Finished Master- and Diploma Theses

  • David Kapfer

Restituting Location Gains - A typology of residential land and property taxes in Europe

Master Thesis, in Cooperation with the TU Berlin.

Submission:
December 2014

Abstract:

This thesis is motivated by three objectives for an optimal design for the financing of local provision of public goods and services - land use sufficiency, simplicity and (economic) impact neutrality - in the field of recurrent direct taxes on immobile property or real estate. Although this is the least evadable and most local asset resource, this kind of taxation is currently no relevant source of revenue to local governments; research on the reasons is rare.

Through a literature review, this thesis derives ten criteria for an optimal design of such a tax, classifies EU member countries' taxes systematically along these criteria and identifies six types of current tax combinations.

The theoretical optimum derived is a legally separated tax levied not on real estate but only on the included location surface (thus similar to a 'single tax') and assessed at capital value reflecting current market prices. Regarding subjects it is most effective if specifically targeted as incentive for sufficiency oriented land consumption at owner-occupiers and owners of vacant real estate or multiple residences as main drivers of urban sprawl. It is found that in nine of the ten criteria, the majority of countries apply the opposite of an optimal taxation. The most obvious deviations are found to be the difference between nominal and effective rates and the extensive granting of reliefs from tax liability for Residential Owners. They form a significant part of the gap between current revenue and the potential revenue from Residential Location surface which would be needed to cover the local government revenue need for the current level provision of public goods and services.

The main deviations are found to be exemptions from tax liability for owner-occupiers or private indebtedness favouring reliefs such as Mortgage Interest Deductibility.

These results are then discussed together with real-world second-best design examples to allow for the recommendation of fields for intensified empirical research.

  • Oliver Tietjen

Analyses of Risk Factors in Conventional and Renewable Energy Dominated Electricity Markets

Master Thesis, in Cooperation with the FU Berlin. pdf

Submission:
August 2014

Abstract:

The large scale expansion of renewable energies challenges many prevailing electricity markets all over the world. There is an ongoing scientific debate if a market design solely based on marginal cost pricing is sufficient to integrate renewable energies. Of particular interest is the question if the investment risks of renewable plants, mostly due to their capital intensity, are prohibitive high in a pure market setting. Moreover, their fluctuating production nature might also increase the investment risks for conventional fossil plants. The objective of this paper is therefore to examine these questions.

For this purpose, a numerical electricity market model is conducted in a Monte Carlo simulation to compute the investment risks of different renewable and fossil plant types. The resulting risk values are then incorporated in the model to study the influence of the risk on the investment decisions. Furthermore, the risk is integrated on a stand-alone (per plant type) and on a portfolio basis. The later case accounts for hedging effects between different plant types to lower the overall investment risks. This procedure is done for a market dominated by renewable and a market dominated by fossil fuel plants to analyze the difference.

The results confirm that renewable energies have higher investment risks compared to fossil plants on a stand-alone basis. But renewables can be used as hedges for gas plants, which increase their investment attractiveness in the fossil fuel market. However, in the renewable dominated market there are not further hedging advantages and the renewable stand-alone risks remains high. If these high investment risks lead to suboptimal renewable investments, a de-risking market design extension might be a proper solution. Another finding is that the investment risks for gas plants rise with higher renewable shares, due to the impact of the fluctuating renewables availability on the electricity price and the production volumes of the gas plants. This also has policy implications: An increased risk of gas plants might hamper their construction which can cause blackouts. If this indeed becomes a problem, a capacity market as an additional market design element can be a solution since it leads to safer revenues.

  • Ina Neher

Bioenergy and other Drivers of Land Expansion and Greenhouse Gas Emissions - A Kaya-Like Decomposition
Master Thesis, in Cooperation with the TU Berlin. pdf


Submission:
July  2013

Abstract:
Currently, 12% of ice-free land is used as cropland. Agricultural production and land use change are responsible for 32% of total anthropogenic greenhouse gas (GHG) emissions in CO2 equivalent. Population growth, changing diets and technological improvements are seen as the main drivers for past variations in cropland and GHG emissions. In the future, the demand for bioenergy is expected to add additional pressure on the agricultural sector. However, the individual contribution of the main drivers on cropland expansion and increasing GHG emissions remained undetermined.

This study aims to quantify the past and future influence of the main drivers on cropland expansion and rising GHG emissions. For this purpose, a Kaya-like decomposition method is used on a global and regional scale. Furthermore, the decomposition differentiates the contributions of single demand sectors (food, feed, bioenergy and others) on the dynamics of cropland and agricultural GHG emissions. For the future analysis, data from projections of the Model of Agricultural Production and its Impact on the Environment (MAgPIE) is used, following the middle of the road scenario of the Shared Socio economic Pathways (SSP2) between 1995 and 2105. Focusing on the possible influences of bioenergy on the environmental impacts of agriculture, a baseline and a mitigation scenario are compared varying in the demand of bioenergy and carbon prices for emitted GHGs.

