Please read the assigned readings for next week’s class. See attachments.William Emmons_Consumer Spending
WEF_ConsumptionDilemma_SustainableGrowth_Report_2011 (for Wed, read pages 13 – 17 of article)
Please focus particularly on the WEF reading (pages 13 – 17) for the Oct 1 class which will feature guest lecturer Prof. Pa Her, Professor of Psychology, followed by discussion.
1. The Coming Climate Crash: Lessons for Climate Change, Henry Paulson
2. The Big Green Test: Conservatives and Climate Change, Paul Krugman
3.Why Emissions Trading is More Effective than a Carbon Tax, International Emissions Trading Association (IETA)
1) What remedy does Henry Paulson view as the most effective means to reduce carbon emissions from fossil fuels (i.e. sources such as coal fired power plants)? Why does he believe this to be the most effective remedy?
2) Paulson also argues that attempting to do more than this now would not be advisable. What reasons does he make for taking this position? Do you agree/disagree?
3) In his response to Paulson, Paul Krugman argues that “A carbon tax may be the best thing we could do, but we won’t actually do it”. Explain why he make this argument.
4) Krugman then argues that there are several other alternatives that can more easily be achieved if there is a willingness to do them. What are some of these alternatives and what benefit does he see in these alternatives?
5) Finally, the International Emissions Trading Association argues that the most effective means of addressing the current carbon emissions crisis is the adoption of emissions trading. What is emissions trading?
6) Which – if any – of these three proposals do you see as offering the most effective policy and why?
Assignment reviewed in class on Wed. 9/3:
I. Define terms that make up the title of the course: Environmental Economics
II. Consider the following list of fundamental economic concepts and terms: review the meanings of these concepts and think about how you would answer the questions that follow:
- Cost-benefit analysis
- Economic efficiency/allocative efficiency
- Marginal change; marginal utility; marginal benefit
- Equilibrium analysis
- Opportunity cost
- Economic rationality/individuals as rational decision makers seeking to maximize own self-interest
- Externalities and market failure
- Economic growth
- Allocative efficiency
1. Why is an understanding of these concepts important to the scholarly research you will conduct in the course? How is your understanding of these key concepts important to your success in the course?
2. Discuss how an economist might apply one or more of these concepts to an understanding of the following issue: The environmental impact of Hurricane Sandy on New York’s economy; Applying any of these economic concepts, identify one question you would ask as to how to work toward a solution to some of the economic losses or environmental challenges in the wake of the storm. (Will discuss in class on 9/10)
III. Read pages 1 through 9 of the assigned article by Robert Atkinson and Darren Hackler, “Economic Doctrines and Approaches to Climate Change Policy and post your answers to the following questions for Wed. Sept. 10. This article is in the course pack. We will continue with a full review and discussion on 9/10.
In pages 1 – 9, the authors discuss their views of how Neoclassical economists, Neo-Keynesian economists, and Innovation Economists would design economic policies to address the issue of climate change. Discuss your answers to the following questions:
1. What do neoclassical economists view as the central issues to resolve in addressing the challenges of climate change? Which of the concepts (in the list above) are central to the neoclassical view? Summarize the neoclassical argument.
2. What is your assessment of the neoclassical view? Are the assumptions about human economic behavior and about how to address environmental problems realistic? Explain.
3. Describe two or three ways in which the neo-Keynesian view differs from the neoclassical perspective? What would neo-Keynesian economists view as important in addressing the challenges of climate change? Explain
4. What are the principal problems the authors have with both the neoclassical and neo-Keynesian approaches to addressing climate change issues? Clearly explain.
5. The authors finally discuss what they term the “Innovation Economics” perspective. What are the three arguments the authors cite as to why neither the neoclassical nor the neo-Keynesian views offer an suitable policy framework for addressing the economic realities of the 21st century?
6. What do you believe are the most important issues with respect to current environmental challenges and what if anything would you take from any of these three perspectives to explore those issues?