The renewable energy curse – does corruption turn clean energy into dirty? @GarethMP

Massimo Tavoni and Caterina Gennaioli published a nice paper showing that corruption and violence was higher in the high wind provinces of Italy after the installation of wind generators. They built on earlier work about countries with abundant renewable resources and weak institutions. The main question in their paper

… is whether an increase in the expected returns of investments in wind energy, following the introduction of the new policy regime based on a green certificate system, has driven economic agents, namely bureaucrats and entrepreneurs, to engage more in rent seeking activities.

As they studied Italy, there is no surprise about the answer which was yes. High winds ensure high returns of the wind farm investment, but whether this translates into more bribery depends on institutional quality. There was more corruption, and so especially in high-wind provinces of Italy.

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Source: Green policy and corruption | VOX, CEPR’s Policy Portal.

The construction of an average wind park is associated with an increase of criminal association activity of 6%. Italy will have more corruption than elsewhere in the old European Union.

The wider problem is renewable energy is a celebrity technology. In the context of expressive politics, so many cheer for solar and wind power that standards drop in terms of who qualifies for subsidies and who should lose support when their investments do not turn out as promised.

https://twitter.com/CountCarbon/status/715136022414299138

Wind power is not new, it is intermittent, is unsuitable for modern work, and is land constrained but it is still subsidised. Green rent seeking is a real risk even in countries with the best political institutions.

Actual and synthetic real per capita GDP and real per worker GDP in the 1973 EU enlargement

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Source: How rich nations benefit from EU membership | VOX, CEPR’s Policy Portal.

@StatModeling @ryanmcmaken Europe sub-Reddit just can’t handle the truth about how poor they are!?

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How long have you got in Europe when you are waiting for God?

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Source: OECD Economic Surveys: Germany 2016 | OECD READ edition.

Murray Rothbard vs. EU 1989!

Being in or out of Europe is already a complicated business

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EU late joiners relative labour productivities @NickCohen4 @iainmartin1 @CapX

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Source: Edward Prescott.

..

Original EU Labor Productivities Relative to U.S. @NickCohen4 @iainmartin1 @CapX

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Source: Edward Prescott.

Real GDP per working age British, Dane and Swede 1950 – 2012, PPP

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Source: Computed from OECD StatExtract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/

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Source: Computed from OECD StatExtract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/

The data is detrended at 1.9% per  year – the trend rate of growth for the USA in the 20th century. A rising line means growth greater than 1.9% for that year,  a falling line means growth of less than 1.9% for the year. A flat line is growth of 1.9% for that year.

Britain, Sweden and Denmark all grew quickly up until the 1970s in a period known as post-war catch up.In the 1970s and early 1980s, there was the British disease. The 1970s to the early 1990s was Swedosclerosis. There was a boom in the British economy subsequent to the economics of Mrs Thatcher.

European integration explained in one easy chart

Who are the members of Euroland?

Ease of doing business across the European Union is rather variable

Maybe joining Euroland isn’t that bad after all

Maybe the European Union membership isn’t that bad after all, especially if you’re a former Eastern Bloc country

A refugee boat from Libya

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