Principles of Environmental and Natural Resource Economics

✍ Scribed by Ahmed Hussen

• Year: 1999
• Tongue: English
• Leaves: 383
• Edition: 1
• Category: Library

✦ Synopsis

This text offers an systematic exposition of environmental and natural resource economics. It considers a variety of real world examples to illustrate the policy relevance and implications of key economic and ecological concepts.

✦ Table of Contents

Book Cover......Page 1
Half-Tilte......Page 2
Title......Page 3
Copyright......Page 4
Contents......Page 5
Figures......Page 14
Tables......Page 16
Case studies......Page 17
Exhibits......Page 18
Preface......Page 19
Acknowledgments......Page 24
Introduction: Overview of Environmental and Resource Economics as a Subdiscipline in Economics......Page 26
part one THE “PREANALYTIC” VISION OF NATURAL RESOURCES: THE STANDARD ECONOMIC PERSPECTIVE......Page 30
1.1 INTRODUCTION......Page 31
1.2 THE CONCEPT OF RESOURCES......Page 32
1.3 SCARCITY AND ITS ECONOMIC IMPLICATIONS......Page 33
1.4 A SCHEMATIC VIEW OF THE ECONOMIC PROCESS......Page 34
1.5 APPLYING THE CONCEPT: ECOTOURISM, CATTLE RANCHING AND THE ECONOMY OF COSTA RICA......Page 37
1.6 CHAPTER SUMMARY......Page 39
REFERENCES AND FURTHER READING......Page 41
part two MARKETS, EFFICIENCY, TECHNOLOGY AND ALTERNATIVE ECONOMIC INDICATORS OF NATURAL RESOURCE SCARCITY......Page 42
2.1 INTRODUCTION......Page 43
2.2 BASIC ASSUMPTIONS......Page 44
2.3 AN INTERPRETATIVE ANALYSIS OF DEMAND, SUPPLY AND MARKET EQUILIBRIUM PRICE......Page 45
2.4 EVALUATING THE PERFORMANCE OF A PERFECTLY COMPETITIVE MARKET ECONOMY......Page 50
2.4.1 Consumers’ surplus......Page 51
2.4.2 Producers’ surplus and net social benefit......Page 53
2.4.3 Pareto optimality and the Invisible Hand Theorem......Page 54
2.5 PRODUCT PRICE AS A MEASURE OF NATURAL RESOURCE SCARCITY......Page 55
2.6 CHAPTER SUMMARY......Page 60
REFERENCES AND FURTHER READING......Page 62
chapter three MARKET SIGNALS OF NATURAL RESOURCE SCARCITY:......Page 63
3.2 THE DEMAND FOR A FACTOR OF PRODUCTION: THE CASE OF NATURAL RESOURCES......Page 64
3.3 KEY VARIABLES AFFECTING THE SUPPLY OF A FACTOR OF PRODUCTION: THE CASE OF NATURAL RESOURCES......Page 66
3.4 LONG-RUN MARKET VALUATION OF A FACTOR OF PRODUCTION......Page 68
3.5 RENT AND EXTRACTION COST AS ALTERNATIVE MEASURES OF NATURAL RESOURCE SCARCITY......Page 69
3.5.1 Differential rent......Page 70
3.6.1 Factor substitution......Page 73
3.6.2 Changes in production technology: technical advances......Page 75
3.7 IMPORTANT CAVEATS......Page 77
3.8 CHAPTER SUMMARY......Page 78
REFERENCES AND FURTHER READING......Page 80
part three ECOLOGY: THE ECONOMICS OF NATURE......Page 81
chapter four THE CONCEPT OF NATURAL RESOURCES:......Page 82
4.2 ECOSYSTEM STRUCTURE......Page 83
4.3 ECOSYSTEM FUNCTION......Page 84
4.3.1 Materials recycling......Page 85
4.3.2 Succession, equilibrium, stability, resilience and complexity......Page 86
4.4 THE LAWS OF MATTER AND ENERGY......Page 89
4.5 THE BASIC LESSONS OF ECOLOGY......Page 91
4.6 HUMANITY AS THE BREAKER OF CLIMAXES......Page 92
