Environmental Economics
NRE 571 / Econ 471
Credits: 3
Prerequisites: Econ 401 or NRE 570.

This course is a three-part introduction to the economics of environmental policy. The first part of the course compares the four main policy measures used to regulate polluters, namely (1) imposing taxes on pollution, (2) setting standards on allowable emissions, (3) issuing tradeable pollution permits, and (4) holding polluters legally liable for environmental damages. Also, a new policy measure is discussed that has recently become popular, namely (5) simply making information about the pollution available to the public. These measures are compared in terms of their overall efficiency, the incentives for technological innovation that they provide, and their ease of enforcement. The second part of the course discusses why it is difficult to put a dollar figure on the benefits of environmental regulation, and how economic theory can be used to get around this problem. Finally, the third part of the course covers miscellaneous topics such as the economics of biodiversity, the environmental effects of trade and development, and the economics of global warming.