Module Information

Module Identifier
Module Title
Academic Year
Semester 2

Course Delivery

Delivery Type Delivery length / details
Lecture 1 x 2 hour lectures per week


Assessment Type Assessment length / details Proportion
Semester Exam 2 Hours   Written examination  Outcomes assessed: 1, 2, 3, 4, 5  100%
Supplementary Exam 2 Hours   Written examination  Outcomes assessed: All  100%

Learning Outcomes

On completion of this module, students will be able to :

1. Discuss the causes of market failure relating to environmental issues;
2. Discuss and evaluate economic models relating to optimal environmental standards;
3. Evaluate the effectiveness of a range of policy instruments for the environment;
4. Discuss and evaluate methodologies for environmental valuation;
5. Critically evaluate the application of economic principles to contemporary environmental policy issues.

Brief description

This module examines the economic principles underlying the analysis of environmental problems and applies these principles to contemporary policy issues. Topics covered in this module include discussion of economic principles and market failure; optimal environmental standards; Coase theorem, polluter pays principle, command and control policies, Pigovian (pollution) taxes, pollution subsidies, pollution permits; and environmental valuation methodologies. These principles are then applied to contemporary environmental policy issues.


This module examines the economic principles underlying the analysis of environmental problems and encourages students to apply these principles to contemporary policy issues.

The module aims are:
a. To understand economic principles relating to market failure;
b. To discuss the characteristics of environmental goods;
c. To critically evaluate the application of economic principles to contemporary environmental policy issues.

Transferable skills

.3 Use and analysis of numerical information
Students will complete a series of class exercises that will aim to demonstrate and enhance their understanding of economic principles.

.4 Writing in an academic context
Students will be required to undertake a written examination.

Reading List

General Text
Brent, R J (1996) Applied cost-benefit analysis Edward Elgar Primo search Field, B C (1994) Environmental economics: an introduction McGraw-Hill Primo search Harrington, W; Morgenstern, R D and Sterner, T (2004) Choosing environmental policy: comparing instruments and outcomes in the United States and Europe. Resources for the future Primo search Hensher, Rose and Green (2005) Applied choice analysis: a primer Cambridge University Press Primo search Herriges, J A and Klim, C L (1999) Valuing recreation and the environment: revealed preference methods in theory and practice Edward Elgar Primo search Kahn, H; Brown, W and Martel, L (1976) The next 200 years: scenario for America and the World Associated Business Programmes, 1977. Primo search Kalof, L and Satterfield, T (2005) The Earthscan reader in environmental values Earthscan Publications Primo search Kula, (1994) Economics of natural resources, the environment and policies Primo search Louviere, Hensher and Swait (2000) Stated choice methods: analysis and applications Cambridge University Press Primo search Malthus, T (1798) An essay on the principle of population Primo search Markandya A (Ed) (1992) The Earthscan Reader in envirmental economics London: Earthscan Primo search Markyanda, A and Richardson, J (editors) (1992) Earthscan reader in environmental economics Earthscan Publications Primo search McLaren, D; Bullock, S and Yousuf, N (1998) Tomorrow's world Primo search Meadows, D H and Randers, J (1992) Beyond the limits: confronting global collapse; envisioning a sustainable future Primo search Meadows, D H et al (1972) The limits to growth Primo search Mitchell and Carson (1989) Using surveys to value public goods: the CV method Primo search Pareto, P (1909) Manuel d'economie politique Primo search Pearce D, Markandya A and Barbier E B (1989) Blueprint for a Green Economy Earthscan Publications Primo search Pearce, DW and Turner, RK (1990) Economics of Natural Resouces and the Environment Harvester Wheatsheaf Primo search Perman and McGilvray (1999) Natural resource and environmental economics Chapter 3 Primo search Roberts, J (2004) Environmental policy Routledge Primo search Smith, A (1776) The wealth of nations Primo search World Commission on Environment and Development (1987) Our common future Primo search Adamowicz, et al (1994) Journal of environmental economics and management Combining revealed and stated preference methods for valuing environmental activities 26 (3) : 271-292 Primo search Arrow, K J R et al (1993) Federal Registration Report of NOAA Panel on Contingent Valuation 58 : 4016 - 4614 Primo search Christie, M, Hanley, N and Hynes, S (2007) Journal of Forest Economics Valuing enhancements to forest recreation using choice experiments and contingent behaviour methods Primo search Coase, R H (1960) Journal of Law and Economics The problem of social cost pp 1 - 44 Primo search Daly, H (1990) Ecological economics Towards some operational principles of sustainable development Volume 2: 1-6 Primo search Hanley, N (1989) Journal of Agricultural Economics Valuing rural recreation sites. An empirical comparison of approaches 40: 361-375 Primo search Hardin (1968) Science The tragedy of the Commons 162 (3859) : 1243-1248 Primo search O'Byrne et al (1985) Journal of environmental economics and management Housing values, census estimates, disequilibrium and the environmental costs of airport noise; a case study of Atlanta 12 Primo search Wackernagel et al (2002) Proceedings of the Academic of Science Tracking the ecological overshoot of the human economy 99 (14) : 9266-9271 Primo search Willis (1991) Scottish Journal of Political Economy The recreation value of the Forestry Commission Estate in Great Britain 38 (1) : 58 - 75 Primo search HM Treasury (2004) The Green Book: appraisal and evaluation in central government HM Treasury Primo search
Recommended Text
Begg, D; Fisher S and Dornsbusch, R (1994) Economics McGraw-Hill Primo search Folmer, H, Gabel, H L and Opschoor, H (1997) Principles of environmental and resource economics Edward Elgar: Cheltenham Primo search Garrod, G and Willis, K G (1999) Economics valuation of the environment: methods and case studies Edward Elgar Primo search Hanley, N and Spash, C (1992) Cost benefit analysis and the environment Edward Elgar: Cheltenham Primo search Hodge, I (1995) Environmental economics Macmillan Primo search Meadows, D; Randers, J and Meadows, D (2005) Limits to growth: the 30 year update Earthscan Publications Primo search European Environment Agency (2006) Using the market for cost-effective environmental policy: market-based instruments in Europe EEA Report No 1/2006EEA Primo search
Recommended Consultation
Winter, M (1996) Rural politics: policies for agriculture, forestry and the environment Routledge Primo search


This module is at CQFW Level 5