1

AED Economics 4330 The Sustainable Economy: Concepts and Methods

Department of Agricultural, Environmental, and Development Economics Ohio State University Spring Quarter 2013

INSTRUCTOR: Professor Elena Irwin

Office: Room 316, Ag. Admin Building; Email: irwin.78@osu.edu ; Office phone: 614-292-6449

Office Hours: Mon and Thurs 11:30-12:30pm or by appointment (email is the best way to reach me or

talk to me before/after class to set up a time)

TEACHING ASSISTANT: Matthew Gnagey

Office: Room 247, Ag Admin Building; Email: gnagey.1@osu.edu

Office Hours: Tues and Fri 2-3pm or by appointment (email works best to set up an appointment)

TIME AND LOCATION: Tues & Thurs, 9:35-10:55 Agriculture Admin Building 251

CREDITS AND PRE-REQUISITES: 3 credit hours. Pre-requisites: AED Econ 2001 (Principles of

Microeconomics) or an equivalent course; AED Econ 4310 (Environmental and Resource Economics) or

an equivalent course or permission of the instructor. I will assume that you already have knowledge of

basic microeconomic principles and concepts specific to environmental and resource economics, which

include: efficiency of markets and the price mechanism in allocating scarce resources; sources of market

failures, including externalities and public goods; role of government in correcting market failures; types

of environmental policies, including market-based incentives.

DESCRIPTION AND GOALS: I am thrilled to be developing and teaching this course for the first time ever

in Spring 2013. This is a one-of-a-kind course. It draws heavily from environmental and resource

economics, which is a well-established field of economics, and also incorporates a number of concepts

from ecological economics, which is a more interdisciplinary field that is sometimes at odds with

mainstream economics. It also touches on sustainability methods used largely outside of economics,

such as lifecycle assessment and ecological footprint analysis. The unifying theme of the course is

reflected in the title: concepts and methods for defining and assessing the sustainable economy.

As you will quickly realize from day one of this course, defining a sustainable economy requires that we

grapple with unresolved questions about the sustainability of our current economic systems. These are

some deep questions, including: What are the constraints to economic production and consumption

that are imposed by the Earth’s ecosystem? What are the trade-offs in terms of the economy, the

environment and human well-being that are implied by these constraints? What trade-offs are we

willing and able to make as individuals and as a society to achieve a more sustainable economy? What

are the best policies, including the right incentives for individuals, firms, communities and nations, to

reach this goal? While there is no single “right answer” to any of these questions, there are key concepts

and theories that provide a framework for defining a sustainable economy and tools and methods for

evaluating the sustainability of economic activities within a given region. Thus the course will focus on

learning these concepts and methods, which corresponds to my two main goals for this course:

2

(1) To deepen your understanding of the constraints and trade-offs that are implied by a

sustainable economy and the nature of the debate and uncertainty that surround these

questions.

(2) To help you gain a critical understanding of the tools and methods used to measure

sustainability, including their strengths, weaknesses and application to evaluate the

sustainability of economic activities within a specific geographic region.

LEARNING OBJECTIVES

Upon completion of this course, it is my hope is that you will be able to do following:

1. Summarize the key similarities and differences in how sustainability and sustainable development

are defined.

2. Synthesize the ideas and questions surrounding the following key aspects of sustainability and their

implications for the trade-offs that are necessary to achieve a more sustainable economy:

a. Substitutability between manmade and natural forms of capital

b. Ecosystem resilience

c. Technological innovation

d. Resource scarcity and ecological limits

e. Population and income growth, economic activity

f. Uncertainty and risk

3. Explain the role of markets and why markets often fail to provide the right incentives for achieving

sustainable development.

4. Summarize different policies and explain which policies are most appropriate for addressing

economic, ecological and social sustainability goals.

5. Describe the various methods used to value non-market ecosystem services and explain how these values can be used in measures of sustainability.

6. Explain how cost-benefit analysis can be used in sustainability measurement and the reasons why the cost-benefit criterion alone is insufficient as a sustainability criterion.

