The rapid rise in the price of crude oil between 2004 and the summer of 2006 are the subject of debate. This paper investigates the factors that might have contributed to the oil price increase in addition to demand and supply for crude oil, by expanding a model for crude oil prices to include refinery utilization rates, a non-linear effect of OPEC capacity utilization, and conditions in futures markets as explanatory variables. Together, these factors allow the model to perform well relative to forecasts implied by the far month contracts on the New York Mercantile Exchange and are able to account for much of the $26 rise in crude oil prices between 2004 and 2006.

Between 2001 and 2004 conversion to pasture accounts for seventy percent of all land conversion in the Brazilian state of Mato Grosso. The economic incentives for this conversion are investigated using pastureland rents. Pastureland rents are estimated from physical and geographic determinants, and we test their validity by using them to model the location of conversion to pasture between 2001 and 2004. Our estimates for pasture rents range between $15-436 per hectare per year with a mean of $227/ha/yr. The predictive power of these rent estimates subsumes the power of common proxy variables such as distance to roads.Results indicate that a one-hundred dollar increase in mean pasture rent for land previously occupied by cerrado increases the probability of conversion to pasture 8.6 to 11.1 percent.  The predictive power of cattle rents points to the competitive and speculative aspects of profit seeking in the creation of new pasture for a large part of the Amazon basin. The use of economic rent allows the direct study of fiscal policy levers on land conversion behavior in the Amazon basin, expanding policy discussions beyond the role of roads and road improvement and towards excise taxes, conversion taxes, or conservation subsidies.



We use spatially efficient logit models to explore the role of economic incentives on the expansion of cropland in the Mato Grosso region between 2001 and 2004. An empirical measure for agricultural economic rent is used to quantify the desirability of a particular plot of land, which previous research proxies with variables such as distance to roads or urban areas, and simple climatic and edaphic variables. Results indicate that the measure for economic rent provides additional information and explanatory power to one of the most commonly used proxies, distance to roads. As predicted by economic theory, it is not simply access or variation in transportation costs that drives the spatial determinants of agricultural expansion, but the expected total returns from the venture. This suggests that spatially explicit rent models can be used to simulate the location and quantity of land-use change in an economically consistent framework. Such a framework lays the foundation for an enhanced methodology that can evaluate the ability of fiscal policy levers to influence the location...

Given the widely noted increase in the warming effects of rising greenhouse gas concentrations, it has been unclear why global surface temperatures do not rise after 1998 (1-3). Here we show that the observed record for surface temperatures are largely the result of declining solar insolation as part of a normal eleven-year cycle, and a cyclical change from an El Nino to a La Nina. Anthropogenic effects cause little warming because the rapid growth in short-lived sulfur emissions largely offset rising greenhouse gas concentrations. As such, we find that recent global temperature records are consistent with the existing understanding of the relationship among global surface temperature, internal variability, and radiative forcing, which includes anthropogenic factors with well known warming and cooling effects.

Oil prices, inventory levels, and utilization rates are influenced by changes that are transmitted horizontally and/or vertically through the energy supply chain. We define horizontal transmissions as changes that are generated by linkages among fuels at a similar stage of processing while vertical transmissions are changes that are generated by upstream/downstream linkages in the oil supply chain. Here, we investigate vertical and horizontal transmissions by estimating vector error correction models (VECMs) that represent relationships among the price of crude oil, US refinery utilization rates, US stocks of crude oil, US stocks of motor gasoline, the US price of motor gasoline, and the US price of a substitute fuel, natural gas. Causal relationships estimated from both weekly and quarterly observations indicate that the price of crude oil is an important gateway for disturbances to the oil supply chain. Impulse response functions indicate that disturbances to crude oil prices ripple down the oil supply chain and affect inventory behaviors, refinery utilization rates, and the price of motor gasoline...

We test the hypothesis that real oil prices are determined in part by refinery capacity, non-linearities in supply conditions, and/or expectations and that observed changes in these variables can account for the rise in prices between 2004 and 2006. Results indicate that the re␣ning sector plays an important role in the recent price increase, but not in the way described by many analysts. The relationship is negative such that higher re␣nery utilization rates reduce crude oil prices. This effect is associated with shifts in the production of heavy and light grades of crude oil and price spreads between them. Non-linear relationships between OPEC capacity and oil prices as well as conditions on the futures markets also account for changes in real oil prices. Together, these factors allow the model to generate a one-step ahead out-of-sample forecast that performs as well as forecasts implied by far-month contracts on the New York Mercantile Exchange and is able to account for much of the $27 rise in crude oil prices between 2004 and 2006.

Reconciling anthropogenic climate change with observed temperature since 1998
The economics of cropland conversion in Amazonia: The importance of agricultural rent
Horizontal and vertical transmissions in the US oil supply chain
Oil prices: The role of refinery utilization, futures markets and non-linearities
Assessing the factors behind oil price changes
Pasture Conversion and competitive land rents in the Amazon

We evaluate the welfare implications of agricultural expansion in the Brazilian Amazon by comparing spatially explicit estimates of soybean rents and the value of ecosystem services. Although these estimates are generated from different data sets, models, and estimation techniques, the values are comparable, such that the value of ecosystem services is greater than soybean rents for about 61 percent of the total area and 24 percent of the area where soybean rents are positive. Given this balance, the baseline approach that fails to value ecosystem services reduces total social welfare by 45 percent relative to an optimum. Much of this loss can be avoided by policy instruments that internalize the value of ecosystem services via land conversion taxes, conservation subsidies, or excise taxes. Regardless of intervention regime, policy makers should be cognizant of the diminishing net benefits of converting land to agriculture. Realizing the final 3.8 percent of total social welfare requires the conversion of 15 percent of natural ecosystems.

Ecosystem service value and agricultural conversion in the Amazon: Implications for policy intervention
Does Temperature contain a stochastic trend: linking statistical results to physical mechanisms

By construction, the time series for radiative forcing that are used to run the 20c3m experiments, which are implemented by climate models, impart non-stationary movements (either stochastic or deterministic) to the simulated time series for global surface temperature. Here, we determine whether stochastic or deterministic trends are present in the simulated time series for global surface temperature by examining the time time series for radiative forcing. Statistical tests indicate that the forcing contain a stochastic trend against the alternative hypothesis that the series are trend stationary with a one-time structural change. This result is consistent with the economic processes that impart a stochastic trend to anthropogenic emissions and the physical processes that integrate emissions in the atmosphere. Furthermore, the stochastic trend in the aggregate measure of radiative forcing also is present in the simulated time series for global surface temperature, which is consistent with the relation between these two variables...