Welcome to ESM 204: The Economics of Environmental Management

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Welcome to ESM 204 The Economics of
Environmental Management

• Purpose of the class to help you solve
  environmental problems i.e., to help you solve
  generic group projects.
• Our goal is to help you see the economic
  dimensions of environmental problems and use that
  information to generate solutions.

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Staff

• Prof. Christopher Costello
• 4410 Bren Hall, 893-5802, costello_at_bren
• Office Hours Monday/Tuesday 830-930
• Marc Conte, TA
• 3424 Bren Hall, mconte_at_bren
• Office Hours Tuesday/Wednesday 200-300
• PhD student in Bren
• Plan to attend office hours! We want to get to
  know you!

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Course Vitals

• Prerequisites Calculus ESM 251 or Econ 100AB
• 20 lectures, Tuesday Thursday, 1100-1215
• 1 discussion section per week, run by Marc
• You should be familiar with Excel SOLVER
• You are expected to attend all lectures and 1
  discussion per week.
• Workload Above average. Expect 8-10 hours per
  week outside of class, on average.

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Grading

• Homework Assignments .. 40
• 5-6 mini-group-projects may/should work with a
  partner, submit 1 copy with both names
• Late assignments will not be accepted
• May not use the same partner twice (i.e., keep
  moving!).
• Work should be your own!. Do not share outside
  your team!
• Class/section participation .. 10
• Midterm..20
• Take Home Distributed Feb 13, Due Feb 15
• Final Exam..30
• March 22, 1200-300, MSI building
• Cheating/plagiarism will not be tolerated.

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Readings Preparation

• Readings available as a reader _at_ Grafikart
• Some also available on web
• Several books will be used a lot
• Recommended only though you may wish to buy
• Hartwick and Olewiler The Economics of Natural
  Resource Use, 2nd Edition (Addison-Wesley, 1998)
• Boardman et al Cost-Benefit Analysis, 2nd Ed
  (Prentice-Hall, 2001)
• Kolstad Environmental Economics (Oxford, 2000)
• Lower level book Goodstein

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Preparation

• Please come to class prepared.
• Preparation read the assignments listed for the
  day on the webpage.
• I will call on you in class. Please help make
  this an interactive experience.
• Questions??

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Course Approach

• VERY hands-on
• Every lecture designed to help solve a generic
  group project.
• Lecture Style
• Begin with brief overview from last class
  questions.
• Motivate new material.
• I will always motivate material with a
  hypothetical group project
• If I cant think of a good use for the material
  in a real-world, group-project-like setting, you
  should not bother learning it.
• Cover new material ask about readings
• Open discussion throughout.

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What will we cover?

• Course broken into 4 sections
• Project Evaluation Evaluating public
  environmental projects and regulations (5)
• Measuring benefits and costs (3)
• Environmental Regulation (6)
• Managing renewable and non-renewable resources (5)

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Section 1 Evaluating Projects and Regulations

1. Cost effectiveness vs. cost/benefit, public
   goods, externalities
2. Applications cost-effectiveness, cost-benefit,
   multi-objective methods
3. Efficiency surplus doing benefit-cost
   analysis equity vs. efficiency
4. Inflation discounting
5. Risk uncertainty

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Section 2 Measuring benefits and costs

1. Costs of regulation and the benefits transfer
   approach travel cost
2. Revealed preference approaches
3. Stated preference approaches constructed
   markets experiments.

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Section 3 Environmental Regulation

1. Regulatory options and efficiency.
2. Innovative approaches to regulation
3. Incidence of environmental regulations.
4. Spatial and temporal dimensions of environmental
   regulations.
5. Monitoring and enforcement.
6. Regulatory experience in developed vs. developing
   countries, green accounting.

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Section 4 Managing renewable non-renewable
resources

1. Rent, water, and common property.
2. Fishery economics.
3. Managing the fishery.
4. Forest economics management.
5. Non-renewable resources and energy.