ENR-30306 Theories and Models in Environmental Economics


Credits 6.00

Teaching methodContact hours
Group work5
Independent study

Language of instruction:


Assumed knowledge on:

ENP-32306 Advanced Environmental Economics and Policy.

Continuation courses:

Thesis Environmental Economics (ENR-80418/-21/-24/-27/-30/-33/-36/-39), Economics and Management of Natural Resources (ENR-31306); Cost Benefit Analysis and Valuation Methods; Selected topics in Environmental and Resource Economics.


The course focuses on applied analysis of the relationship between economic activity and environmental problems. Different methodologies of making environmental scenario studies are discussed at an intermediate level. Methodologies that will be dealt with include systems, dynamic optimisation, input-output, computable general equilibrium and game-theoretic modelling.
Some of the major environmental problems, including climate change, cannot be analysed without taking the international aspects into account. Therefore, the course will deal explicitly with the economic theory on international trade and its relation with the environment.
This course provides students the analytical insights and skills to develop and critically evaluate applied environmental-economic models.

Learning outcomes:

After successful completion of this course students are expected to be able to:
- understand and criticize empirical studies from international journal articles;
- analyse and evaluate the theoretical background of applied environmental economic optimisation models;
- design and construct an environmental economic model in GAMS;
- analyse and appraise policy scenarios by means of the designed model;
- write a research report and give a scientific presentation with the results of a policy analysis.


An approximate division of activities is:
- lectures (10% of time: 16 hours);
- class discussions (5% of time: 8 hours, discussing a selection of articles);
- self-study (20% of time: 32 hours; incl. written exam and preparation of discussions);
- computer practicals (15% of time: 24 hours);
- writing a paper on a case study (50% of time: 80 hours; incl. solving the model using GAMS, writing the paper).


The grade for the course will be determined based on:
- a case study, including the case study report, the presentation and the discussion (50%);
- written examination of the lectures and the discussion articles in the reader (50%).


The literature for this course will consist of two readers, made by ENR; one reader will consist mainly of articles from international journals, the other is for the computer modelling.