Module 3

Question 1

Nihilism

Answer 1

Nothing has an intrinsic value - no such thing

Question 2

egoism

Answer 2

only value is to maximize own good

Question 3

anthropocentrism

Answer 3

all humans have intrinsic value - other animals only value humans or nothing

Question 4

zoocentrism

Answer 4

all animals experiencing pleasure can have value

Question 5

biocentrism

Answer 5

all living organisms have value (plants and nature)

Question 6

ecocentrism

Answer 6

interactions not just individuals conclude that all organisms have value

Question 7

cosmic universalism

Answer 7

everything has intrinsic value (even lifeless)

Question 8

cost-benefit analysis

Answer 8

rational framework for decision making - measures the benefits minus the costs of taking that action - estimates strengths and weaknesses of alternatives

Question 9

ecosystem services

Answer 9

varied benefits to humans provided by the natural environment and healthy ecosystems

Question 10

use-values

Answer 10

has direct or indirect consumption values (food, fuel, medicine)

Question 11

non-use value

Answer 11

may value it now because we might use it in the future (it has existence value) - willingness to pay to preserve a river that our kids may play in

Question 12

contingent valuation

Answer 12

determining peoples levels of valuation through methods of willingness to pay/accept in order to derive consumer surplus

Question 13

prospect theory

Answer 13

people value losses more than gains

Question 14

consumer surplus

Answer 14

the difference between what one is willing to pay and what one actually has to pay for a service/project/good (when actual price is lower than WTP)

Question 15

revealed preferences approach

Answer 15

based on consumer behaviour being the best analysis of their preference: travel cost, house prices, wage risk

Question 16

Life Satisfaction Approach

Answer 16

focuses on experienced human wellbeing rather than market production

Question 17

3 components to aggregation problem

Answer 17

1- over individual (externalities and opportunity cost)
2- over time (how much does future matter?)
3- over possible outcomes (risk and uncertainty)

Question 18

Discount Factor

Answer 18

compares one point in time to another - how much we care about having 1 fish in future vs now

Question 19

Discount Rate

Answer 19

how much you are discounting over time (expected to grow faster in the future so discount rate will be positive)

Question 20

Interest Rate

Answer 20

tells you how much to discount future benefits

Question 21

Risk Aversion

Answer 21

preferring something more certain than something uncertain but has a higher expected payoff

Question 22

Quantifying Risk

Answer 22

Risk = Badness x probability

evaluating identified risks to determine a response to corresponding risks

Question 23

The Rebound Effect

Answer 23

increased efficiency of a resource leads to increased overall use of that resource and of energy

Question 24

Green Paradox

Answer 24

threat of climate change and policies to phase out fossil fuels induces oil producers to extract at faster rate thus accelerating climate change

Question 25

Precautionary Principle

Answer 25

cannot use lack of scientific certainty as excuse to postpone preventative measures for environmental degradation

Question 26

diminishing marginal utility

Answer 26

the marginal utility from each additional unit decreases as consumption increases (satisfaction of eating a second chocolate bar is less than the first)

Question 27

SCC

Answer 27

Social Cost of Carbon: estimated economic cost/damage of emitting an extra unit (tonne) of GHG into atmosphere today (or in a given year)

Question 28

mitigation

Answer 28

process of avoiding/reducing GHG emission (ex: providing info, subsidies, prices, regulaiton)

Question 29

adaptation

Answer 29

dealing with climate change effects and mitigating damage (Ex: disaster managment, complex development policy)

Question 30

geoengineering

Answer 30

reverse climate change without treating GHG causes | ex: artificial volcanic eruption, parasol

Question 31

carbon pricing

Answer 31

market based approach to decrease carbon emissions by big firms/factories in the market by passing on the price of emitting to them, provides financial incentive to lower carbon emissions

Question 32

Cap and Trade

Answer 32

the government sets a quota of total emissions amount per unit of time (ex per year), firms releasing GHG can then trade or bid on permits

Question 33

Carbon Tax

Answer 33

Gov decides on fixed price to be paid by firms emitting GHGs per unit of carbon

Question 34

Risk Premium

Answer 34

the return a firm is expecting to get back after putting an investment - price uncertainty leads to this which can lead to extracting fossil fuels even faster

Question 35

average annual carbon footprint

Answer 35

20tonnes CO2e/person/year | according to lecture (according to google it is 4)

Question 36

gloabl emissions

Answer 36

37 gega tonnes CO2

Question 37

Strategic Bias

Answer 37

someone might inflate their stated WTP if they think they wont actually have to pay it - their answer is affected by the context of the issue

Question 38

framing bias

Answer 38

changing how the issue/question is framed can change the answer

Question 39

free riding

Answer 39

giving an answer that is less than true valuation because you want others to pay but don't want to contribute your own true valuation