Government Ownership Versus Regulation of Mining Enterprises in Less-developed Countries

Less-developed government equity in mining projects has become increasingly popular, both in academic literature and in practice. Despite this, it has received surprisingly little scrutiny: this paper analyses the reasons for LDC governments taking equity in mineral projects and discusses whether equity is the most appropriate means of achieving these objectives. It concludes that equity has few unique advantages over taxation and other government powers of regulation in achieving the diverse objectives of government. It further concludes that the advantage to a government of equity participation will probably increase with the degree of development of the economy.     

State mineral production taxes and mining law reform

Fuel and leasable minerals mined in the United States have historically been subject to federal royalties while locatable minerals have not. In recent years there have been multiple attempts to alter this policy and subject locatable minerals to federal royalties as well; most recently the preliminary 2012 Obama budget included a gross royalty on hard-rock mining on public lands. This paper analyzes the issue of imposing such federal royalties from both a legal and economic perspective. From a legal perspective, it is argued that the state of western property rights precludes royalties on currently extant claims so revenues from a royalty would not be realized for many years. From an economic perspective, it is argued that the effect on revenue would be smaller than one might anticipate due to such a royalty crowding out state levies or encouraging vertical disintegration on the part of mining firms to avoid much of the burden of the royalty.     

An economic appraisal of the Australian oil and gas industry

The author assesses Australian oil and gas production within the context of overall domestic energy supply and demand. Future domestic production of petroleum is unlikely to meet more than 60% of domestic demand after this decade, although gas reserves should be adequate until 2000. Important economic issues - leasing, royalties, taxation, pricing, and exploration incentives - and their relationship to future supply and demand, are identified and evaluated.     

Natural Resource Dependency and Decentralized Conservation Within Kanchenjunga Conservation Area Project,Nepal

Kanchenjunga Conservation Area Project (KCAP) in Nepal is among the first protected areas in the world to institute a completely decentralized system of conservation and development. Proponents of decentralized conservation claim that it increases management efficiency, enhances the responsiveness to local needs, and promotes greater equity among local residents. This study assessed local equity by evaluating the levels of dependencies on natural resources among households and the factors affecting that dependency. Data were collected via detailed surveys among 205 randomly selected households within the KCAP. Natural resource dependency was evaluated by comparing the ratio of total household income to income derived from access to natural resources. Economic, social, and access-related variables were employed to determine potential significant predictors of dependency. Overall, households were heavily dependent on natural resources for their income, especially households at higher elevations and those with more adult members. The households that received remittances were most able to supplement their income and, therefore, drastically reduced their reliance on the access to natural resources. Socio-economic variables, such as land holdings, education, caste, and ethnicity, failed to predict dependency. Household participation in KCAP-sponsored training programs also failed to affect household dependency; however, fewer than 20% of the households had any form of direct contact with KCAP personnel within the past year. The success of the KCAP as a decentralized conservation program is contingent on project capacity-building via social mobilization, training programs, and participatory inclusion in decision making to help alleviate the dependency on natural resources.     

Net value royalties : Practical tool or economist's illusion?

The petroleum industry has traditionally generated substantial revenues for governments. Where governmental power is divided, as in federations like Canada and Australia, a junior level of government normally collects royalties while the senior level levies a variety of imposts (income tax, export duties, excises on production). The combination of recent sharp reductions in prices, more price volatility and an era of freer markets has subjected existing tax and royalty systems to severe strain and has shifted attention to the design of fiscal systems that are more profit- sensitive. For the royalty element, interest focuses on net value royalties (NVRs). This paper deals with the nature and problems of NVRs. It proceeds by looking first at the application of resource rent royalties in Australia. It then focuses on recent megaproject royalty arrangements in Alberta and evaluates the degree to which Alberta's current royalty system is profit- sensitive. Problems associated with NVRs are discussed in the fourth section; concluding remarks are made in the last section.     

