Ecological Economics and Sustainable Development

Bowdoin College

Brunswick, Maine
Instructor(s): Vail, David
Subject area: Economics
Department: Economics
Course number: 321
Year taught: 1996
Level: Undergraduate

Instructor's email:

Please note that the copyright for this syllabus is retained by the instructor.


Ecological economics is an emerging interdisciplinary field of study, based on a recognition that the economy is an open subsystem of the ecosystem and subject to the "laws" that govern all biophysical processes. While ecological economics has roots in neoclassical welfare, environmental and natural resource economics, it is distinguished by an evolutionary perspective -- social and natural systems co-evolve, change is cumulative and irreversible, and disequilibrium is the norm. Ecological economics puts greater emphasis on the complexity and uncertainty of interactions between human activities and natural life support systems, making extensive use of insights from systems ecology, conservation biology, and other life sciences.

The first part of the course (roughly 8 weeks) traces the evolution of economic thought regarding the environment and explores the widening dialogue between economists and natural scientists. It addresses the question whether a unifying paradigm is possible -- or in sight. The latter part of the course (roughly 5 weeks) traces a decade of efforts to articulate principles of sustainable development and translate them into quantitative indicators of "progress" and operational guidelines for resource allocation and ecosystem conservation. The readings explore three
dimensions of sustainability: economic, environmental, and social (cultural, institutional).

Monday Games and Discussions

You come to Economics 321 with considerable economics background. Many of you are well versed in environmental sciences and several have extensive math training. Two core course objectives are to tap your knowledge and encourage collaborative learning. Most weeks, the Monday class time will be used for student-led games, experiments and discussions. I will assign the broad topics and readings, but what actually happens will depend on the leaders' interests and inventiveness. Each Monday game/discussion will have two or three leaders, depending upon the class size.

Some Mondays will also be used for guest speakers, exam review, and final project planning. Please mark September 30th on your calendars: Ted Halstead from the "Redefining Progress" project will speak.

Reading assignments

Copies of course readings will be on reserve at H-L Library, but you are urged to purchase Richard Norgaard, Development Betrayed. Several copies of Ronald Bailey, ed. The True State of the Planet and AnnMari Jansson, et al., Investing in Natural Capital are also available at the bookstore. In addition, several chapters of Tom Tietenberg's Environmental and Natural Resource Economics will be duplicated and made available by the bookstore. Finally, you may have your own copy of several other course readings by paying $4.00 at the beginning of the semester, to cover costs.

Numerous reading assignments build on concepts and models from intermediate economic theory. However, we will also encounter other natural and social science modeling techniques and methods of mobilizing empirical evidence. An important course focus is economic and philosophical debates about the meaning, measurement and moral dimension of "progress". This exploration relies heavily on the Norgaard book. (Reading Details)

You will collaborate with other class members to organize and lead two games or discussions.

Research Projects

During the final month of the course, the reading assignments will be lighter as you carry out research on topics related to the theme of sustainable development. Research findings will be presented in class during the reading period and research papers will be due on the last day of
the reading period. Many research methods and topics are possible, but I will encourage the class to consider a collaborative approach, focusing on a cluster of issues "close to home." Examples of such issues are the ecological-economic sustainability of the North Woods, the gulf of Maine bioregion, and Bowdoin College on the eve of a new century and a new millennium.


Provisionally, the course grading formula is as follows:

Exam--20 %
Two short essays--30 %
Written exercises and
class participation--25%
Final Project--25 %

Any proposed changes to this formula will be discussed with the class.

Notes: See the course syllabus for approximate dates of the exam and essays. The exam schedule will allow some choice of times. The short essays will be 3 to 4 pages in length; you are encouraged to submit a first draft for comments. Written exercises might include mini-essays, homework assignments and quizzes. Assessment of class participation will combine day-to-day involvement and Monday discussion leadership. The final project will involve a prospectus, a written paper and an oral presentation. Students may collaborate on the short essays and the final project.


Date Topic

Sep 2 What Ecosystems Do for Us - a Free Lunch?

Sep 9 #1 Individual Freedoms, Collective Responsibilities and Sustainability

Sep 16 #2 "Modernism": where do "Western" ideas and values come from?

Sep 23 #3 Causes and Consequences of Population Growth: Are the Malthusians Right?

