In this review, we attempt to describe the evolution of integrated assessment modeling research since the pioneering work of William Nordhaus in 1994, highlighting a number of challenges and suggestions for moving the field forward. The field has evolved from global aggregate models focused on cost-benefit analysis to detailed process models used to generate emissions scenarios and to coupled model

The aim of this article is to review a number of issues related to uncertain population forecasts, with a focus on world population. Why are these forecasts uncertain? Population forecasters traditionally follow two approaches when dealing with this uncertainty, namely scenarios (forecast variants) and probabilistic forecasts. Early probabilistic population forecast models were based upon a frequentist

This review covers a nascent literature that experiments with survey design to measure whether the way in which we collect socio-economic data in developing countries influences the data and affects the results of subsequent analyses. We start by showing that survey methods matter and the size of the survey design effects can be nothing short of staggering, affecting basic stylized facts of development

Despite the significant risks and uncertainties that farmers in developing and emerging countries face in their production process, efforts at encouraging them to adopt agricultural insurance to mitigate their production risks have mainly yielded little success. This article reviews the recent literature on the demand for agricultural insurance in developing and emerging countries, by presenting the

In urban areas around the world, increasing motorization and growing travel demand make the urban transportation sector an ever-greater contributor to local air pollution and greenhouse gas emissions. The situation is particularly acute in developing countries, where growing metropolitan regions suffer some of the world's highest levels of air pollution. Policies that seek to develop and manage this

From the perspective of sending countries, international migrants are positively selected in terms of schooling, particularly in low-income countries. While emigration affects human capital accumulation, it also induces positive spin-offs in the form of remittances, incentives to acquire education, and diffusion of technology and democratic ideas. The net income implications for those left behind are

Despite growing policy commitment and decades of extensive research, nutritional deficiencies remain a key challenge for health systems worldwide. In addition to causing significant personal costs for those affected, indirect effects, such as reduced overall human capital accumulation or losses in labor productivity, can impose substantial obstacles for the achievement of economic development goals

Rising global demand for vegetable oil during the last few decades has led to a drastic increase in the land area under oil palm. Especially in Southeast Asia, the oil palm boom has contributed to economic growth, but it has also spurred criticism about negative environmental and social effects. Here, we discuss palm oil production and consumption trends and review environmental, economic, and social

The financial system could help achieve the global climate targets by aligning investments to sustainability. However, investors are largely exposed to carbon-intensive assets that could become stranded, thus delaying the low-carbon transition and bringing new sources of risk for financial stability, i.e., climate-related financial risks. Here, we discuss climate-related financial risks, the challenges

Assets in the fossil fuel industries are at risk of losing market value due to unanticipated breakthroughs in renewable technology and governments stepping up climate policies in light of the Paris commitments to limit global warming to 1.5 or 2°C. Stranded assets arise due to uncertainty about the future timing of these two types of events and substantial intertemporal and intersectoral investment

Spillovers among jurisdictions are ubiquitous and likely to increase with increasing population and consumption, so the centralization or decentralization of environmental governance is of pressing concern in a world of tightly linked socio-ecological systems. Spillovers play a key role in federalism analysis because they tend to reduce benefits from decentralization. Laboratory federalism, a common

Cost-benefit analyses have largely failed to demonstrate a positive benefit to cost ratio for programs designed to improve and protect water quality in the United States and European Union. At the same time, research from outside economics suggests that water quality ranks among the most urgent environmental concerns and highlights deep social and cultural connections to clean water. Exploring alternative

We develop a theory of change for payments for environmental services (PES) to review their imminent strengths and weaknesses in light of a growing body of impact evaluation studies. We show that PES are probably at least as environmentally additional as other conservation tools, based on the limited evidence. The original vision of PES as being direct, flexible, and potentially effective remains valid

The theoretical literature analyzing eco-label programs has focused mainly on how intricate interactions between firms, eco-label certifiers, and regulators shape these programs’ economic and environmental outcomes. Far less attention has been paid to the consumer side, which has typically been modeled very simply. Meanwhile, empirical researchers in behavioral economics, social psychology, and market

The past decades have seen the development of a multitude of sustainability-related food labels aimed at reducing the existing information asymmetry between food practitioners and consumers regarding the sustainability impact on the food supply chain. Sustainability-related food labels can correct market failures and contribute to a more sustainable world. This review discusses the effectiveness of

Much of neoclassical economics is concerned with prices—more specifically, with relative prices. Similarly, economists have studied behavior in the face of risk and uncertainty for at least a century, and risk and uncertainty are without a doubt a feature of economic life. It is thus puzzling that price risk—that is, unexpected departures from a mean price level, or price volatility—has received so

