Cost-effective policies allow for minimizing the compliance costs associated with reaching a desired environmental quality target. In this paper a conceptual model has been developed to examine the compliance costs under an intra-plant emission trading system for a non-uniformly mixed assimilative pollutant. The model incorporates the number of emission sources, the concentration of pollutants emitted at each source, the marginal cost of abatement for each source, the transfer coefficient that relates emission at each source with the impact on ambient air quality, and the desired ambient air quality target. The model is applied to an integrated steel plant in India. Results of this study demonstrate that emission trading is more cost effective than the existing regulatory system. Further, intra-plant trades would result in significant savings to the steel plant while securing an improvement in ambient air quality in the studied geographical area.

This paper examines agricultural intensification and its impact on deforestation in a frontier region of the Philippines. Panel data covering the period 1994–2000 are used to study labor demand and resource reallocation in response to lowland irrigation development. Results illustrate how irrigation has led to changes in employment, incomes, and activities at the forest margin. Findings indicate that the off-farm employment opportunities created by irrigation development have helped to reduce rates of forest clearing. Although some initial employment gains have been reversed, wage-induced increases in agricultural productivity in the uplands have reduced forest pressure. Results show that lowland irrigation has had direct, indirect, and lagged effects on rates of forest clearing, and that a virtuous cycle may be at play, with irrigation leading to both poverty reduction and reduced forest pressure.

This paper develops an approach to assess the political risk associated with implementation of institutional reforms in the water sector, while providing insights into the interrelationship of institutional arrangements, power structure, and policy outcome. The analytical approach consists of a two-tier process to assess the institutional feasibility of reform implementation. The first tier is a structured analysis of power distribution among the power groups interested in the outcome of the reform. The second tier is a Delphi process, reflecting the opinions of experts. The approach was applied to the case of the National Drainage Program Project (NDP) in Pakistan, currently in the early stages of implementation. Several hypotheses regarding likely progress were tested, using the feedback provided by a panel of experts in the Delphi process.