EE 511: Ecological Economics

Course Information

Instructor:	Brynhildur Davidsdottir Office: STO 466; Office Hours: by appointment. Tel. 617-349-2744. email: bdavids@bu.edu or brynhildur_davidsdottir@abtassociates.com
Meeting Time:	Lecture: Tuesday 6-9 PM
Classroom Locations:	Lecture: CAS 453
Readings	Reading packet: available at STO 141 – occasional additional readings will be available as well in the CEES office.
Course Description and Course Objectives	The increase in human numbers and economic activity has put Homo Sapiens in a position to greatly influence the flow of energy and matter on Earth. Explaining the extent and impacts of this influence is well beyond the theory and analytical tools of individual disciplines, such as economics, ecology or the physical sciences. A new interdisciplinary approach is needed, one that unites the relevant aspects of different disciplines. The theory and tools necessary to understand the relation among human populations, natural resources, the environment, and economic growth are brought together in the discipline of Ecological Economics. In this course you will be introduced to the history and methods of Ecological Economics. Methods such as green national accounting, valuation of ecosystem services, measuring resource scarcity, accounting for natural capital and the methods of industrial ecology, are discussed in detail. After taking this class you will be able to think critically about economic theory, apply the concepts taught in the class as well as, hopefully feel inspired to contribute to the development of this new exciting field of research.
Grading:	Your grade is based on four short in-class quizzes and a take-home cumulative final, in addition to a research paper and a review paper. The final exam will be given out on Tuesday May 3rd. Research Paper: 30% - due on Tuesday April 26^th. The research paper should be maximum 15 pages of double-spaced text, excluding graphs and references. The topic must be approved by the instructor, and a one-page proposal is due on Tuesday February 15^th. Be prepared to discuss your potential topic in a group-brainstorming session on Tuesday February 8^th. Book Review or Literature Review (on a topic unrelated to your research paper). 10% due date TBA Four (4) very short quizzes: 5% each, time TBA. Final exam (take-home): 20% (essays), given on May 3^rd. Class participation, occasional short assignments: 20%. This class is heavily discussion based and therefore requires that you read the assigned material before coming to class and participate in discussion. Many of the ideas we will discuss are controversial, and we will spend a considerable amount of time debating and discussing the class material. Each student will be assigned a week where he/she must be prepared to lead discussions hint: and thus be extra well prepared that particular week!
Incomplete Grades:	“I” grades are given only when specific work has not been completed AND when the student and instructor have conferred and the instructor has assigned a date within the next 12 months for the work to be completed. The I grade automatically becomes a permanent F if the work is not completed with 12 months from when the incomplete was given. This is CAS policy.
Academic Honesty and Copyright	Plagiarism and other forms of academic misconduct are serious offenses. I take them very seriously and I expect my students to do likewise. You should read the CAS Academic Conduct Code for further information about specific definitions, procedures, sanctions, etc. Copies of the Code are available in CAS 105. I am required to refer cases of suspected academic misconduct to the CAS Dean’s Office. The syllabus, course descriptions, and handouts created by Professor Davidsdottir, and all class lectures, are copyrighted by Boston University and/or Professor Davidsdottir. Except with respect to enrolled students as set forth below, the materials and lectures may not be reproduced in any form or otherwise copied, displayed or distributed, nor should works derived from them be reproduced, copied, displayed or distributed without the written permission of Professor Davidsdottir. Infringement of the copyright in these materials, including any sale or commercial use of notes, summaries, outlines or other reproductions of lectures, constitutes a violation of the copyright laws and is prohibited. Students enrolled in the course are allowed to share with other enrolled students course materials, notes, and other writings based on the course materials and lectures, but may not do so on a commercial basis or otherwise for payment of any kind. Please note in particular that selling or buying class notes, lecture notes or summaries, or similar materials both violates copyright and interferes with the academic mission of the College, and is therefore prohibited in this class and will be considered a violation of the student code of responsibility that is subject to academic sanctions.

