Economics of the environment and climate change
Course. Last offered: Spring, 2023.
The course introduces the economic concepts and methods relevant for analyzing problems and policies relating to the environment and climate change. The course will explain the environmental economic approach to sustainable development and the role that economic instruments can play in protecting the environment and fighting global warming.
Taking the course will prepare students for further advanced studies in the economics of the environment, natural resources and climate change at the master's level.
Environmental economics: The most recent research
Continuing and professional education. Last offered: Spring, 2023.
In the course, researchers from the Department of Economics at the University of Copenhagen delve into three key climate policy questions, which are presented and discussed based on the most recent research:
How do energy and climate policy interact? Renewable energy has become competitive, but is still associated with significant challenges and costs. Balancing the electricity market continuously becomes more difficult when fluctuating energy sources replace more flexible power plants.
What are the best instruments and measures to reduce CO2e leakage? A central theme for Danish climate policy, as exemplified by the recent agreement on a green tax reform from June 2022.
What does the choice of discount rate mean for climate policy priorities in the short and long run? Correct use of the discount rate is necessary so that society can prioritize the most effective climate policy instruments, seen in the light of climate policy's long time horizon.
The course focuses on presenting and discussing the political implications of these three questions.
Environmental cost-benefit analysis
Seminar. Last offered: Fall, 2022.
How should decision-makers (e.g., governments or financial investors) decide between potential projects and policies? Answering this poses many challenges, not least for many environmental projects and policies. Such projects and policies may have effects on goods and services that are not traded in the market, adverse distributional effects, and inherent risks and uncertainties. Parallel to this are the challenges of financing sustainable growth.
This course introduces students to the general method and use of cost-benefit analysis. There will be particular emphasis on applications to resource and environmental economics. The course therefore deals with many crucial aspects of environmental cost-benefit analysis.
The goal is to equip students with the necessary background to assess the validity of practical environmental cost-benefit analyses, as well as to formulate how current guidelines can be improved based on the latest economic research.
The course will consist of a lecture block that provides an overview and introduces students to key concepts.
Examples of topics students may work on:
Revealed preferences methods for valuing non-market goods.
Contingent valuation method for valuing non-market goods.
Value or benefit transfer.
Distributional issues in cost-benefit analysis.
Discounting approaches and reasonable values.
Discounting and inequality.
Discounting under uncertainty.
Discounting of scarce non-market goods.
Applications to climate change.
Continuing and professional education. Last offered: Spring, 2022.
What does the choice of discount rate mean for climate policy priorities in the short and long term? What are the best instruments and tools to reduce greenhouse gas emissions?
In this course, researchers from the University of Copenhagen teach how the discount rate can be used to shape climate policy, and what instruments and tools can be used to implement climate policy - e.g. choice of instruments in a small open economy, dilemmas associated with regulation versus market and nudging as an alternative to more traditional instruments.
A central part of the teaching deals with what practice is in other countries.
PhD workshop in climate economics
Workshop. Last offered: Spring, 2021.
The workshop has two objectives: First, to introduce PhD students to recent articles and working papers on the research frontier in climate economics with special emphasis on (i) adaption to and damages from climate change, (ii) climate policy (both normative and positive considerations), and (iii) innovation and adoption of green technologies. Second, doing so with a focus on:
What makes a good research paper?
Econometric methods used in climate economics.
Computational and model estimation/calibration tools applied in climate economics.
How does the results compare to related literature?
Scope for future research.
The form of the workshop will be weekly meetings of 1 hour, where a reading group member will present a paper from the reading list, where after it will be discussed with focus on the above five points.
Course. Last offered: Spring, 2021.
The course is an introduction to economic approaches to justice and fairness from both theoretical and empirical perspectives.
1. The course starts with an introduction to welfare economics, the part of economics that addresses ethical issues. This introduction will be framed as a discussion of the possibility for a society to aggregate different views on what is good. Arrow’s impossibility theorem states that this is infeasible, but subsequent approaches have explored how this result may be circumvented.
The course considers two such approaches. The most common way to avoid the impossibility result is to assume that well-beings of agents can be both measured and interpersonally compared. An alternative is to restrict the attention to one-dimensional issues, such as individual income.
2. The course contains an introduction to empirical measurement of social welfare and inequality. This introduction will be framed around how to rank income distributions and Lorenz curves. The course considers what properties measures of inequality should satisfy, how to theoretically derive measures of equal versus unequal distributions, and how to measure inequality in practice. The course will also cover a number of empirical questions related to inequality.
3. The course contains an introduction to intergenerational justice. This introduction will be framed around conflicts between the interests of the present and the interests of future generations. Related to this conflict is the question of how to treat future generations.
The course identifies and illustrates ways to resolve intergenerational conflicts by normative analysis based on intertemporal social choice. It then considers whether normative analysis based on intertemporal social choice is relevant for actual decision-making. The course will also cover applications to the climate and population problems.
Perspectives on sustainability. Course. Last offered: Fall, 2022.
Advanced economics of the environment and climate change. Course. Last offered: Fall, 2022.