Environmental Economics

United States International University
San Diego, California

Instructor: Bainbridge, David
Subject area: Economics
Department: Economics
Course number: ES4000
Year taught: 1997
Level: Undergraduate

Instructor's Email: bainbrid@usiu.edu
Please note that the copyright for this syllabus is retained by the instructor.

This course covers concepts and policy issues associated with international aspects of renewable and non-renewable natural resource management, pollution, environmental protection, and regulation. Most environmental problems are symptoms of flawed or incomplete markets and inaccurate accounting and the failure of environmental organizations to make change reflects the weakness of assessing the cause of problems as "moral failure". If the rules of the game change people will work as hard to reach sustainable solutions if they are more profitable.

This course reviews the foundations and principles of economics, but focuses on environmental economics and the critical factors that distinguish ee from conventional economics - current externalities, discount rates, inter-generational transfers, and the perverse effects of government intervention in markets. Emphasis is on applied problems and differences between countries and systems of management. EE solutions can only be developed with a good understanding of cultural and political settings. Opportunities for Green entrepreneurship are also examined.

Readings and papers are an important part of this class.

Course objectives
Provide a foundation for studying and interpreting resource management using environmental economics.
Develop an awareness of economic principles and sustainability.
Improve students information and communication skills.
Integrate each students personal experiences, cultural background, and skills into the course.
Prepare students for subsequent studies and work in environmental management.

Required texts
Hawken, P. 1993. The Ecology of Commerce. Harper Business.
Moore, C. and A. Miller. 1994. Green Gold. Japan, Germany and the United States and the Race for Environmental Technology. Beacon

Selections from:
Andersen, M.S. 1994. Governance by Green Taxes. Making Pollution Prevention Pay. Manchester University Press. UK. (out of print)

Suggested reading:
Makower, J. 1993. The e Factor. Times.
Piasecki, B. 1995. Corporate Environmental Strategy. John Wiley.
Willig, J. 1995. Auditing for Environmental Quality Leadership. John Wiley.
Socolow et al. 1997. Industrial Ecology and Global Change. Cambridge.

Week by week
1. Introduction and summary.
Hawken Ch 1,2 Moore Intro, Ch 3
Environmental economics--why, what, how, for whom. Supply, demand and prices -- elasticity of demand. The dismal science and the folly of traditional economics, oblivious to environmental limits and uncertainties. The issue of externalities and market failure.

2. Economics for a sustainable future
Hawken 3,5 Moore 4
Natural laws, assets and values, distinguishing between mining and harvesting resources. Mortgaging the future and the discount rate problem. The problem of subsidies, corporate welfare, and governmental policy - a look across several nations. Why eastern Europe is so polluted. The global market, pollution, and labor.

3. Policies and management strategies
Hawken 4 Moore 9
Policy options and assessing environmental policy. Making the market complete and effective. From command and control to the free market. The complexity of governance - simple solutions are politically correct but rarely work. Government givings and takings.

4. The value of case studies and interpretation of effects. The cultural, political and environmental setting and what works, what doesn't. Economics of water pollution cleanup. Denmark, France, and Germany. Andersen 4,5

5. Economics of water pollution cleanup Andersen 5,

6. Hawken 11
Case study continued -- the Netherlands, United States, California. Cost effectiveness of water pollution policies and implications for other environmental problems and resources

6. Environmental economics and the built environment Moore 5, 8
Amory Lovins and perfectly perverse incentives for doing the wrong things. Performance contracting and other signs of hope. A look at the positive
benefits of improving refrigeration efficiency.

7. Forest management and mismanagement - an example of environmental economics, why there is little forest replanting despite the growing demand
for wood handouts Agriculture, cost accounting for the Amish and their neighbors. Hawken 9

8. Environmental technology and business opportunities, ee and industrial
ecology Hawken, Ch 10 Moore Ch 1,2,6

9. Making the future work. Moore Ch 10, Hawken Ch 12
A look at wages - 1970-1995. Welfare, the coming oil scarcity and opportunities for Green industry around the world, by-passing the smokestack industrial era.

