Working Papers

Water affordability in the U.S.

(with Casey Wichman).

In the US, recent trends suggest that the cost of water and wastewater is rising three-times faster than inflation and water infrastructure requires more than 1-trillion USD investments over the next 20-25 years. In this paper, we assemble the most comprehensive data set of utility water and sewer prices in the US, capturing approximately 45% of the US population, matched with community-level socioeconomic characteristics and typical levels of consumption. Using these data, we provide a large-scale snapshot of the distributional burden of water and sewer bills across income groups, geography, and race. Descriptive statistics suggest that 13.8% households have water and sewer expenditures greater than what the EPA deems affordable, and that households in the lowest income decile pay on average 7.8% of their annual income on water and sewer service. We show that using median household income at the county level drastically understates the extent of the water affordability problem relative to using the full income distribution within Census block groups. Additionally, we find that the number of households facing affordability concerns is positively associated with water and sewer price levels, impoverished residents, and the proportion of black residents, after conditioning on poverty levels. Lastly, we simulate self-sufficient water affordability programs, implemented at the county level, that redistribute the burden borne by low-income customers. We show that affordability policies that provide a lump-sum rebate to low-income households and are paid for by income taxes dominate policies that change marginal incentives for water and sewer consumption.

An econometric analysis of the Brazilian merger policy

(with Mariusa Pitelli and Adelson Figueiredo). Revise and resubmit. (Code and data will be available soon).

This paper analyzes the factors influencing the decisions made by the Brazilian Competition Policy System on merger operations from 2004 to 2011. Estimates of binomial logit models show that two standard market structure indicators – high post-merger market share and unfavorable entry conditions - significantly increase the likelihood of an operation being challenged. Additionally, we find that three factors not explicitly associated with the Brazilian Merger Guidelines play a relevant role in merger policy decisions. Specifically, mergers in regulated markets, involving vertical integration or having a foreign firm as the largest participant are less likely to be challenged.

Refereed Publications

(with Leigh Tesfatsion, Chris R. Rehmann, Yu Jie, and William J. Gutowski). Environmental Modelling & Software. 89: 40-60. (Code in Java available here)

This study describes the architecture and capabilities of an open source agent-based Java platform that permits the systematic study of interactions among hydrology, climate, and strategic human decision-making in a watershed over time. To demonstrate the platform's use and capabilities, an application is presented in accordance with ODD protocol requirements that captures, in simplified form, the structural attributes of the Squaw Creek watershed in central Iowa. Illustrative findings are reported for the sensitivity of farmer and city social welfare outcomes to changes in three key treatment factors: farmer land-allocation decision method, farmer targeted savings, and levee quality effectiveness for the mitigation of city flood damage.

Work in progress

Optimal climate policy under uncertain post-tipping regimes

The risk of an irreversible, discontinuous and known change in the global climate system has been shown to substantially affect climate policy. Nevertheless, the magnitude of the regime changes caused by climate tipping elements is inherently uncertain. Building on a recursive dynamic model of climate policy, this paper examines how the optimal carbon tax responds to uncertainty on climate sensitivity in the post-tipping regime. I consider moderate to extreme cases of uncertainty and alternative specifications of risk attitude and damage function. Results show that mean-preserving uncertainty raises the optimal tax by at most 0.2%. The small extent of the effects is a consequence of the small short-term impact of varying the climate sensitivity.

Computer Science & Engineering Publications

(In Portuguese) A Digital Notebook in school laptops: concept and tool development

(with Cecília Baranauskas). Brazilian Journal of Computers in Education. 7: 59-73. (Code in Python available here)

This paper presents the inception, design and development steps of an educational tool aligned to the proposal of the One Laptop per Child Program (OLPC): the Digital Notebook. Preliminary tests suggest its feasibility and potential utility as a support tool for learning processes.