Environmental Economics B

Environmental Economics at DIS provides students with a broad introduction to the economic theories and tools of policy analysis relevant to modern environmental concerns.

The course is composed of five applied modules, centered on different environmental economics topics: (1) Externalities; (2) Pollution; (3) Environmental Valuation; (4) Policy Instruments; and (5) Health and Environment.

The sequence of modules takes us gradually from the local level, where environmental harms are analyzed as simple externalities, to the state level, where various environmental issues are explained in terms of their effects on marginal damage and abatement costs within and across national industries, to the debate on the necessity and limitations of pricing the environment, and finally arena of international climate issues, where countries interactions come into play. In the last two modules, both potential solutions for climate mitigation (through market and non-market based policy instruments) and effects (i.e. climate impacts) are discussed through the lens of environmental economics.

 

Learning Objectives

The objectives of the course are (1) to give you a broad understanding of the causes and alternative solutions to modern environmental problems from an economic perspective, and (2) to apply insights derived from economic theory in designing and evaluating policy solutions to a variety of environmental issues.

You will learn to understand the role of economics in environmental issues and in the formation of environmental policy. You will learn that economic objectives do not necessarily conflict with environmental goals, and that while environmental crises commonly arise as a result of market failures, market incentives can at times be used to improve environmental quality.

By the end of this course, you will be able to express an informed view on the role, contribution, and limitations of economic tools in providing policy guidance on environmental issues.

 

Faculty

Luiza Karpavicius. PhD candidate in Environmental Economics (Aarhus University - current), Msc in Environmental and Natural Resource Economics (University of Copenhagen, 2021), Bsc in Economic Sciences (university of São Paulo, Brazil, 2018). From March 2025 postdoctoral researcher at the University of Copenhagen. With DIS since 2024.

Elena Boriani. PhD, Chemical Risk Assessment , Open University London – Mario Negri Research Institute Milan, 2010. 2009-2011 Environmental Chemistry and Toxicology, Mario Negri Institute, IT, 2011-2012 PostDoc NERI Aarhus University, DK, 2013 Consultant COWI, DK, 2015-2018 PostDoc National Food Institute, DTU, 2019 PostDoc National Food institute, DTU, QSAR group, 2020-present Owner Principal Researcher of EB Consult. With DIS since 2024.

Course Requirements

This course presupposes at least one introductory economics course, preferably microeconomics. This means that you are expected to be comfortable handling basic supply and demand analysis both graphically and algebraically (i.e. with simple equations). If you are unsure that you can fulfill this expectation, please inform the instructors as soon as possible.

Course Materials

Required reading assignments from course books will be made available online, along with (optional) supplementary articles. The course outline will be posted on DIS Canvas, listing the required readings for each lecture. Check the course outline frequently for updates.

The assigned readings for each lecture should be read prior to the lecture. Students will often be randomly asked to answer questions about the assigned readings during the class, and therefore preparation is necessary to enable class participation. Here is a suggestion to prepare for class: Write down 2-3 things that strike you about the day’s reading, such as some key findings, interesting arguments, questions you had, etc. This will help you be prepared to answer questions and make insightful comments in such instances.

Please note, any class materials (slides; notes) will be added to canvas after each class. The reason why we won't provide slides beforehand is twofold: First, we want to incentivize that you come to class, and have your own notes based on class discussions. If you have slides beforehand, you may be tempted to skip class. We want to avoid this :) Second, class materials may change depending on where discussions lead to. We want classes to be the result of our interactions together (and not only a one-way conversation) and our material will reflect that.

Grading

In addition to the readings and through active participation in class discussions, a variety of written and oral assignments, both for individuals and for the "seminar groups," will be used to develop students' facility with the tools of environmental economics and policy analysis both inside and outside of class. Preparation for and participation in these assignments will contribute greatly to your overall grade.

The grading allocation will be as follows:

Participation (individual and group): 25%

"Key takeaways" class session review assignments: 10%

Midterm exam: 20%

Climate change paper assignment: 20%

Final paper assignment (free topic): 25%

ChatGPT and Generative AI Tools Policy

 Generative AI is permitted in specific contexts and with acknowledgment. 

