Econ 260
Environment & Economics
Summer Term 2025 |
Instructor: Staff |
Total sessions: 25 Sessions |
Office Hours: TBA |
Session Length: 145 Minutes |
Classroom: TBA |
Credits: 3 Units |
Class Length: 7 Weeks |
Language: English |
Course Overview:
This course explores the interplay between economic systems and the environment. It applies economic theories to analyze environmental issues and examines policy tools for managing these challenges, focusing on achieving efficient and sustainable outcomes.
Required Material:
Daniel J. Phaneuf and Till Requate, A Course in Environmental Economics: Theory, Policy, and Practice, Cambridge University Press, 2016.
Learning Objectives:
1. Understand the fundamentals of how economic activity impacts the environment.
2. Analyze market failures associated with environmental issues, including public goods and externalities.
3. Evaluate various policy mechanisms used for pollution control and resource conservation.
4. Develop critical thinking skills on sustainable economic development.
Course Outline: Week 1:
Lecture 1-2: Introduction to Environmental Economics
Lecture 1: The economic system and environmental issues Lecture 2: Key concepts in environmental economics
Lecture 3-4: Market Failure and Environmental Degradation
Lecture 3: Public Goods and Common Resources
o Understanding public goods (e.g., clean air) and common resources (e.g., fisheries).
o Why markets fail to provide adequate public goods or sustainably manage common resources.
o Examples of public goods and common resources in environmental contexts.
Lecture 4: The Tragedy of the Commons
o Exploring the idea of overexploitation in shared resources.
o Key theories explaining why individuals overuse common resources.
o Fisheries collapse and deforestation.
Quize 1
More specific requirements (e.g., topic, formatting requirements, deadlines, etc.) will be provided in the course.
Week 2:
Lecture 5-7: The Economic Strategies for Pollution Management
Lecture 5: Externalities and Their Environmental Impacts
o Positive and negative externalities in environmental contexts.
o The role of externalities in contributing to pollution, climate change, and biodiversity loss.
o Industrial emissions and urban air pollution.
Lecture 6: Pollution Taxonomy and Types
o Different types of pollution (air, water, soil, noise) and their characteristics.
o Identifying key sources and understanding the short- and long-term environmental impacts.
o Industrial air pollution in urban areas.
Lecture 7: Efficient Pollution Allocation
o The concept of marginal abatement cost and its role in achieving efficiency.
o Balancing environmental health and economic activity.
o Cost-benefit analysis of pollution reduction in developing economies.
Week 3:
Lecture 8-10: Economic Instruments and Policies in Canada
Lecture 8-9: Economic instruments: taxes, subsidies, and permits
o Exploring Pigouvian taxes, subsidies, and tradable permits as tools for addressing externalities.
o Key considerations in implementing pollution taxes, addressing inefficiencies, unintended consequences, and the balance of flexibility and market risks.
o Carbon taxes in Nordic countries, U.S. renewable energy subsidies, and the Acid Rain Program's SO2 trading showcase different pollution control strategies.
Lecture 10: Case studies in pollution control
o Sweden’s Carbon Tax - Successfully reduced emissions but faced political resistance.
o U.S. Acid Rain Program - Effective SO2 reduction through cap-and-trade, but initial industry opposition.
o EU Emissions Trading System - Reduced emissions, though challenged by low carbon prices.
Midterm Exam: multiple choice, short answer and long answer questions (Contains topics in Lecture 1-10)
Week 4:
Lecture 11-15 : Cost Benefit And Policy Analysis in Environmental Decision-Making
Lecture 11-12: Overview of Canadian environmental policies
o Canada's approach to environmental management includes the Canadian Environmental Protection Act (CEPA), and the Climate Change Plan for Canada focusing on carbon reduction.
o Provinces like British Columbia and Quebec have implemented carbon taxes and cap- and-trade systems to reduce emissions.
o Canada participates in global agreements like the Paris Agreement, committing to reduce greenhouse gas emissions.
Lecture 13-15: Analysis of policy effectiveness and environmental outcomes
o Carbon taxes and cap-and-trade systems have shown mixed results in reducing emissions, with provinces like British Columbia successfully lowering carbon output.
o The CEPA has helped reduce toxic emissions, but enforcement and enforcement gaps persist.
o Policies like the Species at Risk Act aim to protect biodiversity, yet challenges in habitat loss and species decline remain.
Assignment 2
The course will provide more specific requirements (e.g., topic, formatting requirements, deadlines, etc.).
