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Ecological Economics Lecture 2

Doctoral Program and Advanced Degree in Sustainable Energy Systems Doctoral Program in Mechanical Engineering Doctoral Program in Environmental Engineering. Ecological Economics Lecture 2. Tiago Domingos Assistant Professor Environment and Energy Section Department of Mechanical Engineering.

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Ecological Economics Lecture 2

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  1. Doctoral Program and Advanced Degree in Sustainable Energy SystemsDoctoral Program in Mechanical EngineeringDoctoral Program in Environmental Engineering Ecological EconomicsLecture 2 Tiago DomingosAssistant ProfessorEnvironment and Energy SectionDepartment of Mechanical Engineering

  2. Ecological Economics vs. Environmental and Natural Resource Economics • Ecological Economics • The basis is the environment/ecosystems • Ecocentric • “Top-down”, Pro-active • Ecology and Economics • Environmental Economics • Interaction between environment and economics • Anthropocentric • “Bottom-up”, Reactive • “Just” Economics

  3. Intrinsic vs. Existence Value • Choice and knowledge • Compensation • Risk vs. Certainty • Economic vs. Intrinsic value

  4. Syllabus I • Scale (ecology), distribution (ethics), efficiency (economics), constraints (thermodynamics) • Formal analogy • Microeconomics and thermodynamics • Biophysical valuation • Industrial ecology, industrial metabolism • Substantive integration • Thermodynamics and ecology: DEB • Thermodynamics and economics: Ayres • Epistemology and sociology of science • Ethics and welfare • Static vs. intertemporal optimisation • Lagrangian multipliers • Maximum principle

  5. Syllabus II • Microeconomics • Review of consumer theory • Review of producer theory • Review of market structures • Game theory • Evolutionary and institutional economics • Pollution economics; pollution control instruments

  6. Market Equilibria and Externalities MSC MPC Social optimum Market equilibrium MPB y

  7. Syllabus III • Ecological and economic networks • Life Cycle Analysis • Input-Output Analysis • Computable General Equilibrium Models • Indicators of environmental responsibility • Economic valuation methods • Intertemporal choice and uncertainty • Discount rate • Cost-benefit analysis;

  8. Syllabus IV • Sustainable development • Weak vs. strong sustainability • Economic growth theory • Neoclassical and endogenous • Ayres • Economic theory of sustainable development • Biophysical and other indicators of sustainable development • Index of sustainable economic welfare • Ecological footprint • Human Appropriation of Net Primary Production • EcoIndicator95, EcoIndicator99 • Environmental Kuznets hypothesis

  9. Next Lecture ASSIGNMENTS Chapter 3, problem 5 Chapter 15, problem 1, 2 READINGS: Varian, Intermediate Microeconomics Choice: chapter 5 (appendix) Demand: chapter 6 (appendix) Market demand: chapter 15 Equilibrium: chapter 16 Producer theory: chapters 17, 18, 19, 20, 21, 22

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