Understanding and effectively utilizing generative AI tools (such as ChatGPT, DALL-E, and others) is becoming an essential skill across various professions, including for environmental economists. In this class, you are allowed to explore and use generative AI tools as a resource for learning and completing assignments, provided your use aligns with ethical guidelines and standards for academic integrity (see academic regulations below). Most importantly, any substantial use of generative AI tools must be transparently documented and properly cited into any submitted work. For example, if you choose to use any AI software to assist with your climate change or final assignment essays, you should mark in the end of the assignments: "This content was revised for grammar and clarity using ChatGPT" or "This initial draft was generated with assistance from ChatGPT."

However, we advise caution and critical thinking when deciding how to use AI tools in this class. Not only because it may harm your own learning experience (if you are not writing or thinking on your own, you are not learning) but also because of ethical and environmental issues associated with certain AI tools. A few examples of relevant environmental issues can be found here:

https://apnews.com/article/chatgpt-gpt4-iowa-ai-water-consumption-microsoft-f551fde98083d17a7e8d904f8be822c4 

https://www.theguardian.com/commentisfree/2023/dec/23/ai-chat-gpt-environmental-impact-energy-carbon-intensive-technology

https://www.techradar.com/pro/chatgpt-is-having-a-really-bad-impact-on-the-environment

Ultimately, it is up to you as a student to decide how to use AI within this course. However, the following guidelines apply:

Permitted purposes of AI Use

• Help with braimstorming ideas for essays (being mindful that chat GPT and other softwares may make mistakes and are not reliable sources of information!)
•  Revising language for clarity, grammar, or cohesion or refining the structure and flow of content that you have written.
• Clarifying complex concepts from class or materials or asking AI to provide examples to support your understanding of class concepts.

Prohibited Uses

• Copy-pasting unedited content directly generated by AI into submitted work.
• Using AI tools to bypass critical thinking, problem-solving, or creative processes central to the assignment's learning objectives (during the midterm exam or in any other capacity)
• Submitting work that has been edited or developed with the assistance of AI softwares without clear acknowledgements of how such software was used.
• Use of AI in any way that conflicts with DIS academic regulations

Academic Regulations  

Please make sure to read the Academic Regulations on the DIS website. There you will find regulations on: 

• Course Enrollment and Grading  
• Academic Expectations and Honor Code 

DIS - Study Abroad in Scandinavia - www.DISabroad.org

Special note about laptop use in class: Use of laptop computers in class is allowed for the purpose of note-taking ONLY; other computer activities can prove distracting.  Students should also refrain from any activity/behavior that may be disturbing to other students who are making the effort to be attentive.

 

Readings

Textbooks (all excerpts posted on Canvas, no textbooks to be picked up from the DIS Library during arrivals week)

• Boriani, E., Bagnol, B., Savic, S., Campaner, R., Cediel, N., & Garnier, J. (2024). Gender equality in the context of One Health. OneHealth (Cabionehealth publication).
• Copeland, B. R., & Taylor, M. S. (2005). Trade and the Environment: Theory and Evidence. Princeton University Press.
• Field, B. C., & Field, M. K. (2006). Environmental Economics: An Introduction (4th ed.). McGraw-Hill Irwin.
• Harris, J. M. (2005). Environmental and Natural Resource Economics: A Contemporary Approach (2nd ed.). Houghton Mifflin.
• Sterner, T., & Coria, J. (2013). Policy Instruments for Environmental and Natural Resource Management. Routledge.
• Tietenberg, T., & Lewis, L. (2018). Environmental and Natural Resource Economics (11th ed.). Routledge.