7. Summarize the debate over discounting future benefits and costs.

8. Critique Gross Domestic Product (GDP) as a measure of human well-being and explain how and why the value of other forms of capital can be included in national accounts.

9. Compare and contrast alternative approaches used to measure sustainability and explain why it is important to consider both ecosystem functioning and economic valuation when assessing sustainability.

10. Collect and analyze data to assess the sustainability of economic activities within a specific region or country.

3

I have tried to design the course content and assignments to meet these learning objectives. As a result,

there isn’t just one single textbook that we will be using. Instead, we will use various texts and a number

of supplemental readings and other resources. The learning goals are ambitious and thus so are some

of the assignments, most notably the sustainability report that you will produce, which is briefly

described below. Do not let this scare you! You have many resources at your disposable, including Matt

and me, so please don’t hesitate to talk with us and ask us for help, ideas, feedback, etc.

WEBSITE: Carmen

READINGS: There are two required texts for this course:

G. Atkinson, S. Dietz, E. Neumayer, eds. (2007) Handbook of Sustainable Development. Cheltenham, UK: Edward Elgar.

Available new on Amazon for $66; available new and used from other sellers through Amazon for less than this.

N. Hanley, J. Shogren, B. White (2001) Introduction to Environmental Economics: First Edition. Oxford

and New York: Oxford University Press.

Available at Oxford University Press for $64.95 (plus $5.50 shipping, ships within 2-3 days):

http://www.oup.com/us/catalog/general/subject/Economics/MacroeconomicTheory/?view=us

a&ci=9780198775959&view=usa

NOTE: A second edition of this textbook is about to be published, but is not yet available. It can

be preordered on Amazon for $64.95. You could wait and get the second edition instead since it

still has all the chapters we will be using (although page numbers will differ). It looks like the

new edition will be shipping soon, but it is unclear exactly when.

In addition, we will make use of a variety of other books, reports and articles. Copies of all supplemental

readings will be made available on the Carmen class website. Most of these readings are identified in

the Course Outline below and a few are to be determined (TBD) after the course is underway. It’s also

likely that I will swap out a reading here or there as we go along, depending on what I judge to be best. I

will announce any changes to the syllabus in class and will post the updated version and updates to the

Carmen website.

I would also encourage you to keep an introductory microeconomics textbook on hand so that you can

refresh your memory of economic principles as needed.

GRADING AND ASSIGNMENTS

Grades are based on the following:

1. Sustainability report .................................................................................... 15% 2. Writing assignments (4) .............................................................................. 20% 3. Data analysis assignments (4) ..................................................................... 30% 4. In-class participation ................................................................................... 20% 5. In-class final exam ....................................................................................... 15%

4

SUSTAINABILITY REPORT: The course culminates with your own sustainability study, in which you will

evaluate the sustainability of economic activities within a particular geographic region using the

concepts and methods that we learn in class and based on your synthesis of the literature and original

data analysis. Matt and I will work with you to choose your geographic region. Data availability is a key

consideration in choosing your region, so a larger region (e.g., metropolitan region, state or country) will

work better than a single town. I will distribute a complete description of this assignment in class.

WRITING AND DATA ANALYSIS ASSIGNMENTS: The writing and data analysis assignments will provide

the “scaffolding” for your sustainability report. Each assignment is designed to help you with a

component of your report by applying the concepts and methods that we learn in class to your study. In

brief, the four writing assignment are: (1) summarize background and current trends of the region, (2)

discuss existing studies that have examined sustainability or aspects of sustainability of the region, (3)

assess the findings from your own data analysis of sustainability indices and indicators for the region and

(4) identify sustainability policies and future scenarios. In brief, the four data analysis assignments are:

(1) compare changes in total wealth and the components of wealth for various countries, (2) identify

and collect sustainability indicators for your region and analyze trends over time, (3) calculate aggregate

measures of wealth for your region using these indicators and value estimates from the literature, (4)

compare the costs and benefits of future scenarios and evaluate the sustainability of each. More

detailed instructions for each of these assignments will be posted on Carmen. All due dates are

indicated in the syllabus under the Course Outline.

