Resource and Environmental
Economics
University of Southern California
Los
Angeles, California
Instructor(: Pendleton, Linwood
Subject area:
Economics
Department: Economics
Course number:
487
Year taught: 1998
Comments: Lecture notes, problem sets,
and sample exam questions may be found on the professor's
website.
Please note that the copyright for this syllabus is
retained by the instructor.
Overview: This course examines economic issues in the
consumption, allocation, and management of natural resources. Students will
learn the economic principles behind the management of renewable and
non-renewable resources. Readings and problem sets will give students practice
in applying economic tools to natural resource problems. The course concludes
with a critical discussion of the more controversial issues in natural resource
economics: sustainability and environmental valuation.
Course
Description:
This course examines economic issues in the consumption,
allocation, and management of natural resources. Students will learn the
economic principles behind the management of renewable and non-renewable
resources. Readings and problem sets will give students practice in applying
economic tools to natural resource problems. The course concludes with a
critical discussion of the more controversial issues in natural resource
economics: sustainability and environmental valuation.
Course
Requirements:
Readings:
The readings for
this course are light. Every student is expected to read, consider, and possibly
reread the assigned material before each class. Classes will build upon the
assigned readings but will not review this material.
The readings will come
from 3 sources (required):
1) Environmental and Natural Resources Economics.
Tom Tietenberg. 4th edition. (Referred to as TT)
2) Economics of the
Environment. Dorfman and Dorfman. Referred to as D&D
3) Reserve Readings
and Handouts: These readings are noted throughout the syllabus.
Class
Participation:
Class participation will not be graded. Nevertheless, class
participation is mandatory and required to pass the course (I'm serious).
Students must come to class prepared to participate.
Quizzes:
There
will be weekly scheduled quizzes, lasting approximately 10 minutes each. The
quizzes will be used primarily to determine areas that are giving students the
most trouble. The quizzes are worth 10% of the final grade.
Problem Sets:
There will be 5 problem sets for the semester. Students will have one week
to complete each problem set. Students may work in groups but each student must
present their results independently; all group members must be noted on each
problem set. Problem sets are worth 10% of the final grade.
Group
Project:
There will be one group project at the end of the semester (20% of
final grade)
Exams:
There will be two 1 1/2 hour exams - a mid-term
(30% of final grade) and a final (30%).
I.
Introduction to Resource and Environmental Economics
TT Chap 2
(Lectures 1 and 2)
D&D Chap 5
Normative vs. Positive
Economics
Economic Efficiency
A Marginal Approach To Measuring Cost and
Benefits
Time: Discounting
II. The Allocation of Scarce Resources:
Resource Scarcity, Rent, and Time
TT Chaps 3 and 13 (Lectures 3 and
4)
Property Rights and Environmental Problems
Resource
Scarcity
Scarcity Rent, Marginal User Cost
One Period, Two Period, and N-
Period Resource Extraction
Hotelling's Rule
IV. Non-renewable
(depletable) resources
TT Chaps 6 and 7 (Lecture
5)
Reserves
Extraction and Technology
Backstops
V. Land
Allocation
(Lecture 6)
David Ricardo
Capitalization of
Rent
Competing activities
Development vs. Economic Wilderness
Factors
affecting the limits of development
VI. Renewable
Resources
A. Timber: (Lecture 7,8,9, and 10)
TT Chap 11.
Mining
and Plantations
Biological Timber Management
Economic Timber
Management
The Faustmann Formula
Non-timber Forest Benefits
B.
Multiple Use Management (Lecture 11)
C. Water (Lecture 12 and 13)
TT
Chap 9
Surface Water
Ground Water
Current Allocation Systems
D.
Open Access Resources: Fisheries and Tropical Forests (Lecture 14)
D&D
Chap 1
TT Chap 12
(Optional: The Property Interface, J.H. Dales. Chapter 3
in M and R, on reserve)
Defining Common Property/Open Access
Resources
Fisheries: (Lecture 14 and 15)
D&D Chap 6
The
Schaefer Model
Economic Versus Biological Management
Management
Alternatives:
Rushing
Regulation
Assigning Property Rights
ITQ's
Shellfish Leasing
Tropical Forests: (Lecture 16)
Public Policies and
the Misuse of Forest Resources. Chapter 1. Overview (on reserve)
The state of
tropical timbering
What drives tropical deforestation
Methods to stem
deforestation
VII. Sustainability
(Lecture 17 and
18)
Growth, Sustainability Indicators and Green Accounting
D&D Chaps.
11 and 12
TT Chap 21
Defining sustainability
The Brundtland
Commission
Sustainable Growth Paths
The Discount Rate and
Sustainability
International Issues in Sustainability: Imperialism or
Empiricism
Green Accounting
VIII. Measuring Non-market Resources
(Lecture 19-26)
A. Use Values and Non-Use Values
B. Valuation
Techniques: Contingent Valuation and the Revealed
Preference
Methods
D&D Chap 20
IX. A Case Study: Logging vs.
Fisheries in Palawan.
This will be a case study in which students play
the roles of policy makers and
consultants in the Philippines. Get handouts
and assignments from the
professor.