Articles/Reports (all made available in Canvas)

• Andersen, C. M., et al. (2024). Air Pollution and Cognition in Children: Evidence from National Tests in Denmark (No. 11434). CESifo Working Paper.
• Boriani, E., Baderna, D., Benfenati, E., & Thomsen, M. (2013). Application of ERICA index to evaluation of soil ecosystem health according to sustainability threshold for industry impact. Science of the Total Environment, 443, 134–142.
• Boriani, E. (2012). How to evaluate ecosystem health according to sustainability threshold for industry impact, need of new risk indices. Journal of Ecosystem and Ecography, 2(e105). https://doi.org/10.4172/2157-7625.1000e105
• Boriani, E., Aragrande, M., Canali, M., Balzan, M. V., & Asaduzzaman, M. (2021). Pragmatic use of planetary health and nature-based solutions for future pandemics using COVID-19 case scenario. Frontiers in Public Health, 9. https://doi.org/10.3389/fpubh.2021.620120
• Coase, R. H. (1960). The Problem of Social Cost. The Journal of Law & Economics, 3, 1–44.
• Copeland, B. R., & Taylor, M. S. (2009). Trade, tragedy, and the commons. American Economic Review, 99(3), 725–749.
• Croci, E. (2005). The economics of environmental voluntary agreements. Handbook of Environmental Voluntary Agreements, 3–30. Springer.
• Environmental Protection Agency, Ireland. (2012). Hydraulic Fracturing or ‘Fracking’: A Short Summary of Current Knowledge and Potential Environmental Impacts.
• Fullerton, D., & Stavins, R. (1998). How Economists See the Environment. Nature, 395, 433–434.
• Garnier, J., et al. (2020). Helping to heal nature and ourselves through human-rights-based and gender responsive One Health. One Health Outlook. https://doi.org/10.1186/s42522-020-00029-0
• Helbling, T. (2012). Externalities: Prices Do Not Capture All Costs. International Monetary Fund, 3 pp.
• IPCC. (2014). Climate Change: Mitigation of Climate Change - Summary for Policy Makers.
• Jackson, M. O. (2011). A Brief Introduction to the Basics of Game Theory. Stanford University.
• Karpavicius, L. (2024). Empirical Essays on the Transaction Costs of Land Use Carbon Sequestration.
• Karpavicius, L. M., & Chimeli, A. (2024). Forest Protection and Human Health. FEA/USP.
• Laing, G., et al. (2023). Advancing One Health: Updated core competencies. CABI International. https://doi.org/10.1079/cabionehealth.2023.0002
• Ledgard, J. (2005). Bjorn Lomborg is the World’s Most Optimistic Statistician. Strategy+Business, 38, 7 pp.
• Lynas, M. (2003). Natural Bjorn Killer. The Ecologist, 33(2), 26–29.
• McKibben, B. (2012). Global Warming’s Terrifying New Math, 9 pp.
• McKinsey & Company. (2008). Greenhouse Gas Abatement Opportunities in Sweden: Report.
• Penn, G., et al. (2024). General ecosystem health indicators: A scoping review. CABI One Health. https://doi.org/10.1079/cabionehealth.2024.0006
• Rayamajhee, V., & Paniagua, P. (2021). The Ostroms and the contestable nature of goods: Beyond taxonomies and toward institutional polycentricity. Journal of Institutional Economics, 17(1), 71–89.
• Rüegg, S. R., et al. (2018). A Systems Approach to Evaluate One Health Initiatives. Frontiers in Veterinary Science, 5.
• Salvo, A. (2020). Local pollution as a determinant of residential electricity demand. Journal of the Association of Environmental and Resource Economists, 7(5), 837–872.
• Singer, P., & Lomborg, B. (2011). Does Helping the Planet Hurt the Poor? Wall Street Journal, 8 pp.
• Surowiecki, J. (2014). Climate Trades. The New Yorker (October 13), 1 page.
• Sunstein, C. R., & Weisbach, D. A. (2008). Climate Change and Discounting the Future: A Guide for the Perplexed. Harvard Law School Working Paper, sections I and II, pp. 1–12.
• The Economist. (2007). Playing Games with the Planet, 3 pp.
• Yan, D., et al. (2018). Environmental sustainable decision making– The need and obstacles for integration of LCA into decision analysis. Environmental Science & Policy, 87, 33–44. https://doi.org/10.1016/j.envsci.2018.05.018