IN-CLASS PARTICIPATION: Your participation in class is critical to the success of this class. For that

reason, in-class participation makes up a fair percent of the grade and I will use the following activities

to assess your participation. None of these will be assigned a letter grade, but each will count towards

your overall participation grade:

Reading logs: These will be assigned on a frequent basis to help you with the readings and class

discussions. You will write these outside of class as you work on a reading assignment. They are

due at the beginning of class, although I won’t collect them until the end of class so that you can

use them for that day’s class discussion and activities. Specific prompts for writing these will be

posted on Carmen and announced in class.

Class scribe: We will have an in-class discussion or activity most classes and will need a scribe to

record a summary of the main ideas or points of discussion. The scribe will be responsible for

providing a summary during the first five minutes of the next class. You can sign up in advance

to be scribe for the day.

In-class quizzes: These will occur on an occasional at the beginning of class and will consist of

basic questions about the main points from the readings that are required for that day.

In-class responses: These will occur on an occasional basis at the end of class. I will give you a

prompt or question for you to respond to that is based on the day’s class discussion or activities.

Grades are a weighted average of your performance. Unless revised later to reflect an overall curve,

letter grades will be assigned according to the following grading scheme cutoffs:

A 93 % A- 90 % B+ 87 % B 83 % B- 80 % C+ 77 % C 73 %

C- 70 % D+ 67 % D 60 % E 0 %

5

COURSE POLICIES

All assignments are due in class at the beginning of class. Electronic copies of the written assignments or

data analysis assignments may be submitted to the Carmen website (by the same deadline). Any late

assignment will have 10% deducted each day it is late (including weekends). An assignment is

considered late when it is submitted after the stated deadline, and deductions will be taken beginning

with the missed deadline. At my discretion, exceptions may be made for emergencies or other well-

documented issues. These exceptions are easiest to make when you notify me before the deadline.

ACADEMIC MISCONDUCT: Academic integrity is essential to maintaining an environment that fosters

excellence in teaching, research, and other educational and scholarly activities. All students are

expected to abide by the University’s Code of Student Conduct

http://studentaffairs.osu.edu/pdfs/csc_12-31-07.pdf). Please refer to the OSU Web site for details on

Academic Misconduct (http://oaa.osu.edu/coam.html). The Ohio State University’s Code of Student

Conduct (Section 3335-23-04) defines academic misconduct as: “Any activity that tends to compromise

the academic integrity of the University, or subvert the educational process.” Examples of academic

misconduct include (but are not limited to) plagiarism, collusion (unauthorized collaboration), copying

the work of another student, and possession of unauthorized materials during an examination.

Ignorance of the University’s Code of Student Conduct is never considered an “excuse” for academic

misconduct, so I recommend that you review the Code of student Conduct and, specifically, the sections

dealing with academic misconduct. Any violation of the University’s policy will be dealt with according to

University procedures.

DISABILITY SERVICES: Any student who feels he/she may need an accommodation based on the impact

of a disability should contact me privately to discuss to discuss his/her needs.

COURSE OUTLINE

Note: Readings from the Handbook of Sustainable Development are denoted as Handbook; readings from the Hanley, Shogren, White Introduction to Environmental Economics book are denoted as HSW. TBD = To Be Determined

PART I: PRINCIPLES OF SUSTAINABILITY

Week 1: Introduction

Overview of course and introductory comments (Jan 8)

What are the criteria for a sustainable economy? What are the various definitions of sustainability?

Required readings: o E. Barbier, A. Markandya (2013) A New Blueprint for a Green Economy, London:

Earthscan. Chapter 1, “Introduction,” pp. 1-15 and Chapter 3 “Sustainable Development” pp. 36-53

Economic growth, human well-being and the environment (Jan 10)

What are ecosystem services? What is their relationship to human well-being? How does economic activity impact ecosystem services and natural capital?

