Conference Agenda

Deforestation in Indonesia has been a major problem for many decades, with rates of logging still high for one of the most important ecosystems on Earth. The rise of deforestation in Indonesia has been attributed to a variety of causes, with some pointing to the 20th-century voluntary mass resettlement - called Transmigration Program - of Javanese and Balinese individuals to the ”Outer Islands” of the country, until then sparsely populated by indigenous groups. Using the Transmigration Census of 1998 together with Census data and a novel index of ecosystem integrity, this paper estimates the environmental externalities of the Indonesian ransmigration Program on Indonesian forests since the decentralization process in 2000. Results show that transmigrant villages are significantly more destructive to their surrounding ecosystem, especially when the share of indigenous people in the village is lower. Moreover, there is evidence that villages turned to more damaging palm oil plantations to cope with the low rice productivity of randomly assigned soil quality, rather than high suitability for palm oil. Ethnic fractionalization is consistently correlated with better ecosystem integrity, an unexpected result that does not, however, impact the conclusions of the analysis. This research suggests that economically vulnerable communities with little knowledge about their resources have a detrimental effect on the ecosystem, and integrating migrants with the local population in a new environment is crucial to ensure the sharing of information and the sustainability of the surrounding ecosystem.

This paper provides novel evidence on how spatial planning regulation impacts the deployment of solar photovoltaic installations in France. Solar energy projects must meet eligibility criteria to participate in national public auctions, based on the land used by the installation. Eligibility criteria, in turn, are transposed in land-use planning at the municipality level. Using a quasi-experiment, I study how this interaction impacts the amount of land allocated to solar at the municipality level. My findings suggest that the heterogeneity in administrative frameworks to define land-use planning distorts the spatial deployment of solar facilities. Municipalities with more detailed land-use planning frameworks increase the amount of land allocated to solar by an average of 100 m^2 per km^2. Conversely, more recent land-use planning and frameworks integrated at the inter-municipality reduce the amount of land by 50 m^2 and 100 m^2 per km^2 due to stricter restrictions on new land developments.

Climate risk is unequal: it affects different countries and assets differently, with

important impacts on commodity-related currencies and energy markets. Moreover,

financial markets possess useful information about climate expectations

(Schlenker and Taylor (2021); Downey et al. (2023); Hale (2024)). We assess

the forecasting power of firms’ climate exposure for realized volatility of commodity

currencies and oil futures. Since information about climate risk arises

at multiple frequencies, we construct ‘green’ and ‘brown’ indices using a mixed

data frequency model. We collect intraday data for commodity currencies (Australia,

Euro, Canada, and Norway); oil futures (WTI and Brent); and green and

brown firms. We calculate realized volatility at multiple frequencies, then extract

a latent green and brown index. We use a heterogeneous autoregressive

(HAR) model to forecast volatility, and assess robustness with a machine learning

framework. The HAR model plus a brown index consistently outperforms

other models in terms of mean square error and out of sample R-squared.

The causal impacts of local institutions on tropical deforestation are still little explored in the literature because they involve endogenous mechanisms that act through socioeconomic and political channels that hinder identification. To fill such a gap, this paper explores exogenous geographical and historical variations in current local institutions to estimate their effects on forest cover in Brazil, an ecologically and economically important country. We assume that the initial conditions the country's settlers found led to institutional designs that conditioned its subsequent development, explaining current institutions' differences. Our main results show that the local institutional change has a positive heterogeneous causal effect on deforestation, even after several robustness checks. We also used a Causal Random Forest algorithm to estimate individual treatment effects, which further supported our main results. This empirical evidence demonstrates that public policies that aim to improve local institutional quality must adequately consider the potential side effects of deforestation.

Does the disclosure of biodiversity risk affect firms’ cost of equity yet?

This question is important in light of recent initiatives by academics and global policymakers to raise awareness about biodiversity. As a key component of natural

capital, biodiversity fosters economic development and societal wellbeing (Heal

(2020); Barrett (2022); Dasgupta (2024)). While the natural resources and global

public good literatures have long underscored economic aspects of biodiversity,

researchers are just beginning to study its financial implications. We focus on

a relatively new path: biodiversity risk disclosure and financial accounting. We

build on the disclosure literature and examine the relationship between biodiversity

information disclosure and the cost of equity capital. Using a standard approach,

we test the informativeness of biodiversity risk disclosure and gauge whether potential benefits have started accruing to firms. In all specifications biodiversity disclosure does not affect the cost of equity capital. For markets to reflect biodiversity concerns, therefore, awareness must be raised by regulation, public pressure, or media attention.