DATE			TOPIC	READING
T	Jan.	18	Introduction to the course	Daily 2004
			PART 1. The Beginning – Basic Organizing Laws and Principles
T	Jan.	25	Motivation and Historical Roots of Ecological Economics Where and when did it all begin?	Cleveland 1987, Boulding 1966, Daly 1968, Martinez-Alier 1987, Costanza 1998
T	Feb	1	Concepts and tools of economics Concepts and tools of thermodynamics	Christensen 1989, Daily 1992, Ruth 1993, Victor 1991 Georgescu-Rogen 1971, Ayres 1978, Ruth 1994
T	Feb	8	Concepts and tools of ecology The link between ecosystems, thermodynamics and the economy – co-evolution and evolutionary economics How do thermodynamics and ecology inform economic decision-making? The making of a sustainability science.	Folke 1999, Ruth 1993 Norgaard 1985, Norgaard 1988 Ruth 1996, Allen 1994, Daily 2004. Daily 1992
			PART 2. Valuing ecosystem services
T	Feb	15	Comparative Value Theories Classical, neoclassical, Marxism, biophysical, ecological economics Valuing ecosystem services – comparative analysis of different values (e.g. use and non-use values) and different methods. The methods discussed are: Contingent evaluation, travel cost, hedonic pricing, energy theory of value, avoided cost, replacement values. Comparative case study Discussion – Can the price ever be right?	Hall et al. 1986 Farber et al. 2002 Goulder and Kennedy 2000 Groot et al 2002 Kristrom 1999, Johansson, 1999 Costanza et al 1989.
T	Feb	22	No Class - Monday Schedule of Classes
			PART 3. How well are we doing? What are the appropriate sustainability indicators?
T	March	1	Greening the National Accounts Standard National Accounts Accounting for Natural Capital Incorporating natural and human capital into national accounts – weak and strong sustainability, welfare indicators	Cherry 1980 Daily and Cobb 1990 Costanza and Daily 1992 Costanza et al 1997 Van Dieren1995, p. 167-257
T	March	8	Spring Recess
T	March	15	Incorporation of Natural and Human Capital into National Accounts Weak Sustainability – specific methods – case studies Incorporation of Natural and Human Capital into National Accounts Strong Sustainability – specific methods – case studies Welfare Indicators, HDI – case studies	Neumayer 2003 Neumayer 2003, Hueting 1991 and WWF 1992. Cobb and Halstead 1994 Costanza et al 1997 Van Dieren1995
T	March	22	Natural Resource Scarcity Malthus, Ricardo, Barnet and Morse, Slade - Neoclassical approach Biophysical approach. Best first, resource quality, economic and environmental energy cost EROI case studies	Krautkraemer 2002 Hall and Hall 1984 Norgaard 1990 Cleveland 1991
T	March	29	Limits to Growth? Micro-foundation. Production Functions – incorporating thermodynamic limits Substitution and technological change Material and energy efficiency, energy quality Technological change and thermodynamic limits - role of energy in technological change, learning curves	Nicholson, chapter 10 Stern 1996 Ayres and Nair 1984 Patterson 1996. Cleveland et al. 2000 Ruth and Bullard 1993 deVries and Berry 1979 Technical change – ch.6 Loschel 2002
T	April	5	Are there limits to growth? Comparative analysis of different paradigms	Meadows et al 1972 Mikesell 1995 Solow, R. 1992 Ecological Economics sept.1997, pages 261-275 Victor 1991
			Bringing Concepts to Action
T	April	12	Environmental policy design – insight from ecological economics Natural Resource Management – insight from ecological economics – aquaculture and forestry	Underwood and King 1989 Costanza et al. 1997. 192 – 217 Folke (1988) Creedy and Wurzbacher 2001
T	April	19	Industrial ecology Industrial ecology flow cycle The triple bottom line Dematerialization	Graedel and Allenby 1995 Cleveland and Ruth 1999
T	April	26	Tools of Industrial Ecology LCA – life cycle analysis Net Energy Analysis Environmental Cost Accounting Case study	Graedel and Allenby 1995 Bourman et al. 2000
T	May	3	Student Presentations The Future of the Discipline

Reading list

Ayres R.U, 1978, Applications of Physical Principles to Economics, in Resources, Environment and Economica.

Ayres, R.U. and I. Nair. 1984. Thermodynamics and Economics. Physics Today. pp. 62-71.

Bergh (ed.) Handbook of Environmental and Resource Economics, Edward Elgar Publishing, Cheltenham, pp. 809 – 823.

Boulding K.E., 1966, The economics of the coming spaceship earth, Excerpt from “Quality in a growing economy”.

Bourman et al., 2000,Material flows and Economics models an analytical comparison of SFA, LCA and partial equilibrium models, Ecological Economics 32:195-216.

Cherry, R.D., 1980. Chapter 4 - Production, Income, and Spending, in Marcoeconomics, Addison-Wesley Pub. Co., Reading, MA. pp 61-91.

Christensen, P.P., 1989. Historical Roots for Ecological Economics: Biophysical versus Allocative Approaches Ecological Economics, Vol. 1, pp. 17 - 36.

Cleveland C., 1987, Biophysical Economics: historical perspective and current research trends, Ecological Modeling 38:47-73.

Cleveland C., 1991, Natural Resource Scarcity and Economic Growth Revisited: Economic and Biophysical Perspectives, in: Costanza R. Ecological Economics: The Science and Management of Sustainability.

Costanza, et al., 1997, An Introduction to Ecological Economics, pages 192 – 217.

Costanza, R. and B.C. Patten. 1995. Defining and Predicting Sustainability, Ecological Economics,

Vol. 15, pp. 193 – 196.

Costanza, Robert and Herman E. Daly. 1992. Natural Capital and Sustainable Development. Conservation Biology, Vol. 6(1). pp 37-46.

Costanza, Robert, Stephen C. Farber, and Judith Maxwell. 1989. Valuation and Management of Wetland Ecosystems. Ecological Economics, Vol. 1. pp 335-361.

Costanza, Robert, 1998. Beyond the Argument Culture, Ecological Economics, Vol. 27, pp. 113 – 114.