6

Required readings: o Millennium Ecosystem Assessment (2005), “Ecosystems and Human Well-Being, Our

Human Planet: Summary for Decision Makers,” Chapter 1 “MA Conceptual Framework,” pp. 1-13

o Millennium Ecosystem Assessment (2005), “Ecosystems and Human Well-Being, Our Human Planet: Synthesis,” Chapter 1, “Summary for Decision Makers,” pp. 1-24

Additional reading: o Millennium Ecosystem Assessment (2005), “Ecosystems and Human Well-Being, Our

Human Planet: Summary for Decision Makers,” Chapter 2, “Current State and Trends: Ecosystems and Their Services around the Year 2000,” pp. 16-30.

Additional resources: o Millennium Ecosystem Assessment website:

http://www.unep.org/maweb/en/index.aspx o UN Millennium Project and Millennium Development Goals:

http://www.unmillenniumproject.org/who/index.htm o GreenFacts: http://www.greenfacts.org/en/ecosystems/index.htm (includes synthesis

of Millennium Ecosystem Assessment report)

Week 2: Weak sustainability

Natural capital as an economic asset (Jan 15)

What is the contribution of natural capital to the total wealth of a country? Under what conditions is a decline in natural capital wealth sustainable?

Required readings o HSW Chapter 6 “Economic Growth and Sustainable Development,” pp. 120-147 o P. Dasgupta, A. Duraiappah (2012) “Well-Being and Wealth,” Chapter 1 in UNU-IHDP

and UNEP (2012). Inclusive Wealth Report 2012. Measuring progress toward sustainability. Cambridge: Cambridge University Press, pp. 13-26. Full report available online: http://www.ihdp.unu.edu/article/iwr

Additional readings o R.M. Solow “Sustainability: An Economist’s Perspective.” In Economics of the

Environment: Selected Reading (2012) R. N. Stavins (ed), Harvard University Press. o J.C.V. Pezzy and M.A. Toman. “Sustainability and Its Economic Interpretations.” In D.

Simpson et al. eds. (2005) Scarcity and Growth Revisited. Resources for the Future. Measuring the value of natural capital as a component of wealth (Jan 17)

How has the World Bank calculated total wealth and changes in wealth by country? How does population growth influence the change in the composition of wealth?

Required readings: o World Bank (2011) The Changing Wealth of Nations: Measuring Sustainable

Development in the New Millennium, Chapter 1 “Introduction and Main Findings,” pp. 3-26 and Chapter 2 “Wealth and Changes in Wealth 1995-2005,” pp. 27-50

Additional readings o World Bank (2006) Where Is the Wealth of Nations? Measuring Capital for the 21st

Century

Additional resources: o Wealth of Nations data http://data.worldbank.org/data-catalog/wealth-of-nations

Week 3: Strong sustainability

7

Introduction to ecological economics (Jan 22)

What are the basic tenants of ecological economics? How do these differ from traditional economic thought?

Required readings o H.E. Daly and J. Farley (2011) Ecological Economics, Chapter 2, “The Fundamental

Vision,” pp. 15-35 o R. Ayres, J. van den Bergh, J.M. Gowdy (1998) “Viewpoint: Weak versus Strong

Sustainability,” Tinbergen University discussion paper.

Website: Sustainable scale: http://www.sustainablescale.org/

Additional readings o K.E. Boulding, “The Economics of the Coming Spaceship Earth,” in Environmental Quality

in a Growing Economy, The Johns Hopkins University Press, 1966. o H.E. Daly (1996) Beyond Growth, Chapter 4, “Operationalizing Sustainable Development

by Investing in Natural Capital,” pp. 75-87

Complexity and resilience (Jan 24)

How do ecosystems respond to human impacts? What is the value of ecosystem and social resilience?

Readings o TBD Reading from B. Walker, D. Salt (2006) Resilience Thinking: Sustaining Ecosystems

and People in a Changing World. o Handbook, Chapter 5, W.N. Adger “Ecological and Social Resilience,” pp. 78-90

Videos on resilience http://rs.resalliance.org/2010/12/13/resilience-and-regime-shift-videos/

Data analysis assignment #1 due Jan 24

Week 4: Resource scarcity, ecological limits and economic growth

An old resources debate: Scarcity and limits to growth (Jan 29)

When we will run out of oil and other fossil fuels and minerals? Do markets allocate non-renewable resources efficiently? What determines optimal resource extraction and what happens a non-renewable resource is depleted?

