Economics 423: Environmental and Natural Resources
Economics
Professor Steven C. Hackett
Humboldt State University
Fall 2009
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Sect 1: TuTh
11-12:20 KA 104; Sect 2: TuTh 2:00-3:20 SH 109;
4th Unit: Wed 10-10:50 GH 215
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Office Location: Siemens Hall 206c.
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Office Consultation Hours: Tues/Thurs 3:30-5
pm, Wed 11-12 am, and by appointment. Office hours subject to furlough
closures. I don’t have an open door policy.
·
Telephone Number: 826-3237. E-Mail: hackett
[at] humboldt.edu
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Course Internet site: http://www.humboldt.edu/~envecon
(Ask Prof. Hackett for user name and password in class)
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http://www.humboldt.edu/~humboldt/academics.shtml HSU Admissions and Records (Schedule of
Classes, academic calendar, etc.)
ECON
423.
Environmental & Natural Resources Economics (3-4). Apply economic
principles to public policies and management of natural resources (water, air,
fisheries, forestry). Benefit/cost
and economic impact analyses. Economics and Business Administration
majors MUST enroll for 4 units and must have completed ECON 210. [Note that
this course usually follows a lecture/discussion format].
To
develop your critical thinking and analytical reasoning skills in the following
areas:
·
The
fundamentals of economics: scarcity, choice, and opportunity cost.
·
Basic
ethics, value systems, and the normative foundations of economics and other
social systems.
·
The
requirements and equilibrium characteristics of a well-functioning competitive
market, the interpretation of gains from trade and efficient resource
allocation, and the conditions under which markets fail.
·
Discussion
of property rights, including recreational access, and how the distribution of
property rights affects who pays for land conservation or regulatory
protections.
·
The economics of externalities, with
applications to land use issues (including CEQA and EIR’s)
·
Welfare
analysis of the market inefficiency caused by negative externalities (4th unit,
Econ/Bus majors)
·
The
role of pollution taxes and other regulatory schemes in resolving the
inefficiency due to negative externalities.
·
The
economics of natural resources, including dynamically efficient production (4th
unit, Econ/Bus majors), the optimal management of both renewable and
non-renewable resources, and the governance issues associated with overcoming
the tragedy of the commons. Application to fisheries or other locally relevant
common-pool resource.
·
Issues
and techniques associated with measuring the value of non-marketed aspects of
the environment, with emphasis on recreational area valuation and the travel
cost method.
·
The
methods (and shortcomings) of benefit/cost analysis.
·
The
political economy of environmental regulation and natural resources management.
·
The
economics of assuring environmental compliance.
·
Methods
of regulation that harness the incentives of markets, with special emphasis on
marketable pollution allowances.
·
An
environmental economic analysis of global climate change.
·
To
enhance your analytical, research, and written communication skills by writing
an objective term paper essay.
·
To
enhance your presentation skills by constructing a poster that presents key
points of your research, and participating in a class-wide poster session at
the end of the semester (see Econ Dept office, SH 206, for good poster
examples).
It is
possible to succeed in this course without having done any previous study of
economics, but you will have a bit more work ahead of you than those who do
have an economics background. Emphasis is given to respecting diverse
viewpoints and perspectives.
Hackett,
Steven C., Environmental and Natural
Resources Economics: Theory, Policy, and the Sustainable Society, (3rd
Edition, M.E. Sharpe, Publishers, 2006). Note that the first and second
editions of the textbook are not satisfactory substitutes for the third
edition.
