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Announcements for Friday, March 16, 2012

Announcements

  • Welcome John Inama, Systems Support Specialist

    Welcome to John Inama, the department's new Systems Support Specialist! John started on Monday, March 12, and is now located in 62E Heady Hall. He can also be reached at x4-6718, jinama@iastate.edu.

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  • Wednesday's Environmental/Resources Workshop with Alicia Rosburg, Iowa State University

    On Wednesday, March 21, Alicia Roseburg, Iowa State University, will present, "Cellulosic Biofuel Supply with Heterogeneous Biomass Suppliers: An Application to Switchgrass-based Ethanol," from 12 PM to 1:20 PM, in 468D Heady Hall.

    Abstract: The potential of biomass for alternative energy production has attracted considerable attention because of associated implications for energy security, food supply, and climate change. This paper considers the economic impacts of spatial variation and landowner behavior on potential biomass supply for U.S. cellulosic biofuel. To examine these impacts, we develop and apply a long-run biomass production through bioenergy conversion cost model that incorporates heterogeneity of biomass suppliers within and between local markets. In an application to US switchgrass-based cellulosic ethanol production, we find that cost-minimizing biofuel production decisions, which include biorefinery size, biomass transportation distance, and price of biomass, vary significantly across locations. Further, we develop an aggregate switchgrass ethanol supply curve from the cost-minimizing local biorefinery capacities and production costs (i.e., local supplies) to evaluate the potential for and cost of achieving cellulosic biofuel production targets such as the revised Renewable Fuels Standard (RFS2) mandates. We find that switchgrass-based ethanol could satisfy the 2016 RFS2 cellulosic biofuel mandate of 4.25 billion gallons per year at a cost of $3.45 per gallon ethanol ($5.15 per gallon gasoline equivalent). By accounting for observed heterogeneity in potential biomass suppliers within and between local markets, we are able to tradeoff economies in biomass production, transportation, and conversion not previously obtained. Our empirical results suggest that spatial variation in the economics of biomass production plays an important role in the potential supply and distribution of U.S. cellulosic biofuel production.

  • Thursday's Department Seminar with Dr. Hirokazu Okumura, The Graduate School of Public Policy, The University of Tokyo, Japan

    On Thursday, March 22, Dr. Hirokazu Okumura, The Graduate School of Public Policy, The University of Tokyo, Japan, will present “Can Renewable Energy Substitute for Nuclear Energy in Japan?” from 3:40 PM to 5 PM, in 368A Heady Hall.

    Professor Hirokazu Okumura is Project Professor at the Graduate School of Public Policy, University of Tokyo, Japan, a position he has held since 2005 (with one month intermission). He is also the former Director-General of the Public Utilities Department at the Ministry of International Trade and Industry (MITI), which regulates electricity and gas markets in Japan. During his tenure at MITI he directed early efforts to deregulate these markets. Following the earthquake and tsunami that struck Japan in March 2011, he has become involved in renewed efforts to restructure the Japanese electric power industry to help ensure more efficient and reliable operations. During his visit to the US he is investigating ongoing efforts to restructure US electric power markets, including the use of agent-based modeling to explore alternative restructuring proposals through systematic computational experiments in advance of implementation.

    Abstract: Nuclear energy has been a substantial source of fossil fuel energy in Japan since the 1970s, after the oil price shocks. After the Fukushima Daiichi nuclear disaster in Japan in March 2011, however, renewable energy sources such as wind and photovoltaic (solar) power have been encouraged as substitute energy sources. For example, last summer the Japanese Diet introduced a new act forcing utility companies to buy electricity generated by renewable energy sources. In this talk I will address whether renewable energy sources can substitute for nuclear energy, given various unresolved economic and institutional barriers. I will also discuss broader possible solutions for the Japanese power industry, including the development of a deregulated electricity market permitting consumer choice among multiple electricity generation sources.

  • Friday's Department Seminar with Alexander Monge-Naranjo, Penn State University

    On Friday, March 23, Alexander Monge-Naranjo, Penn State University, will present, "Knowledge Spillovers and the Optimal Taxation of Multinational Firm," from 3:40 PM to 5 PM, in 368A Heady Hall.

    Alexander Monge-Naranjo is a macroeconomist with a wide array of research interests centered on frictions and imperfections in the labor and credit markets. His most recent work has focused on the impact of credit constraints on the formation of human capital, specifically on investments in higher education. He also works on the aggregate implications of reallocating skills and the diffusion of knowledge across countries, on the ability of learning models to explain the dynamics and cross-section behavior of the adoption of government policies across countries and on the impact of contract enforcement limitations on the behavior of firms. Monge-Naranjo has been at Penn State University since 2008. Previously he was at Universidad de Costa Rica, Northwestern University and INCAE Business School and. In several occasions he has been an external consultant for the World Bank, the Inter American Development Bank and for the Central Bank of Costa Rica.

    Abstract: This paper examines a key policy question for many developing countries: Should they allow and even subsidize the entry and operation of multinational firms? I consider a model in which spillovers drive the formation of productive knowledge, the typical rationale for attracting multinational firms. I depart from most work on the gains of openness and instead of using simple counterfactual policies (i.e. compare complete openness or complete closedness with each other or with actual policies) I characterize the gains attainable under a Ramsey program, when taxes are set to maximize the welfare of the recipient country subject to the equilibrium behavior of national and foreign agents. I find that contrary to laissez-faire, openness under optimal taxation always leads developing countries to catch up with developed countries and improves their welfare. However, in stark contrast with some observed practice, I find that a developing country should only subsidize the entry of foreign firms if the domestic accumulation of know-how is also subsidized.

  • Weekly Media Connections for the Department of Economics

    Chad Hart, ISU grain Extension economist, spoke with Fran Howard, AgWeb.com, on the latest USDA supply and demand report. He also spoke with Sue Danielson, WHO Radio, on meat demand and the impact the recession had upon it.

    Dave Swenson spoke to Ross Boettcher, Omaha World Herald, on his reaction to Iowa's continued improved economic outlook and a reduction in the unemployment rate. He also spoke with Andrew Nelson, Omaha World Herald, on a bequest to the communities of Dennison, Ricketts, and Charter Oak. Nelson asked what a city do with a small ($20,000 to $50,000) donation from an estate. Swenson suggested the creation of scholarship program, or to use the funds to leverage additional community resources to, in turn, leverage state or federal resources to provide a public good or service that was needed.

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