Assignment deadlines - automatic deduction if late unless I am notified in advance.

Percent of grade
#1 RESUME DUE Sept 17 -- 5%
#2 PAPER ONE DUE (2 pages) Sept 24 --10%
QUIZ #1 Oct 1--10%
#3 PAPER TWO DUE (2 pages) Oct 15 --10%
QUIZ #2 Oct 22 --10%
#4 BIG PAPER DUE (10-15 pages) Nov 3 --30%
#5 PRESENT papers, wrap-up, final two weeks -- 5%
FINAL Wed November 12 1:50 PM --20%

Assignment #1. RESUME due Sept 17
A resume is critical part of your professional tool kit. It can be difficult to find a good job without a good resume. This is a paper presentation of yourself, your skills and experience. It cannot replace essential job skills and work habits--but it must reflect what you know and can do in a clear, concise manner. A resume can't get you the job, but it can help get the interview. This is a general version -- more attuned for academia than business. Find out what the preferred format is for the target company or job you are seeking. Resumes are increasingly computer scanned so don't get fancy, use simple fonts and no color. This must be typed, carefully edited and checked.
Street or mail Address Phone/Fax/E-mail
at school at home
(optional, please list home city and country)
Education: (finished and projected)
Goal advanced degree or career -- what, where?
Current goal -- such as BA Environmental Studies, USIU 1999
Any previous college?
High school -- where, when
Experience: (work, volunteer, school groups)

Most recent first - include company/city? responsibilities
Any publications and research papers: (formatted as follows)
Last name, first initial. year. title. where published
Use recent class papers if necessary.
For example: Steen, A. and B., D.A. Bainbridge and D. Eisenberg. 1994.
The Straw Bale House. Chelsea Green, White River Junction, VT 326 pages.
Talks and presentations: List school talks, title, place, when
Computer skills: specify Macintosh or IBM programs (such as Microsoft

Word, Excel, etc., you should know a spreadsheet and writing program.
Language skills: reading, writing
Other skills: (Photography and illustration, dance, construction)
Special training: if any
Community service: volunteer work, committees, etc.
Memberships and associations: you should join a professional organization in your expected field of work, student rates are low travel experience: (list countries)

Paper Format No cover sheet, no title page, use recycled paper
All papers should be typed, one and a half or double spaced in 12 point Times or similar font, 1.5 inch margin on the left and 1 inch margins on all other sides. Typographical errors, spelling mistakes, and poor grammar must be corrected by careful proofreading. Ask a friend to check it.

You should use at least five articles and/or sources for your paper. Although textbooks, newspaper articles, and magazine articles can be useful to get started use professional journals, government documents, and scholarly books as primary source materials for the papers.

#2. Short Papers number one September 24
Your first two-four page paper will describe an issue affecting economics of water or energy supply or will examine the ethical responsibility we have to future generations and how environmental economics should be used to reflect this obligation. These are to include at least 4 references.

#3. Short Papers number two October 15
Your second paper should be on a specific topic or issue in ee, i.e. Do externalities favor non-chemical alternatives to chemical weed control? Water marketing - full costs? Should San Diego's water system be privatized. The environmental cost of corporate welfare. The carbon tax - what should it be? Farmers markets and environmental costs/benefits in San Diego The ee of community supported agriculture THE BEST PAPERS AND LETTER WILL BE FEATURED IN THE USIU ENVIRONMENTAL NEWSLETTER

Notes on references.
Except in cases where original investigations are done, your paper will be a report on research by others. In your paper be sure to give credit for their thoughts or research. This is done by including the citation in the sentence where you use this information. When you use an investigator's data, state his/her ideas, paraphrase his/her conclusions, or quote him/her directly, cite the reference as follows at the end of the sentence (Altieri, 1995) with no page number reference.

