This review traces the evolution of India's agricultural policy regime, centered on price supports, input subsidies, and complex trade policies that oscillate between protectionism and implicit taxation of farmers. It highlights three interlinked challenges: low farm incomes, poor diet quality, and environmental degradation. The policy architecture that ensures food security constrains the pace of agricultural transformation. Reform requires repurposing subsidies and restoring credibility to trade policy. While the digital infrastructure is in place to begin the shift to smarter subsidies, the political path is risky, as policy must seek credible ways to signal protection of farmer interests. Despite these policy rigidities, economic growth and urbanization continue to drive structural changes in agriculture. Diversification away from cereals, new food value chains, and rising integration with nonfarm employment are the key dynamic forces shaping agricultural outcomes. Future outcomes will depend on policy responses to emerging food value chains and new agricultural technologies.
Flooding is one of the costliest natural disasters in the United States, and a major source of flood damage is to the residential housing stock. Given the value of housing, both as a major source of household wealth and to the residential mortgage market, a long-standing literature has examined how floods impact house prices and evaluated the protective role of flood insurance. In this review, we synthesize the literature examining the impact of flood risk and flood events on housing value. We also examine research themes in the US flood insurance market including the determinants of flood insurance demand, the impact of insurance on household decisions to manage flood risk, and emerging changes to watch in the public and private flood insurance markets. We then survey key data challenges and opportunities and conclude by examining who bears the flood risk in the US housing market. As climate change is expected to change future precipitation patterns and raise sea levels, flood risk and insurance will likely be even more important for housing markets in the future.
This review reassesses the economics of commodity price stabilization policies through the lens of the rational expectations storage model. In frictionless markets, private speculative storage efficiently smooths commodity prices; thus, welfare gains from public intervention require the presence of market or endowment failures, which are prevalent in agricultural markets in low-income settings. Optimal state–contingent stabilization policies raise welfare but are complex, crowd out private storage, and are difficult to design and implement. Simple rules—notably narrow price bands or storage-cost subsidies—offer more feasible approximations, with subsidies being more efficient. In open economies with high trade costs, storage can mitigate price troughs. Conversely, export controls can mitigate domestic transmission of global price spikes but are non-cooperative. Although storage policies stabilize prices, their welfare effects are nuanced. They entail large redistributive transfers that far exceed efficiency gains; accordingly, they should be viewed as second-best instruments, valuable when better-targeted alternatives are unavailable.
Twenty years after its launch, the European Union Emissions Trading System (EU ETS) stands as the world's largest and most mature carbon market. The ETS has developed, from generous allowance allocation and initial price collapse to the introduction of the Market Stability Reserve, enabling more effective emissions reductions. Drawing on major reviews and recent empirical studies shows that the system decreased emissions, limited carbon leakage, and facilitated low-carbon innovation, especially in the power sector. The system evolved from a pure cap-and-trade to a hybrid instrument that adjusted the allowance supply to stabilize prices and functions within a broader policy ecosystem, which influences its effectiveness. However, the EU ETS still faces challenges: decarbonizing heavy industry, considering transport and building, phasing out free allocation, managing social impacts, and more. The EU ETS can teach us to design politically feasible carbon pricing systems that are durable.
This article summarizes methods, prospects, and methodological questions for water quality benefit transfer. Benefit transfer is the use of welfare estimates from settings where original valuation research has been conducted to predict similar estimates for other settings, allowing quantification of benefits and costs when original valuation studies are infeasible. Water quality has been among the most researched areas of benefit transfer, in part due to requirements for benefit-cost analysis within policies and programs that affect surface and ground water. The article begins with a review of benefit transfer methods and characteristics of water quality that challenge transfer validity. We then explore alternative approaches for meta-regression modeling and value prediction to support these transfers, focusing on emerging methods that may afford greater flexibility than traditional parametric approaches and enable gains in transfer accuracy, while maintaining desirable theoretical properties. The article concludes with a discussion of unresolved questions and research needs.
Food has long served as an instrument of statecraft. Yet agricultural economics typically analyzes policy through the lens of consumer and producer welfare, which neglects security externalities. We review the literature at the intersection of agricultural economics and political science, examining how food systems both shape and are shaped by geopolitical forces through the two channels of (i) domestic instability with international spillovers, and (ii) the deliberate use of food in statecraft. Our synthesis of key findings in the literature suggests that (i) food prices relate to riots and instability while ambiguously relating to civil war and violence, (ii) the wide geographic spread of agriculture limits but does not eliminate unilateral coercive leverage compared with other strategic sectors, and (iii) domestic food policies are strongly related to national security goals. Moreover, we point out the many extant data sets one can use to do work in this area and identify several research gaps in the literature. As global uncertainty intensifies, integrating geopolitical analysis into agricultural economics is essential for policy relevance.
