Departmental news

“Under the market, both the efficiency of the trading platform and the higher level of compliance allowed regulators to reach their environmental goals, while lowering abatement costs for plants,” says study co-author Dr Anant Sudarshan. “The market is a win for both government and industry, as well as for the public by reducing air pollution.”

Particulate air pollution is causing a public health crisis in many lower-income countries, with the average person in India losing more than 3 years of life expectancy according to research. Lower-income countries tend to rely on command-and-control approaches to regulating pollution, which are difficult to enforce, even though pollution markets, also known as cap-and-trade programs, have a strong track record of reducing pollution at low costs in the United States and Europe.

A new study, Can Pollution Markets Work in Developing Countries? Experimental Evidence from India published in the May issue of The Quarterly Journal of Economics, describes the design of, and experimentally evaluates, the world’s first cap-and-trade market for particulate pollution. The market has been operating for more than five years in Gujarat, India. Its success demonstrates that pollution markets can work in low- and middle-income countries where pollution is frequently very high and state capacity is often low.

The study finds:

• The plants that participated in the market reduced particulate emissions by 20 to 30 percent overall relative to plants that did not participate in the market.
• It cost plants that participated in the market 11 percent less to abate emissions compared to those plants under the command-and-control regulations.
• The emissions trading system (ETS) functioned well: plants held enough permits to cover their emissions 99 percent of the time, while those plants outside of the market met their pollution limit at most 66 percent of the time.
• In total, the benefits of the market exceed its costs by at least 25 times.

“The market delivered a rare win-win-win by reducing pollution, decreasing abatement costs, and raising government’s success at enforcing the law. And, it did all this in a setting where there was great skepticism that pollution markets could work,” says study co-author Michael Greenstone, the Milton Friedman Distinguished Service Professor in Economics at the University of Chicago. “This success of pollution markets is generating a great deal of interest from other governments that are trying to balance the goals of economic growth and environmental quality. In addition to our continuing collaboration with the Gujarat Pollution Control Board, we’re now working with other states in India and governments in other countries to scale-up the use of pollution markets.”

Greenstone and his co-authors Anant Sudarshan of the University of Warwick, and Rohini Pande and Nicholas Ryan, both of Yale University, worked with the Indian state of Gujarat to launch and evaluate the market in the city of Surat. The government mandated 317 large, coal-burning plants to install pollution monitors. From there, half the plants were randomly assigned to the market while the rest were kept under traditional regulations. The plants in the market were given a cap on the total amount of pollution they could emit. Those that easily met the cap traded permits with those who could not meet the cap, with both buyers and sellers benefiting.

“We have worked with the Gujarat Pollution Control Board for over a decade on testing policy interventions such as altering the incentives of third-party pollution monitoring and sharing emissions information with the public,” Nicholas Ryan says. “This collaboration is setting a path for environmental policy across India.”

The plants that participated in the market reduced particulate emissions by 20 to 30 percent overall, relative to plants that were experimentally assigned to continue with the status quo form of regulation. Further, plants that participated in the market benefited from 11 percent lower pollution abatement costs that increased their profits.

From a legal or regulatory perspective, the market also functioned almost perfectly—with plants holding enough permits to cover their remaining emissions 99 percent of the time. By contrast, those plants outside of the market were in violation of their pollution limits at least a third of the time.

When the researchers put it all together, the benefits of the market exceeded the costs by at least 25 times. It is usually a cause for celebration when a program has a benefit-to-cost ratio of 1.2, so this finding suggests there is a tremendous opportunity to be had in using pollution markets. The high benefits come from the large mortality costs of air pollution and the low costs of abatement in the market.

Because of the success of the market, the Gujarat government expanded it to include those plants originally left out of the pilot experiment. It also launched a second market in the city of Ahmedabad—Gujarat’s largest city and a major industrial hub—and is exploring expanding the market regime to additional industry clusters and pollutants, as well as additional cities. Meanwhile, the research team is working with another Indian state to develop a statewide market for sulfur dioxide emissions. The research team is providing strategic advice to several other Indian state governments and beginning conversations with other countries on how to use markets to meet their environmental and climate goals.

“The exciting part of the emissions trading scheme that we did for particulate matter,” Rohini Pande says, “aside from reducing emissions, is that it provides a proof of concept that even in a setting with lower state capacity, a compliance market can work, and often will outperform the command-and-control approach.”

