Suchergebnisse

AbstractReal-life risk decisions are taken in a social context. However, we still know little about how that affects risk decisions. We have experimentally investigated the effect of social comparison on risk taking. We designed an experiment that allows us to isolate social comparison from other channels whereby the social context can affect risk decisions. The design also allows us to find impacts of the social reference point both if the individual cares about the distance to the social reference point and if she cares about her rank. Thus, we compare risk-taking in isolation to risk-taking with various exogenously imposed social reference points. We find that risk-taking is affected by the desire to get ahead of others, both when the social reference point is within reach (rank can be affected) and when it is out of reach (rank cannot be affected). Our results suggest that people do not only care about rank but also care about the distance to the social reference point.

Land conflicts in developing countries are costly. An important policy goal is to create respect for borders. This often involves mandatory, expensive interventions. We propose a new policy design, which in theory promotes neighborly relations at low cost. A salient feature is the option to by-pass regulation through consensus. The key idea combines the insight that social preferences transform social dilemmas into coordination problems with the logic of forward induction. As a first, low-cost pass at empirical evaluation, we conduct an experiment among farmers in the Ethiopian highlands, a region exhibiting features typical of countries where borders are often disputed. Our results suggest that a low-cost land delimitation based on neighborly recognition of borders could deliver a desired low-conflict situation if accompanied by an optional higher cost demarcation process.

AbstractEthiopia is experiencing an increasing frequency and intensity of slow‐onset and acute disasters caused by climate change, with significant health impacts. Understanding and addressing these impacts involves trade‐offs, which are central to effective priority setting in health and overarching efforts to meet the Sustainable Development Goals. Despite minimal historic greenhouse gas emissions, Ethiopia has been at the forefront of climate action since launching the Climate‐Resilient Green Economy (CRGE) in 2011, a low‐carbon development strategy. To learn from the Ethiopian approach, this paper examines to what extent health has been integrated into the CRGE. We found that the early years of the CRGE prioritized developing the financial basis of the green economy, while the health impacts of climate change have only been tentatively considered to date and remain detached from broader health strategies. Further analysis of climate adaptation measures, "health co‐benefits," and reducing specific vulnerabilities of the health sector could help improve health and build climate resilience.

We test the effect of stake size on ambiguity attitudes. Compared to a baseline condition, we find subjects to be more ambiguity seeking for small-probability gains and large-probability losses under high stakes. They are also more ambiguity averse for large-probability gains and small-probability losses. We trace these effects back to stake effects on decisions under risk (known probabilities) and uncertainty (unknown probabilities). For risk, we replicate previous findings. For uncertainty, we find an increase in probabilistic insensitivity under high stakes that is driven by increased uncertainty aversion for large-probability gains and for small-probability losses.

In response to a challenge from members of the Carbon Pricing Panel for the world to expand carbon pricing to cover 25 percent of global emissions by 2020, Ethiopia commissioned a carbon pricing study to obtain recommendations on the role and possible forms of carbon pricing policies in Ethiopia. The study summarized in this report is a collaborative effort by the Government of Ethiopia, the Ethiopian Development Research Institute (EDRI), and the World Bank to better understand the potential benefits and costs for Ethiopia with use of carbon pricing to reduce greenhouse gas (GHG) emissions. The study also investigates distributional impacts of carbon pricing and measures that can help address unwanted distributional impacts. The specific aims include supporting the Government of Ethiopia (GoE) in identifying policy actions, including carbon pricing, to achieve its GHG emission reduction targets; facilitating a dialogue among Ethiopian stakeholders on related policy instruments; and building analytical and technical capacity for GoE's future policy planning. Lessons from this analysis may also be useful for other low-income countries.

This study uses a computable general equilibrium model to analyze various policy scenarios for a carbon tax on greenhouse gas emissions from petroleum fuels and kerosene in Ethiopia. The carbon tax starts at $5 per ton of carbon dioxide in 2018 and rises to $30 per ton in 2030. Different scenarios examine the impacts with revenue recycling through a uniform sales tax reduction, reduction of labor income tax, reduction of business income tax, direct transfer back to households, and use by the government to reduce debt. Because petroleum fuels and kerosene are a relatively small part of the Ethiopian economy, the carbon tax has quite small impacts on overall economic activity while having a notable proportionate impact on greenhouse gas emissions from these energy sources, depending on the recycling scenario. The carbon tax can raise significant revenue -- up to $800 million per year by 2030. The impacts on the poor through increased cost of living are not that large, since the share of the poor in total use of petroleum fuels and kerosene is small. In terms of income effects through employment changes, urban households tend to experience more impacts than rural households, but the results also depend on the household skill level and the revenue recycling scenario.