The U.S. Ethanol and Commodity Policy Labyrinth: Looking into Welfare Space to Analyze Policies that Combine Multiple Instruments

David S. Bullock and Anabelle Couleau

No 126901, 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil from International Association of Agricultural Economists

Abstract: We analyze complicated ethanol/commodity policies not just in (q, p) space, but also in “policy space” and “welfare space.” Specific advantages of conducting policy analysis in welfare and policy spaces are (1) it makes clearer the distributional consequences of policy change instead of focusing solely on the aggregate welfare consequences of policy change; (2) it can be used to analyze the effects of many (even infinitely many) policies instead of just a few; and (3) it makes clearer what it means for policies to be more/less “efficient,” and for policy instruments to make each other more/less “efficient.” We show the usefulness of our framework to critique various conclusions that have recently been expressed in the literature on ethanol policies that employ multiple instruments.

Keywords: Research and Development/Tech Change/Emerging Technologies; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 40
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:ags:iaae12:126901

DOI: 10.22004/ag.econ.126901

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