The results show that whilst in the past population growth represent the major driver for agricultural production, it loses its main influence during the 21st century. In the future, bioenergy is identified as the main driver being responsible for more than 50% of cropland expansion in the baseline and 70% in the mitigation scenario. Furthermore, the cultivation of bioenergy crops contributes about 40% to 60% of future N2O emission increases.
Besides bioenergy, the livestock sector also significantly influences agricultural GHG emissions. 40% of CH4 emissions increases are caused by livestock production. In contrast, improved technological practices in agriculture reduce pressure on both cropland and GHG emissions.

While the production of bioenergy shows definite potential to reduce net GHG emissions by replacing fossil fuels, it has an extreme influence on agricultural GHG emissions and land use changes. Using crops for the provision of energy competes with food production for available resources such as cropland, water and fertilizer. Hence, food security has to be guaranteed before crops are cultivated to produce energy. Shifting diets towards the reduction of animal-based products in emerging and developed economies instead is able to lessen GHG emissions without severe consequences for the global food security.

  • Michaja Pehl

Integration of CO2 Abatement Options for Industry in REMIND

Diploma Thesis, in Cooperation with the TU Berlin.

Submission: December 2012

Abstract:

Industry is the sector with the second highest greenhouse gas emissions. Industry production and energy consumption are bound to continue to increase, due to population growth and increasing affluence. Therefore, options for the reduction of CO2 emissions, especially carbon capture and sequestration, are gaining prominence.

In order to examine the usefulness of CCS in industry with the integrated assessment model REMIND, the industry sector emissions had to be pseudo-endogenised. To that end, historic data as well as projections of industry shares in stationary energy use were utilized. Together with sub-sector energy use share for the cement, chemicals, and iron and steel industry, a baseline of industry CO2 emissions was established. CCS options were implemented into the model via two magrinal abatement cost curves for the 2020 to 2030 abd tge 2035 to 2100 timeframes, that were calculated using cost and reduction rate data from the literature.

The results from the modeling show that CCS options in industry can contribute to the reduction of climate change mitigation costs. They also lessen the need for structural change in the energy supply of the stationary sector.

  • Sophie Benard

Distributional Effects of Financing Public Capital in a Two-Class Society

Master Thesis, in Cooperation with the TU Berlin.

Submission: October 2012

Abstract:

In der Volkswirtschaftslehre wurde das optimale Versorgungsniveau von öffentlichen Dienstleistungen mehrfach unter der Annahme homogener Haushalte analysiert, unter anderem von Barro (1990). Die Vermögensverteilung ist in entwickelten Ländern in der Regel jedoch nicht homogen, was die Präferenzen der Agenten bezüglich des Versorgungsniveaus von öffentlichen Dienstleistungen beeinflussen kann. Das Ziel der vorliegenden Arbeit ist es, die Verteilungseffekte der Finanzierung eines produktiven öffentlichen Kapitalstocks unter Betrachtung der Heterogenität der Vermögensverteilung zu analysieren. Zwei Finanzierungsmechanismen werden untersucht und verglichen: der öffentliche Kapitalstock wird entweder mit einer Kapitalertragssteuer oder mit einer Lohnsteuer finanziert.

Die zentrale Annahme der folgenden Analyse ist, dass die Gesellschaft sich in zwei Klassen teilen lässt: Kapitalisten und Arbeiter. Die durchgeführte Untersuchung basiert somit auf den zwei-Klassen Modell von Michl und Folev (2004). Diesem Modell nach verhalten sich die Kapitalisten dynastisch und erhalten ihre Einkünfte ausschließlich dadurch, dass sie ihr Vermögen dem Produktionssektor leihen. Die Arbeiter hingegen optimieren ihr Konsum- und Sparverhalten unter Betrachtung ihres Lebenszyklus: sie arbeiten in der ersten Lebensphase und sparen gleichzeitig für die Rente.

Um das Verhalten dieses hybriden Modells zu verstehen, wird das Verhalten der beiden Bevölkerungsgruppen zuerst ohne Finanzierung eines öffentlichen Kapitalstocks betrachtet. Die analytische Lösung des Modells zeigt, dass alleine die Kapitalisten den Zinssatz bestimmen, und somit gilt eine Version des Pasinetti-Theorems. Basierend auf diesem Ergebnis kann ein äquivalentes Ramsey-Modell definiert werden, das identische Ergebnisse auf der aggregierten Ebene liefert. Damit ist die intertemporale Effizienz des Modells gezeigt.

Weiterhin wird die Einführung einer Kapitalertragssteuer mit Umverteilung der Steuereinnahmen untersucht. Diese führt zu Wohlfahrtsverlusten, weil sie von dem dezentralen Marktergebnis abweicht, das im Sinne der Maximierung des aggregierten Konsums optimal ist.

