Resources and Environmental Economics First Term 2019/2020 PowerPoint Slides prepared by Dr. Walaa W. Diab FCOM-BU Dr. Walaa Wageh Diab
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Resources and Environmental Economics First Term 2019/2020
PowerPoint Slides
prepared by
Dr. Walaa W. Diab FCOM-BU
Dr. Walaa Wageh Diab
Resources and Environmental Economics First Term 2019/2020
Lecture 4
PowerPoint Slides prepared by
Dr. Walaa W. Diab FCOM-BU
Dr. Walaa Wageh Diab
Resources and Environmental Economics
First Term 2019/2020 COURSE SYLLABUS
PowerPoint Slides prepared by
Dr. Walaa W. Diab FCOM-BU
1-‐ Instructor Contact Info. Name: Dr. Walaa Wageh Diab
Office Hours: from 8:30 am to 9 am each Wednesday Online Office Hours: Each Friday at 1pm to 3 pm
Class meets Wednesday Email: [email protected]
Course website: Lecture slides and exercises accessible through My official page:
hVp://bu.edu.eg/staff/walaadyab4
Dr. Walaa Wageh Diab
Resources and Environmental Economics
First Term 2019/2020 COURSE SYLLABUS
Dr. Walaa Wageh Diab
Resources and Environmental Economics
First Term 2019/2020 COURSE SYLLABUS
Dr. Walaa Wageh Diab
6
What is Economics?
• Economics – the study of how to make trade-offs; the science of the allocation of scarce resources.
• Environmental Economics: the study of trade-offs between economic activities and natural environment, it focus on a goal of helping society reduce its degradation of the environment. It is also defined as the application of the principles of economics to the study of how environmental resources are managed.
7
8
q As the scale of economic activity has proceeded steadily upward, the scope of environmental problems triggered by that activity has transcended geographic and generational boundaries.
9
q The nation-state used to be a sufficient form of political organization for resolving environmental problems Whereas each generation used to have the luxury of being able to satisfy its own needs without worrying about the needs of generations to come, intergenerational effects are now more prominent. Solving problems such as poverty, climate change
10
q Solving problems such as poverty, climate change change, ozone depletion, and the loss of biodiversity requires international cooperation.
q Because future generations cannot speak for
themselves, the current generation must speak for them. Current policies must incorporate our obligation to future generations, however difficult or imperfect that incorporation might prove to be.
11
Trade-‐offs occur at every geographic scale
We are experiencing losses of habitat and the destruc@on of many renewable resources including: – Many of our most important global fisheries. – Massive losses of tropical forests. – Rapid die-‐off of coral reefs. – Extensive losses of wetlands. – Conversion of grasslands and other ecosystems to desert at a fast rate.
Ø What inhibits economic systems from using its resources wisely and efficiently to protect the
sustainability of the planet and people’s livelihoods over @me?
Dr. Walaa Wageh Diab
q An outcome is economically efficient if all resources are put to their
highest valued use, or alternatively if a desired outcome is reached
using the fewest resources.
q Environmental economics uses efficiency as a central criterion for
evaluating outcomes and policies. An attempt is made to find
policies that that provides a maximum amount of protection for the
environment at a minimum cost of resources
q Equity is also an important consideration in the evaluation of
outcomes and policies, because it is important for policies to be both
fair and efficient.
Dr. Walaa Wageh Diab
14
Why Study Resources and Environmental Economics?
• Study of natural sciences is not sufficient to completely analyze problem
because these sciences do not include human behavior.
• The Economics of the Environment has a number of special features that are
not typical of many economic problems:
– Optimal allocation of environmental resources has implications for future choice.
– Many decisions regarding environmental resources are irreversible.
– Market failure is an important characteristic of many environmental issues.
– Optimal allocation requires understanding the whole ecological system and how it responds
to changes in both ecological and economic systems.
The environment and economy are linked
• Economies receive inputs from the environment.
– Process them for use
– Discharge the wastes back into the environment
• Traditional economists ignore the environment.
– Environmental economists accept that human economies exist within, and depend on, the environment.
The environment and economy are linked (canceled)
Natural Resources the Environment Provides
• Renewable resources: – Perpetually available: sunlight, wind, wave
energy – Renew themselves over short periods of
time • These can be destroyed
• Non-renewable resources: can be depleted
Renewable
Natural Resources the Environment Provides
Nonrenewable
Minerals Fossil Fuels
Forest Water Fruit/Nuts Fish
• Economic growth and environmental Balance
• Conservation recourses
• Pollution control and environment
Scope of Environmental Economics
Ozone depletion
Atmospheric Pollution
Acid Rain
Global warming
• What is the fundamental nature of the environmental problem?
• Should the government “intervene” at all?
• How clean should the environment be?
• How can we achieve the desired environmental quality?
Policy Questions
• “Free” markets will generate excessive pollut ion and overuse environmental services, hence, collective or public intervention is necessary
Economic Perspective on Environmental Management
models are useful abstractions, but the conclusions they yield depend on the structure of the model. Change the model and you are likely to change the conclusions. As a result, models should always be viewed with some skepticism.
Examining human behavior in a non-laboratory setting, however, poses special challenges because it is nearly impossible to control completely for all the various factors that influence an outcome beyond those of primary interest. The search for more control over the circumstances that provide the data we use to understand human behavior has given rise to the use of another analytical approach— experimental economics
Together, econometrics and experimental economics can provide different lenses to help us understand human behavior and its impact on the world around us.
30
31
A positive feedback loop is a situation where two events are mutually reinforcing. With this situation a small change in one input can cause a bigger final increase in both the initial input and the secondary effect.
32
The process of capital accumulation illustrates one positive feedback loop. ex. New investment generates greater output, which when sold, generates profits. These profits can be used to fund additional new investments. Notice that with positive feedback loops the process is self-reinforcing.
33
34
35
Positive feedback loops are also involved in climate change. Scientists believe, for example, that the relationship between emissions of methane and climate change may be described as a positive feedback loop. Because methane is a greenhouse gas, increases in methane emissions contribute to climate change. The rise of the planetary temperature, however, could trigger the release of extremely large quantities of additional methane currently trapped in the permafrost layer of the earth; the resulting larger methane emissions would further increase temperature, resulting in the release of more methane, and so on.
36
37
38
39
40
41
42
43
44
45
Related Documents
