Review of Environmental, Economic and Policy Aspects of Biofuels

By Deepak Rajagopal, David Zilberman. 2007

333 citations recorded by the source corpus.

The world is witnessing a sudden growth in production of biofuels, especially those suited for replacing oil like ethanol and biodiesel. This paper synthesizes what the environmental, economic, and policy literature predicts about the possible effects of these types of biofuels. Another motivation is to identify gaps in understanding and recommend areas for future work. The analysis finds three key conclusions. First, the current generation of biofuels, which is derived from food crops, is intensive in land, water, energy, and chemical inputs. Second, the environmental literature is dominated by a discussion of net carbon offset and net energy gain, while indicators relating to impact on human health, soil quality, biodiversity, water depletion, etc., have received much less attention. Third, there is a fast expanding economic and policy literature that analyzes the various effects of biofuels from both micro and macro perspectives, but there are several gaps. A bewildering array of policies - including energy, transportation, agricultural, trade, and environmental policies - is influencing the evolution of biofuels. But the policies and the level of subsidies do not reflect the marginal impact on welfare or the environment. In summary, all biofuels are not created equal. They exhibit considerable spatial and temporal heterogeneity in production. The impact of biofuels will also be heterogeneous, creating winners and losers. The findings of the paper suggest the importance of the role biomass plays in rural areas of developing countries. Furthermore, the use of biomass for producing fuel for cars can affect access to energy and fodder and not just access to food.

Subfields: Pollution, Renewable Energy, Sustainability and the Environment

View Paper: https://www.semanticscholar.org/paper/80f6fc2aa14eaffa2376736419c8bb5660a30190

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Citations in the corpus

Impact of Biofuel Production on World Agricultural Markets: A Computable General Equilibrium Analysis (2007, neutral): “Rajagopal and Zilberman (2007) provide an extensive review of the literature on environmental, economic, and policy studies on biofuels.”
Systematic review of effects on biodiversity from oil palm production (2014, background): “Over the last decade there has been a growing interest in bioenergy, especially biofuels, that has been driven by concerns about global climate change, increasing energy demand, and reducing dependence on fossil fuels (Rajagopal and Zilberman 2007).”
Biofuel-related price transmission literature: A review (2013, background): “Reviews of the literature investigating the economic impacts of biofuels have paid special attention to structural models (Kretschmer and Peterson, 2010; Rajagopal and Zilberman, 2007).”
Understanding why firms should invest in sustainable supply chains: a complexity approach (2012, background): “…resources, require greater energy and chemical usage, and reduce biodiversity through expansion into protected areas such as the Amazon rainforest (Rajagopal and Zilberman 2007).1 The Brazilian government has responded to these criticisms by introducing the Social Fuel Stamp scheme2 that provides…”
The Social Costs and Benefits of Biofuels: The Intersection of Environmental, Energy and Agricultural Policy (2010, background): “Many studies emphasize several key benefits of ethanol policy, including reduced tax costs for farm subsidy programs, reduced fuel prices, and improved international terms of trade in both corn exports and oil imports (Gardner 2007; Rajagopal et al. 2007; de Gorter and Just 2009a; Schmitz, Moss, and”
The Economics of a Blend Mandate for Biofuels (2009, neutral): “As well, biofuel policies are often cited as means to improve farm incomes, reduce the tax costs of farm subsidies, and enhance rural development (Rajagopal and Zilberman 2007).”
Will EU biofuel policies affect global agricultural markets (2008, methodology): “Rajagopal and Zilberman (2007) also state that 'biofuels affect not only farmers, but also affect agro-industries, the well-being of consumers, balance of trade, and the government budget.”