IP 321
Instructor:
Environmental Economics and Management
(Spring 2009/2010)
Doc. Ing. Petr Šauer, CSc.
Head of Department of Environmental Economics
University of Economics Prague
W. Churchilla 4, 130 67 Prague 3
Tutorial hours: Thursdays 12:30-14:15 p.m.; Room 332 NB
1.
Initial information about the content of the course;
Nature and the environment; getting knowledge about nature and the environment
Šauer 2007, Chap. 1
2.
Nature, the environmental and its protection as a problem of economic analyses; natural
goods and property rights – an introduction and key terms.
Šauer 2007, Chap. 2.1 - 2.2
Readings: Hardin, G.: The Tragedy of the Commons
3.
Ethics, human needs and values, environmental values, implications for actions of
individuals in the markets and in political systems, implications of environmental
policies.
Class exercise: comparison of human values of university students from approximately 8 states all over the
World and values of the current group (a questionnaire distributed at the class); discussion about human
value priorities and their importance for individual's behavior both in the economic system and in the
political system.
Šauer 2007, Chap. 2.3
4.
Analytical evaluation of single environmental factors and an evaluation of the total
quality of the environment in a region: the difference between a state and the quality of
the environment; finding the "points of orientation" on the half-straight-line of the
changed state of the environment for the evaluation; using multicriteria analyses for the
evaluation.
Class exercise (case): multicriteria evaluation of total quality of living in a city, where ecological factors
are included; a discussion about getting a consensus between different human values oriented participants,
discussion of public choice problems in the field, etc.
Šauer 2007, Chap. 2.4
5.
Explaining terms: economic damage from environmental degradation, control costs
(environmental protection costs), environmental burden of the economy.
Class exercise: small "brainstorming" on finding examples of both the damage and control costs.
Šauer 2007, Chap. 3.1, 4.1, 4.2
6.
Economic damage from environmental degradation: main approaches to quantification
both the damage and benefits from environmental protection projects.
Class exercise: real and hypothetical market of a selected private good; valuation without and with
additional ecological (ethical) information given to the consumer; impact on the markets.
Class exercise: simplified cost-benefit analyses - the benefits evaluation based on a contingent valuation.
Class exercise: travel cost method
Šauer 2007, Chap. 3.2 – 3.4
Readings: Knetch J.L., Davis R.K.: Comparison of Methods for Recreation Evaluation
2
7.
Environmental capital investment: a concept of net and gross control costs; efficiency of
environmental protection spending from both private and public point of view; possible
approaches to quantification of environmental effects for setting priorities of funding
from public financial sources; the role of cost-benefit and cost-effectiveness analyses
and problems of discounting are also discussed in this block.
A numerical illustrations of polluter's decision-making and of a public authority decision-making.
Šauer 2007, Chap. 4.3 – 4.4
8.
Models of optimal behavior of a single polluter; main types of tools of environmental
policies from a single polluter point of view
Simple numerical illustration: optimal pollution on a microeconomic level.
Šauer 2007, Chap. 6
9.
Tools of environmental policy, conditions upon which they work, their advantages and
disadvantages, the role of government: long- mid- and short term administrative tools
(command-and control approach)
Šauer 2007, Chap. 7.1 – 7.2
10.
Coase’s idea and other private solutions to environmental problems.
Small class lab economic experiment: Coasian theory based negotiation
Šauer 2007, Chap. 7.3
Readings:
Coase, R.: The Problem of Social Cost
Randall A.: Coasian Externality Theory in a Policy Context
10.
Pollution permits trading as a market-based tool of environmental policy.
Class lab experiment: pollution permits trading in a hypothetical region
Šauer 2007, Chap. 7.4
Readings: Tietenberg T.: Transferable Discharge Permits and the Control of Stationary Source
Air Pollution: A Survay and Synthesis
11.
Environmental taxes, charges, financial supports, environmental policy tool mixes;
voluntary approaches and other tools of environmental policy.
Class exercise based on data from the exercise in section 10; computer illustrations on a model
Šauer 2007, Chap. 7.5
Readings: Baumol W.J., Oates W.E.: The Use of Standarts and Prices for Protection of the
Environment
12.
Basic macroeconomic view on environmental problems: optimal environmental quality
in some territory - static and dynamic model; discussion about the degree of optimism
and pessimism about economic growth; introduction into sustainable development;
other macroeconomic consequences of environmental and economic policy decisions
Simple numerical illustration: an optimal environmental quality on the macroeconomic level.
Class exercise: small "brainstorming" on finding possible macroeconomic impacts of the environmental
policy decisions.
Šauer 2007, Chap. 8
13.
Introduction into the theory of Renewable and Non-renewable resources
3
****
Students prepare their own presentations on selected interesting topics, which are mainly based
on current practical themes and are discussed at lectures. A selection of the topic is always
discussed with students according to his/her interests. The presentation can have a "classic"
form or it can be prepared as a class exercise (small class lab experiment).
The list of potential topics will be distributed at the first lecture
Exam conditions:
2 written exams
- max 60 points
(2x about 6 questions, average 5 points each)
Attendance
- max 20 points
Student presentation - max 10 points
Active participation - max 10 points
TOTAL
- max 100 points
The grading is made within the final oral exam
Grading scale:
100 - 90
89 - 75
74 - 60
59 and less
A Excellent
B Very Good
C Good
F Failure
4
Literature:
Textbook: (available at Department of Environmental Economics; possible to buy or
borrow for deposit)
Šauer Petr (2007): Introduction to Environmental Economics and Policy with Economic Lab
Experiments and Class Exercises, Nakladatelství a vydavatelství litomyšlského semináře, Praha,
ISBN 978-80-86709-10-9
Readings (available from the University library):
Environmental Economics and Policy (Selected Classical Readings), Edited by: Šauer P.,
Livingston M., ETP, Nakladatelství a vydavatelství litomyšlského semináře, Prague-GreeleyBratislava 1996, ISBN 80-902168-1-1
Alternative textbooks recommended (available from the University library):
Kolstad, Ch. D.(2000): Environmental Economics. Oxford University Press
Field, B.C. & Field, M.K. (2006): Environmental Economics: An Introduction, McGraw-Hill.
Tietenberg T. (2006): Environmental Economics, and Policy, 5th edition, Pearson/AddisonWesley.
Another literature:
Environmental Yearbook of the Czech Republic (since 1991)
Prague Environment 1998, 2007. Institute of Municipal Informatics of the City of Prague 1999,
2008
State Environmental Policy. Ministry of the Environment of the Czech Republic, Prague 1999,
2001, 2003, 2005
Report on the Environment in the Czech Republic. Ministry of the Environment of the Czech
Republic.
Useful link for searching for literature in the field:
http://www.cenia.cz/
see pages of the Department of Environmental Economics UEP for other useful links.
Useful addresses for searching for literature in Prague:
Library of the Ministry of the Environment and Library of the Czech Ecological Institute (both
located in the same building): Vršovická (street) 65, Praha 10 - Vršovice
Library CERGE and Economic Institute of the Czech Academy of Science, Politických vězňů 9,
Praha 1