4.7 CHAPTER SUMMARY......Page 96
REFERENCES AND FURTHER READING......Page 98
part four FUNDAMENTALS OF THE ECONOMICS OF ENVIRONMENTAL RESOURCES......Page 99
chapter five THE MARKET, EXTERNALITY, AND THE “OPTIMAL” TRADE-OFF BETWEEN ENVIRONMENTAL QUALITY AND ECONOMIC GOODS......Page 100
5.1 INTRODUCTION......Page 101
5.2 THE ECONOMIC PROCESS AND THE ASSIMILATIVE CAPACITY OF THE NATURAL ENVIRONMENT......Page 102
5.3.1 Common property resources and the economic problem......Page 105
5.3.2 Environmental externalities and their economic consequences......Page 107
5.4 INTERNALIZING EXTERNALITY USING THE PIGOUVIAN TAXES APPROACH......Page 111
5.5 THE MACROECONOMIC EFFECTS OF ENVIRONMENTAL REGULATIONS: AN OVERVIEW......Page 114
5.6 CHAPTER SUMMARY......Page 116
REFERENCES AND FURTHER READING......Page 118
part five THE PERENNIAL DEBATES ON THE BIOPHYSICAL LIMITATIONS TO ECONOMIC GROWTH......Page 120
6.1 INTRODUCTION......Page 121
6.2 THE SIMPLE MALTHUSIAN GROWTH DOCTRINE: POPULATION AND RESOURCE SCARCITY......Page 122
6.3 MODIFIED MALTHUSIAN MODELS: POPULATION, RESOURCE USE AND ENVIRONMENTAL QUALITY......Page 125
6.3.1 Population and its impact on resource utilization and environmental quality......Page 126
6.3.2 Per capita consumption and its influence on the population-resource-environment interrelationship......Page 127
6.3.3 Technology and its influence on the population-resource-environment interrelationship......Page 128
Technical progress......Page 129
6.3.4 The basic lessons of the Ehrlich-Commoner model......Page 131
6.4 HAS MALTHUS BEEN DISCREDITED?......Page 132
6.5 CHAPTER SUMMARY......Page 134
REFERENCES AND FURTHER READING......Page 135
chapter seven BIOPHYSICAL LIMITS TO ECONOMIC GROWTH:......Page 137
7.2 RESOURCE SCARCITY, TECHNOLOGY AND ECONOMIC GROWTH......Page 138
7.3 THE CLASSICAL DOCTRINE OF INCREASING RESOURCE SCARCITY: THE EMPIRICAL EVIDENCE......Page 140
7.4 EMERGING RESOURCE SCARCITY OR ABUNDANCE: THE RECENT EVIDENCE......Page 143
7.5 ECONOMIC GROWTH, THE ENVIRONMENT AND POPULATION: THE NEOCLASSICAL PERSPECTIVE......Page 146
7.6 CHAPTER SUMMARY......Page 148
REFERENCES AND FURTHER READING......Page 150
chapter eight BIOPHYSICAL LIMITS TO ECONOMIC GROWTH:......Page 152
8.2 ECOLOGICAL ECONOMICS: NATURE AND SCOPE......Page 153
8.3 THE DEVELOPMENT OF ECOLOGICAL ECONOMICS: A BRIEF HISTORICAL SKETCH......Page 155
8.4.1 Kenneth Boulding (1909–93): ecological limits......Page 158
8.4.2 Nicholas Georgescu-Roegen (1906–94): energy as a limiting factor......Page 159
8.4.3 Herman Daly: the steady-state economy......Page 161
The means and ends spectrum......Page 162
The biophysical, economic and ethical dimensions of the steady-state economy......Page 163
Practicality of the steady-state economy......Page 166
8.5 CHAPTER SUMMARY......Page 168
REFERENCES AND FURTHER READING......Page 169
chapter nine THE ECONOMICS OF SUSTAINABLE DEVELOPMENT......Page 171
9.1 INTRODUCTION......Page 172
9.2 SUSTAINABLE DEVELOPMENT: A HELPFUL TERM OR A VAGUE AND ANALYTICALLY EMPTY CONCEPT?......Page 173