Week 1 (25 & 27 Aug): Chapter 1--Introduction to
Environmental and Natural Resources Economics
Week 2 (01 & 03 Sept): Chapter 2--Value Systems
and Economic Systems
For
further reading on the Internet:
Internet Classics Archive (http://classics.mit.edu/Browse/index.html)
McMaster
U. History of Economic Thought Archive (http://socserv.mcmaster.ca/econ/ugcm/3ll3/)
Week
3 (08 & 10 Sept): Chapter 3--The Economics of Market Allocation
For
further reading on the Internet:
Antitrust
Division of the U.S. Department of Justice (http://www.usdoj.gov/atr/index.html)
European
Union Competition Policy Website (http://europa.eu.int/comm/competition/index_en.html)
Hayek
Research Website (http://www.hayekcenter.org/friedrichhayek/research.html)
Week
4 (15 & 17 Sept): Finish Chapter 3, start Chapter 4--Externalities
For
further reading on the Internet:
EPA’s
National Center for Environmental Economics (http://yosemite1.epa.gov/ee/epa/eed.nsf/pages/homepage)
Environmental
Externalities in Electric Power Markets: Acid Rain, Urban Ozone, and Climate
Change (http://www.eia.doe.gov/cneaf/pubs_html/rea/feature1.html)
Week
5 (22 & 24 Sept): Quiz 1. Finish Chapter 4. Application of
externality theory to environmental planning – CEQA EIR Land Use – new
commercial development and blight impacts on existing commercial districts
(lecture outlines at http://www.humboldt.edu/~envecon/ppt/econ423econblightceqa.ppt).
One-page outlines of term papers are due Thurs!
For
further reading on the Internet:
Energy
and Resources Group, UC-Berkeley (http://socrates.berkeley.edu/erg/index.shtml)
Economic
Sustainability and Scarcity of Natural Resources (http://www.rff.org/Documents/RFF-IB-00-tahvonen.pdf)
Racing
for Crabs (http://californiaagriculture.ucop.edu/0404OND/pdfs/crabs.pdf)
The
Value of the World’s Ecosystem Services and Natural Capital (http://www.esd.ornl.gov/benefits_conference/nature_paper.pdf)
Economic
Reasons for Conserving Wild Nature (http://www.sciencemag.org/cgi/content/abstract/297/5583/950)
Week
6 (29 Sept & 01 Oct): Chapter 5--The Economics of Natural Resource Systems
Part I. Focus on CA energy crisis, recycling economics, intuition on dynamic
efficiency. NOTE: Also read the parts of Chapter 16 having to do with local
self-governance of common-pool resources (p. 454-62).
Week
7 (06 & 08 Oct): Tues: Review for first midterm exam. First midterm exam
Thurs! (Note that unlike some of the past first midterm exams on the course
website, this first midterm includes coverage of Chapter 5).
Week
8 (13 & 15 Oct): Chapter 5 –Gordon model of a fishery; common-pool resource
economics
Week
9 (20 & 22 Oct): Chapter 7--Measurement and Analysis of Benefits and Costs
(summary coverage of key concepts; discuss CA Energy Comm. study on Klamath
dams)
For
further reading on the Internet:
National
Ocean Economics Program Non-market valuation database for recreational and
other non-market uses: (http://noep.mbari.org/nonmarket/)
Gretchen
Daily’s InVEST model for valuing nature’s services –
Natural Capital Project (requires ArcView software) (http://www.naturalcapitalproject.org/toolbox.html)
The
Benefits of Meeting Federal Clean Air Standards in the South Coast and San
Joaquin Valley Air Basins – IEES 2008 (http://business.fullerton.edu/centers/iees/reports/Benefits%20of%20Meeting%20Clean%20Air%20Standards.pdf)
EPA's
Guidelines for Preparing Economic Analyses (http://yosemite.epa.gov/ee/epa/eed.nsf/webpages/Guidelines.html)
Elwha
River dam removal and ecosystem restoration environmental impact statement and
other documents (http://www.nps.gov/olym/naturescience/elwha-restoration-docs.htm)
California
Energy Commission study of dam re-licensing and decommissioning options for the
Klamath Basin hydroelectric project: http://www.energy.ca.gov/2006publications/CEC-700-2006-010/CEC-700-2006-010.PDF.
Addendum
to California Energy Commission study of dam re-licensing and decommissioning
options for the Klamath Basin hydroelectric project: http://www.energy.ca.gov/2007publications/CEC-700-2007-004/CEC-700-2007-004.PDF.
Week
10 (27 & 29 Oct): Chapter 8--The Political Economy of Environmental
Regulation and Resource Management.
For
further reading on the Internet:
Federal
Elections Commission Campaign Finance Reports (http://www.fec.gov/disclosure.shtml)
National
Institute on Money in State Politics (http://www.followthemoney.org/)
Montreal
Protocol for Substances that deplete the Ozone Layer (http://ozone.unep.org/Treaties_and_Ratification/2B_montreal_protocol.shtml)
Keohane et al: The Positive Political
Economy of Instrument Choice in Environmental Policy (http://www.rff.org/Documents/RFF-DP-97-25.pdf)
Week
11 (03 & 05 Nov): Quiz 2. Chapter 9--Motivating Regulatory
Compliance: Monitoring, Enforcement, and Sanctions.