• Can Pollution Markets Work in Developing Countries? Experimental Evidence from India Michael Greenstone, Rohini Pande, Nicholas Ryan, Anant Sudarshan The Quarterly Journal of Economics, Volume 140, Issue 2, May 2025, Pages 1003–1060, https://doi.org/10.1093/qje/qjaf009
• Read the research summary
• The research team behind this work is affiliated with the Energy Policy Institute at the University of Chicago’s India program (EPIC-India), J-PAL South Asia, and the Economic Growth Center at Yale University.
• The research team was awarded funding to scale the market by J-PAL’s King Climate Action Initiative (K-CAI), and J-PAL South Asia's Solutions and Advancements through Research for Water, and Air (SARWA) and Alliance for Scaling Policy Impact through Research and Evidence (ASPIRE)..

The University held its annual research celebration earlier this week. At the event, Adrian Fowle was announced as one of the winners of the “Research Enabler” award for 2025. This is a very well deserved recognition - Congratulations, Adrian!

Congratulations to all the winners.

Eloisa Ocando Thomas and Jingyang Xu (both History): EDIBLE BOUNDARIES: Food, Identity, and the Material Culture of Eating and Drinking

Xiaoyan Tan (SMLC and Gustavo Ruiz da Silva (Philosophy): (Neo)Colonial Images and Literature: The Construction of the Other

Archana Vinod (English) & Malvika Nair (SMLC): Is a Better World Possible? - Solidarity as a Conversation across Temporalities

Cells contain a myriad of vesicle types with distinct behaviours and functions. Intracellular nanovesicles (INVs), collectively marked by the membrane protein TPD54, are a recently described family of small, uncoated vesicles that move mainly via diffusion. Many subtypes or ‘flavours’ of INVs appear to exist and participate in various trafficking processes. In this study (Fesenko et al., 2025), the Royle lab report the first INV proteome and explore whether ATG9A vesicles, small vesicles involved in autophagosome biogenesis, are in fact a flavour of INV. The INV proteome shows overlap with proteomes from synaptic vesicles, synaptic-like microvesicles (SLMVs) and ATG9A vesicles, which are particularly enriched for TPD54. To determine whether TPD54-containing vesicles also contain ATG9A and vice versa, the authors ‘trap’ each vesicle type by relocalising them to mitochondria and observe how the other vesicle marker responds. Trapping of TPD54 also relocalises the bulk of ATG9A vesicles, whereas trapping of ATG9A only affects a fraction of TPD54 vesicles, suggesting that ATG9A vesicles are a specific subset of INV. Moreover, trapping of INVs relocalises several proteins established to be ATG9A vesicle cargoes. ATG9A vesicles are thought to function as ‘seeds’ for growing phagophores, and the authors indeed observe that TPD54 depletion dampens autophagy in starved cells. Together, these data indicate that ATG9A vesicles represent a new INV flavour and implicate INVs in autophagic regulation.

Read the paper here.

Read the interview with first author Mary Fesenko.

WMG was pleased to welcome Richard Parker, Mayor of the West Midlands, and representatives from the Department of Transport and the logistics industry, on to campus to hear more about its Last Mile Logistics Project.

The Last Mile Logistics Project is a partnership between WMG and Transport for West MidlandsLink opens in a new window (TfWM), and is funded by the West Midlands Innovation AcceleratorLink opens in a new window.

As part of the project, the University of Warwick campus is being used as a testbed for a small fleet of low-speed electric delivery vehicles to demonstrate how they can help the UK reach Net Zero, while cutting congestion and improving air quality.

It’s the ultimate quest for modern businesses - how to reduce environmental impact, remain competitive and align to customer values that increasingly drive buying decisions. But how much do we really understand about what it takes to bring us products and services? And how can businesses meet our demands without it costing the Earth?

These were the many themes discussed at the recent WMG Alumni webinar, from why supply chains are something we should all care about, to why businesses cutting waste is key, and how advances in technology could be supply chains’ missing link.

It is with great sadness that the Department of History announce the death of Professor Fred Reid.

In this Open Biology paper from the Dean lab, Athina Paterou and her co-authors present a set of >100 plasmids that allows endogenous gene tagging using a diverse set of protein tags and drug resistances. This facilitates extensive protein-protein interaction studies, biochemistry, and microscopy techniques understand protein function. They perform extensive validation of these tags, identifying the best (brightest, most stable) fluorescent protein for different applications, and highlighting the effect of tandem epitope tags on protein localisation and function in expansion microscopy appraches. To meet the needs to the parasitological community, they show the plasmid series works in related parasites, such as Leishmania mexicana, and create a plasmid for tagging GPI-anchored proteins.
Read the paper here.Link opens in a new window