Required readings: o HSW Chapter 14 “Resources and Energy” pp. 316-338 o J.A. Krautkraemer, “Economics of Scarcity: The State of the Debate.” Chapter 3 in

Scarcity and Growth Revisited, RFF (2005)

Additional readings: o J. Tierney (1990) “Betting on the Planet,” New York Times Magazine. Accessed online

1/4/2013 http://www.nytimes.com/1990/12/02/magazine/betting-on-the-planet.html An emerging consensus: Thresholds, ecological limits and assimilative capacity (Jan 31)

Why are thresholds important? What are critical ecosystem services? Can aggregate wealth measures account for ecosystem dynamics and thresholds?

Required readings: o K. Arrow et al. (1995) “Economic Growth, Carrying Capacity and the Environment.”

Science 268: 520-21. o P.R. Ehrlich and L.H. Goulder (2007) “Is Current Consumption Excessive? A General

Framework and Some Indications for the United States,” Conservation Biology 21(5): 1145–1154

Writing assignment #1 due Jan 31

8

Week 5: Uncertainty, irreversibility and managing risk

Uncertainty and irreversibility (Feb 5)

How are uncertainty and irreversibility accounted for in environmental economics and policy?

Required readings: o Pindyck (2007) “Uncertainty in Environmental Economics.” Review of Environmental

Economics and Policy 1(1): 45-65. o J Quiggen (2008) “Uncertainty and Climate Change Policy,” Economic Analysis and Policy

38(2): 203-210 A new resources debate: Shale gas development and its known and unknown impacts (Feb 7)

What are the costs and benefits of shale gas development? How should we account for the unknown costs?

Require readings: o S. Brown (2010). “Abundant Shale Gas Resources: Long-Term Implications for U.S.

Natural Gas Markets.” Resources Summer 2010, Resources for the Future o M. Zoback, S. Kitasei, B. Copithorne (2010) “Addressing the Environmental Risks from

Shale Gas Development,” Briefing paper 1, Worldwatch Institute

Additional resources: o A. Krupnick, Resources for the Future. Risk matrix for shale gas development. Accessed

online 1/4/2013 at http://www.rff.org/centers/energy_economics_and_policy/Pages/Shale-Matrices.aspx#tableone

o Video with Sheila Olmstead, RFF: http://vimeo.com/50116542 o Video from Yale U: Debate on hydraulic fracturing (w Bill McKibbon, former oil executive

and others) https://environment.yale.edu/news/article/yale-panel-to-debate-hydraulic-fracturing

PART II: METHODS FOR ASSESSING SUSTAINABILITY Weeks 6 and 7: Non-market valuation

Valuing ecosystem services (Feb 12)

What are the types of ecosystem service values? What are the methods that are used to assign value?

Required reading: o HSW Chapter 3, “Valuing the environment and natural resources,” pp. 34-67

Benefits transfer method (Feb 14)

How can benefits transfer be used to value ecosystem services? What are the advantages and limitations of this approach?

Required readings: o D. Pearce, G. Atkinson, S. Mourato (2006) Cost-Benefit Analysis and the Environment:

Recent Developments, OECD Publishing, Chapter 17, “Benefits Transfer,” pp. 253-268

Data-bases of existing valuation studies and data: o EVRI - Environmental Valuation Reference Inventory: http://www.evri.ca/ (requires

registration and login)

9

o The New Zealand Non-Market Valuation DataBase http://www2.lincoln.ac.nz/nonmarketvaluation/

o Review of Externality Data http://www.isis-it.net/red/ o Some of these websites are reviewed here:

http://yosemite.epa.gov/EE/epa/eed.nsf/webpages/btworkshop.html/$file/lantz.pdf

Data analysis assignment #2 due Feb 14 Sustainability and cost-benefit analysis (Feb 19, 21)

What is cost-benefit analysis (CBA)? How can CBA be extended to incorporate sustainability concerns? What is the role of discounting?