Land protection initiatives play a key role in supporting biodiverse, resilient, and productive land systems. Understanding how they affect and interact with social equity is critical for long-term conservation success. Here, we review equity-relevant design and implementation aspects of protected areas, community-based conservation, indigenous governance, payments for ecosystem services, and direct regulation. Existing literature shows that unless effective benefit-sharing mechanisms are in place, land protection often transfers economic surplus from local communities to regional beneficiaries or reinforces existing distributional inequalities. Future work can contribute to understanding these mechanisms, including the institutional structures that facilitate procedural equity and the causal pathways that enable greater equity in specific economic, biophysical, and social contexts.
Integrated assessment models (IAMs) are pivotal tools that synthesize knowledge from climate science, economics, and policy to evaluate the interactions between human activities and the climate system. They serve as essential instruments for policymakers, providing insights into the potential outcomes of various climate policies and strategies. Given the complexity and inherent uncertainties in both the climate system and socioeconomic processes, understanding and effectively managing uncertainty within IAMs are crucial for robust climate policy development. This review provides a comprehensive overview of how IAMs handle uncertainty, highlighting recent methodological advancements and their implications for climate policy. We examine the types of uncertainties present in IAMs; discuss various modeling approaches to address these uncertainties; and explore recent developments in the field, including the incorporation of advanced computational methods.
Ensuring universal access to clean water remains one of the most pressing global challenges, particularly in low-income countries. Despite considerable efforts under the United Nations Millennium Development Goals and Sustainable Development Goals, progress has been uneven, with persistent gaps in infrastructure financing and service delivery. In this review, we critically assess current measurements of water access, which fail to capture the true state of access. Standard metrics often emphasize the presence of infrastructure. We propose using dynamic measurement frameworks that go beyond infrastructure presence and include indicators for reliability, temporal variability, quality, affordability, and gender-based disparities. We also examine the potential and limitations of emerging technologies in measuring water access. To complement improved measurement, we review evaluation practices of water interventions, which are dominated by experimental methods. While these methods are useful for identifying causal impacts, they often overlook key factors such as long-term functionality, maintenance challenges, user and community engagement, and local institutional capacity that determine the effectiveness and sustainability of water access solutions. We argue for combining quantitative impact evaluation methods with qualitative evaluation methods to address these gaps and better understand how water interventions interact with complex socioeconomic, environmental, and behavioral factors.
The debate on industrial policies has long been polarized between proponents of government intervention and free-market advocates. Proponents argue for market failure correction and industry nurturing, while opponents warn of the inability of the government to “pick winners” and its vulnerability to rent-seeking interests. What the current literature overlooks is that effective industrial policies must simultaneously design pie-expanding “public good” policies with appropriate redistribution policies to facilitate their political acceptance. Using this notion, this review proposes a new approach by extending the political-economic seeking transfer and political-economic resource transaction (PEST-PERT) portfolio framework to examine the efficacy of industrial policies in the agricultural, natural resource, and environmental sectors. Several empirical examples are presented, including payment for ecosystem services, conservation programs, agricultural policy reform, development subsidies to increase maize productivity, infrastructure development, and transportation investments. These industrial policy portfolios are dissected for two policy types: (a) pie-expanding policies that promote public goods, reduce transaction costs, and resolve coordination failures; and (b) redistributive policies often needed to overcome opposition from blocking coalitions. In each empirical study, the policy portfolio is specified, distinguishing these two types of policies.
Mitigation action in agrifood systems is essential for reducing the sector's growing contributions to climate change. It remains unclear, however, to what extent mitigation in the agrifood systems space addresses gender inequalities and involves women as agents of climate action. This article reviews the literature to identify the main linkages between gender and mitigation in agrifood systems, examines the key barriers preventing women from equitably participating in and benefiting from mitigation actions in agrifood systems, and concludes with best practices to mainstream gender in mitigation actions in a substantive and sustainable way. Promising approaches include strengthening women's land rights; supporting women's economic empowerment through access to finance, information, and opportunities; and supporting women's groups.
In recent decades, rapid urbanization in low- and middle-income countries (LMICs) has significantly affected agrifood systems and agricultural development. Innovations in transportation, storage, and value chains, as well as the expansion of nonfarm sectors, have transformed rural communities and reshaped agricultural production patterns. This review revisits the evolving link between cities and agriculture in LMICs, drawing on key theoretical frameworks and recent empirical findings. Three major pathways determining the interaction between urban centers and agricultural development emerge. First, transportation costs and access to urban markets continue to influence agricultural decision-making. Second, changing consumer preferences following urbanization and growing integration into global agrifood value chains drive lasting changes in local farming systems. Third, the expansion of urban nonfarm labor markets is shifting labor away from farms, with uncertain consequences for agricultural development. As a result, the empirical evidence is often context specific.
Carbon dioxide removal (CDR) is an emerging topic in climate policy. We review the nascent economic literature on the governance of CDR and discuss policy design and institutions. We first assess the role of CDR in climate policy portfolios that include abatement and adaptation. Cost-saving technological progress could make CDR a game changer in climate policy: CDR creates new sectoral, intertemporal, and international flexibilities, which reduce overall costs and allow a return to a temperature target after temporary overshooting. Moreover, CDR can reduce the problem of international cooperation due to substantially lower supply-side leakage via fossil fuel markets. A key challenge lies in its governance and incentive structure, which are complicated by the nonpermanence of carbon storage and default risks of the firms committed to future CDR. For CDR governance, we survey approaches that incentivize removals by price instruments or include CDR in (modified) emissions trading schemes.
