Download Environmental and Natural Resources Economics by Thomas H. Tietenberg PDF

By Thomas H. Tietenberg

Environmental and typical source Economics  takes a policy-oriented strategy, introducing monetary conception within the context of debates and empirical paintings from the sector. Readers will achieve an international standpoint of either environmental and usual source economics.

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One broad class of violations occurs when an agent making a decision does not bear all of the consequences of his or her action. Suppose two firms are located by a river. The first produces steel, while the second, somewhat downstream, operates a resort hotel. Both use the river, although in different ways. The steel firm uses it as a receptacle for its waste, while the hotel uses it to attract customers seeking water recreation. If these two facilities have different owners, an efficient use of the water is not likely to result.

The team running the experiment would then calculate how many allowances each successful participant would acquire, based on all the bids, as well as the market-clearing price. To the extent that the results of these experiments have proved to be replicable, they have created a deeper understanding about the effectiveness of markets, policies, and institutions. The large and growing literature on experimental economics has already shed light on such widely divergent topics as the effectiveness of alternative policies for controlling pollution and allocating water, how uncertainty affects choices, and how the nature of cooperative agreements affects the sustainability of shared natural resources.

Many specific examples of these broad categories of problems are discussed in detail in the following chapters. This section provides a flavor of what is to come by illustrating the challenges posed by one pollution problem (climate change) and one resource scarcity problem (water accessibility). Climate Change Energy from the sun drives the earth’s weather and climate. Incoming rays heat the earth’s surface, radiating energy back into space. Atmospheric “greenhouse” gases (water vapor, carbon dioxide, and other gases) trap some of the outgoing energy.

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