Prague, Czech Republic - Course Descriptions - Environmental Economics and Management

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The course provides knowledge on all the important aspects of environmental economics, environmental policy and management both on the micro a macroeconomic level. It does not intent to require large portions of readings for memorization. Rather the intention is to support a true understanding of the principles, concepts and theories in the field. Discussion of concrete systems of environmental management is one of the typical subjects of student projects. Various class exercises are introduced for use in classes. Most typically, they take the form of simple economic lab experiments, where students are placed in the role of various economic subjects. A special textbook was elaborated to provide main text for the course.

1.    Initial information about the content of the course;
    Nature and the environment; getting knowledge about nature and the environment
Šauer 2007, Chap. 1

2.    Nature, the environmental and its protection as a problem of economic analyses; natural goods and property rights – an introduction and key terms.
Šauer 2007, Chap. 2.1 - 2.2
Readings: Hardin, G.: The Tragedy of the Commons

3.    Ethics, human needs and values, environmental values, implications for actions of individuals in the markets and in political systems, implications of environmental policies.
    Class exercise: comparison of human values of university students from approximately 8 states all over the World and values of the current group (a questionnaire distributed at the class); discussion about human value priorities and their importance for individual's behavior both in the economic system and in the political system.
Šauer 2007, Chap. 2.3

4.    Analytical evaluation of single environmental factors and an evaluation of the total quality of the environment in a region: the difference between a state and the quality of the environment; finding the "points of orientation" on the half-straight-line of the changed state of the environment for the evaluation; using multicriteria analyses for the evaluation.
    Class exercise (case): multicriteria evaluation of total quality of living in a city, where ecological factors are included; a discussion about getting a consensus between different human values oriented participants, discussion of public choice problems in the field, etc.
Šauer 2007, Chap. 2.4

5.    Explaining terms: economic damage from environmental degradation, control costs (environmental protection costs), environmental burden of the economy.
    Class exercise: small "brainstorming" on finding examples of both the damage and control costs.
Šauer 2007, Chap. 3.1, 4.1, 4.2

6.    Economic damage from environmental degradation: main approaches to quantification both the damage and benefits from environmental protection projects.
    Class exercise: real and hypothetical market of a selected private good; valuation without and with additional ecological (ethical) information given to the consumer; impact on the markets.
    Class exercise: simplified cost-benefit analyses - the benefits evaluation based on a contingent valuation.
        Class exercise: travel cost method
Šauer 2007, Chap. 3.2 – 3.4
Readings: Knetch J.L., Davis R.K.: Comparison of Methods for Recreation Evaluation

7.    Environmental capital investment: a concept of net and gross control costs; efficiency of environmental protection spending from both private and public point of view; possible approaches to quantification of environmental effects for setting priorities of funding from public financial sources; the role of cost-benefit and cost-effectiveness analyses and problems of discounting are also discussed in this block.
    A numerical illustrations of polluter's decision-making and of a public authority decision-making.
Šauer 2007, Chap. 4.3 – 4.4

8.    Models of optimal behavior of a single polluter; main types of tools of environmental policies from a single polluter point of view
    Simple numerical illustration: optimal pollution on a microeconomic level.
Šauer 2007, Chap. 6

9.    Tools of environmental policy, conditions upon which they work, their advantages and disadvantages, the role of government: long- mid- and short term administrative tools (command-and control approach)
Šauer 2007, Chap. 7.1 – 7.2

10.    Coase’s idea and other private solutions to environmental problems.
    Small class lab economic experiment: Coasian theory based negotiation
Šauer 2007, Chap. 7.3
Readings:    Coase, R.: The Problem of Social Cost
        Randall A.: Coasian Externality Theory in a Policy Context

11.    Pollution permits trading as a market-based tool of environmental policy.
    Class lab experiment: pollution permits trading in a hypothetical region
Šauer 2007, Chap. 7.4
Readings: Tietenberg T.: Transferable Discharge Permits and the Control of Stationary Source             Air Pollution: A Survay and Synthesis