For
further reading on the Internet:
Code
of Federal Regulations (http://www.gpoaccess.gov/cfr/index.html)
Cornell
University Legal Information Institute's Coverage of Environmental Law
(http://www.law.cornell.edu/topics/environmental.html)
EPA
Compliance and Enforcement Portal (http://www.epa.gov/compliance/)
Week
12 (10 & 12 Nov): Chapter 10--Creating Incentives for Environmental
Protection and Resource Management (focus on cap-and-trade). Final term
papers due Thurs!
For
further reading on the Internet:
Clean
Air Markets (http://www.epa.gov/airmarkets/)
Stavins: Experience with Market-Based
Environmental Policy Instruments (http://www.rff.org/Documents/RFF-DP-01-58.pdf)
International
Experiences with Economic Incentives for Protecting the Environment (http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0487-01.pdf)
Additional
Optional Reading: "Environmental Policy Since Earth Day I: What Have We
Gained?" Freeman, Journal of Economic Perspectives 16 (Winter 2002):
125-146.
Week
13 (17 & 19 Nov): Tues: Review for second midterm exam. Second midterm
exam Thurs!
***
Thanksgiving break week – no class on 24 & 26 Nov ***
Week
14 (01 & 03 Dec): Chapter 11--Global Climate Change: Science, Policy,
and Economics Posters due for poster session Tues!
Thurs--grades, final exam comments, course evaluation
Week
15 (08 & 10 Dec): Posters due for poster session Tues! Thurs—review for
final exam
Week
16 (16 – 18 Dec): Optional final exam – 11:00 class has its final on Thurs 17
December from 10:20 – 12:10 am in the classroom. 2:00 class has its final on
Tues 15 December from 3:00 – 4:50 in the classroom.
My
responsibility as professor is to lead and motivate students who are committed
to the learning process, and to determine the extent to which students have
mastered the material covered in this course. I aim to be courteous,
respectful, and responsive to student needs. Grades are assigned based on my
professional judgment of the quality of your work and are not subject to
negotiation. Students are responsible for their learning outcomes and their
performance on all assignments. Students are expected to attend class regularly
and on time, are expected to be active learners who contribute to the classroom
discussion, and are expected to be courteous and respectful of others. All cell
phones and other such communication devises must either be off or on “vibrate”
mode, and you are not to take or initiate telephone calls or text messages
during class. Laptop computers and similar devises can only be used during
class to take notes or to research material for class discussion going on at
that time. You cannot be checking email or browsing the internet during class.
Please contact me if you have a problem or a conflict relating to the course.
Late or missing work will receive a grade of 0. All of us are subject to HSU
and CSU policies, which include nondiscrimination, academic honesty, student
discipline, and family educational rights and privacy. It is my goal to create
a friendly, inclusive, and rigorous classroom culture in which everyone is
welcome to comment and contribute, and in which diversity is respected. I want
this to be a class that we all look forward to attending, and that we can look
back upon as having been a very positive experience.
·
Students
with Disabilities: Persons who wish to request disability-related
accommodations should contact the Student Disability Resource Center in House
71, 826-4678 (voice) or 826-5392 (TDD). Some accommodations may take up to
several weeks to arrange. http://www.humboldt.edu/~sdrc/
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Add/Drop
policy: Students are responsible for knowing the University policy, procedures,
and schedule for dropping or adding classes. http://www.humboldt.edu/~reg/regulations/schedadjust.html
·
Emergency
evacuation: Please review the evacuation plan for the classroom (posted on the
orange signs) , and review http://studentaffairs.humboldt.edu/emergencyops/campus_emergency_preparedness.php
for information on campus Emergency Procedures. During an emergency,
information can be found campus conditions at: 826-INFO or
www.humboldt.edu/emergency
·
Academic
honesty: Students are responsible for knowing policy regarding academic
honesty: http://studentaffairs.humboldt.edu/judicial/academic_honesty.php
or http://www.humboldt.edu/~humboldt/catalogpdfs/catalog2007-08.pdf
·
Attendance
and disruptive behavior: Students are responsible for knowing policy regarding
attendance and disruptive behavior: http://studentaffairs.humboldt.edu/judicial/attendance_behavior.php
We
will have a variety of class participation exercises and homework. While this
work will be turned in, it will not be graded – these are activity points only.
