University
of
Econ 115/ EnvSt 175: Intermediate Environmental Economics
Winter
2012
Prof. Charles D. Kolstad
Office: NH 2032 & BH 3416; Office Hours: W1-2 (North Hall--NH); Tu 11:30-12:30 (Bren Hall--BH), or by appt.
Lectures: Buchanan 1940; TuTh2:00-3:15; plus discussion section (each student should register for one discussion section and attend regularly).
TA: Mr. Valentin Shmidov [Office Hours Mo 12-2, Fr 12-2 (NH 2021)]; shmidov@econ.ucsb.edu; mailbox in NH 2120
Ms. Sara Adler [Office Hours W 1-3 (NH2049)]; adler@umail.ucsb.edu
Mr. Ty Robbins [Office Hours: Tu 9-11 (NH2049)]; trobbins@umail.ucsb.edu
PLEASE READ THE FOLLOWING:
This is an advanced undergraduate course in environmental economics. One quarter of intermediate microeconomics (Econ 10A) and calculus are prerequisites. Econ 100B (second quarter of intermediate micro) and Econ 140AB (econometrics) are recommended. We will cover most aspects of the economy’s interaction with the environment. However, the course will be short on policy and long on theoretical developments in the area of environmental economics. Students without the preparation should wait or enroll in EnvSt 174: Environmental Economics and Policy.
This course will not be easy but should be rewarding. On average, you should expect approximately 8 hours of work per week outside of the classroom. The course will involve a good deal of reading and homework. You should read all of the material in the chapter before the date scheduled for class discussion.
Office Hours: Profs. Kolstad and Shmidov have set aside 5-6 hours of office hours every week. You are encouraged to use these office hours for one on one interaction with one of us. Do not assume we are too busy to meet with you. Students are very important and we both like to meet with you.
Exams: There will be a midterm (Tuesday, Feb 14) and a final exam (Tuesday, March 20, 4-7pm). The midterm covers the first five weeks of the course. The final will cover the whole course, with a modest emphasis on the second half. The midterm and final will be closed book although you may bring one sheet of notes (8.5”x11”, both sides ok) to each exam. Furthermore, even though we will not go over all the material in a chapter, you will be responsible for all of the assigned material on exams, unless material is expressly excluded. Midterm and midterm solutions will be posted on Gauchospace.
Honor Code: It goes without saying that giving or receiving aid on an exam is considered cheating and it a violation of the honor code (with consequences, including the potential for permanent/lifetime dismissal from the University of California). Any discussion or note passing among students during an exam will be considered prima facie evidence of cheating.
Class Participation: Part of your grade is for class participation. Make sure you have your picture attached to your name in GauchoSpace so that we can attach your participation to your name! And although we do not take attendance, you should plan to attend class and section regularly. Attendance is a component of participation. Exams may include material not in the readings but covered in class or section.
Sections: Section will be held every week, including the first week. Sections are an important part of the class, involving discussion of readings and in-depth examination of issues introduced in lecture. Participation in sections will be part of your class participation grade in the course.
Homework: There are also weekly homework assignments (most weeks anyway). A week's homework is due by midnight Friday, and should be uploaded to GauchoSpace. Check GauchoSpace regularly for announcements and assignments. Homework may be handed in late, up to the point where the answers are posted on the web page. You have one “free” tardy for homework; any others will have a grade penalty for being late. Furthermore, your worst homework grade will be dropped. Homework is graded on a 0-100 basis with extra credit problems allowing scores in excess of 10. Homework answers will be posted on Gauchospace.
Joint Work: Homework is supposed to reflect your individual work, not group work. You may discuss general issues with your fellow students but you should not copy from someone else. Each student should turn in his or her own homework.
Grading: The 7-8 homework assignments will count roughly 25% in the final grade; the midterm 25%, the final 35%; and class participation (questions, class discussion, section discussion, attendance, etc.), 15%. Grading is on a curve. The last time I taught this class, the average grade was 80 (as was the median), which translated into a low B-.
Readings: There is one required book, available from the UCSB Bookstore or Amazon (or anywhere else!): Charles D. Kolstad, Environmental Economics, 2nd Edition (Oxford University Press, 2010) [referred to as Kolstad]. Make sure you get the second edition, not the first edition. The first few chapters will be posted on GauchoSpace to allow time for you to get your copy of the book. There are also readings, mostly available either as downloads on GauchoSpace OR (if there is a hotlink) directly, though you may need to be doing it from a UCSB domain. We will not necessarily discuss all readings in class or section. But you should be prepared to discuss readings, either in class or in section. And whether or not they are discussed, there may be questions on the readings on exams.
CLASS SCHEDULE AND HOMEWORK ASSIGNMENTS
Please read the appropriate material before the first class meeting on that material. Articles are generally downloadable from GauchoSpace (unless there is a hotlink in which case you have to be at a UCSB computer to access the library copy).
1. Intro & Environmental Policy
(Week 1)
Kolstad: Chapters 1 & 2
Bjorn Lombord, “The Truth about the Environment,” The Economist (2 Aug 2001).
Don Fullerton and Robert Stavins, “How Economists See the Environment,” Nature, 395:6701 (1998).
Garrett Hardin, “The Tragedy of the Commons,” Science, 162:1243-48 (1968).
2. Social Choice and Efficiency
(Week 2)
Kolstad: Chapters 3 & 4
Arrow et al, “Are We Consuming Too Much?”, J. Economic Perspectives (2004)
3. Market Failure, Public Goods and
Externalities (Week 3)
Kolstad, Chapter 5
John Tierney, “Where the Tuna Roam,” NYTimes (2006)
Costello et al, “Can Catch Shares Prevent Fisheries Collapse?,” Science (2008)
4. Making Decisions about the
Environment (Week 4)
Kolstad, Ch 6
M. Burns, “Unusual Coalition Pushes for Creek Tax,” Santa Barbara News-Press, 10/23/2000. [see Gauchospace]
Kelman “Cost-Benefit Analysis: An Ethical Critique”
5. Valuation Methods: Revealed
Preferences (Week 4-5)
Kolstad, Ch 7, 8
"A Price on the Priceless?," Economist, Aug. 17, 1991.
“Putting
a Price on the Priceless: One Life,” NY Times (Sept 9, 2007)
6. Valuation Methods: Constructed
Markets (Week 5-6)
Kolstad, Ch 9, 10
Midterm (See
Sample
Midterm and Solutions
from a previous year)
Covers first five weeks on outline (through Revealed Preference Valuation Methods).
7. Regulating Polluters:
(Week 7)
Kolstad, Ch 11
J. Leape, “The London Congestion Charge,” J. Economic Perspectives (2006)
8. Regulating Polluters: Prices
& Quantities (week 8)
Kolstad, Ch 12 & 13
Ronald Coase, “The Problem of Social Cost,” J. Law and Economics [Ch 3 in Stavins]
"Feedlot
Price: $1.82/month," Santa Maria Times,
Michael Sandel, “It’s Immoral to Buy the Right to Pollute,” NY Times (1997)
9. Voluntary Actions and Agreements
(Week 9).
Readings:
Kolstad, Ch 17
James Maxwell and Forrest Briscoe, “There’s Money in the Air,” Bus. Strat. & Env. (1998).
Larry Summers World Bank Memo.
10. Asymmetric Information: Hidden
actions and hidden types (Week 10)
Readings:
Kolstad, Ch 15 & 16