- Spatial Aggregation Bias in Implicit Prices of Environmental Amenities (Economics Bulletin, 2019, Vol. 39 No. 2 p.A113)
- Mineral Taxes and the Local Public Goods Provision in Mining Communities (Resources Policy, 2017, Vol. 53, 328-339; with Dusan Paredes).
- Disaggregation of Sectors in Social Accounting Matrices using a Customized Wolsky Method: A Comment on its Estimation Bias (Applied Economics Letters, 2016, Vol. 23(11), 785-789).
- Scales of Production and Mining Economies: The Case of Chile in its Regional Dimension (In Spanish) (EURE, 2014, Vol. 40 (121), 247-270; with Patricio Aroca).
Oil, Politics, and “Corrupt Bastards” (Job Market Paper – with Alexander James)[Paper]
We develop an analytical framework in which a natural-resource-extracting firm pays an incumbent politician both legal and illegal bribes in exchange for a reduced severance tax rate. A positive resource shock increases the marginal benefit of a tax cut and more bribes are given. We test this theory using forty years of U.S. state-level data, measuring legal corruption as contributions to political campaigns from the oil and gas sector. We measure illegal corruption in two ways: convictions of public corruption and as “reflections” of corruption — measured as the fequency that iterations of words like “corrupt” and “fraud” appear in local newspapers. We find that oil-rich U.S. states are significantly more corrupt than their oil-poor counterparts and that this is especially true during periods of high oil prices, suggesting an underlying causal relationship. Beyond natural resources, our theory predicts that political competition increases legal contributions and decreases illegal ones. The former prediction is supported by the data.
- Is Mining and Environmental Disamenity? Evidence from Resource Extraction Site Openings (Revised and Resubmitted) [Paper]
Extractive industries are often challenged by nearby communities due to the environmental and social impacts of the activity. If proximity to resource extraction sites represents a disamenity to households, the opening of new mines should lead to a decrease in housing prices. Using evidence from more than 6,000 new resource extraction sites in Chile, this study addresses whether the heavy environmental and social impacts of digging activities outweigh their local economic benefits to the housing market in emerging economies. Findings from a spatial difference-in-difference nearest-neighbor matching estimator reveal that households near mining activity get compensated with lower rental prices, mostly in places with high perceptions of exposure to air pollution. Further analysis suggests that this compensation is lower among new residents of mining towns, which constitutes evidence of a taste-based sorting across space. Results in this study bring to light the need of incorporating welfare effects of potential social and environmental disruptions in future studies addressing the economic impact of new mining operations.
- Air Quality Warnings and Temporary Driving Bans: Evidence from Air Pollution, Car Trips, and Mass-Transit Ridership in Santiago (In Preparation for Submission)
Driving restrictions constitute a common governmental strategy to reduce airborne pollution and traffic congestion in many cities of the world. Using high-frequency data on air pollution, car trips, and mass-transit systems ridership, I evaluate the effectiveness of temporary driving bans triggered with air quality warnings in Santiago, Chile. I employ a fuzzy regression discontinuity design that uses the thresholds in the air quality index used to announce these warnings as instruments for their announcement. Results show that these temporary bans reduce car trips by 6-9% during peak hours, and around 7-8% during off-peak hours. This is consistent with air pollution reductions during peak hours, and with increments in the use of Santiago’s mass-transit systems during hours at which the systems run with some capacity. Increments in mass-transit ridership uncover the importance of alternatives modes of transportation in securing the effectiveness of temporary driving bans.
Work in Progress:
The U.S. Coal-to-Gas Plant Conversion Process: Evidence from Housing Market Capitalizations (with Scott Loveridge)
Recent fuel-switching projects carried by several power plants in the United States promise several environmental gains at both the global and the local level. Using data on more than 1,000,000 property transactions around the country, we derive local property value impacts from the coal-to-natural gas switching process on residential properties that are located in the neighborhood of the switching facilities. We adopt a spatial difference-in-difference approach that uses records of residential property transactions of homes that are located near, and far, from plants substituting their fuels and plants that do not innovate. A triple difference estimator strengthens these estimations. Our results indicate that property values increase in the immediate vicinity of the fuel-switching plants. Most of these impacts occur immediately after the shutdown of a coal-fired power generation unit, which reveals the disamenity effect of coal-fired power plants.
The Warmth of the Sun: Estimating the Pollution and Health Impacts of Solar Investments in Chile (with Cristobal Ruiz-Tagle and Beia Spiller)
Renewable energy can provide local and regional social benefits, through reductions in air pollution and the resulting positive effects on human health. Despite the emerging literature on the modelling of energy displacements by renewable generators, the extent that these renewable investments translate into health improvements has yet to be tested empirically. Our research estimates the health impacts of increasing adoption of solar energy generation in Chile, through changes in local air pollution. Our focus is on the spatial heterogeneous effects of increasing solar generation. Solar energy adoption can displace some fossil fuel generators but can increase the power injection from other fuel sources as well (such as those ramping up in response to evening reductions in solar generation). These variable effects on deployment of different generator types along with the distribution of fossil fuel power plants across the country results in spatially heterogeneous changes in local air pollution concentrations. Consequently, we hypothesize that health outcomes, such as hospital admissions and urgent care visits –particularly those due to respiratory and cardiovascular diseases– will have improved (worsened) in places where emissions decreased (increased) due to solar generation. To the best of our knowledge, this is the first empirical paper examining some of the local environmental and health benefits of solar power generation.
Chapters in Books (in Spanish):
- Project Analysis and the Regional Dimension (with P. Aroca), in Evaluación Social de Proyectos: Orientaciones para su Aplicación. Aguilera, R. (Editor). Facultad de Ciencias Sociales, Universidad de la República, Uruguay. 2011. (In Spanish).
- Copper Mining in the Antofagasta Region (with P. Aroca), in Región de Antofagasta, Pasado, Presente y Futuro. Llagostera, A. (Editor). Ediciones Universitarias, Universidad Católica del Norte, Chile. 2010. (In Spanish).
- Water Resources in a Dry Area (with M. Lufin and M. Hasewaga), in Región de Antofagasta, Pasado, Presente y Futuro. Llagostera, A. (Editor). Ediciones Universitarias, Universidad Católica del Norte, Chile. 2010. (In Spanish).
- La Experiencia del Instituto de Economía Aplicada Regional (IDEAR) de la Universidad Católica del Norte (with E. López), in Centros de pensamiento estratégico territorial: Instrumentos de la gobernanza regional en Chile, Vergara, P. (Editor). Subsecretaría de Desarrollo Regional y Administrativo, Chile. 2010.