Sep 30 Guest Speaker: Ted Halstead, "Redefining Progress"
Oct 7 #4 Cost-Benefit Analysis: The Environmental Economist's Favorite Tool
(monetary metric, missing morality, discounted future generations)
Oct 21 Exam Review

Oct 28 #5 Biodiversity and the "Spasm of Extinctions": Should We Take the Risk?

Nov 4 Research project: brainstorming session

Nov 11 #6 Sustaining Culture and Communities: Why and How?

Nov 18 #7 Responses to Human-caused Climate Change

Nov 25 Research project: working session

Dec 2 #8 Is Capitalism Sustainable?


Note: In the following assignments, "Bailey" refers to Ronald Bailey, ed. The True State of the Planet; "Jansson" refers to AnnMari Jansson et al., Investing in Natural Capital; "Norgaard" refers to Richard Norgaard, Development Betrayed; and "Tietenberg" refers to Tom Tietenberg, Environmental and Natural Resource Economics.

I. Framing: Ecological Economics and Sustainable Development (3.5 weeks)

A. Implications of viewing the economy as an open sub-system of the ecosystem -Jansson: Ch. 1
- C. Folke, et al, "Investing in Natural Capital...", Ch 20.
- W. Rees and M. Wackernagel, "Ecological Footprints..."
-Norgaard: Preface, Chapters 1, 3, 4, 6 (page 62), 9, 11 Costanza, R., "The Importance of Envisioning In Motivating Change Toward Sustainability "
-Bailey: "Prologue" and "Epilogue"

B. Properties and Functions of Ecosystems
-Jansson: Ch. 5
- AM Jansson & Jansson, "Ecosystem Properties as a Basis for
Sustainability", Ch. 9 to page 161
- R. deGroot, "Environmental Functions...", and Ch. 12.
- H. Odum, "The Energy of Natural Capital".
-Norgaard: Ch. 8

C. Man and Natures in classical economics
-Deane, P., "Origins of Modern Growth Theory"
-Daly, H. (see below) pages 11-17, 27-28
-Foster, J. B., "Marx and the Environment"
-Norgaard: Chapters 5 (to page 57), 6, 11
-Tietenberg: Chapter 5 (pages 95-103)
-Bailey: Ch. 1 (N. Eberstadt, "Population, Food and Income")

D. Four Seminal essays in ecological economics (and a rebuttal)
-Boulding, K. (1966) "The Coming Spaceship Earth"
-Georgescu-Roegen, N. (1971) "The Entropy Law and the Economic Problem"
-Hardin, G. (1968) "The Tragedy of the Commons"
-Daly, H. (1971) "Introduction to Essays Toward a Steady State Economy"
-Bailey: Chapters 4 (S. Moore, "The Coming Age of Abundance") and 10 (Goklany, "Richer is Cleaner"); review Prologue and Epilogue.

[for Ted Halstead's talk on 30 Sept.: J. Lintott, "Environmental Accounting: useful to whom and for what?" and "File: Genuine Progress Indicator"]

II. Neoclassical Environmental Economics and Growth Theory (3 weeks)

-Tietenberg, Chapters 2 (& appendix), 3, 4, 6 (& appendix), 13, 14 (& appendix), 20 (pages 491-507), 21
-Solow, R. (1973) "The Economics of Resources or the Resources of Economics"
-Review Norgaard, Ch. 5 and 6.

[If you have the Economics 255 textbook, R. Frank' s Microeconomics and Behavior, you might want to review Ch. 3 Rational Consumer Behavior (appendix), Ch. 6 Intertemporal Choice, Ch. 7 Beyond Self-Interest?, Ch.9 Production Theory (& appendix), Ch. 17 Capital (& appendix), Ch. 19 Externalities, Property Rights and the Coase Theorum.]

A. Micro-scale: Cost-Benefit Analysis (subject to revision)
-review Tietenberg pp. 67-84
-Arrow, K. et al. Benefit-Cost Analysis in Environmental, Health and Safety Regulation
-Jansson: review Ch. 9 pages 161-166
- R. deGroot, Ch. 18
- D. King, "Can We Justify Sustainability. . . ? "
-O'Neill, J. "Cost-Benefit Analysis, Rationality and the Plurality of Values"

B. Macro-scale: Growth theory with natural capital (subject to revision)
-Solow, R. (1974) "Intergenerational Equity and Exhaustible Resources"
-Review Tietenberg, pp. 512-527, Daly (1971) pp. 14-24.
-Toman, M., et al., "Neoclassical Economic Growth Theory and Sustainability"
-Jansson: Ch. 2 to page 29 - Daly, "Investing in Natural Capital"


