Lecture 1 Environment and Economic Resource Use Flashcards
Explain the problems in resource and environmental economics
· Market failure (e.g. prices for kerosene do not reflect damages
to the environment)
· Dynamics (use of natural resources affects future generations)
· Irreversibility (e.g. effects of climate change, loss of biodiversity)
· Relationship between ecological and economic systems
Assess the importance of resource and environmental economics
“Environmental problem”: The environment is not for free, there is a tough competition for use. The environment is not a public good as there is rivalry for use.
Natural resources are too cheap for the good of future generations, are being selfishly exploited at a rapid rate, and are being produced and consumed wastefully.
Resource and environmental economics applies economic principles to questions concerning the development and management of the environment and natural resources
International climate policy: Paris Agreement, Green Deal etc.