12.    Environmental taxes, charges, financial supports, environmental policy tool mixes; voluntary approaches and other tools of environmental policy.
    Class exercise based on data from the exercise in section 10; computer illustrations on a model
Šauer 2007, Chap. 7.5
Readings: Baumol W.J., Oates W.E.: The Use of Standarts and Prices for Protection of the Environment

13.    Basic macroeconomic view on environmental problems: optimal environmental quality in some territory - static and dynamic model; discussion about the degree of optimism and pessimism about economic growth; introduction into sustainable development; other macroeconomic consequences of environmental and economic policy decisions
    Simple numerical illustration: an optimal environmental quality on the macroeconomic level.
    Class exercise: small "brainstorming" on finding possible macroeconomic impacts of the environmental policy decisions.
Šauer 2007, Chap. 8


14.    Introduction into the theory of Renewable and Non-renewable resources

* * * *

Students prepare their own presentations on selected interesting topics, which are mainly based on current practical themes and are discussed at lectures. A selection of the topic is always discussed with students according to his/her interests. The presentation can have a "classic" form or it can be prepared as a class exercise (small class lab experiment).


There are three groups of topics of student presentations:
a)    Czech and Middle Europe environmental problems (air pollution, water pollution, waste disposal problems, comparison of East-West situation in selected area, selected natural resources problems, selected environmental problems in towns etc.)
b)    International and global environmental problems (trans-boundary emission problems, tropical deforestation, climate changes (greenhouse effect, global warming), ozone layer problem, biological diversity problems etc.)
c)    Other (according individual interests of students - for instance: Environmental problems in developing countries; ethics, human values and the environment etc.)



Exam conditions:

2 written exams - max 60 points
(2x about 6 questions, average 5 points each)
Attendance - max 20 points
Student presentation - max 10 points
Oral final exam - max 10 points
TOTAL - max 100 points



Grading scale:
100 - 90            A Excellent
  89 - 75            B Very Good
  74 - 60            C Good
  59 and less      F Failure

 
Literature:

Textbook: (available at Department of Environmental Economics; possible to buy or borrow for deposit)
Šauer Petr (2007): Introduction to Environmental Economics and Policy with Economic Lab Experiments and Class Exercises, Nakladatelství a vydavatelství litomyšlského semináře, Praha, ISBN 978-80-86709-10-9

Readings (available from the University library):
Environmental Economics and Policy (Selected Classical Readings), Edited by: Šauer P., Livingston M., ETP, Nakladatelství a vydavatelství litomyšlského semináře, Prague-Greeley-Bratislava 1996, ISBN 80-902168-1-1



Alternative textbooks recommended (available from the University library):
Kolstad, Ch. D.(2000): Environmental Economics. Oxford University Press
Field, B.C. & Field, M.K. (2006): Environmental Economics: An Introduction, McGraw-Hill.
Tietenberg T. (2006): Environmental Economics, and Policy, 5th edition, Pearson/Addison-Wesley.

Another literature:
Environmental Yearbook of the Czech Republic (since 1991)
Prague Environment 1998, 2007. Institute of Municipal Informatics of the City of Prague 1999, 2008
State Environmental Policy. Ministry of the Environment of the Czech Republic, Prague 1999, 2001, 2003, 2005
Report on the Environment in the Czech Republic. Ministry of the Environment of the Czech Republic.

Useful link for searching for literature in the field:
http://www.cenia.cz/
see pages of the Department of Environmental Economics UEP for other useful links.
Useful addresses for searching for literature in Prague:
Library of the Ministry of the Environment and Library of the Czech Ecological Institute (both located in the same building): Vršovická (street) 65, Praha 10 - Vršovice
Library CERGE and Economic Institute of the Czech Academy of Science, Politických vězňů 9, Praha 1

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