UC Berkeley

The fields of environmental and resource economics provide us with the tools that allow us to better understand the world around us and the ways in which humans interact with it. People benefit from goods and resources provided by the environment, but can also harm the environment through externalities created by their economic activity. The utilization of environmental resources often requires government and society to implement policies in order to protect and preserve these resources for the future. This dissertation explores three topics in environmental and resource economics. The first measures an environmental externality caused by urban development and proposes a policy that balances continued development with the welfare of those harmed by the externality. The second explores how people adapt to changes in climate resulting from migration, which may inform us about adaptation to climate change and migration in the future. The third topic studies the effectiveness of policies aimed at protecting marine resources, at a time when marine protection is rapidly expanding.

The first chapter, titled "Shadow Prices: Measuring the Cost of Shadows from New Construction in New York City," studies one negative externality of urbanization - the blocking of sunlight by construction - and a policy that can be implemented to ensure a balance between urban development and the welfare of those who are harmed by their reduced access to sunlight. I begin by measuring the externality of urban shadows by estimating the impact of shadows created by new highrise construction on nearby housing prices. Making use of publicly available housing transactions data and building shapefiles for New York City, I create a shadow accumulation model to measure the amount of shadow created by highrises that are cast on residential units in Manhattan in each year for highrises constructed between 2005 and 2014. I then use a differenced regression model with spatial-time fixed effects to estimate the effect of a change in shadows on nearby residential unit sale prices. I estimate that a 10 percentage point increase in average daily shadow received by a unit (e.g. 1 hour of additional shadow in a day with 10 hours of sunlight) is associated with an approximately 3.78% decrease in unit price. Finally, I propose a policy that incorporates this estimate in regulating building height.

In the second chapter, titled "Estimating the Relationship Between Inter-Climate Migration and Air Conditioning Adoption," which I coauthored with Leopold Biardeau, we measure the relative increase in residential air-conditioning (AC) adoption rates in states that see higher levels of migration from relatively cooler states, within the contiguous United States. We consider how the average percent increase in Cooling Degree Days (CDDs) by migrants to a given destination state increases the average rate of residential AC adoption in the four decades spanning from the 1960s to the end of the 20th century. We find significant positive effects of the percent increase in CDDs experienced by migrants on rates of air conditioning adoption. To confirm the validity of this relationship, we rely on an instrumental variables approach using origin state determinants of emigration, along with the distance between states, to provide evidence that this result is not the byproduct of a reverse causality relationship in which higher residential AC-adoption levels would be responsible for increased immigration from relatively cooler states. These results provide some insights regarding the expected impact relative temperature changes may have on Climate Change adaptation. In particular, we might expect that an increase in population displacements from warmer countries to relatively cooler ones lead to a lower increase in energy demand for cooling purposes that what would have been anticipated.

In the third and final chapter, titled "Evaluating the Effectiveness of Very Large Marine Protected Areas at Deterring Fishing Effort," which I coauthored with Leopold Biardeau and David Zilberman, we study the extent to which Very Large Marine Protected Areas (VLMPAs) have been successful at deterring fishing effort. The last decade has witnessed a considerable increase in the designation of VLMPAs, Marine Protected Areas spanning at least 100,000 km-squared. On paper, these protected areas offer conservation benefits not seen in smaller ones. Yet, their large sizes may constitute a challenge for enforcement. Using on satellite-based data that tracks vessel fishing hours, we find evidence that VLMPAs have, on average, been able to deter fishing effort, although a case-by-case analysis reveals varying levels of success. To better understand the nature of possible illegal fishing in these VLMPAs, we investigate the characteristics of the vessels infringing on the fishing bans in these VLMPAs and find that most of the infractions can be traced back to a few industrialized countries.

These three chapters fall back on three important question in environmental and resource economics: What are the environmental externalities associated with economic activity and what policies can be implemented to compensate those harmed while balancing the interest of allowing continued economic activity? How do people adapt to changes in their environment? And finally, how successful are current policies that are designed to protect the environment and its resources? The research contained in this dissertation applies each of these questions in different contexts, and in doing so, helps us to better understand the economics of resources and the environment.