We develop a theoretical Applied General Equilibrium (AGE) model that explicitly includes the environmental input in production functions and the consumers' preferences for environmental quality in utility functions. We empirically apply the model to provide some insights into the effects of the enhanced consumption of Novel Protein Foods (NPFs) and to assess the effects of a higher consumers' willingness to pay for the protection of the environment in the Europe Union (EU). We find that these preference changes impact the pork production and consumption as well as ammonia (NH3) emissions. Sensitivity analysis shows that the results are more sensitive to the value of the elasticity of utility with respect to environmental quality than to that of the substitution elasticity between pork and NPFs.
|Publication status||Published - 2005|
- AGE models
- Environmental economic modelling
- Novel Protein Foods