Wenn die Einnahmen in einem öffentlichen Kapitalstock investiert werden, können sowohl eine Kapitalertragssteuer als auch eine Lohnsteuer bei geringer Besteuerungsrate parento-effizient sein, d. h. man kann die Steuerrate so setzen, dass beide Klassen bessergestellt werden. Die beiden Steuern sind aber nicht verteilungsneutral. Unter einer Kapitalertragssteuer steigt der Anteil am Kapital, den die Arbeiter besitzen, womit die Verteilung des Vermögens homogener wird. Eine Lohnsteuer hingegen führt zu einer stärkeren Polarisierung der Kapitalverteilung, mit einer Zunahme des Anteils am Kapital, der den Kapitalisten gehört. Wenn der Staat eine homogenere Kapitalverteilung anstrebt, ist eine Kapitalertragssteuer besser geeignet.

Steht aber die Effizienz im Mittelpunkt, ist die Lohnbesteuerung attraktiver, weil sie eine höhere Steigerung der Produktivität und des gesamten Konsums als bei der Kapitalertragssteuer ermöglicht. Dabei ist anzumerken, dass die Arbeit im Modell ein fixer Faktor ist, sodass die Arbeiter die bereitgestellte Arbeitsmenge nicht anpassen, wenn Löhne besteuert werden. Diese Annahme verstärkt die Attraktivität der Lohnbesteuerung. Diese Arbeit macht also deutlich, dass es einen Konflikt zwischen ausgeglichener Vermögensverteilung und Maximierung des Outputs bei der Wahl der Finanzierungsmethode gibt.

  • Jan Siegmeier

Patterns and Determinants of Carbon Emissions Embodied in Trade

Master Thesis, in Cooperation with the TU Berlin. pdf

Submission: December 2011

Abstract:

Basierend auf jüngsten Forschungsergebnissen zur großen und wachsenden Bedeutung des Welthandels bzw. der für den Handel produzierten Güter für die Emission von Treibhausgasen, widmet sich diese Arbeit der Analyse von Mustern des CO2-Fussabdrucks verschiedener Handelsströme sowie möglicher Ursachen. Es werden die gleichen Daten verwendet wie von Peters et al. (2011). Die Analyse erfolgt in zwei Schritten:

Erstens werden zur genaueren Bestimmung der Muster die Veränderungen des im Handel „enthaltenen“ CO2 zwischen 1992 und 2006 zerlegt, und zwar in diejenigen Anteile, die auf Veränderungen bilateraler Handelsvolumina, länder- und sektorspezifischer CO2-Intensitäten und der Sektorzusammensetzung einzelner bilateraler Handelsströme zurückzuführen sind. Der Skaleneffekt ist der dominierende, insbesondere für Exporte von Ländern ohne Emissionsreduktionsziel unter Annex B des Kyoto-Protokolls, gefolgt von Intensitätsveränderungen, die für Exporte aus Annex B - Ländern besonders wichtig sind. Zusammen führen die beiden Nettoeffekte in einem Größenverhältnis von etwa 4 zu 1 zu einer Verdreifachung der Netto-CO2-Importe der Annex-B-Länder. Die Sektorzusammensetzung spielt nur eine geringe Rolle.

Im zweiten Schritt werden ökonometrische Schätzverfahren angewendet, um die Mechanismen der den CO2-Bilanzen zugrunde liegenden Handelsströme mit einem Gravitationsmodell zu analysieren. Dabei werden die CO2-Intensitäten der Handelsströme als exogen angenommen. Es wird der Versuch gemacht, die Ergebnisse von Feenstra et al. (2001) zu reproduzieren. Diese nutzen jahres- und sektorweise Schätzungen für die Elastizitäten des Handels bezüglich des BIP des Exporteurs und Importeurs, um auf verschiedene mit der Struktur des Gravitationsmodells konsistente Theorien zu schließen. Sie argumentieren außerdem, dass die unterschiedlichen Ergebnisse für Schätzungen mit dem Gravitationsmodell in der Literatur nicht von verschiedenen Ländercharakteristiken abhängen, sondern von der Art der Güter, die sie handeln. Die Ergebnisse in Analogie zu Feenstra et al. werden bezüglich ihrer Robustheit bei Verwendung anderer Schätzverfahren überprüft.

Theoretische und methodische Aspekte der ökonometrischen Modellierung werden diskutiert und eine Reihe von Tests durchgeführt, um das am besten geeignete Modell auszuwählen. Es werden drei Arten von Schätzungen vorgenommen: Erstens für auf drei Güterarten aggregierte Handelsdaten mit OLS, analog zu Feenstra et al. (2001); zweitens mit Länderpaar-spezifischen Achsenabschnitten und der einfachen OLS-Methode überlegenen Panelschätzverfahren, und drittens mit Panelverfahren auf Sektorebene.

Unsere Ergebnisse stützen diejenigen von Feenstra et al. (2001) für differenzierte Güter. In diesem Fall weist eine höhere Elastizität des Handels bezüglich des BIP des Exportlandes auf ein Modell des monopolistischen Wettbewerbs mit einem “Heim-Markt-Effekt” hin, statt auf ein alternatives Modell, das Güter auf Länderebene unterscheidet. Dieses Ergebnis ist robust bei den meisten Schätzverfahren (abgesehen von einem Panelansatz, der Differenzen zwischen aufeinanderfolgenden Jahren bildet).

