Huo • Group 7 (March 5) on Honda • Darryl Davis-rosa • Cliff Bradshaw • Marco Gonzales • Huabin Liang • Group 10 (March 5) on Bank of America • Daniella Trimble • Omar Kaif • Matthew Perez • TzeHsin Chuang • David Rodriquez • Group 9 (March 5) on Pepsi • Soonchun Kwon • Kuna Bhasin • EmaanAmeri • Alvin Cheung • Group 11 (March 5) on ExxonMobil • Ken Cummings • Qihao Zhang • Steven Cox • Group 12 (March 5) on AT&T • Maro Choi • Tim Dalton • Sean Rocha • Zachary Nigro

  21. Group Project • Case Study on CSR • 10-15 mins PowerPoint presentation (80%) • Written executive summary • Content • Overview of the company and the industry • Type of CSR activities • CSR investment in dollars • Identify why it is relevant for the firm to adopt CSR • Recommendations

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