Required readings: o HSW Chapter 4, “Cost-benefit analysis and the environment,” pp. 68-93 o D. Pearce, G. Atkinson, S. Mourato (2006) Cost-Benefit Analysis and the Environment:

Recent Developments, OECD Publishing, Chapter 16, “Sustainability and Cost-Benefit Analysis,” pp. 237-252

o Handbook, Chapter 7, C. Hepburn “Valuing the Far Off Future: Discounting and its Alternatives,” pp. 109-121

Writing assignment #2 due Feb 21

Week 8: Aggregate measures of sustainability

More on environmental accounting and measuring natural capital wealth (Feb 26, 28)

What is GDP? Why isn’t GDP a good measure of human well-being? What are some alternative indices and how are they calculated? What is the difference between sustainability indices and indicators? How can they be used in tests of weak and strong sustainability?

Required readings: o G. Heal (2012), “Reflections: Defining and measuring sustainability.” Review of

Environmental Economics and Policy 6(1): 147-163 o K. Mumford, “Measuring inclusive wealth at the state level in the United States,”

Chapter 4 in UNU-IHDP and UNEP (2012). Inclusive Wealth Report 2012. Measuring progress toward sustainability. Cambridge: Cambridge University Press, pp. 69-86

o K.J. Bagstad, R. Shammin (2012). “Can the Genuine Progress Indicator better inform sustainable regional progress?—A case study for Northeast Ohio,” Ecological Indicators 18:330-341

Additional reading: o E. Barbier, A. Markandya (2013) A New Blueprint for a Green Economy, London:

Earthscan. Chapter 5, “Accounting for the Environment and Sustainability,” pp. 80-101 o Handbook Chapter 17, G.M. Lange, “Environmental and resource accounting,” pp. 271-

291

Additional resources: o State of Maryland Genuine Progress Indicator:

http://www.green.maryland.gov/mdgpi/index.asp o Maryland Genuine Progress Indicator Tutorial: http://youtu.be/brp1SNh5xbQ o World Development Indicators http://data.worldbank.org/indicator o Environment and Data Statistics from the World Bank:

http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/ENVIRONMENT/EXTDATASTA/0,,menuPK:2875803~pagePK:64168427~piPK:64168435~theSitePK:2875751,00.html

o Adjusted Net Savings from the World Bank: http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/ENVIRONMENT/EXTDATASTA/0,,

10

contentMDK:21061847~menuPK:2935516~pagePK:64168445~piPK:64168309~theSitePK:2875751~isCURL:Y,00.html

o World Bank manual for calculating Adjusted Net Savings http://siteresources.worldbank.org/INTEEI/1105643-1115814965717/20486606/Savingsmanual2002.pdf

o Inclusive Wealth Index website: http://www.ihdp.unu.edu/article/read/iwr o World Happiness Report: http://www.earth.columbia.edu/articles/view/2960

Week 9: Physical measures of ecological impacts

Material flows and lifecycle assessment analysis (Mar 5)

What are the environmental impacts of production and consumption along the entire supply chain and product life cycle: raw materials acquisition, production, use, disposal? Is an ebook better than a paper book?

Required readings: o C. Hendrickson, L. Lave, H.S. Matthews (2006) Environmental Life Cycle Assessment of

Goods and Services: An Input-Output Approach. Chapter 1, “Exploring Environmental Impacts and Sustainability,” pp. 3-20; Chapter 3, “Environmental Valuation for Life Cycle Assessment,” pp. 29-41; Chapter 9 “E-Commerce, Book Publishing and Retail Logistics,” pp. 86-93

Ecological footprint analysis (Mar 7)

How are ecological footprints calculated and what are their strengths and limitations? How do they compare to other sustainability measures?

Required readings: o Handbook, Chapter 20, I. Moffatt, “Environmental space, material flow analysis and

ecological footprinting,” pp. 319-345 o N. Hanley et al. (1999) “Measuring Sustainability: A Time Series of Alternative Indicators

for Scotland.” Ecological Economics 28: 55–73

Websites: o Global Footprint Network Homepage: www.footprintnetwork.org o Living Planet Report, World Wildlife Foundation:

http://wwf.panda.org/about_our_earth/all_publications/living_planet_report/

Data analysis assignment #3 due Mar 7

SPRING BREAK WEEK (Mar 9-15) Week 10: Ecosystem services modeling and valuation Natural Capital Project (Mar 19)

How can models of ecosystem functioning be combined with economic models of ecosystem services? Why is this important for valuation of ecosystem services and policy?