Für den Handel mit homogenen Gütern werden die Thesen von Feenstra et al. allerdings nicht gestützt. Zwar finden wir eine Tendenz zu niederigerem (höherem) Einfluss des BIPs des Exporteurs (Importeurs), im Vergleich zu Handel mit differenzierten Gütern. Aber die Elastizität bezüglich des Importeurs bleibt weiterhin oft kleiner als die des Exporteurs, oder ist nur um einen insignifikanten Betrag größer. Daher ergibt sich kein Hinweis für Marktzugangsbeschränkungen in einem reziproken “Dumping”-Modell, wie sie von Feenstra et al. berichtet werden, und auch nicht für den entgegengesetzten Fall mit freiem Zugang für Firmen.

Die Schätzungen für homogene Güter liefern im Gegenteil derart schwankende Ergebnisse und oft unplausible negative Elastizitäten und insignifikante Parameterschätzungen, dass bezweifelt werden muss, ob das Gravitationsmodell in seiner hier verwendeten Form zur Beschreibung solcher Handelsströme überhaupt geeignet ist. Die schlechte Prognose des Handels mit homogenen Gütern kann als ein Hauptgrund dafür gesehen werden, dass unsere Schätzungen die beobachteten CO2-Muster des Handels insbesondere für die Exporte der „nicht-Annex-B-Länder“ nicht vollständig reproduzieren können.

  • Lena Reuster

Regulation of Markets for Privately Provided Public Goods: The Case of Voluntary Carbon Offsets

Master Thesis, in Cooperation with the TU Berlin.

Submission:
November  2010

Abstract:

This thesis analyses the voluntary carbon market (VCM) as a market for a privately provided public good, and discusses the welfare implications of regulatory interventions on that market. The VCM involves two fundamental market failures. On the one hand, reducing carbon emissions by paying for offset projects is a public good. On the other hand, carbon offsets exhibit credence characteristics giving rise to strong information asymmetries. The findings of the thesis demonstrate that a minimum quality standard (MQS) may increase social welfare merely due to the positive external effect of carbon offsets. Moreover, we show that a MQS may in certain cases also improve welfare by solving the consumer information problem depending on the probabilities of mismatch. However, in terms of transaction costs a MQS exceeds other less regulatory policy options. In the light of the limited impact and efficiency the VCM may have for overall climate policy, it seems questionable whether a MQS should be prescribed as an instrument to increase the public good climate protection. We conclude that a MQS regulation will only improve welfare and efficiency when the consumer information problem is solved  and public good benefits are considered additional.

  • Svenja Loos

The costs of REDD - Business as usual vs. Community Forest Management in Viet Nam

Master Thesis, in Cooperation with the TU Berlin.

Submission: June 2010

Abstract:

Der Klimawandel und seine Auswirkungen sind zentraler Bestandteil einer in den letzten Jahren international geführten Debatte. Insbesondere die Eindämmung der Emission von klimaschädlichen Treibhausgasen zur Verhinderung einer globalen Erwärmung und die Minderung der negativen Wirkungen auf die natürlichen Ressourcen stehen im Fokus internationaler Verhandlungen innerhalb der Klimarahmenkonvention der Vereinten Nationen (UNFCCC). Wäldern kommt durch ihre Fähigkeit zur Speicherung von Kohlenstoff bei der globalen Treibhausgasreduzierung eine zentrale Rolle zu.

2007 stellte das International Panel on Climate Change fest, dass etwa 17 Prozent der globalen Treibhausgasemissionen aus Entwaldung und Wald Degradation resultieren. Infolgedessen steht die Verminderung von Emissionen durch Entwaldung und Degradation (REDD) im Fokus der UNFCCC Verhandlungen. REDD ist ein Finanzierungsmechanismus, der vermiedene Entwaldung und damit Emissionsreduktion in Entwicklungsländern innerhalb eines finanziell entschädigt. Das REDD-Instrument, erstmal auf der COP 11 in Montreal im Jahr 2005 diskutiert, könnte es zukünftig (nach Ablauf der ersten Verpflichtungsperiode des Kyoto-Protokolls ab 2012) Industrienationen ermöglichen sich an Vermeidungsmaßnahmen in Entwicklungsländern zu beteiligen bzw. diese zu initiieren und eigene Emissionen durch Ankauf von Emissions-Zertifikaten auszugleichen. Auf der COP 15 in Kopenhagen im Dezember 2009 wurde das REDD-Instrument als ein wichtiges Werkzeug bestätigt und die Bereitstellung von finanziellen Mitteln gefordert. Ziel von REDD ist die Entwicklung eines Payment for Environmental Services (PES) Systems, in dem in den Wäldern gespeichertes CO2 ein monetärer Wert zugeordnet wird. Dabei müssen Vergleichswerte aus der vorherigen Entwaldungsrate bestimmt werden, um die vermiedenen Emissionen nach Einführung von REDD berechnen zu können. Außerdem ist es für die Umsetzung von zentraler Bedeutung, 1.) die Ursachen der Entwaldung und Änderung der Landnutzung vor Ort zu analysieren, 2.) die Opportunitätskosten alternativer Landnutzungen zu bestimmen und 3.) den Kohlenstoffgehalt des Waldes zu ermitteln.