This article reviews environmental, social, and governance (ESG) criteria and Sustainable Development Goals (SDGs) within the EU policy framework. It evaluates integration of the SDGs into existing sustainability reporting frameworks, advocating for more comprehensive and interdisciplinary approaches to embed long-term SDGs in corporate sustainability reporting. This is considered essential to accelerate the EU business sector's sustainability transformation. Moreover, this review evaluates the effectiveness of current frameworks in influencing firm behavior, particularly in reducing pollution levels, promoting green innovation, and complying with enhanced disclosure requirements. Finally, it concludes by suggesting that, while progress has been made, there is a need for further alignment and refinement of these frameworks to ensure that they drive meaningful corporate action and policy development toward achieving the transformation to sustainability.
The increasing pressure on global water supplies from overexploitation, drought, and pollution necessitates efficient and sustainable water management. Integrated water resource management strategies have shown effectiveness in decision support, but a deeper integration of economic and participative methodologies is needed. This research reviews the core characteristics and directions of experimental economics and living labs (LLs) and aims to address three research questions, namely, how the participatory, real-world environment of living laboratories can be incorporated into the controlled, hypothesis-driven nature of experimental economics; what is the significance of behavioral insights that are derived from experimental economics in the design and implementation of living labs; and how these two approaches can be merged under one framework. The focus of this review is the improvement of water resource management through collaborative and stakeholder-driven innovation. LLs provide authentic environments for cocreation, allowing scientists and stakeholders to address water-related issues such as supply, demand, and shortage. These environments connect controlled experimental conditions with real applications, providing comprehensive insights into behavioral reactions and policy formulation. LLs can enhance and be strengthened by economic methodologies, particularly in water valuation through integrated frameworks accounting for environmental externalities and opportunity costs. Finally, this article shows that integrating behavioral insights and experimental approaches within LLs improves the external validity of experimental economics by putting interventions in real-world settings.
Biofuels are a fixture of modern US fuels markets due largely to the Renewable Fuel Standard, which was passed 20 years ago. We provide a broad overview of modern federal biofuel policies, highlighting key industry trends and policy controversies. We divide our focus into past versus present issues. Past issues include concerns over food price impacts and land use changes due to the policies, as well as the limited ability of mandates to spur investment and bring down the cost of low-carbon cellulosic ethanol production. Present issues include the increasing importance of state policies and the rise of the renewable diesel industry. We conclude by discussing emerging markets for sustainable aviation fuel and the return of concerns around food price effects, land use change impacts, and the scarcity of low-cost, low-carbon biofuels.
This article provides a critical review of the socioeconomic impacts of mining critical raw materials (CRMs), whose global demand is rising at an unprecedented pace due to the ongoing energy transition. Our review focuses on five key socioeconomic aspects: health, employment, human development, public services, and culture. These areas are significantly affected by mining in general, and by CRM extraction in particular, each with distinct features. By critically surveying the scientific literature on the spillovers of extractive industry, this review investigates and highlights the complexity of the interconnected impacts on the communities and regions that host mining projects. Thus, we call for a holistic, interdisciplinary approach to better understand these effects and their interactions. This perspective can help the international community pursue not only the energy transition, but also a just energy transition—one that internalizes the negative socioeconomic externalities and considers social justice, while mitigating environmental harms.
This review describes the history, current practice, and prospects for measuring a population's access to foods for health using the lowest-cost locally available items, in contrast to quantities actually chosen, so as to distinguish between unaffordability of healthy diets and other causes of malnutrition. Retail prices, cost per day, and affordability relative to earnings have been used to measure food access for centuries, driving early definitions of poverty and income thresholds for subsistence. Substitution between items based on food composition was introduced soon after nutrient requirements were quantified, leading to the development of linear programming and other diet modeling techniques. This article describes how and why modern diet cost and affordability metrics have been adopted by international organizations, government agencies, and researchers to monitor food markets and guide intervention, concluding with new frontiers for research on other factors limiting access to healthy diets, such as cooking costs and time use, and factors that cause displacement of low-cost healthy diets by other foods.
This article synthesizes peer-reviewed studies on fertilizer demand and supply in Africa published from 2007 to 2024. This large body of literature is skewed toward fertilizer demand, with little emphasis on critical supply chain challenges such as high costs and logistics, nor does it focus on the rising importance of micro, small, and medium enterprises (e.g., agrodealers), fertilizer production, and blending in Africa. Additionally, most research has focused on a relatively small number of countries and on cereal crops, overlooking Africa's geographic, crop, and dietary diversity. The article advocates for a broader research agenda that recognizes the recent dynamism in African fertilizer markets and challenges posed by climate change, conflict, and other shocks. It emphasizes the critical need for new and better-quality data for this research agenda to be executed and to provide empirical evidence-based guidance for more effective and efficient fertilizer use and, ultimately, enhanced agricultural productivity and sustainability on the continent.