Policies for tin exporters

The ‘restructuring’ of production and marketing is now an important part of less developed countries' (LDCs) policies to increase their gains from primary commodity exporting. Analysis of structural change in the tin industry shows that considerable increases in real income have been achieved by taxation and by equity restructuring. Specialist foreign tin companies have been replaced in part by major mining multinationals, however, whose bargaining power is stronger. Investment appraisals suggest that foreign companies in Asia have not been taxed excessively, but that more could be done to aid local, labour-intensive mining.     

Petroleum exploitation and contract terms in developing countries after the oil price collapse

In resource taxation the critical fiscal requirement is a scheme which performs the twin functions of ensuring that projects which are viable on a pre-tax basis remain so post-tax, and that the host government obtains a reasonable share of the economic rent. Royalty, income tax, production-sharing and the resource rent tax are examined in the light of their efficiency at meeting these two criteria. The resource rent tax is probably the most appropriate fiscal instrument because this tax permits a threshold rate of return to be earned before the tax becomes payable. One drawback is that during the early years of a project the host government may receive little or no revenue. An advance resource rent tax can be used to eliminate this shortcoming. A further problem is the disincentive to exploration which can be produced.     

From insight to action in reservoir management—lessons from Asia

The World Commission on Dams (WCD) has now presented its final report on the problems with large dams. Many dam projects were found to be underperforming, especially those built for irrigation purposes. WCD also reports that many projects fail to meet current standards of social equity. A reallocation of costs and benefits is needed, but entrenched interests make this a difficult task. This article identifies shortcomings in large Asian irrigation projects: why the problems emerged, and what could be done to improve the performance of existing projects. The article argues that Asian irrigation agencies take mainly an engineering perspective, focusing on the dam itself. In a large number of cases, it takes over 10 years for the infrastructure to be installed and for the water to be delivered to the fields of the command area. Agencies need to improve their competence in dealing with social and environmental issues. This article argues that social and economic infrastructure is often inadequate; there is a need for an integrated view of the role of agriculture in development. Furthermore, adaptive management practices and water user participation can often be critical elements. To be successful, participation needs to be gender sensitive, and stakeholders at all income levels need to be consulted. To bridge the gulf between rhetoric and action, there is also a need for independent evaluation of dam projects.     

From Siting Principles to Siting Practices: A Case Study of Discord among Trust,Equity and Community Participation

This paper contributes to the noxious facilities siting literature by exploring some implications of adhering to some recommended principles and practices for competent siting. Through a qualitative case study of a landfill siting process in Peel (Ontario, Canada) three principles are critically assessed: trust; equity; and community participation. While laudable notions in principle, in practice they can impact each other in important ways which can (potentially) undermine the siting process. These impacts result mainly from the failure to achieve meaningful goals associated with one principle (e.g. community participation) which can exacerbate problems achieving goals associated with other principles (e.g. trust). The resulting discord can be further aggravated by the snowballing of adverse effects over time. In particular, practices for achieving trust and equity were adversely linked, as were the relationships between spatial equity and procedural equity and interregional and intraregional equity. These adverse synergisms were linked together with ineffective community participation which brought the process to a halt. Siting inertia (a process momentum difficult to redirect) and an inflexible siting context contributed to these conflicts. Implications for siting and further research are discussed.     

Mining investment promotion

Attitudes in developing countries with respect to private investment in natural resources have changed substantially in recent years. Countries must now compete for such investment by ensuring that policies pertaining to state participation, financing, marketing and taxation of mining ventures provide the investor with returns that are commensurate with the risks taken. Governments must also be prepared to help the investor compete on world markets through lower capital and operating costs. This entails granting exemptions of customs, excise and value added taxes as well as providing for policies on taxation, government participation, industrial relations, safety and environment, and procurement and personnel that are in line with international mining industry standards. Efforts to promote mining sector investment through the strengthening of technical ministries, preparation of basic geological and project information, investment symposia and an international mining council can be helpful in bringing opportunities to the attention of the investment community. But, these efforts can only succeed if the policy changes now being put into place continue to evolve and contribute to an atmosphere in which entrepreneurship and private investment can flourish.     

