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Module Title
LM Environmental Economics
School
Birmingham Business School
Department
Birmingham Business School
Module Code
08 19956
Module Lead
Dr. Matthew Cole
Level
Masters Level
Credits
20
Semester
Semester 1
Pre-requisites
Co-requisites
Restrictions
An understanding of basic microeconomics is required. Compulsory for MSc Environmental and Natural Resource Economics
Exclusions
Description
Students are introduced to the concept of the externality, the Coase theorem and the importance of property rights as a determinant of market failure. Alternative revelation methods for determining the value of public goods are presented. The optimality of the Pigouvian tax based solution is derived and contrasted to other regulatory methods of pollution control including tradable permits, environmental subsidies and command and control. The proper implementation of these measures is explored within the context of imperfect competition, imperfect mixing, imperfect monitoring ability, uncertainty and tax interaction effects. The final part of the course deals with the monitoring and enforcement of environmental regulations; and the ex-post regulation of environmental hazards using strict and negligence based liability versus ex-ante standards.
Learning Outcomes
By the end of the module the student should be able to:
Demonstrate comprehensive understanding of the role of property rights as determinants of environmental degradation
Understand the economic arguments in favour of particular forms of environmental regulations and how these are modified by problems relating to market structure, uncertainty and non-observability of polluting activities
Demonstrate knowledge and understanding of the complex economic issues underlying monitoring and enforcement
Critically evaluate the relative advantages of ex-ante regulations and legal liability for dealing with environmental hazards
Comment critically on contemporaneous environmental issues from an economics perspective
Assessments: 3 hour written examination (80%) 2,000 word essay (20%)
Reassessment: 3 hour exam (100%)
Other
None
Reading List
Baumol, W & Oates, W. 1988. The Theory of Environmental Policy. Cambridge: Cambridge University Press.
Kolstad, C. 2000. Environmental Economics. Oxford: Oxford University Press.