The merger of Dow and DuPont, the acquisition of Syngenta by ChemChina, and the acquisition of Monsanto by Bayer have recently reshaped the global seed and biotech industry and caused concern about growing market concentration. This review documents market concentration in seed and agricultural biotech markets and discusses its causes and impacts. The available evidence suggests that concentration

We appraise the current status of relational contract theory, along with associated empirical studies, with the goal of providing an orientation to the field to economists who may not have expertise in contract theory. We begin with a theoretical discussion focusing mainly on intuition and the usefulness of the theory for conceptualizing applied agricultural contracting problems. We also discuss current

Studies examining pricing outcomes in the food retail industry are complicated both by the multiproduct nature of transactions and by the presence of highly concentrated food processing and retailing industries that mediate between relatively competitive farm product markets and the consumer market. In this review, we examine theoretical and empirical evidence for retail pricing and the vertical relationships

The food-energy-water (FEW) nexus is facing grand challenges in meeting increasing demand resulting from global changes in climate, economy, and population. Emerging technologies are expected to play a critical role in responding to these challenges. Focusing on four types of prominent emerging technologies (namely precision agriculture coupled with big data and machine learning, gene editing, second-generation

The world's forests provide valuable contributions to people but continue to be threatened by agricultural expansion and other land uses. Counterfactual-based methods are increasingly used to evaluate forest conservation initiatives. This review synthesizes recent studies quantifying the impacts of such policies and programs. Extending past reviews focused on instrument choice, design, and implementation

Forests have become an important carbon sink in the last century, with management and carbon fertilization offsetting nearly all of the carbon emitted due to deforestation and conversion of land into agricultural uses. Society appears already to have decided that forests will play an equally ambitious role in the future. Given this, economists are needed to help better understand the efficiency of

The Annual Review of Resource Economics presents Professor Sir Angus Deaton in conversation with economist Dr. Gordon Rausser. Dr. Deaton is Senior Scholar and the Dwight D. Eisenhower Professor of Economics and International Affairs Emeritus at the Woodrow Wilson School of Public and International Affairs and Department of Economics at Princeton University and Presidential Professor of Economics at

Fertilizer and other input subsidies have been prominent components of agricultural policies in many Asian and African countries since the 1960s. Their economic and political rationale is scrutinized with emphasis on the second generation of targeted input subsidy programs that were scaled up in Sub-Saharan Africa after 2005. The extent to which they fulfill the goal of being market smart is assessed

International agricultural research is often motivated by the potential benefits it could bring to smallholder farmers in developing countries. A recent experimental literature has emerged on why innovations resulting from such research, which often focuses on yield enhancement, fail to be adopted due to either external or internal constraints. This article reviews this literature, focusing on the

Despite the fact that migration out of agriculture has always been a part of the economic development process, policy makers have long feared that migration from rural areas reduces agricultural production. This article reviews the growing microeconomic literature with more credible statistical identification that evaluates the effects of migration on agricultural production and other outcomes among

Most of the world's displaced people are hosted in low-income countries. Focusing on evidence from poor countries, we review the literature on the economic consequences of hosting refugees or internally displaced people. In the short run, violence, environmental degradation, and disease propagation are major risks to the host populations. In the long run, infrastructure, trade, and labor markets are

Urbanization is taking place at an unprecedented pace and scale in China, India, and many other emerging economies. This will have profound impacts on the world economy and environment. This review provides a critical assessment of the current understanding of the intertwined relationships between agglomeration, economic growth, and environmental quality. We start by providing a brief overview of the

Natural disaster losses have been increasing worldwide. Insurance is thought to play a critical role in improving resilience to these events by both promoting recovery and providing incentives for investments in hazard mitigation. This review first examines the functioning of disaster insurance markets broadly and then turns to reviewing empirical studies on the role of natural disaster insurance in

The environmental justice literature has found that the poor and people of color are disproportionately exposed to pollution. This literature has sparked a broad activist movement and several policy reforms in the United States and internationally. In this article, we review the literature documenting correlations between pollution and demographics and the history of the related movement, focusing

Biodiversity is declining worldwide, and the costs of biodiversity losses are increasingly being recognized by economists. In this article, we first review the multiple meanings of biodiversity, moving from species richness and simple abundance-weighted species counts to more complex measures that take account of taxonomic distance and functionality. We then explain the ways in which protecting biodiversity