现行资源税设置中存在的问题及对策

对资源征税的意义不仅在于增加财政收入,更重要的是促进资源的有效管理,为国民经济持续、稳定的发展提供可靠保证。从这个目的出发,就资源税设置中存在的一些问题进行了深入探讨,以期使资源税的征管工作能在国民经济运行中发挥更大作用。     

现阶段我国收入分配格局探析

现阶段我国居民收入分配差距的扩大在近年来越来越严重,这不仅表现在城乡居民间,还表现在不同行业之间、不同地域之间等各个方面。从上述三个方面出发,对现阶段我国居民收入分配格局进行了初步分析,并从非均衡经济、经济体制、税收制度和公共服务角度分析了造成差距的原因,提出了深化收入分配制度改革等相关对策建议,对如何缩小收入分配差距,改善现状具有参考意义。     

Indigenous people and mineral taxation regimes

Indigenous people in a number of major mineral-producing countries have established a substantial and growing capacity to tax mineral resources extracted from their traditional lands. However, almost no analysis has been conducted regarding the conceptual and practical issues involved in designing mineral taxation regimes for use by indigenous people. The general literature on mineral taxation is of limited relevance because basic assumptions it makes regarding the nature of the taxing authority (national or state governments) do not apply to indigenous peoples. This article discusses some key characteristics of indigenous communities as they relate to taxation of mineral resources. Against this background, it identifies a number of approaches to mineral taxation which might be utilized by indigenous groups and which acknowledge the specific constraints and circumstances they face while at the same time recognizing their need to attract and maintain investment on their traditional lands. It also reviews the inter-relationship between indigenous and state or governmental tax regimes.     

An Empirical Analysis of the Effects of China’s Land Conversion Program on Farmers’ Income Growth and Labor Transfer

In this article, we hypothesize that in addition to participation status and household characteristics, the impact of China’s Sloping Land Conversion Program on income growth and labor transfer is determined by local economic conditions, program range, and political leadership, and the degree of impact on income may vary among different economic sectors. To test these propositions, we have compiled a panel data set of 600 households in three counties in the Loess Plateau region, with observations for times both prior to and after the program’s inception (1999 and 2006), for both aggregate and categorical incomes, and for both participating and non-participating households. Using a difference in differences model and repeated cross-sectional data, we find that participation status, local economic conditions, program extent, and political leadership indeed have significant impacts on household income and off-farm employment. Moreover, the effects of participation on crop production income, animal husbandry income, and off-farm income vary substantially. These results carry major policy implications in terms of how to improve the effectiveness and impact of ecological restoration efforts in and outside of China.     

The practice of participatory research and gender analysis in natural resource management

Stakeholder participation is expected to improve the efficiency, equity, and sustainability of natural resource management research and development (R&D) projects by ensuring that research reflects users’ priorities, needs, capabilities, and constraints. Use of participatory methods and tools is growing rapidly; however, there is little systematic evidence about what participation actually means in practice, or about what difference it makes. Based on an inventory of 59 self‐described participatory R&D projects in the area of natural resource management, this article characterizes the typical project and analyzes how stakeholders are selected, how they participate in the research process, and what their involvement means for project costs and impacts. The results suggest that, while projects are generating a range of direct and indirect benefits for participants, more careful attention needs to be paid to achieving equitable impacts. Current practices may lag behind best practices in key areas, such as power sharing and participant selection, and may therefore be missing important contributions from women and other marginalized groups.     

The dilemma of the mining royalty: contractual or realty interest

At common law, the legal nature of a mining royalty between private parties will decide the respective rights of payor and recipient. In some circumstances, it will also determine whether the interest of the recipient will prevail or may be lost and ignored. Industry practices, even those of long standing, that are contrary to the law will not change the law or its effect to meet such concerns. This paper looks at the development of the mining royalty between private parties in Canada and the effect of the realization by recipients that contractual royalties, as opposed to royalties that are interests in the lands or product to which they relate, can be lost in certain circumstances. Suggestions are made for some features that may assist in transforming an otherwise contractual royalty into a real property interest. Some of the concerns for both payor and recipient with respect to the implementation of such suggestions are also discussed.
The article has two appendices attached. Appendix A is an extract from an article by the author discussing the concept of payment of a royalty in kind which is relevant to such suggestions. Appendix B contains some of the more lengthy explanatory notes referred to in the text of the article.     

