Khyati Malik - Research

My dissertation work targets decarbonization pathways by considering expansion of land-based carbon sequestration and large-scale grid integration of renewable energy sources. I study the feedback between farmers' land use decisions and geophysical processes, and how the shift to renewable energy impacts GHG reductions. In my other collaborative projects, I explore optimal public good provision, linked to my published work on how increase in work from home has influenced the value of green amenities. In another project, I solve a dynamic Nash equilibrium by building a multi-region model with emission permit trading among 12 aggregated regions in the world. Lastly, I assess the positive impact of COVID-19 vaccines in the United States by modeling the infection spread using data-driven methods.

Job Market Paper

Soil to Savings: Optimal Farmer Compensation for Carbon Sequestration Services in the Midwest United States

The objective of this research is to assess if there is a viable market for soil carbon sequestration in the Midwest region of the United States. Second, I evaluate the tradeoffs between crop yield and soil carbon sequestration. I develop an infinite horizon model in which farmers maximize their lifetime utility while undertaking decisions about carbon sequestration practices. Farmers are compensated for the sequestered carbon. To determine the model parameters, I use field data and also perform biophysical simulations of crop growth and carbon sequestration using the Environmental Policy Integrated Climate (EPIC) model.

Peer Reviewed Journal Publications

Malik K., Kim S.*, Cultice B. J., The Impact of Remote Work on Green Space Values in Regional Markets, Journal of Housing Economics (2023) (link) (*joint first author)

We investigate the extent to which the increased prevalence of work from home (WFH) due to the COVID-19 pandemic has made green amenities more desirable. We focus on ten major metropolitan statistical areas (MSAs) of the United States and use a hedonic pricing approach to identify changes in the implicit prices of yard space and park proximity. We find that home buyers in most MSAs assigned a greater value to private green amenities in the post-COVID period, but this preference does not correlate with the extent of WFH. Significant heterogeneity was observed in the preference for private green spaces in the post-COVID period.

Book Chapters

Gopalakrishnan, Sathya, Malik, Khyati, and Zhu, Kunxin, ‘Climate Change and Coupled Human and Natural Systems’, Routledge Handbook of Climate Change and Society, 2nd Edition.

Papers in Review

Dynamics of Global Emission Permit Prices and Regional Social Cost of Carbon Under Noncooperation (with Yongyang Cai and Hyeseon Shin) (link)

We build a dynamic multi-region model of climate and economy with emission permit trading among 12 aggregated regions in the world. We solve for the dynamic Nash equilibrium under noncooperation, wherein each region adheres to the emission cap constraints following commitments that were first outlined in the 2015 Paris Agreement and updated in subsequent years. Our model shows that the emission permit price reaches $811 per ton of carbon by 2050. We demonstrate that a regional carbon tax is complementary to the global cap-and-trade system, and the optimal regional carbon tax is equal to the difference between the regional marginal abatement cost and the permit price.

The WTP-WTA Gap for Public Goods: New Insights from Compensating and Equivalent Variation Closed Form Solutions (with Daniel H. Karney) (link)

This study derives exact closed-form solutions for compensating variation (CV) and equivalent variation (EV) for both marginal and non-marginal changes in public goods, assuming homothetic utility. These parameters can be recovered using observable data and a single sufficient statistic summarizing consumer preferences for empirical applications. The CV and EV expressions also reveal three economic mechanisms influencing their magnitudes, including the relative preference effect, which explains the significant disparity between willingness to pay (WTP) and willingness to accept (WTA) for public goods.

Working Papers

Ramping Up Emissions? The Implications of Intermittent Renewables for Thermal Power Plant Pollution

Policymakers increasingly advocate renewable energy to reduce emissions and enhance air quality. However, intermittent solar and wind power require conventional plants to frequently ramp output, causing inefficiencies and increased nitrogen oxide (NOx) emissions. This study offers the first empirical, multi-state analysis of ramping-induced emissions in the U.S. from 2010 to 2021. Results indicate ramping significantly elevates NOx emissions, notably in late afternoons, exacerbating ozone issues. Older plants and solid-fuel EGUs show greater emissions penalties. Thus, managing ramping externalities through fuel shifts, battery storage, demand management, and flexible generation is crucial for aligning renewable integration strategies with climate and air quality goals.

Work in Progress

A Data-driven Approach to Model the Spread of COVID-19 Vaccination in the United States and Evaluate the Positive Externality of COVID-19 Vaccines (with Seunghun Chung)