Course info

Course Objective: 

Course Objective: The course aims to disseminate the techniques of valuing the worth of non-market commodities especially environmental goods and service. Several case studies based on different valuation techniques would help the students appreciate the application of these techniques in determining the worth of environmental commodities.

Course Outcomes:  The students will be able to

1

Discern valuation criterion in environmental economics, including its key principles and methods.

2

Use microeconomic principles in valuation of environmental good and services

3

 Determine consumer preferences to infer demand for environmental quality.

 4

Apply approaches of non-market valuation of environmental goods and services, and of their strengths, weaknesses and methods of application

 5

 Demonstrate theoretical and practical application of different valuation techniques.

6

Apply cost benefit analysis to decide on a sustainable project.

Course Content:  

 UNIT I

Economic Valuation of Environmental Damage or Benefits I

Economic Theory and Measurement of Environmental Benefits. Demand for Environmental Service – Willingness to Pay and Willingness to Accept.

10 Hrs

 UNIT II

Economic Valuation of Environmental Damage or Benefits II

Concepts of Consumer’s Surplus. Compensating and Equivalent Surplus in the context of rationed goods and the Environment.

10 Hrs

 UNIT III

Alternative Approaches and Methods of Environmental Valuation – I

i.              Revealed Preference and Stated Preference Method – Hedonic Pricing, Household Production Function, Travel Cost Method, Defensive cost and Contingent Valuation Method.

ii.             Case studies to be discussed.

 10 Hrs

 UNIT IV

Alternative Approaches and Methods of Environmental Valuation –II

i.              Valuation of Health and Human Life

iii.            Case studies to be discussed

 10 Hrs

UNIT V

Alternative Approaches and Methods of Environmental Valuation –III

         i.            Valuing Environment as Input in Production

        ii.            Case studies to be discussed

10 Hrs

UNIT VI

Environmental Accounting and Measuring Green GDP

i.              Sustainable Macroeconomic Accounting of National Income and Wealth.

ii.             Green Accounting.

iii.            Environmental Cost-Benefit Analysis for Sustainable Development.

iv.            Rationale of Discounting the Future in the context of Sustainability

v.             Theory of Krutilla-Fisher Equation for Preservation or Development

10 Hrs

Internal Assessment: 

 CIA 1

Unit I, Unit II 

 CIA 2

Assignment submission and/or presentation/Written Test 

Text Books: 

1.       Kolstad C.D., Environmental Economics, Oxford University Press, 2000.

 Reference Books: 

1.      Johansson Per-Olov: The Economic Theory and Measurement of Environmental Benefits, Cambridge University Press, Cambridge, 1987.

2.      Bhattacharya R.N. (ed.), Environmental Economics: An Indian Perspective, Oxford University Press, 2001.

3.      M.N. Murthy Environment, Sustainable Development, and Well-being  Valuation, Taxes, and Incentives, OUP May 2009