Petroleum royalties and regional development in Brazil: The economic growth of recipient towns

In 1997, Brazil approved law n^er 9478, establishing new rules for sharing petroleum royalties with Brazilian municipalities. The goal of this paper is to evaluate whether royalties distributed under the new law have contributed for the development of benefited municipalities. For that the difference-in-differences estimator (diff-in-diff) is used, which compares the evolution of the economic product into the municipality affected by the new law with the unaffected ones, by exploring the new legislation as an exogenous change. The data refer to the municipal gross domestic product (GDP) growth rate before and after the event. Results are surprising, showing that royalty receivers grew less than municipalities that did not receive such resources. The difference is small but statistically significant. In general, an increase of one real in royalties per capita reduces the growth rate of the municipal product in 0.002 percentile points.     

SOCIAL CLASS DIFFERENCES IN RESERVOIR VISITS1

ABSTRACT: Previous research provides evidence of a socioeconomic bias in outdoor recreational participation. One explanation of this bias is that socioeconomic groups have differential opportunities to participate, with the “costs” of this participation especially serving to restrict the recreational access of lower class persons living in urban areas. Using driving distance as a measure of cost, this study assessed the effects of travel costs on the attendance of three social class groups from an urban population at rural reservoir facilities. Findings support the contention that, while increased driving distance has a dampening effect on recreational participation, this effect is most pronounced for the lower class person. These findings point to the importance of equity considerations in the planning of outdoor recreational facilities.     

Waste Management in Guangdong Cities: The Waste Management Literacy and Waste Reduction Preferences of Domestic Waste Generators

A questionnaire survey was conducted in 2002 on 1365 households in two prefectural-level cities in the Pearl River Delta, Jiangmen and Zhongshan. Three groups of issues are covered in this paper: 1) waste management literacy, concerns, and public participation; 2) waste recycling practices and the potential for waste avoidance; and 3) public environmental literacy. This study confirms findings from previous surveys and provides new information on important issues such as imposing monetary charges on waste and environmental activities, littering, source separation programs (SSPs), and public participation and expectations in local waste management. Saving up recyclable materials for redemption in waste depots is commonly practiced in mainland China regardless of the level of development of a city, although at the household level, high-income families tend to place less value on the revenues to be gained from redemption than lower income groups do. Data from the previous and the present studies indicate that such voluntary but largely economically driven waste recovery behavior diverts at least 10% of the household waste from the waste stream. Although uncompensated SSP is less appealing in the two cities than compensated SSP, it was found that when the median per capita income of a city reaches RMB2000 per month, a high participation rate for uncompensated waste recovery is more likely to occur. Education and income levels are the chief factors affecting littering behavior and the potential for waste avoidance. Contrary to general belief, the local Chinese community is active in microwaste management. The concern, however, is over the inability of the grassroots bureaucracy to deal with rising expectations for waste collection services and neighborhood cleanliness.     

THE POTENTIAL IMPACT OF WATER REALLOCATIONS ON AGRICULTURE IN IDAHO1

ABSTRACT: Economics is concerned with the allocation of resources between alternative uses. Traditionally, in the western United States, water resources have been committed to agriculture and irrigation. Other competitive uses such as power, industry, and recreation are challenging this allocation. What are the impacts of shifting water out of agriculture into other uses, is a question that needs to be given consideration. Ilia paper attempts to evaluate the tradeoff between using farm land for either irrigated or dryland production and the resulting impacts on gross farm income and the average price of land. Baaed on historical data, reducing irrigated acreage and increasing dryland acreage could greatly reduce both farm income and the equity in farming. The model presented in this paper should be useful for evaluating the tradeoffs between dryland and irrigated land use, especially when there are gat differences in productivity such as those that exist in the inter-mountain region of the Western United States.