290009 Economic Theory of Environmental Policy

Details
Institute of Food and Resource Economics
Earliest Possible YearMSc. 1 year to MSc. 2 year
DurationOne block
 
Credits7.5 (ECTS)
Course LevelMSc
 
ExaminationContinuous Assessment

written examination and oral examination

Portfolio Examination


All aids allowed

Description of Examination: 3 exercises (2 pages each) 1 paper (6 pages) and presentation of paper

Weight: Each exercise 15% (total 45%) Paper 45% Presentation 10%



7-point scale, internal examiner
 
Organisation of TeachingLectures and exercises
 
Block PlacementBlock 1
Week Structure: A
 
Teaching LanguageEnglish
 
Mandatory PrerequisitesMicroeconomics (BA) Environmental and natural resource economics (BA) Welfare economics and policy analysis
 
RestrictionsNone
 
Areas of Competence the Course Will Address
Competences obtained within basic science:

Understanding and comprehension of the economic theory of environmental policy
Transfer of the theories to new areas within environmental economics
Being able to evaluate the possibilities and limitations of the theory

Competences obtained within applied science:

Comprehend the causes of pollution and the methods used to regulate pollution
Apply the knowledge obtained to new environmental issues

Competences obtained within ethics & values:

Is able to discuss to the ethical problems with economic incentive regulation
 
Course Objectives
It is the objective of this course to provide a comprehensive presentation of the theoretical and methodological aspects of the economic theory of environmental economics, especially of environmental policy.
 
Course Contents
The central themes of the course are causes of pollution and the design of incentive based policy instruments. The main components of the course are

1) Market failure as the explanation for pollution. Here several cases of market failure will be analyzed. Examples are externalities, common property goods and public goods.

2) The design of environmental policy instruments. Here the emphasis will be on instruments that set incentives to reduce emissions such as taxes, subsidies, tradable permit schemes and liability rules. Issues covered are the regulation of point and non-point pollution, emissions and ambient regulation, optimal regulation under uncertainty, uniformly and non-uniformly mixed pollutants and the political economy of instrument choice. Furthermore, in connection with taxes we will discuss the existence of a double dividend and under tradable permits the issue of market power will be analyzed.

3) International environmental problems. International environmental pollution causes some special problems compared with national pollution. the main problem here is that countries cannot be forced to reduce emissions when their pollution causes damage in other countries. In this part, we will discuss the origin of the problem and possible solutions such as side payments, issue linkage and coalition formation.


 
Teaching And Learning Methods
Teaching is given in the form of lectures, and practicals. The lectures will present the main themes of the course. The practicals deal with more technical issues and will give a platforms to discuss exercises.
 
Learning Outcome
Stipulated in "Areas of Competence the Course Will Address"
 
Course Litterature
Hanley, N., Shogren, J.F. and White, B.: Environmental Economics in Theory and Practice, Macmillan Press, 2006.

Baumol, W.J., Oates, W.E.: The Theory of Environmental Policy, 2nd Edition, 1988.

Plus additional papers and articles
 
Course Coordinator
Peter Fristrup, pefr@life.ku.dk, Institute of Food and Resource Economics/Environmental Economics and Rural Development Div., Phone: 35333641
 
Study Board
Study Committee NSN
 
Course Scope
lectures60
theoretical exercises36
examination4
preparation106

206