This workshop is intended for researchers and doctoral students in economics who are interested in resource and environmental economics. The webinar is led by a team of researchers composed of Geir B. Asheim (Oslo University), Hassan Benchekroun (McGill University), Sophie Bernard (Polytechnique Montréal), Etienne Billette de Villemeur (Université de Lille, UQAM), Robert Cairns (McGill University), Justin Leroux (HEC Montréal), and Charles Séguin (UQAM).

This workshop on natural resource and environmental economics will host Raphaël Jananji, PhD student at the University of Montreal, and Philippe Kabore (UQAR).

→ This event will be in English.

• Raphaël Jananji, PhD student at the University of Montreal.
  Optimal Correction of Environmental Stochastic Externalities

Abstract

We study the optimal correction of environmental externalities when pollution shifts the distribution of climate shocks. Motivated by the extreme event attribution literature, which argues that emissions alter not only the frequency but rather also the full distribution of weather events, we model what we call stochastic externalities. In our framework, the parameters of a distribution of climate shocks are functions of the pollution stock rather than fixed values. Unlike prior work in the economic literature that models endogenous climate risk through increasing arrival rates of catastrophic events, our framework captures the continuous shift of the entire shock distribution. We solve the social planner's problem in a representative agent economy, first in a three-period model and then in an infinite-horizon recursive framework, and derive the optimal corrective carbon tax. The optimal tax adds a stochastic externality correction term to the standard Pigouvian term, which equals to the covariance between future utility and the derivative of the score of the shock distribution with respect to the pollution stock. For normally distributed shocks, this correction decomposes into a mean-shift channel, a risk-aversion channel, and a damage-curvature channel, each with a distinct economic interpretation. In a numerical example, we show how the stochastic externality channel significantly increases the optimal corrective tax beyond the standard Pigouvian tax and how much welfare can be gained from considering this channel. Our framework accommodates any parametric family of continuous distributions satisfying mild regularity conditions and nests both the standard deterministic model and the "exogenous" stochastic framework as special cases.

• Philippe Kabore (UQAR).
  Illegal Toxic Waste Dumping and Long-Term Human Capital Outcomes: Evidence from the Probo Koala Disaster in Côte d’Ivoire

Abstract

In August 2006, 528 cubic meters of hazardous waste were illegally dumped across seventeen sites in Abidjan, Côte d’Ivoire, affecting over 100,000 people. This paper examines the long-term causal impacts of toxic exposure on women’s health behaviors, labor supply, fertility, and education. Using 2021-2022 Demographic and Health Survey data, we compare women who lived within 3 kilometers of dumping sites in 2006 to those 7-20 kilometers away, using an intent-to-treat method coupled with an inverse probability weight. Fifteen to sixteen years after the crisis, exposed women are 13.7 percentage points more likely to use modern contraceptives and to have been tested for HIV. We find suggestive evidence of 12-14 percentage point increases in employment. However, we find no significant effects on fertility, healthcare utilization, or education. The pattern, significant health behavior changes without detectable fertility or education effects, suggests the crisis generated lasting shifts in health consciousness rather than altering ultimate outcomes.