Aktuell existieren einzelne Pilotprojekte der Weltbank (FCPF) und der UN (UN-REDD Program) und nur wenige Untersuchungen zu diesem Thema. Ziel dieser Arbeit ist es, die Möglichkeit der Implementierung von REDD in Viet Nam zu eruieren. Dazu wurden in der Provinz Dak Nong in Viet Nam die Opportunitätskosten für den Erhalt des Waldes (durch Community  Forest Management) im Gegensatz zur Umwandlung in Agrarflächen (business as usual) für zwei Dörfer im zentralen Hochland berechnet. Das nötige Datenmaterial wurde 2009 in einer Befragung vor Ort erhoben und in einer Kosten-Nutzen-Analyse für das jeweilige Dorf verwendet. Als Ergänzung des Datenmaterials, das von lokalen Entscheidungsträgern zur Verfügung gestellt wurde, konnten eigene Erhebungen zur aktuellen Entwaldungsrate in Form von GPS-Messungen durchgeführt und Auswertungen vorhandener Forstinventurdaten vorgenommen werden. Der Kohlenstoffgehalt der Waldflächen wurde in Kooperation mit der Tay Nguyen Universität im April und Mai 2009 gemäß der IPCC Richtlinien durchgeführt. Ergebnisse der Arbeit zeigen unterschiedliche Entwaldungsraten in den beiden Untersuchungsgebieten in Abhängigkeit vom Managementregime (jährliche Entwaldungsrate von 16,1% in Thon 5 und 1% in Thon 6), wobei die Waldflächen mehrheitlich als „Poor Forest“ zu klassifizieren sind. Aus der Befragung lassen sich Informationen über die Landnutzung ableiten. Die durchschnittliche Anbaufläche beträgt 4 ha und es bestehen Unterschiede zwischen den Dörfern hinsichtlich des Flächenanteils angebauter Feldfrüchte. Die höchsten Einnahmen werden durch den Anbau von Kaffee (224,6 USD/ha/Jahr) und Cashew-Nüssen (139,9 USD/ha/Jahr) erzielt, die auf jeweils rund 50% der Anbaufläche angebaut werden. Durch die Vermarktung des eingeschlagenen Holzes innerhalb des Community Forest Managements werden 94 USD im Jahr pro Haushalt eingenommen. Außerdem spielen alternative Produkte, die der Wald zur Verfügung stellt, so genannte Nicht-Holz-Produkte (Non Timber Forest Products), eine zentrale Rolle für die Dorfbewohner. So sammeln alle Befragten (N=97) essbare Pflanzen und Feuerholz für den Eigenbedarf. Zur Berechnung der Opportunitätskosten wurden 6 Szenarien unter Berücksichtigung der Variablen 1.) Einnahmen durch kommerzielle Holzverwertung, 2.) Kohlenstoffaufnahmefähigkeit der Pflanzen und 3.) Kohlenstoffgehalt alternativer Landnutzung für die Einnahmen und Kohlenstoffspeicherung generiert. Die Berechnungen für die einzelnen Szenarien zeigen, dass ein hoher Kohlenstoffgehalt der Wälder zu niedrigen Opportunitätskosten pro t CO2 führt, wobei der Kohlenstoffaufnahmekapazität hohe Bedeutung zukommt. Des Weiteren ergibt sich aus einem hohen Kohlenstoffgehalt alternativer Landnutzungen bzw. bei hohen Einkommen aus der Landwirtschaft, höhere Opportunitätskosten pro t CO2. Da potenzielle Investoren immer noch der kostengünstigen Variante suchen, sind geringe Opportunitätskosten eine Voraussetzung an einer Teilnahme an einem zukünftigen CO2-Handel mit REDD Zertifikaten. Der Vergleich mit anderen Studien ergab, dass der vergleichsweise geringe Kohlenstoffgehalt der Wälder in Dak Nong zu höheren Opportunitätskosten für die einzelnen Agrarprodukte führt. Werden allerdings die durchschnittlichen Opportunitätskosten gemäß des Landnutzungsanteils an der Gesamtfläche berechnet, so sinkt dieser Durchschnittswert und liegt im Rahmen anderer Untersuchungen und somit im ,Soll‘ Bereich für die Teilnahme an einem REDD Markt Mechanismus. Es konnte festgestellt werden, dass sich Community Forest Management als Maßnahme zu vermiedener Entwaldung eignet und somit eine wichtige Voraussetzung für REDD in Viet Nam schaffen kann. Zusätzliche Einnahmen aus REDD könnten zudem den Wert des Waldes steigern und somit den Nutzungsdruck durch die lokale Bevölkerung und deren Armut verringern.

