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If You Cannot Take The Heat, Get Out Of The Cerrado … Recovering The Equilibrium Amenity Cost Of Nonmarginal Climate Change In Brazil

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  • Christopher Timmins

Abstract

ABSTRACT This paper presents an empirical technique for valuing large changes in nonmarketed local attributes (e.g., climate amenities) without data describing prices of locally traded commodities like housing. A model of endogenous sorting is used to identify individuals' indirect utility functions, from which the value of the change in the local attribute is recovered while accounting for equilibrium impacts on markets for labor and locally traded commodities. Annual amenity costs of Brazilian climate change are estimated to be between $1.6 and $8.1 billion for a moderate climate change scenario, depending upon the role of migration costs.

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  • Christopher Timmins, 2007. "If You Cannot Take The Heat, Get Out Of The Cerrado … Recovering The Equilibrium Amenity Cost Of Nonmarginal Climate Change In Brazil," Journal of Regional Science, Wiley Blackwell, vol. 47(1), pages 1-25, February.
    • Handle: RePEc:bla:jregsc:v:47:y:2007:i:1:p:1-25
    DOI: 10.1111/j.1467-9787.2007.00497.x
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    1. repec:pri:rpdevs:deaton_tarozzi_prices_poverty is not listed on IDEAS
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    Cited by:

    1. Maddison, David & Rehdanz, Katrin, 2011. "The impact of climate on life satisfaction," Ecological Economics, Elsevier, vol. 70(12), pages 2437-2445.
    2. Freeman, Richard & Liang, Wenquan & Song, Ran & Timmins, Christopher, 2019. "Willingness to pay for clean air in China," Journal of Environmental Economics and Management, Elsevier, vol. 94(C), pages 188-216.
    3. Qin Fan & Meri Davlasheridze, 2016. "Flood Risk, Flood Mitigation, and Location Choice: Evaluating the National Flood Insurance Program's Community Rating System," Risk Analysis, John Wiley & Sons, vol. 36(6), pages 1125-1147, June.
    4. Dan S. Rickman, 2014. "Assessing Regional Quality of Life: A Call for Action in Regional Science," The Review of Regional Studies, Southern Regional Science Association, vol. 44(1), pages 1-12, Spring.
    5. Klaiber, H. Allen, 2014. "Migration and household adaptation to climate: A review of empirical research," Energy Economics, Elsevier, vol. 46(C), pages 539-547.
    6. Zhang, Junfu & Zheng, Liang, 2015. "Are people willing to pay for less segregation? Evidence from U.S. internal migration," Regional Science and Urban Economics, Elsevier, vol. 53(C), pages 97-112.
    7. David Albouy & Walter Graf & Ryan Kellogg & Hendrik Wolff, 2016. "Climate Amenities, Climate Change, and American Quality of Life," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 3(1), pages 205-246.
    8. Balistreri , Edward J. & Tarr, David G., 2011. "Services liberalization in preferential trade arrangements : the case of Kenya," Policy Research Working Paper Series 5552, The World Bank.
    9. Kuminoff, Nicolai V., 2009. "Decomposing the structural identification of non-market values," Journal of Environmental Economics and Management, Elsevier, vol. 57(2), pages 123-139, March.
    10. Brown, Zachary S. & Connor, Lawson & Rejesus, Roderick M. & Yorobe, Jose M., 2021. "Landscape-level feedbacks in the demand for transgenic pesticidal corn in the Philippines," Ecological Economics, Elsevier, vol. 180(C).
    11. van Duijn, Mark & Rouwendal, Jan, 2021. "Sorting based on urban heritage and income: Evidence from the Amsterdam metropolitan area," Regional Science and Urban Economics, Elsevier, vol. 90(C).
    12. Seth Morgan & Alexander Pfaff & Julien Wolfersberger, 2022. "Environmental Policies Benefit Economic Development: Implications of Economic Geography," Annual Review of Resource Economics, Annual Reviews, vol. 14(1), pages 427-446, October.
    13. Wenquan Liang & Ran Song & Christopher Timmins, 2020. "Frictional Sorting," NBER Working Papers 27643, National Bureau of Economic Research, Inc.
    14. Liang Zheng, 2016. "What city amenities matter in attracting smart people?," Papers in Regional Science, Wiley Blackwell, vol. 95(2), pages 309-327, June.
    15. Nicolai V. Kuminoff & V. Kerry Smith & Christopher Timmins, 2013. "The New Economics of Equilibrium Sorting and Policy Evaluation Using Housing Markets," Journal of Economic Literature, American Economic Association, vol. 51(4), pages 1007-1062, December.
    16. Xing, Chunbing & Zhang, Junfu, 2017. "The preference for larger cities in China: Evidence from rural-urban migrants," China Economic Review, Elsevier, vol. 43(C), pages 72-90.
    17. Oliveira, Jaqueline & Pereda, Paula, 2020. "The impact of climate change on internal migration in Brazil," Journal of Environmental Economics and Management, Elsevier, vol. 103(C).
    18. Jie-Sheng Tan Soo, 2018. "Valuing Air Quality in Indonesia Using Households’ Locational Choices," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 71(3), pages 755-776, November.
    19. Zhang, Junfu & Zheng, Liang, 2014. "Are Ghettos Good or Bad? Evidence from U.S. Internal Migration," IZA Discussion Papers 8093, Institute of Labor Economics (IZA).
    20. Nicolai V. Kuminoff & V. Kerry Smith & Christopher Timmins, 2010. "The New Economics of Equilibrium Sorting and its Transformational Role for Policy Evaluation," NBER Working Papers 16349, National Bureau of Economic Research, Inc.
    21. Bakkensen, Laura A. & Ma, Lala, 2020. "Sorting over flood risk and implications for policy reform," Journal of Environmental Economics and Management, Elsevier, vol. 104(C).
    22. Delazeri, Linda Márcia Mendes & Cunha, Dênis Antônio da & Couto-Santos, Fabiana Rita, 2018. "Climate change and urbanization: evidence from the Semi-Arid region of Brazil," Revista Brasileira de Estudos Regionais e Urbanos, Associação Brasileira de Estudos Regionais e Urbanos (ABER), vol. 12(2), pages 129-154.

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