Required reading: o TBD Reading from P. Kareiva et al. (2011) Natural Capital: Theory and Practice of

Mapping Ecosystem Services, Oxford University Press.

Website: http://www.naturalcapitalproject.org/

Writing assignment #3 due Mar 19 Example of ecosystem services modeling, valuation, and land use scenarios (Mar 21)

11

How is the InVEST model being applied to develop future scenarios and inform policies? Example of Natural Capital Project: Valuing the Arc Mountains ecosystem services in eastern Tanzania: http://valuingthearc.org

PART III: POLICIES FOR SUSTAINABLE DEVELOPMENT Weeks 11 and 12: Policies for sustainable development

Ethical foundations for sustainability policy (Mar 26) (Matt Gnagey teaching)

What are the ethical foundations of sustainability policies? What is the source of value of nature? How can sustainability concerns be incorporated into cost-benefit analysis?

Required readings: o L. Goulder and D. Kennedy “Valuing Ecosystem Services: Philosophical Bases and

Empirical Methods” in G. Dailey ed. (2007) Nature’s Services, pp. 23-48

Policies for resource efficiency (Mar 26 and 28) (Matt Gnagey teaching)

How can policies provide markets for ecosystem services? What are payments for ecosystem services (PES) programs? Can PES programs benefit the poor?

Required readings: o HSW Chapter 2 “Markets for the Environment” pp. 12-33 o TBD Reading and example of PES o E. Barbier, A. Markandya (2012). A New Blueprint for a Green Economy, discussion of

PES, pp. 124-132

Additional readings: o Forest Trends, The Katoomba Group, and UNEP (2008) “Payment for Ecosystem

Services, Getting Started: A Primer.” Accessed 1/5/2013 online http://www.katoombagroup.org/documents/publications/GettingStarted.pdf

Writing assignment #4 due Mar 28

Policies for ecosystem resilience (Apr 2)

What kinds of policies can address problems posed by uncertainty, irreversibility and tipping points of ecosystems? How can we protect critical natural stocks and ecosystem services?

Required readings: o Handbook, Chapter 6, A. Randall “Benefit Cost Analysis and a Safe Minimum Standard

for Conservation,” pp. 91-105

o R. Bishop (1993) “Economic Efficiency, Sustainability, and Biodiversity,” Ambio 22(2/3): 69-73

o J. Farley (2008) “The role of prices in conserving critical natural capital.” Conservation Biology 22(6): 1399–1408

Policies for intergenerational and intragenerational equity (Apr 4)

What are the linkages between livelihoods, sustainability and vulnerability in low-income countries? What are the trade-offs between intergenerational and intragenerational equity?

Required readings: o P. Dasgupta (2002) “Is Contemporary Economic Development Sustainable?” Ambio

31(4): 269-271 o Handbook, Chapter 12, W.N. Adger, A. Winkels, “Vulnerability, poverty and sustaining

well-being,” pp. 189-204

12

Weeks 13 and 14: Special topics and sustainability reports Local sustainability (Apr 9)

What does local sustainability mean in a globalized world? What are sustainable cities?

Required readings: o Handbook, Chapter 21, Y. Rydin. “Sustainable cities and local sustainability, pp. 347-361

Data analysis assignment #4 due Apr 9

In-class presentations and discussion of sustainability reports (Apr 11, 16) Wrapping up (Apr 18)

What’s the relationship between consumption and happiness? What are the implications for sustainable development?

Required readings: o Handbook, Chapter 16, T. Jackson, “Sustainable Consumption,”pp. 254-268 o J. Schor (2001). “Why do we consume so much?” Clemens Lecture Series 13, St. John’s

University. Accessed 1/5/2013 online http://www.csbsju.edu/Documents/Clemens%20Lecture/lecture/Book01.pdf

Final draft of sustainability report due by Apr 22 Final exam: Thursday April 25 10-11:45AM