Detox Development : Repurposing Environmentally Harmful Subsidies / Richard Damania [and six others].

Format:

Book

Author/Creator:

Damania, Richard, author.

Language:

English

Subjects (All):

Environmental economics.

Pollution--Economic aspects.

Pollution.

Subsidies--Environmental aspects.

Subsidies.

Physical Description:

1 online resource (307 pages)

Edition:

First edition.

Place of Publication:

Washington, DC : World Bank, [2023]

Summary:

Clean air, land, and oceans are critical for human health and nutrition and underpin much of the world's economy. Yet they suffer from degradation, poor management, and overuse due to government subsidies. 'Detox Development: Repurposing Environmentally Harmful Subsidies' examines the impact of subsidies on these foundational natural assets. Explicit and implicit subsidies--estimated to exceed US$7 trillion per year--not only promote inefficiencies but also cause much environmental harm. Poor air quality is responsible for approximately 1 in 5 deaths globally. And as the new analyses in this report show, a significant number of these deaths can be attributed to fossil fuel subsidies. Agriculture is the largest user of land worldwide, feeding the world and employing 1 billion people, including 78 percent of the world's poor. But it is subsidized in ways that promote inefficiency, inequity, and unsustainability. Subsidies are shown to drive the deterioration of water quality and increase water scarcity by incentivizing overextraction. In addition, they are responsible for 14 percent of annual deforestation, incentivizing the production of crops that are cultivated near forests. These subsidies are also implicated in the spread of zoonotic and vector-borne diseases, especially malaria. Finally, oceans support the world's fisheries and supply about 3 billion people with almost 20 percent of their protein intake from animals. Yet they are in a collective state of crisis, with more than 34 percent of fisheries overfished, exacerbated by open-access regimes and capacity-increasing subsidies. Although the literature on subsidies is large, this report fills significant knowledge gaps using new data and methods. In doing so, it enhances understanding of the scale and impact of subsidies and offers solutions to reform or repurpose them in efficient and equitable ways. The aim is to enhance understanding of the magnitude, consequences, and drivers of policy successes and failures in order to render reforms more achievable.

Contents:

Front Cover

Contents

Acknowledgments

About the Authors

Main Messages

Executive Summary

Abbreviations

Chapter 1 Introduction: Global Natural Resource Subsidies

Overview

What are subsidies and why do they matter?

The magnitude of subsidies in natural resource sectors

The remainder of this report

Notes

References

Part I Air

Chapter 2 Toxic Air: Overview

Introduction

Poverty and exposure to air pollution

Fossil fuels and air pollution

Underpricing of polluting activities

A case for action

Chapter 3 Subsidizing Toxic Air: The Vast Underpricing of Fossil Fuels and Their Use

Explicit fossil fuel subsidies

The societal costs of air pollution

Fossil fuel subsidies: Best intentions but detrimental outcomes

Polluting fossil fuels and the role of price signals

Air pollution and price signals

Chapter 4 Virtually Inescapable: The Scale and Distribution of Toxic Air Pollution

The global burden of air pollution

An unequal burden: New evidence on air pollution from the world's coal-fired power plants

Chapter 5 Pro-Poor and Pro-Health: The Benefits of Reforming Subsidies

The distributional implications of fossil fuel subsidy reform

Fossil fuel subsidy reforms save lives

Part II Land

Chapter 6 Size, Scope, and Composition of Agricultural Subsidies

What is an agricultural subsidy?

Policy objectives of agricultural support

What is the magnitude of subsidies in the agriculture sector?

Chapter 7 Inefficient, Unequal, and Unwise: The Economic and Distributional Impacts of Agricultural

Agricultural subsidies and productivity.

Agricultural subsidies and distributional goals

The way forward

Chapter 8 Reap What You Sow: The Water Footprint of Agricultural Subsidies

Nitrogen legacies and the role of subsidies

The law of unintended consequences

Cultivating solutions

Chapter 9 The Effects of Agricultural Subsidies on Forests and Their Spillovers

Global deforestation is sensitive to changes in commodity prices

Assessing the effect of agricultural subsidies on deforestation

Agricultural subsidies and the emergence of infectious diseases: A focus on malaria

Part III Oceans

Chapter 10 The Economic, Social, and Environmental Effects of Harmful Fishery Subsidies

The state of the world's oceans

The dual challenges of open access and direct subsidies

The impact of subsidies in three critical fisheries

Implications and caveats

Part IV From evidence to action

Chapter 11 Reforming Harmful Subsidies in a Complex Political Economy

Establishing the case for reform

Anticipating the political challenges to reform

Navigating political complexity: Six principles for effective reforms

Subsidy reforms for sustainable development

Note

Chapter 12 Bringing Together the Piece

Conclusions

Reference

Boxes

Box 1.1 Formal definitions of implicit and explicit subsidies

Box 2.1 Air pollution: A toxic medley of many different pollutants from many different sources

Box 2.2 The unequal burden of air pollution on women, children, and ethnic minorities

Box 2.3 Indoor air pollution and the risks to human health

Box 2.4 Subsidy reforms and the need for complementary policies to tackle pollution.

