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Essays on the effect of environmental policies in Japan

Okajima, Shigeharu
http://rave.ohiolink.edu/etdc/view?acc_num=osu1337263028

Abstract Details

2012, Doctor of Philosophy, Ohio State University, Agricultural, Environmental and Developmental Economics.
The first part of the dissertation entitled “Energy Intensity in Japan”, discusses the causes of the increase in Japan’s energy intensity, defined as energy consumption divided by GDP since the early 1990’s. The significant reduction in Japan’s energy intensity ceased in the early 1980’s and has even slightly increased since the early 1990’s, indicating that Japan seemingly has reached the limits of its ability to improve energy use. However, further analysis at prefecture level and sector level provides additional insight on energy intensity trends. Our result indicates that the non-uniform energy intensity trends between prefectures are attributed to a high variability in energy efficiency. At sector level, we estimate the income elasticity of energy consumption in each sector and find that a structural change in energy consumption behaviors occurred in all sectors at different time points. More importantly, the structural changes occurred in 1981 in the industrial sector and in 1988 in the commercial sector are presumably responsible for the deterioration of Japan’s energy intensity since the early 1990’s. The second part of the dissertation, entitled “The Demand for Residential Electricity”, estimates the residential electricity price elasticity in Japan. The Japanese government has not imposed a residential electricity tax because the price elasticity of electricity consumption has been considered to be very low. However, there has been little study to provide empirical evidence for the consensus. This paper is intended to fill the gap by estimating the residential electricity price elasticity in Japan. In order to avoid dynamic panel bias, we use the Arellano-Bond estimator to estimate the residential electricity price elasticity. The results show that the estimated price elasticities of residential electricity consumption are -0.1963 in the short run and -0.2298 in the long run at national level. These estimates predict that contrary to the consensus, an increased electricity tax may reduce residential electricity consumption in Japan both in the short run and long run. The decline in electricity consumption in the long run, however, may not be as large as expected in previous studies. The third part of the dissertation, entitled “The Effect of Green Contract Law in Electric Power Procurement Auctions”, examines the impacts of green contracts in electric power procurement auctions. Since electricity prices were higher in Japan than in most developed countries, the Japanese government started electric power procurement auctions in 2000. However, it is hard to tell that Japanese electricity prices are low enough for two reasons. One is the low participation rate in the auctions. The other is the environmental regulatory compliance costs that push up suppliers’ marginal costs. In order to meet the Kyoto Protocol, the Japanese government enacted the green contract law in 2007, which restricts the participation of those companies with substandard emissions control technology. We find that losing one bidder in the auction raises a winning bid price by 1.8% and applying the green contract law to the auction lowers the probability of new entrant participation by 22.1% and increases the winning bid price by as high as 33%.
Timothy Haab (Advisor)
Brent Sohngen (Committee Member)
Eugene Jones (Committee Member)
114 p.
Economics; Energy; Environmental Economics; Environmental Law; Public Policy; Statistics
energy intensity; regional and sectoral differences; income elasticities; price elasticities; environmental taxes; green contract law

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Citations

  • Okajima, S. (2012). Essays on the effect of environmental policies in Japan [Doctoral dissertation, Ohio State University]. OhioLINK Electronic Theses and Dissertations Center. http://rave.ohiolink.edu/etdc/view?acc_num=osu1337263028

    APA Style (7th edition)

  • Okajima, Shigeharu. Essays on the effect of environmental policies in Japan. 2012. Ohio State University, Doctoral dissertation. OhioLINK Electronic Theses and Dissertations Center, http://rave.ohiolink.edu/etdc/view?acc_num=osu1337263028.

    MLA Style (8th edition)

  • Okajima, Shigeharu. "Essays on the effect of environmental policies in Japan." Doctoral dissertation, Ohio State University, 2012. http://rave.ohiolink.edu/etdc/view?acc_num=osu1337263028

    Chicago Manual of Style (17th edition)

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© 2012, all rights reserved.
This open access ETD is published by The Ohio State University and OhioLINK.