9.3 THE HARTWICK-SOLOW APPROACH TO SUSTAINABILITY......Page 175
9.4 THE ECOLOGICAL ECONOMIC APPROACH TO SUSTAINABILITY......Page 179
9.5 THE SAFE MINIMUM STANDARD (SMS) APPROACH TO SUSTAINABILITY......Page 182
9.6 SUSTAINABLE NATIONAL INCOME ACCOUNTING......Page 183
9.7 CHAPTER SUMMARY......Page 186
REFERENCES AND FURTHER READING......Page 188
part six THE ECONOMICS OF ENVIRONMENTAL RESOURCES: PUBLIC POLICIES AND COST-BENEFIT ESTIMATIONS OF ENVIRONMENTAL DAMAGE......Page 190
10.1 INTRODUCTION......Page 191
10.2.1 Pollution control (abatement) costs......Page 192
10.2.2 Pollution damage costs......Page 194
10.3 THE OPTIMAL LEVEL OF POLLUTION......Page 197
10.4 CHANGES IN PREFERENCE AND TECHNOLOGY AND THEIR EFFECTS ON THE OPTIMAL LEVEL OF POLLUTION......Page 200
10.5 AN ALTERNATIVE LOOK AT MARKET FAILURE......Page 201
10.6 THE OPTIMAL LEVEL OF POLLUTION: AN ECOLOGICAL APPRAISAL......Page 202
10.7 CHAPTER SUMMARY......Page 206
REFERENCES AND FURTHER READING......Page 208
11.1 INTRODUCTION......Page 209
11.2 ENVIRONMENTAL REGULATION THROUGH LIABILITY LAWS......Page 210
11.3 THE PROPERTY RIGHTS OR COASIAN APPROACH......Page 213
11.4 EMISSION STANDARDS......Page 216
11.5 CHAPTER SUMMARY......Page 224
REFERENCES AND FURTHER READING......Page 226
12.1 INTRODUCTION......Page 227
12.2 EFFLUENT CHARGES......Page 228
12.3 TRANSFERABLE EMISSION PERMITS......Page 233
12.4.1 Programs to phase out leaded gasoline and ozone-depleting chlorofluorocarbons (CFCs)......Page 238
12.4.2 The acid rain control program......Page 239
12.5 CHAPTER SUMMARY......Page 242
REFERENCES AND FURTHER READING......Page 244
13.1 INTRODUCTION......Page 245
13.2 CAUSES AND CONSEQUENCES OF ACID RAIN......Page 246
13.3 CAUSES AND CONSEQUENCES OF DEPLETION OF THE OZONE LAYER......Page 247
13.4 CAUSES AND CONSEQUENCES OF GLOBAL WARMING......Page 248
13.5 INTERNATIONAL RESPONSES TO ACID RAIN, OZONE DEPLETION AND CLIMATE CHANGE......Page 249
13.6 THE ECONOMICS OF ATMOSPHERIC POLLUTION......Page 253
13.7 CHAPTER SUMMARY......Page 256
REFERENCES AND FURTHER READING......Page 258
chapter fourteen THE ECONOMIC THEORY AND MEASUREMENT OF ENVIRONMENTAL DAMAGE (BENEFIT):......Page 260
14.1 INTRODUCTION......Page 261
14.2 VALUATION OF BENEFITS: THE METHODOLOGICAL ISSUE......Page 262
14.3 PRACTICAL METHODS FOR MEASURING THE BENEFITS OF ENVIRONMENTAL IMPROVEMENT......Page 264
14.3.1 The market pricing approach......Page 265
14.3.3 Hedonic price approaches......Page 266
14.3.4 The household production function approach......Page 268
14.3.5 The contingent valuation method......Page 270
14.4 SOME GENERAL PROBLEMS ASSOCIATED WITH THE ECONOMIC APPROACH TO ENVIRONMENTAL VALUATION......Page 275
14.5 CHAPTER SUMMARY......Page 278
REFERENCES AND FURTHER READING......Page 281
chapter fifteen A FRAMEWORK FOR ASSESSING THE WORTHINESS OF AN ENVIRONMENTAL PROJECT:......Page 283
15.1 INTRODUCTION......Page 284
15.2 THE WELFARE FOUNDATION OF COST-BENEFIT ANALYSIS......Page 285
15.3 THE NET PRESENT VALUE CRITERION......Page 286
15.4 PRIVATE VERSUS PUBLIC PROJECT APPRAISAL......Page 287
