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Ecological Economics Lecture 9

Doctoral Program and Advanced Degree in Sustainable Energy Systems Doctoral Program in Mechanical Engineering Doctoral Program in Environmental Engineering. Ecological Economics Lecture 9. Tiago Domingos Assistant Professor Environment and Energy Section Department of Mechanical Engineering.

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Ecological Economics Lecture 9

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  1. Doctoral Program and Advanced Degree in Sustainable Energy SystemsDoctoral Program in Mechanical EngineeringDoctoral Program in Environmental Engineering Ecological EconomicsLecture 9 Tiago DomingosAssistant ProfessorEnvironment and Energy SectionDepartment of Mechanical Engineering

  2. Pollution Economics – Problem 1 • Producer surplus is zero MPC MEB MPB MSB=MPB+MEB

  3. Producer Surplus – Problem 4 • The Pigou tax is equal to MEC at the social optimum • The surplus loss (-150) is compensated for by the amount of Pigou tax paid (100) and the reduction in external cost (100) • “Estamos a taxar a externalidade e a obter um valor para compensar os efeitos da externalidade” (Patrícia and João)

  4. Partial Equilibrium vs. General Equilibrium • Computable General Equilibrium Model

  5. Next Lecture ASSIGNMENTS Varian, Chapter 30, Review Questions 1-5 Pollution Economics, 7 and 9 Ethics, 1-4 READINGS • Varian • Chapter 30, Welfare • Perman et al. • Chapter 2, Part 1, Ethical Foundations for Environmental Economics • Pearce and Kerry Turner • Chapter 6, Taxation and Optimal Pollution • Chapter 7, Environmental Standards, Taxes and Subsidies • Chapter 8, Marketable Pollution Permits

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