We highlight the extraordinary growth in private conservation via land trusts and conservation easements and describe the problems arising from the interplay of public finance and private decisions. We offer a framework for understanding the popularity of easements and land trusts and for evaluating policy reforms aimed at improving their performance. The framework, grounded in institutional and organizational

Precision farming enables agricultural management decisions to be tailored spatially and temporally. Site-specific sensing, sampling, and managing allow farmers to treat a field as a heterogeneous entity. Through targeted use of inputs, precision farming reduces waste, thereby cutting both private variable costs and the environmental costs such as those of agrichemical residuals. At present, large

Mastitis is the most important production disease in dairy farming, leading to considerable inefficiency in production. In 1992, an important paper describing a simple but very useful economic framework for production diseases in animal farming was published. In a systemic literature search, 77 articles were found on the economics of mastitis. Throughout the years, little progress has been made to

This review focuses on the health and nutrition impacts of food assistance programs. We focus particular attention on the United States, both because of the plethora of types of programs and associated variation and because spending on these programs is a large share of the nonmedical safety net there. We begin by reviewing the theoretical predictions concerning health and nutrition effects of these

The economics of human nutrition has changed greatly in recent years as researchers have moved beyond supply and demand of specific foods and total calories to functional aspects of diet quality, such as nutrient composition, sustainability, and a variety of credence attributes. New kinds of data and methods allow researchers to focus on beneficial or harmful attributes of dietary patterns and the

Challenges to the conventional paradigm have isolated industrial agriculture from consumer segments exhibiting preferences for a growing array of credence attributes, including organic, locally produced, and raised using humane livestock and poultry practices. This review surveys the empirical evidence on the economic impact of the alternative to the conventional industrial agriculture paradigm that

We review the fuel-food price linkage model—time-series, structural, and general or partial equilibrium models, with most attention devoted to the time-series literature. Our assessment is nested in both the discussion of general commodity prices comovement and the prediction of the most likely development of biofuel policies and production. We show that the introduction of significant biofuels policies

Wood-based bioenergy development could play a vital role in attaining energy independence, reducing carbon emissions, and ensuring rural prosperity in the United States. An understanding of policies supporting wood-based bioenergy development coupled with the current status of production of various wood-based bioenergy products would better the prospects of wood-based bioenergy development in the United

Since 2007, large and unexpected declines in generation costs for renewable energy systems, particularly solar but also wind, combined with policy measures designed to limit greenhouse gas emissions, have created a paradigm shift in energy systems. Variable renewable energy now dominates total investment in electricity power generation systems. This dominance of variable renewable energy in investment

Hydrological investments, particularly irrigation dams, have multiple potential benefits for economic development. Dams also have financial, environmental, and distributional impacts that can affect their benefits and costs. This article reviews the evidence on the impact of dams on economic development, focusing on the levels and variability of agricultural productivity, and its effect on poverty

Since the Blue Revolution began in the late 1960s, global aquaculture production has grown rapidly. Aquaculture now accounts for over half of the world's fish for direct human consumption and is expected to approach two-thirds by 2030. With aquaculture's growth, a number of high-profile concerns have arisen, including pollution, feeding practices, disease management and antibiotic use, habitat use

This review evaluates the use of spatial models for the analysis of policy making. First, we examine spatial theory and its applications in a variety of institutional settings. We discuss how the preferences of the actors involved in political processes, the steps in those processes, and the locations of the reversion policies affect the policies that emerge from the processes. To illustrate this and

Computational methods are required to solve problems without closed-form solutions in environmental and resource economics. Efficiency, stability, and accuracy are key elements for computational methods. This review discusses state-of-the-art computational methods applied in environmental and resource economics, including optimal control methods for deterministic models, advances in value function

The literature on real options shows that irreversibilities, uncertainties about future benefits and costs, and the flexibility in decision making generate benefits and costs of delaying immediate action. When applied to government policy making, real option models can lead to efficient policies that take full account of these trade-offs, but they can also cause strategic behavior that tries to delay

Traditional top-down methods for resource management ask first what future conditions will be, then identify the best action(s) to take in response to that prediction. Even when acknowledging uncertainty about the future, standard approaches (a) characterize uncertainties probabilistically, then optimize objectives in expectation, and/or (b) develop a small number of representative scenarios to explore

This article presents an interview with environmental economist Maureen L. Cropper. Maureen completed her Ph.D. at Cornell University and subsequently held positions at the University of California, Riverside, and the University of Southern California. At Riverside, she moved from monetary economics to environmental economics. She then landed at the University of Maryland, where she is a still a professor