 

  • Alexander Körner

 

Mobilizing the black resource? The effects of future coal extraction costs on regional climate change mitigation efforts.
Diploma Thesis, in Cooperation with the TU Berlin.

Submission:
January  2010

Abstract:
The decarbonization of the global energy system, as an option to mitigate intolerable climate change, is likely to lead to a reduced consumption of coal. Compared to a business as usual case without any constraints on carbon emissions, regions face opportunity costs due to not exploiting available coal deposits. The scope of this thesis is to analyze the impact of region specific availability of coal on global and regional climate change mitigation costs. In order to quantify this effect, the estimation of future coal extraction costs must be improved. For this purpose, a new extraction cost model based on region specific geological data as well as regional economic situation has been developed and implemented into the integrated assessment model REMIND-R.

  • Lion Hirth

Governance under Time Inconsistency and Limited Credibility: What can we learn from Monetary Policy for Climate Policy?
Master Thesis, in Cooperation with the University Tübingen, Institute for Social and Behavior Sciences. pdf

Submission:
September 2009

Abstract:
This paper investigates the parameters and circumstances that determine the time inconsistency of climate policy, such as a carbon tax or a cap and trade system. If the best response to a problem changes over time although the problem itself does not change, the response is ``time inconsistent''. Climate policy is time inconsistent because capital investments are irreversible. Once investments are sunk, profit-maximizing firms react differently to tax changes than before. Energy consumption reacts stronger on tax changes, and greenhouse gas emissions react weaker. As a consequence, the optimal tax is lower once investment is sunk. Firms anticipate this relaxation of climate policy and are reluctant to invest in the first place. This results in an inefficient allocation with too much energy consumption, little abatement, and too little technology investments. Institutional arrangements (\textit{polities}) such as an independent ``Carbon Bank'' are discussed as a remedy. Also different types of \textit{policies} are discussed. It is argued that especially feed-in-tariffs can provide a feasible fix for time inconsistency because in contrast to carbon taxes they establish property rights.

Modeling Climate Policy Instruments in a Stackelberg Game with Endogenous Technological Change and Market Imperfection.
Diploma Thesis, in Cooperation with the University Osnabrück, Institute for Mathematics / Computer Sciences. pdf

Submission:
September 2008

Abstract:
In this thesis I develop an integrated assessment model which determines and explains socially optimal as well as second-best policy instruments to achieve climate protection. Within the Stackelberg game approach with the government as leader and economic sectors as followers the model is capable to consider strategical behavior and market imperfections (e.g. technology spillovers and monopolistic markets). It provides for the first time a detailed assessment of a set of prominent climate policies by estimating their distributional effects for households' functional incomes.

Towards a Global Carbon Market - The Clean Development Mechanism´s Current State and Future Prospects.
Diploma Thesis, in Cooperation with the University of Flensburg. pdf

Submission:
June 2008

Abstract:
The Clean Development Mechanism (CDM) established under the Kyoto Protocol is the only instrument that includes developing countries into the international carbon market. However, the mechanism faces serious shortcomings, including high transaction costs and low environmental and economic effectiveness. Moreover, developing countries play a growing role in regard to greenhouse gas emissions and they need to increasingly decarbonize their economies. This raises the question how the CDM can be modified in an international climate agreement post 2012. For this thesis, various options for reforming the CDM are discussed. Particular emphasis is put on China as a key player in terms of emissions as well as political and economical weight. Sectoral no-lose intensity targets are identified as one promising option to include newly industrialized countries such as China into a post-Kyoto agreement, even though the instrument raises some questions in regard to economic and environmental effectiveness.

  • Wasilis von Rauch

Assessing Dynamic Cost-Benefit Analysis of Climate Policy: The Stern Review.
Diploma Thesis, in Cooperation with the Humboldt University Berlin, Institute for Geography. pdf

Submission: May 2008

Abstract:
The Stern Review, published in the end of 2006, quickly raised a lot of discussion and feedback. This is mainly because it predicts high climate change related damages and relatively low costs for stabilising GHG concentrations at levels that would avoid the worst consequences. The Reviews’ key policy recommendation for early and strong action is in contradiction with the so called climate policy ramp which has been the preferred strategy among many economists so far. The thesis analyzes whether Sterns’ results are well founded in terms of economic theory and modelling technique. For this purpose the use of Cost-Benefit Analysis (CBA) in climate policy in general is discussed and best practice criteria for its application are defined. Following this, the Stern Review is analyzed using these best practice criteria alongside with several prominent critiques by other economists. The thesis concludes with a critical assessment of Sterns’ approach and its policy recommendations.

