Seminario Bologna Environmental Economics Group Seminar

Presenter 1: Mathis Fundaro

Title: Strategic Nuclear Policies: Theory and Evidence 

Abstract: Nuclear energy use varies widely across European countries with similar economic and technological characteristics. The present research aims to partly explain why. Using parliamentary debates from 1960 to the present in France and Germany, I show that policymakers in both countries update their beliefs about nuclear risks in a Bayesian manner following major accidents but do so asymmetrically. The debates also reveal that France and Germany strategically interact to plan their future nuclear energy policy, in an asymmetric fashion; German policymakers anticipate relying on French nuclear production to support a domestic phase-out after the 2011 Fukushima Daiichi nuclear disaster, while French policymakers internalize this dependence. To rationalize these findings, I develop a model in which two identical countries form beliefs about nuclear power riskiness and make nuclear investment decisions under uncertainty while strategically interacting. The model extends a two-armed bandit framework and yields (Symmetric and Asymmetric) Perfect Markovian Equilibrium, matching the empirical evidence. 

Presenter 2: Giorgio Dini

Title: Cross-System Externalities between Commons: from Theory to a Lab Experiment

Abstract: Amazon deforestation determines long-distance ecological impacts as the so-called flying river flowing from the Atlantic captures less Amazonian moisture, which negatively affects precipitation in distant regions westward. The magnitude of the externality depends critically on the strength of the linkage between two distant areas and on the robustness of the recipient downstream system. This paper experimentally investigates the exploitative behavior of stylized landowners, whose activities cascade on water users downstream. After deriving precise theoretical predictions, we show that participants respond to these interdependencies: deforestation is significantly lower when spillovers are stronger and the downstream system is more fragile, resulting in higher forest stock and less frequent overshooting of critical thresholds.