The Economics of Climate Change focuses on environmental and climate policy design using economic principles. The course begins with an introduction to the foundations of environmental economics: how market failures can result in externalities, under-provision of public goods, and overconsumption of open-access resources. As a next step, we will examine how non-market valuation techniques can help analyze the costs and benefits of environmental policies.
The second part of the course emphasizes the importance of accelerating policies to reduce greenhouse gas emissions. Thus, part II begins with an analysis of climate policies such as carbon taxes and emissions trading systems. Next, sustainable forest management and technological innovation are discussed as critical elements of a low-carbon transition. The remaining classes examine climate finance, international climate policies, and how behavioral economics can influence perceptions of climate change. In the final lecture, case studies will be examined regarding the successful and unsuccessful implementation of climate policies.