Magazines and journals provide detailed information on reference and style format for authors, often in the first or last issue of the year. We will use a common style for science and ecology. Give full information on your sources with the formats shown below - make careful notes in the library or copy the cover/title page and note library catalog number! These sources are included at the first use of the information in the paper, listing the author and year at the end of the sentence, as in (Bainbridge, 1995).

The style for this and following papers is to cite your sources by author and year in the text, you do not include the page number(s) where you found the material. For example, if Stacey Williams wrote the source paper in 1996 you would end the statement with (Williams, 1996). Barbara Friz were co-author on the paper the citations would be (Williams and Friz, 1996). If you were an additional author the citation would be (Williams et al., 1996).

Complete references are included at the end of the paper in alphabetical order. Reference format for papers in this course is as follows:

Author. Year published. Title. Publisher, place published, pages.
Hartwick, J.M. and N.D. Otewiler. 1986. The Economics of Natural Resource Use. Harper and Row, NY

Chapters in Books.
Author. Year published. Chapter title. pages[abrev. as pp.]. book editor/author. Publisher, place published.
Graedel, T. 1997. Industrial ecology: definition and implementation. pp. 23-41. In Socolow, R., C. Andrews, F. Berkhout, and V. Thomas, eds. 1997. Industrial Ecology and Global Change. Cambridge.

Journal Articles
Author. Year published. Title of paper. Magazine name. Volume (issue number): pages (if rare publisher, place published)
Shearman, R. 1990. The meaning and ethics of sustainability. Environmental Management 14:1-8

Use key phrase from internet source for cite (earthtimes, 1997) and full address and date and search engine in references.
for example www.sdearthtimes.com 7/15-1997 Excite Interview

person. Year. title, comment. where interviewed.
Hammerer, D. 1995. personal communication. Student USIU Environmental
Studies, USIU, 10455 Pomerado Road, San Diego, CA.

#4. Long Paper due Nov 3
Your paper should explore one of the following areas:
a) the economics of a key international environmental problem
b) the economics of a key local environmental issue
c) the effect of discount rates on forestry or agriculture
d) an environmental system--linkages and interactions, external costs, discount rates and inter-generational transfers...
e) a business opportunity in environmental management-- making a market better through industrial ecology
f) a "green" fee to solve a common misuse of resources
g) a critical ee analysis of a legislative bill or economic article
h) Economic assessment of mesquite farming on the Bass Brothers Imperial Valley Farms (wood, sugar - champagne, fodder)
i) A stream authority to return trout to Rose Creek
j) Economic assessment of building practices - perverse incentives
k) Performance contracting - economic and environmental benefits

Communication is the most important part of business, politics and human interaction. Make it work for you by learning how to write well. The long paper should be well written, carefully proofread and fully referenced. The paper should include a computer data base search and the printout for the search should be attached, and must be properly referenced. This paper should be between 10 and 15 pages in length. It will be graded and returned and you can make revisions based on my comments and return it. The goal is to get these published in magazines and journals.

The Long Paper will usually include:
--An introduction that lays out the issue and opposing views.
--The main body of the paper develops your theme using the appropriate scientific and popular literature (at least 5 different sources).
--The close of your paper should look to the future and contain your assessment of how the issue may be or may not be resolved or improved.
--Literature cited must be carefully checked with formats correct and complete.
--A computer search should be attached, with search language and total number of sources found, known as "hits". A world wide web search may be used, but a data base search through the library is better.

This is a lot to accomplish and will require a careful analysis of the issue and a well crafted outline before you start the paper.

Do not use footnotes, use direct quotations only when they are essential to your argument. An example is quoting a section of a law or a
statement made by someone in a speech. In most instances you should paraphrase the information from your sources, giving credit to authors by
citing their paper or book.

Assignment #5. Presentation
Presenting ideas is critical. This short talk can cover any of your papers. Expect to talk for only 5 minutes. Prepare an outline of the key points and use graphic aids -either a transparency or a large chart or display. Your time as presenter is valuable - make sure it counts. More details will be provided in class.