Box 3.1 Pollution sources other than fossil fuels that receive public support and subsidies

Box 3.2 Subsidies: Intended for the poor, but benefiting the rich

Box 3.3 Technical spotlight: A meta-analysis of price elasticities in low- and middle-income countries

Box 3.4 Technical spotlight: A global empirical analysis of the relationship between energy prices and air pollution

Box 4.1 Technical spotlight: New evidence on global air pollution exposure and poverty

Box 4.2 Nuances matter: Air pollution and poverty in Vietnam

Box 4.3 Technical spotlight: New evidence on air pollution from the world's coal-fired power plants

Box 4.4 Historic evidence of socioeconomic sorting in Britain and beyond

Box 5.1 Technical spotlight: Assessing the distributional and health benefits of fossil fuel subsidy reform for 35 countries using the World Bank's Carbon Pricing Assessment Tool

Box 5.2 No two subsidy schemes are the same: Subsidies in Algeria, China, Indonesia, and the Islamic Republic of Iran

Box 5.3 Fossil fuel subsidy reform contributes to reducing greenhouse gases

Box 5.4 Health benefits of climate change mitigation policies

Box 6.1 Landscape restoration projects in Ethiopia

Box 6.2 A simple profit-maximization model to illustrate the policy impacts of support mechanisms

Box 6.3 Domestic support in agriculture: The WTO "boxes"

Box 6.4 The nominal rate of protection and producer support estimate

Box 7.1 Agricultural subsidies and technology adoption

Box 7.2 Technical spotlight: Estimating the impact of agricultural subsidies on total factor productivity at the country level

Box 7.3 Technical spotlight: Meta-analysis of the effects of agricultural input subsidies on agricultural production and farmers' incomes

Box 7.4 Technical spotlight: Farm input subsidy reforms in Malawi and Nigeria.

Box 7.5 Technical spotlight: The Mi Riego highland irrigation program in Peru

Box 7.6 Technical spotlight: Estimating the distributional impact of output subsidies

Box 7.7 Technical spotlight: Estimating the distributional impact of input subsidies

Box 7.8 The varying effectiveness of inorganic fertilizer application on smallholder-managed fields

Box 7.9 Lessons from e-voucher programs in Guinea, Mali, and Niger

Box 8.1 A divided world: Fertilizer feast and famine

Box 8.2 NPK application: Skewed and distorted

Box 8.3 The nitrogen cascade beyond water

Box 8.4 Technical spotlight: Diminishing returns to fertilizer use

Box 8.5 Technical spotlight: Regional effects of fertilizer use

Box 8.6 Technical spotlight: Nitrogen fertilizer use and water pollution

Box 8.7 Technical spotlight: Drawing down the ocean underground

Box 8.8 The fallout of war

Box 9.1 Technical spotlight: The effects of agricultural commodity prices and producer supports on gloabl deforrestation

Box 9.2 Technical spotlight: Two country case studies on the impact of subsidies on deforestation, 2000-10

Box 9.3 Technical spotlight: Estimating the impact of deforestation on malaria transmission

Box 10.1 Managing the many stressors facing global fisheries

Box 10.2 The economics of fisheries

Box 10.3 Ecosystems of the Mauritanian EEZ, the East China Sea, and the northern South China Sea

Box 10.4 Technical spotlight: The Ecopath with Ecosim model

Box 10.5 Technical spotlight: Impact of subsidies and management regimes on biomass

Box 10.6 The importance of fishery ecology in determining the impact of harmful subsidies

Box 10.7 Technical spotlight: Subsidy removal and the recovery of fisheries under job optimization and ecological optimization

Box 11.1 The World Bank's Energy Subsidy Reform Facility.

Box 11.2 When compensation paves the way for reform: Murray-Darling Basin, Australia

Box 11.3 When winners feel like losers: Public perceptions can drive opposition to subsidy reform

Box 11.4 Lessons from India: The complexities of reforming agricultural subsidies and protectionism

Box 11.5 Credible compensation before subsidies are removed

Box 11.6 Lessons from Nigeria: National averages hide vulnerable population groups

Box 11.7 A fuel subsidy reform clears the air: Experience from Cairo, the Arab Republic of Egypt

Box 11.8 Fossil fuel subsidy reform in Mexico

Figures

Figure ES.1 Change in global agricultural productivity due to the use of nitrogen fertilizer, by quantile of use and region

Figure B2.3.1 The Energy Ladder: The dominant energy sources for cooking and heating, by level of income

Figure B2.4.1 Entry points for antipollution policies

Figure 3.1 Global energy sector subsidies, 2017

Figure 3.2 Global explicit fossil fuel subsidies, 2015-25 (projected)

Figure 3.3 Top 20 explicit fossil fuel subsidy programs, 2020

Figure 3.4 Global sources of implicit fossil fuel subsidies and share of GDP, 2015-25 (projected)

Figure 3.5 Top 20 providers of implicit fossil fuel subsidies, 2020

Figure 3.6 Global implicit fossil fuel subsidies, by type of fuel, 2015-25 (projected)

Figure 3.7 Best intentions and detrimental effects of fossil fuel subsidies

Figure 3.8 Fossil fuel subsidies and health expenditures as a share of GDP in select countries, 2019

Figure 3.9 Fossil fuel subsidies and education expenditures as a share of GDP in select countries, 2019

Figure B3.3.1 Price elasticities of gasoline demand

Figure 3.10 Average price elasticities of energy demand

Figure 4.1 Global population exposed to different levels of air pollution risk.

Figure 4.2 Population exposed to air pollution, by region and as a share of total regional population.

Notes:

Includes bibliographical references.

Description based on publisher supplied metadata and other sources.

Description based on print version record.

Other Format:

Print version: Damania, Richard Detox Development

ISBN:

1-4648-1917-3