The Economics of the Environment

Key information

Start date
End date
Year of study
Year 3
Term 2
Module code
FHEQ Level
Department of Economics

Module overview

This course introduces students to economic perspectives on environmental and development issues. The course covers various macro and microeconomic issues as well as economics of climate change.  The macroeconomic topics covered in the lectures includes the relationship of the environment to growth and trade, sustainable economic development and the so-called "resource curse". On the micro side the theory and application of environmental policy in developing countries is discussed as well as the link between environment, poverty and population. Then, the applicability of traditional economic analysis to economics of climate change problem is discussed including the thorny issue of intergenerational equity, that is, how to find the balance between the well-being of future and current generations when deciding how to act on climate change. Lastly, we address the failure of international agreements such as Kyoto to make any significant strides towards halting climate. change.


153400123 - Macroeconomic Analysis


153400130 - Microeconomic Analysis

(Note: For BSc Economics and BSc Development Economics students both these courses are core courses in year 2 of their degrees, but BA two-subject degree students can only take EITHER of these two courses in their year 2)

Objectives and learning outcomes of the module

On successful completion of the course, students will be able to:

  • Apply core economic theory and economic understanding to applied environmental issues.
  • Show understanding of analytical methods with economic theories and models.
  • Select and apply appropriate economic techniques to solve environmental problems.

Method of assessment

AS1 - 10% / AS2 - 90%

Suggested reading

Core readings:

  • Kolstad (2000), Environmental Economics, Oxford University Press.
  • Hanley N., J.Shogren and B.White. (1997). Environmental Economics in Theory and Practice. 1st edition only. Basingstoke: Macmillan.  A333.7 /783687.
  • Perman, Ma, McGilvray, Commons (2003), Natural Resource and Environmental Economics, Third Edition, Pearson.
  • Pearce D W & R K Turner. Economics of natural resources and the environment Harvester Wheatsheaf 1990.
  • Tietenberg T and Lynne Lewis: Environmental and natural resource economics. 9th Edition, Pearson, 2012.


Important notice regarding changes to programmes and modules