Environmental and Climate Economics Course

This module examines the concept of environmental externalities, which are costs and benefits that are not reflected in market prices. Participants will learn about the various types of externalities, such as air and water pollution, deforestation, and habitat destruction, and their impacts on society and the environment. The module explores how externalities arise from economic activities and the role of government intervention, market-based instruments, and how policies can be used to address them.

In this module, participants explore the economic challenges associated with common property resources and public goods. Common property resources, such as fisheries, forests, and grazing lands, face the problem of overexploitation due to the lack of clear property rights. Public goods, such as clean air and national defence, are non-excludable and non-rivalrous, leading to under-provision in the absence of government intervention. Participants learn about the economic theories and policy approaches aimed at managing common property resources and providing public goods efficiently.

This module focuses on methods for valuing environmental goods and services that are not traded in markets. Participants will learn about different valuation techniques, such as stated preference methods (e.g., contingent valuation, choice experiments) and revealed preference methods (e.g., hedonic pricing, travel cost method). The module covers the strengths and limitations of each method, as well as ethical considerations and challenges associated with valuing environmental assets.

Cost-Benefit Analysis (CBA) is a key tool used to assess the economic efficiency of environmental policies and projects. In this module, participants learn how to conduct CBA to compare the costs and benefits of alternative courses of action, considering the environmental, social, and economic impacts. Topics covered include discounting, sensitivity analysis, uncertainty, and the incorporation of non-market values into CBA.

This module examines the economic causes and consequences of pollution and the design of pollution control policies. Participants will learn about the different types of pollution (e.g., air pollution, water pollution, noise pollution) and their sources, as well as the economic theory of pollution control, including command-and-control regulations, market-based instruments (e.g., pollution taxes, cap-and-trade), and voluntary approaches. The module also explores the effectiveness, efficiency, and distributional impacts of various pollution control policies.

Dr Richard Meade provides a high-level overview of how economists frame and address environmental and climate change challenges and uses the transition to net zero emissions in transport as a case study to highlight the range of policy and regulatory approaches that might be used to address that challenge.