Creedy, J., and Wurzbacher, A.D. 2001, The economic value of forested catchment with timber, water and carbon sequestration benefits, Ecological Economics 38:71-83.

Daily H.E., and Cobb J.B., 1990, Misplaced Correctness: Measuring Economic Success, in: For the Common Good: Redirecting the Economy Towards Community.

Daly, H., 1968, On economics as a life science.

Daly, H.E. 1992. Steady-State Economics: Concepts, Questions, Policies, GAIA, Vol. 1, pp. 333 - 338.

Daily et al. 2004, Ecological Economics, Island Press.

de Vries, Bert and R. Stephen Berry. 1979. Physical Information in Economic Analysis in R.A. Fazzolare and C.B. Smith (eds.) Changing Energy Use Futures, Pergamon Press, Frankfurt, pp. 156 – 164

aEcological Economics, 1997, pages 261 – 274.

Farber et al., 2002, Economic and Ecological concepts for valuing ecosystem services, Ecological Economics 41:375-392.

Folke, C. 1999. Ecological Principles and Environmental Economic Analysis, in J.C.J.M. van den Bergh (ed.) Handbook of Environmental and Resource Economics, Edward Elgar Publishing, Cheltenham, pp. 895 – 911.

Folke, Carl and Nils Kautsky. 1989. The Role of Ecosystems for a Sustainable Development of Aquaculture. Ambio, Vol. 18(4). pp 234-243.

Folke, Carl. 1988. Energy Economy of Salmon Aquaculture in the Baltic Sea. Environmental Management, Vol. 12(4). pp 525-537.

Georgescu-Rogen N., 1971, The entropy law and the economic problem.

Goulder and Kennedy, 2000, Valuing Ecosystem Services, Philosophical Bases and Empirical Methods, in Nature’s Services.

Graedel and Allenby, 1995, Industrial Ecology, Prentice Hall.

Groot et al., 2002, A typology for the classification, description and valuation of ecosystem functions, goods and services, Ecological Economics, 41:393-408.

Hall, C.A.S., C.J. Cleveland and R. Kaufmann. 1986. Chapter 3-Value in Classical Economics in Energy and Resource Quality, Wiley-Interscience, New York. Pp. 69-76.

Hall, D.C. and J.V. Hall. 1984. Concepts and Measures of Natural Resource Scarcity with a Summary of Recent Trends, Journal of Environmental Economics and Management, Vol. 11, pp. 363 – 379.

Hueting, R. 1991. Correcting National Income For Environmental Losses: A Practical Solution For a Theoretical Dilemma in R. Costanza (ed.) Ecological Economics, Columbia University Press. Pp 194-213.

Johansson, P-O. 1999. Theory of Economic Valuation of Environmental Goods and Services, in J.C.J.M. van den Bergh (ed.) Handbook of Environmental and Resource Economics, Edward Elgar Publishing, Cheltenham, pp. 747 – 754.

Juan Martinez-Alier, 1987, Introduction, in Ecological Economics: Energy, Environment and Society, Chapter 1.

Krautkraemer, 2002, The Economics of Scarcity: State of the debate. Manuscript

Kriström, B. Contingent Valuation, in J.C.J.M. van den Bergh (ed.) Handbook of Environmental and Resource Economics, Edward Elgar Publishing, Cheltenham, pp. 777 – 795.

Loschel, 2002,Technological change in economic models of environmental policy: a survey, Ecological Economics 43:105-26.

Meadows, D.H., D.L. Meadows, J. Randers, and W.W. Belnews. 1972. Chapter 11-The Limits to Exponential Growth, in The Limits to Growth. Universe Books, New York.

Mikesell, R.F. 1995. The Limits to Growth: A Reappraisal, Resources Policy, Vol. 21, pp. 127 - 131.

Neumayer, E, 2003, Weak versus Strong Sustainability – chapters 5 and 6.

Norgaard, Richard B. 1985. Environmental Economics: An Evolutionary Critique and a Plea for Pluralism. Journal of Environmental Economics and Management, Vol. 12. pp. 382-394.

Norgaard, Richard B. 1990. Economic Indicators of Resource Scarcity: A Critical Essay. Journal of Environmental and Economics and Management, Vol. 19. pp 19-25.

Patterson M.G., 1996, What is Energy Efficiency? Energy Policy, 24:377-390.

Ruth, M., 1996, Evolutionary Economics at the Crossroads of Biology and Physics, Journal of Social and Evolutionary Systems 19(2):125-144.

Solow, R., 1992, An almost practical step towards sustainability, Resources for the Future.

Stern D., 1996, Limits to substitution and irreversibility in production and consumption: a neoclassical interpretation of ecological economics.

Technical Change and Thermodynamic Limits – chapter 6.

Underwood, D.A. and P.G. King. 1989. On the Ecological Foundations of Environmental Policy, Ecological Economics, Vol. 1, pp. 315 - 334.

Victor, Peter A. 1991. Indicators of Sustainable Development: Some Lessons from Capital Theory. Ecological Economics, 4. pp 191-213.