  • Yasaman Mirfendereski

Techno-Economic Assessment of Carbon Capture and Sequestration Technologies in the Fossil Fuel-based Power Sector of the Global Energy-Economy system.
Master Thesis, in Cooperation with Technical University Berlin, Institute for Energy Engineering (Dr. Thomas Bruckner). pdf

Submission:
May 2008

Abstract:
The objective of this thesis is to assess the integration of carbon capture and sequestration (CCS), as one of the mitigation alternatives, to fossil fuel based power plants. In line with this objective, three main fossil fuel-based power plant technologies, Pulverized Coal (PC), Integrated Gasification Combined Cycle (IGCC) and Natural Gas Combined Cycle (NGCC), are modelled with and without CCS in the modeling tool IECM (Integrated Environmental Control Model). The model provides a framework to assess the techno-economics of the plants in question, thus delivering the corresponding data about emissions, costs and plant performance. Moreover, the power plants have to comply with the European large combustion plant regulation regarding the emissions of SO2, NOX and PM (Particulate Matter). The thesis analyzes, in particular, the effect of variability of fuel type by introducing four different coals: Appalachian medium sulfur, Illinois # 6, Wyoming Powder River basin and North Dakota lignite. In addition to fuel type, uncertainty is addressed to some input parameters and analyzed via Monte Carlo Analysis. In order to assess the contribution of CCS in the portfolio of other mitigation options REMIND, a global hybrid model of energy system model and macroeconomic growth model developed by Potsdam Institute for Climate Impact Research, has been used. In REMIND experiments, the corresponding technologies are evaluated with regard to the CO2 emission scenario applied in the system, thus addressing the contribution of the technologies in question, as matter of time and magnitude. Each coal type is separately investigated, thus emphasizing the effect of coal type, not just on the coal technologies, but also on the technology choice in the whole energy system and further on the resource usage. In addition, sensitivity studies carried out in SimEnv tool, indicate the effect of parameter variations on the model results.

Comparing CO2 Mitigation Options in the Electricity Sector: Nuclear Power, Renewable Energy and Carbon Sequestration.
Diploma thesis, in Cooperation with Technical University Berlin, Institute for Energy Engineering (Dr. Thomas Bruckner). pdf

Submission: December 2006

Abstract:
The objective of this study is to assess the role of the three main CO2 mitigation options in the electricity sector. These encompass the transition to carbon free technologies which rely on renewable or nuclear energy sources, and the capture and sequestration of emitted CO2 (CCS). To achieve this objective, experiments with a bottom-up model of the electricity sector have been performed. The model is a subset of a comprehensive energy system model that is currently being developed at the Potsdam Institute for Climate Impact Research using the modeling toolbox genEris. It determines an optimal investment time path by minimizing intertemporally aggregated energy system costs subject to resource and potential constrictions and a cap on emissions. One-factor learning curves are used to represent cost reductions due to learning effects. The model structure has been extended by a complex representation of the nuclear energy sector, including thermal and fast breeder reactors and the main energy and mass conversion steps of the front and back end of the nuclear fuel cycle. Furthermore, the model has been linked to the multi-run experiment environment SimEnv, and sensitivity analysis experiments have been performed to assess the behavior of the model under different parameter assumptions. The experiment results show that the model is able to represent a wide range of possible future scenarios. The restriction of emissions accelerates the substitution of carbon intensive technologies. The use of CCS is highly sensitive to fossil fuel cost assumptions. The use of thermal nuclear reactors is limited by the restricted resources of uranium. Fast nuclear reactors and photovoltaic compete for the role as a singular backstop technology that dominates the electricity sector after the substitution of fossil energy sources. The results of this study will be used by further projects with the objective of integrating the energy system model into an integrated assessment tool which includes a macroeconomic growth model, a carbon cycle model and several geographic regions.

Social Conditions of Technological Change. The Case of Carbon Capture and Storage.
Master Thesis Potsdam University, Faculty of Economics and Social Sciences. pdf
Submission: January 2005 Abstract:
This thesis aims at comprehensively exploring the social aspects of CO2 capture and geological storage technologies (CCGS). CCGS is increasingly regarded as an additional option in a climate change mitigation technology portfolio. However, related research focuses almost exclusively on the engineering and geological aspects. This thesis adopts an interdisciplinary approach drawing together available research from engineering, geology, economics, political philosophy and sociology in order to systematically analyze the various socially relevant aspects of CCGS. Crucial technical aspects and risks that are associated with CCGS are identified and comprehensively discussed. Relevant stakeholders are identified and their respective positions analyzed. As technical feasibility will be necessary but not commensurate condition for the large-scale implementation of CCGS, four decisive social determinants of the viability of CCGS are identified, including (a) marginal costs of technology, (b) opportunity costs of investment, (c) economic costs induced by regulatory framework, and (d) transaction costs resulting from social processes of communication, cooperation and conflict. Regulation will be required that addresses these issues. Selected regulatory issues that could be central in future debates about CCGS are discussed. Also, regulatory aspects that will have to be addressed by any future regulatory framework for CCGS are identified. Finally, with Carbon Sequestration Bonds and a certificate trade based regulatory scheme two regulatory approaches for CCGS are discussed with respect to their ability to meet such requirements. In the conclusion, relevant future research tasks are formulated based on the findings of the thesis. In an appendix a review of analyses of existing regulatory conditions for CCGS is provided.