15.5 DISCOUNTING AND INTERGENERATIONAL EQUITY......Page 292
15.6 CHAPTER SUMMARY......Page 293
REFERENCES AND FURTHER READING......Page 295
part seven BASIC ELEMENTS OF THE ECONOMIC THEORIES OF RENEWABLE AND NONRENEWABLE RESOURCES......Page 297
chapter sixteen FUNDAMENTAL PRINCIPLES OF THE ECONOMICS OF RENEWABLE RESOURCES:......Page 298
16.2 THE NATURAL GROWTH FUNCTION OF BIOLOGICAL RESOURCES......Page 299
16.3 GENERAL CHARACTERISTICS OF THE NATURAL GROWTH FUNCTION OF FISHERY POPULATIONS......Page 301
16.4 THE PRODUCTION FUNCTION OF FISHERY: A STEADY-STATE BIOECONOMIC EQUILIBRIUM MODEL......Page 303
16.5 ECONOMICS OF FISHERIES MANAGEMENT......Page 308
16.5.1 The open-access equilibrium yield......Page 309
16.5.2 The socially optimal level of effort under private property rights......Page 310
16.6 REGULATION OF FISHERY: AN OVERVIEW......Page 312
Time......Page 315
The case of multiple species fishery......Page 316
The stochastic nature of fishery populations......Page 317
16.8 CHAPTER SUMMARY......Page 318
REFERENCES AND FURTHER READING......Page 320
chapter seventeen FUNDAMENTAL PRINCIPLES OF THE ECONOMICS OF NONRENEWABLE RESOURCES......Page 322
17.1 INTRODUCTION......Page 323
17.2.1 Reserves, resources and resource bases......Page 324
17.2.3 The hypothesis of smooth tonnage grade......Page 326
17.3.1 Basic assumptions and preliminary analyses......Page 328
17.3.2 The general condition for optimal intertemporal allocation of nonrenewable and nonrecyclable resources......Page 329
17.3.3 The optimal intertemporal allocation of nonrenewable but recyclable resources......Page 332
17.3.4 Further reflections on the nature of the user cost and some public policy implications......Page 333
17.4 THE OPTIMAL PRICE AND EXTRACTION PATHS OF NONRENEWABLE RESOURCES......Page 336
17.4.1 The time path of nonrenewable resource prices......Page 337
17.4.2 The optimal price path and resource exhaustion......Page 339
Monopoly Power......Page 340
Discount rates......Page 341
17.6 RESOURCE EXHAUSTION, BACKSTOP TECHNOLOGY AND LIMITS TO GROWTH......Page 342
17.7 CHAPTER SUMMARY......Page 344
REFERENCES AND FURTHER READING......Page 346
part eight RESOURCE SCARCITY, POPULATION, POVERTY AND THE ENVIRONMENT......Page 347
chapter eighteen POPULATION, DEVELOPMENT AND ENVIRONMENTAL DEGRADATION IN THE DEVELOPING WORLD......Page 348
18.1 INTRODUCTION......Page 349
18.2 GROWTH TRENDS AND SPATIAL DISTRIBUTION OF GLOBAL POPULATION: A HISTORICAL PERSPECTIVE......Page 350
18.3 POPULATION CONTROL POLICY: IN THEORY AND PRACTICE......Page 353
18.3.1 The theory of the demographic transition......Page 354
18.3.2 The microeconomic theory of human fertility......Page 355
18.3.3 Population control through economic incentives......Page 357
18.4 ECONOMIC DEVELOPMENT, POPULATION, POVERTY AND ENVIRONMENTAL DEGRADATION......Page 358
Political instability and tradition-bound property rights systems......Page 360
International economic relations, development and the environment......Page 362
18.5 CHAPTER SUMMARY......Page 363
REFERENCES AND FURTHER READING......Page 365
Index......Page 367