Environmental Economics. Flashcards

Flashcards covering key vocabulary and concepts from the Environmental Economics lecture notes.

Environmental Economics

Branch of economics studying the interaction between the economy and the environment, assessing the impact of natural resource use and consumption, and evaluating costs and benefits of environmental policies.

Externalities

Costs or benefits of economic activities not reflected in market prices, such as pollution.

Sustainable Development

Meeting the needs of the present without compromising the ability of future generations to meet their own needs.

Market Failures

Situations where markets do not allocate resources efficiently, often involving underpricing of environmental goods and overuse of natural resources.

Marginal Abatement Cost (MAC)

The cost of reducing one unit of pollution, helping policymakers determine the optimal level of pollution control.

Cost-Benefit Analysis (CBA)

Tool to evaluate the economic feasibility of environmental policies by comparing costs and benefits.

Ecosystem Services

Benefits people derive from natural ecosystems, such as clean air and water.

Environmental Policy Instruments

Tools governments use to address environmental problems, including taxes, subsidies, emissions trading, and regulations.

Environment

Includes water, air, soil, and relationships between humans, other organisms, plants, and microbes, providing essential services.

Environmental Pollution

Modification of air, water, or soil characteristics affecting the health and survival of human beings or other living organisms.

Natural Resources

Materials obtained from the environment to meet human needs, such as air, water, soil, minerals, coal, and petroleum.

Renewable Resources

Resources existing in nature in unlimited quantities and not destroyed by human actions, like sunlight, wind, and water.

Non-Renewable Resources

Raw materials created over millions of years and eventually exhausted, such as coal, petroleum, natural gas, and minerals.

Ecology

Study of the relationships between living organisms and their environment.

Industrial Ecology

System that attempts to improve the overall quality of production from non-virgin to finished goods and final disposal.

Ecosystem

Fundamental relationship between organisms and their environment, with organic (biotic) and inorganic (abiotic) components.

Public Goods

Environmental resources like clean air and biodiversity that are non-excludable and non-rivalrous.

Biosphere

Part of Earth where living organisms exist and interact with one another and with non-living components.

Lithosphere

Outermost layer of Earth, composed of the crust and the brittle part of the upper mantle.

Hydrosphere

All water storage areas on Earth that hold liquid water, including oceans, rivers, lakes, and ground water.

Atmosphere

Transparent gaseous envelope around the Earth, extending up to 1600 km, held by gravity.

Real Property

Land and anything permanently attached to it, including buildings and structures.

Personal Property

Any movable or intangible item that is not fixed to real estate or land.

Intellectual Property

Creations of the mind that are legally protected from unauthorized use, including inventions, literary works, and designs.

Property Rights

Legal rights individuals or entities have to own, use, and manage property.

Coase Theorem

Principle stating that private parties can efficiently resolve externality-related issues through negotiation if property rights are well-defined and transaction costs are low.

Pigouvian Tax

Tax implemented on activities that create adverse side effects that are not factored into market prices