  • Raphael Schaub
Transnational Corporations and Economic Development in Developing Countries. Assessing the Effect of Foreign Direct Investments on Economic Growth in Developing Countries with an Extended Solow Model.
Master Thesis in Cooperation with Institute for Sociology, University Zurich, April 2004. pdf
Submission: April 2004 Abstract:
The author has designed an extended Solow-model for exploring the effects of foreign direct investment on economic development. The extended Solow growth model has been proved as a comprehensive one because it includes the foreign capital stock on a per capita base, reinvested earnings and the ratio of foreign to domestic capital in addition to the other variables, which are usually part of a Solow-model. The results based on the regression equation derived from this model are plausible and statistically significant for most of the samples. Generally, the results for the models based on income categories yield a good model fit and are within reasonable range. This holds true not only for the assessed effects of domestic and foreign capital on economic growth, but also for the estimated capital's share in income. It turns out that foreign capital has a positive effect on economic growth in all tested samples. However, economic growth in very poor countries seems to be less affected by the presence of foreign capital as compared to, for example, middle income countries. These countries are not only poor, but they also get very little foreign capital. The scarcity of capital in these countries might result in an economic condition where they are caught in a poverty trap. Therefore it is very likely that foreign capital can contribute only to a very small extent to economic growth. The effect of foreign capital is also weaker in higher income countries, which is likely to result from the widespread availability of capital in these countries. In addition, the high level of development in countries of the First World requires much larger financial and technological efforts to achieve productivity gains.

  • Fabian Pieper
Das Konzept von Lernkurven im Energiesektor - Beschreibung, Modellierung und Aggregation
Diploma Thesis in Cooperation with Technical University Berlin, Institute for Energy Engineering (Dr. Thomas Bruckner). pdf
Submission: May 2003 Abstract:
The thesis explores methods of coupling of bottom-up and top down models. It is a well known fact that only the hard link between macro models and energy system models allows an explicit analysis of feedback loops between the macro-economic and the energy system. However, hard link coupling procedures are time consuming and in many cases not feasible because of the inherent complexity of bottom-up models. The thesis shows that well-designed aggregation procedures of learning curves within the renewable energy sector enable macro modelers to use simple parameterized learning curves in their macro-model without omitting crucial aspects of sector specific dynamics.

Stadt - Verkehr - CO2.
Diploma thesis in Cooperation with Technical University Dresden, Institute for Geography, Prof. Dr. H. Kowalke. pdf
Submission: August 2002 Abstract:
The aim of this thesis is to find major influencing factors of CO2 emissions from road
traffic in urban areas. The approach of the study involves a statistical analysis on the basis of the formerly 23 urban districts of the German capital of Berlin. Correlation and regression analyses of empirical data from the settlement structure, the traffic structure and income have found that the number of jobs per district and the share of the well-off population can best describe the CO2 emissions from traffic in Berlin. Also the number of residents, the total built area, the number of cars and the amount of traffic area are positively related to the dependent variable. Therefore, the possibilities to reduce CO2 emissions from road traffic for urban planners seem limited: a restriction of space dedicated to traffic and a change of transport means for commuting represent leverage points, according to the analysis. The other significant indicators are less able to be influenced by local and regional decision-makers-an alteration in the means of mobility to less CO2 emitting alternatives is needed if CO2 emissions from road traffic are to be extensively decreased.

  • Maren Ewald
Die Wirtschafts- und Verschuldungskrise Subsahara Afrikas - Von der Notwendigkeit globaler Solidarität.
Master Thesis in Cooperation with Technical University Darmstadt, Institute for Sociology.
Submission:
February 2001
Abstract:
The thesis reviews the relevant literature on the poverty trap and evaluates the impact of debt burden on economic growth and social development. Based on this analysis a computer model is designed for assessing different strategies for reducing the debt burden for least developed countries. The focus of this study is a comprehensive assessment of different types of Marshall plans proposed by international agencies.

 

 

Graduate Student´s Theses

  • Richard Moll (2007)
Erweiterung und Anwendung des Energiesystemmodells genEris zur Analyse von Emissionsminderungsmöglichkeiten im Bereich des Fahrzeugverkehrs. In Cooperation with Technical University Berlin, Institute for Energy Engineering (Dr. Thomas Bruckner). pdf
  • Tina Bommhardt (2007)
Assessing the Potential of Offshore Wind Energy as an Innovative CO_2 Emission Reduction Option in the Energy System Model genEris. pdf
  • Alessia De Vita 2006/2007:
Assessing the Potential of Biomass as a CO_2 Emission Mitigation Option by Developing a Sophisticated Description of the Biomass Sector in GenERIS. In Cooperation with Technical University Berlin, Institute for Energy Engineering (Dr. Thomas Bruckner).