NOTE: You cannot get class participation points if you do not attend class when
we do the exercise.
There
will be two quizzes during the semester, one before each examination. Each quiz
is worth 10 percent of your total grade. Click here to see old
quizzes with answers.
You
will be asked to sit for two mid-term examinations. The format of these exams
may include short answer, matching, and computational problem-solving. Click here to see old
midterm exams with answers.
You
will write a research paper in executive summary format. The assignment begins
with a one-page outline of your planned research project, which is worth 5 percentage
points. Building on this outline, you then write a short (target length of 3
double-spaced pages of text; do NOT exceed) word-processed research paper in
executive summary format worth 20 percentage points. Examples of some strong
research papers from past semesters are given in the student essays (http://www.humboldt.edu/~envecon/econ_423/studentEssays.html)
component of the course Internet site. If you have concerns about how to
conduct research for this project, then please take the Research Roadmap
tutorial at: http://library.humboldt.edu/researchroadmap/.
Research
paper requirements: Due to furloughs you will write the paper in executive
summary format rather than as a full-length paper. All research papers will
have a paper cover page (please, no plastic covers or binders!) listing title,
author, course and professor, and date, 3 pages of double-spaced text with font
size of 10 - 12, margins of at least 3/4 of an inch, and with pages numbered
(have sources cited in the text as follows: "Smith (1996)
stated..."), a list of authoritative sources cited in the narrative (a
minimum of 5, preferably more; Wikipedia does not count as an authoritative
source, but is a good place to learn and to find authoritative sources), and
any tables, figures, or other appendix material you would like to include (not
a place to dump more text). Staple your essay in the upper left-hand corner--no
plastic covers or binders! It is recommended that you discuss your topic with
me beforehand, which will allow you to get feedback from me and likely improve
your grade. Please note that the grade of "A" is reserved for work
that is truly an outstanding achievement. In contrast, "B" refers to
work that is more than satisfactory ("C") but not quite an
outstanding achievement. Your research paper grade will be determined based on
(1) mastery of economic concepts, degree of economic sophistication, and the
quality of your description of the linkages between the economic concept and
the environment or natural resources, (2) quality of writing, and (3)
thoroughness of your research. Click here (http://www.humboldt.edu/~envecon/econ_423/Econ%20423%20research%20paper%20grading%20rubric.htm)
to see the grading rubric I will use on your research paper.
You
will prepare of a poster that summarizes your research paper. Posters should be
sufficiently large as to include the title and author's name, summary narrative
in easy-to-read format, substantial economic content, accompanying pictures or
diagrams or numerical examples, and key references cited. Posters will be
displayed in class and a "poster session" will be held in which
students can freely circulate in an unstructured setting and see other people's
work. Posters will be graded based on each of the elements above and on quality
of layout and graphics.
You
may elect to sit for the comprehensive final examination, which is optional. A
student's grade on the final will ONLY count if it exceeds one of her/his
mid-term exam scores, in which case it will replace that score. Students can
elect not to take the final if their mid-term exam scores are satisfactory.
Numerical
scores between 0 and 100 are assigned for each graded item. Your overall course
numerical score is equal to the weighted sum of your numerical scores on each
graded element of the course:
Course
Numerical Score = 0.10*(Class Participation Score) + 0.20*(Quiz Scores)
+ 0.05*(Research Paper Outline Score) + 0.25*(First Midterm Exam Score) +
0.15*(Research Paper Score) + 0.25*(Second Midterm Exam Score) + 0.10*(Poster
Session Score).
Note:
The optional final exam score replaces the lowest midterm exam score if it
exceeds it.
Your
overall course numerical score will then be converted into a letter grade for
the course based on the following scale:
100 -
93: A
92.99
- 90: A-
89.99
- 88: B+
87.99
- 83: B
82.99
- 80: B-
79.99
- 78: C+
77.99
- 73: C
72.99
- 70: C-
69.99
- 68: D+
67.99
- 60: D
59.99
- 0: F