III. Pioneering Analyses and Core Controversies in Ecological Economics (2.0 weeks)

-Norgaard: Chapters 8 - 10, 12, 13
-Jansson: review Ch. 1, 5, 9, 12, 20 plus Ch. 6 to page 98 - C. Perrings, "Biotic Diversity. . . "
-Perrings, C. "Reserved Rationality and the Precautionary Principle"
-Meyers, N. "Biodiversity and the Precautionary Principle"
-Bailey: Ch. 7
- S. Edwards, "Conserving Biodiversity"; review Chs. 4 & 10.
-Arrow, K. et al., "Economic Growth, Carrying Capacity and the Environment"
-O'Neill, R. et al. "Economic Growth and Sustainability: A New Challenge"

IV. Sustainable Development: Visions, Principles and Operational Rules
(4.5 weeks plus reading period)

A. Economic Framing
-review Costanza, "The Importance of Envisioning in Motivating Change Toward Sustainability "
-Jansson, Ch. 2 (Daly, "Operationalizing Sustainable Development by Investing in Natural Capital"), Ch. 16 to page 276 (R. Turner, et al. "Sea Level Rise and Coastal Wetlands. . .)
-Toman, M. et al. "Neoclassical Economic Growth Theory and 'Sustainability'"
-Tietenberg, Ch. 22
-policy implications: Jansson chapter 21 (Costanza)

Final Project Design
B. Social and Cultural Framing: Social Capital, Community Sustainability and
Environmental Justice
-Michael Jacobs, "What is Socio-Ecological Economics?"
-Jansson: Ch. 8 (Berkes & Folke, "Investing in Cultural Capital for Sustainable Use of Natural Capital")
-Vail, D. "Reinventing Community for Sustainable Rural Development"
-Norgaard: Chs. 12-15; review Ch 11 (126-133)

Short Essay on Sustainable Community

C. Transboundary environmental degradation: greenhouse gasses and climate change
-Tom Tietenberg, "Global Pollutants"
-R. Turner et al., "Sea-Level Rise and Coastal Wetlands in the UK" (Jansson, Ch 16)
-Robert Balling, "Global Warming: Messy Models, Decent Data, and Pointless Policy" (Bailey,
Ch 3)
-Frank Muller, "Mitigating Climate Change: The Case for Energy Taxes"

D. Global economic integration and the environment review Tietenberg, pp 545-547
-Scientific American, "Debate: Does Free Trade Harm the Environment?" (Jagdish Bhagwati and
Herrnan Daly)
-David Pearce and Jeremy Warford, "World Markets and Natural Resource Degradation"

E. Is free market (liberal) capitalism sustainable?
-David Korten, "The Truth about Global Competition"
-R.U. Ayres, "Turning Point: the End of the Growth Paradigm"
-Martin O'Connor, "Liberate, Accumulate - and Bust"
-review Bailey, Prologue and Epilogue

Instructor's contribution:

J. S. Mill, "A person is not likely to be a good economist who is nothing else."

Gunnar Myrdal, "There is no view without a viewpoint."

Genesis, "Be fruitful and multiply, and fill the earth and subdue it; and have dominion over the fish of the sea and over the birds of the air and over every thing that moves upon the earth."

Arne Naess, "Humans have no right to reduce the richness and diversity [of life forms] except to satisfy vital needs."

Lawrence Surnmers, "There are no ... limits to the carrying capacity of the earth that are likely to bind at any time in the forseeable future... The idea that we should put limits on growth because of some natural limit is a profound error."

Herman Daly, "Quantitative growth and qualitative development follow different laws. Our planet develops over time without growing. Our economy, a subsystem of the finite and non-growing earth, must eventually adapt a similar pattern."

The Brundtland Commission, "Sustainable development is... development that meets the needs of the present without compromising the ability of future generations to meet their own needs."

Robert Solow, "Sustainability is an essentially vague concept... It is not meaningless, just inevitably vague. "

Fred Smith, "Only under a system where resources are privately owned will people have the ability to express their environmental value accurately. Only through a price system will those values be conveyed to entrepreneurs, who can in turn satisfy those values."

James O'Connor, "Ecological and social wrongs are closely connected and solutions to both presume radical forms of political democracy and new values that depart from those underpinning the present capitalist system."