Week 5:
Lecture 16-18: Environmental Benefits and Cost Benefits Analysis
Lecture 16-18: Methods of valuing environmental benefits and costs
o Market-based methods, such as Willingness to Pay, Hedonic Pricing, and the Travel Cost Method, estimate the value of environmental benefits based on people's preferences, property values, and visitation costs.
o Non-market valuation methods, like Contingent Valuation and Benefit Transfer, estimate the monetary value of environmental goods using surveys and existing studies.
o Cost-benefit analysis (CBA) compares the costs and expected benefits of environmental policies, including non-market values.
Week 6:
Lecture： 19-21: Environmental Impacts and Sustainable Development
Lecture 19-20: Challenges in measuring environmental impacts
o Limited reliable data and difficulty in valuing non-market goods like biodiversity and ecosystem services.
o Challenges in predicting long-term environmental impacts and isolating specific causes due to interconnected factors.
Lecture 21: Concepts of sustainable development
o Meeting present needs without compromising future generations, balancing economic, social, and environmental dimensions.
o Intergenerational equity and the precautionary principle to protect resources and prevent environmental harm.
Week 7:
Lecture 22-25: Case Study and Sustainable Development
Lecture 22: Pollution Decision and Environmental Case Study
o Pollution decisions and the Coase Theorem, regulatory instruments, standards, taxes and subsidies, marketable permits
o Regulatory Instruments Game and Case Study
Lecture 22-23: Trade-offs between economic growth and environmental protection
o Economic development often leads to resource use and pollution, challenging sustainability.
o Short-term growth may conflict with long-term environmental goals.
o Green technologies and circular economy approaches help balance growth and environmental protection.
Final Exam: multiple choice, short answer and long answer questions (Contains topics in All Lectures)
Grading Assessment:
Quizzes |
15% |
Assignment 2 |
15% |
Midterm |
30% |
Final exam |
30% |
Seminar Participation |
10% |
Total |
100% |
Quizzes:
In-class quizzes including 40 multiple-choice and two short answer analysis. The quiz is worth 15% of the final grade. No make-up quizzes. Students must provide valid reasons and official doctor's notes to explain the absence.
Assignment:
Students are required to complete an environmental economic analysis essay during the semester, ranging between 500-800 words. The essays should demonstrate analytical thinking, clear organization, and proper use of evidence to support arguments. Grading will assess the clarity of writing, logic, grammar, and syntax, alongside the depth of analysis and proper citation of references. Specific requirements regarding topics and deadlines will be provided during the
course. Essays will be submitted electronically, and students will receive feedback on the first essay to guide improvement for the second.
Attendance:
Students are required to attend a weekly seminar led by TA to focus on the week's topic and deepen understanding. Seminar time assigned by TA. Seminar attendance counts toward the final grade.
Exams:
The examinations in this course consist of multiple choice, short-answer and long-answer
questions. The final exam is cumulative.
Final Evaluation:
Letter Grade |
Percentage (%) |
Letter Grade |
Percentage |
A+ |
≥95 |
C+ |
64-67 |
A |
89-94 |
C |
60-64 |
A- |
84-88 |
C- |
56-59 |
B+ |
79-83 |
D+ |
54-56 |
B |
73-78 |
D |
50-53 |
B- |
68-72 |
F |
≤50 |
General Policies:
Academic integrity
Academic integrity is the cornerstone of academia and requires students and researchers to
maintain honesty, fairness, trust and responsibility in all academic activities. It includes not only avoiding dishonest behaviors such as plagiarism, cheating, and falsifying data, but also requires taking responsibility for one's own academic actions and ensuring that all work is done
independently and accurately cites the research of others. Violations of academic integrity can result in severe academic penalties, such as zero grades, suspension or even expulsion, and can cause serious damage to an individual's reputation and future career. Upholding academic
integrity is therefore essential to promoting a fair academic environment and facilitating the authentic dissemination of knowledge.
Accessible Resources Policy
The policy ensures that all students, especially those with disabilities, are able to participate equally in school learning and activities. The school provides a wide range of accessibility
resources including, but not limited to, specialized classrooms, hearing aids, Braille textbooks, assistive technology, and flexible testing arrangements. Students are required to apply to the school in advance and provide appropriate medical or psychological evaluations so that an
individualized support plan can be developed for them. This policy is designed to remove barriers in the academic environment and to ensure that every student has access to equitable learning opportunities.
Withdrawal Policy
Students may choose to withdraw from a course within a specified period of time, and may not be able to do so after the expiration date. When withdrawing from a course, students are required to fill out a withdrawal form with a reason, which will be reviewed and processed on a case-by- case basis. Withdrawal from a course may not affect the student's academic performance. If a student withdraws from a course with incomplete requirements, a “W” may be assigned instead of a grade, depending on the course.
