UNIVERSITY OF CALIFORNIA, LOS ANGELES
Department of Economics
Natural Resource Economics
Instructor: Trudy Ann Cameron, Professor, Economics
& Policy Studies
Office: 9367 Bunche Hall
Office hours: by appointment, or drop-in as feasible
Class meetings: to be arranged
Class location: to be arranged
About the course
Economic models must be adapted to accommodate the special
features of natural resource inputs. The traditional curriculum of natural
resource economics emphasized fisheries models, forestry models, and minerals
extraction models (i.e. fish, trees, and ore). In recent years, however,
other resources, notably air, water, the global climate, and "environmental
resources" in general have become increasingly important to policy-making.
Academic and policy interest has now moved beyond simply
the optimal commercial exploitation of the standard trio of resources to
encompass management for other objectives. For example, natural resources
more broadly defined have recreational, as well as commercial values. They
may also contribute to overall social welfare levels due to bequest motives,
or by their mere existence (called passive use values). The past two decades
have produced much new literature in these areas.
Our sequence here at UCLA emphasizes empirical
economic models for natural and environmental resources. This course will
begin with approximately five weeks of material on the standard economic
models for the optimal exploitation of fish, trees, and minerals. (We will
not have time during lectures to pursue all of the myriad sophisticated
refinements of these formal optimization models, although leads will be
provided.) We will then examine the classes of models employed with respect
to air quality, surface water and groundwater quantity and quality, and
recreational uses of fisheries, forests, and other natural environments.
We will also explore models used to address changes in the earth's climate
patterns. Throughout, we will be supplementing our coverage of theoretical
models and conceptual arguments with examination of data sets that might
be exploited in empirical research in these areas.
Course Objective
We aim to have students acquire a basic familiarity with
the standard models used in natural resource economics. We will sample
the state-of-the-art in several research areas, highlighting promising
avenues for further research. At the same time, we will stress the importance
of building a groundwork of familiarity with a broad spectrum of available
research resources. The course will stimulate participants to plan several
tentative research agendas for possible subsequent work in this field (e.g.
dissertation chapters).
Data Sets ![[NEW]](new_tiny.gif)
In the last couple of years, there has been a vast proliferation
of information available over the Internet concerning natural and environmental
resources. While the promise of the Internet as a research tool sometimes
outpaces its payout, we will experiment this year with making familiarity
with data sources accessible via the Internet a much more significant component
of the course.
A growing Collection
of Links to a wide variety of Internet sites of potential value to
the subject matter of this course (and subsequent research in this area)
is under development and can readily be accessed. If you are not comfortable
with procedures for accessing the Internet, do not delay in seeking help.
Policy and Institutional Knowledge
Another component that has been insufficiently emphasized
in previous versions of the course is the linkage to actual resources-and-environment
policies and policy-making. The Internet also now contains many statements
by resource management agencies concerning their management objectives.
An appreciation for the distance between the economic theory of optimal
resource management and the real-life practice of resource management is
an essential part of training for economists in this field. We will explore
natural resource policy both in developed and developing countries.
Synergies with other Economics Subject Areas
Natural resource economics also draws on models and techniques
common to other subfields of economics, and this course will highlight
those connections. It is our intent is to offer Natural Resource Economics
(in conjunction with Environmental Economics) as an attractive complement
to more-traditional subfields of economics such as International Economics,
Development Economics, Public Finance, and Labor Economics, Uncertainty
and Information, Industrial Organization, Economic History and Applied
Econometrics.
Prerequisites
Successful completion of UCLA's first year graduate sequence
(or the equivalent) plus an undergraduate field course in Natural Resource
Economics (or permission of the instructor). Familiarity will be assumed
with the subject matter covered in chapters 6 through 13 of Tietenberg
(1988) Environmental and Natural Resource Economics, Scott, Foresman,
Glenview, Illinois, or the equivalent.
Requirements
Students will be required to generate two research
proposals and to participate in two rounds of "double-blind" written
review and criticism of their classmates' proposals. This is considered
a VERY IMPORTANT component of the course. This is the first stage of the
research process and students are encouraged to view these proposals as
potential dissertation topics.
Experimentally, as an incentive to encourage cooperative
learning and the creation of additional human capital at UCLA in the area
of environment/resources dataset identification and acquisition, an explicit
component of the course grade will be devoted to each student's participation
in this effort.
The complete set of requirement (with weights attached)
is:
Input from the entire class will contribute to evaluation
of the student presentations, and referees reports will be factored into
the evaluation of the proposals. Written critiques of each proposal will
also be provided by the professor.
Readings
This list may seem encyclopaedic, but we will be able to
better focus the readings as the interests of class members are revealed.
Beyond the basic core of fish, trees, and mines, each student might end
up pursuing a unique specialization. The myriad offshoot papers listed
below should be pursued only if the general area is one that sparks the
student's research interests. Additions from the 1995 literature are still
being considered, but selective deletions from this list and additions
from new material should be completed within a week or so.
Inventory
of Environmental Economics Papers in Major General Interest Economics Journals
Abbreviations for sources:
GENERAL:
-
Review of Mathematical Techniques: CC, pp. 1-61.
-
Some classic
articles in the traditional curriculum
ELEMENTARY TEXTS (for review of simple theory):
Simplified outline (with links to detailed outline
and extended lists of readings):
-
OVERVIEW
-
FISHERIES:
-
A Simple Static Model of a Fishery
-
A Simple Dynamic Model of a Fishery (Neher version)
-
Alternative Dynamic Model of a Fishery (HO version)
-
Fisheries Regulation (Theory and Practice)
-
Extensions
-
FORESTS:
-
Maximum sustained yield, single crop scenario
-
Ongoing private harvests (Faustmann model)
-
Multiple-use forests
-
Empirical forest economics
-
Deforestation
-
MINERALS:
-
costless production case
-
models with extraction costs: constant marginal costs (Neher)
-
models with increasing extraction costs but no stock effects,
c(x) only (Sweeney)
-
models with increasing extraction costs and stock effects,
C(x,b)
-
*optimal extraction with endogenous prices, P(X,t)
-
competitive equilibrium with Hotelling costs: many firms
-
model with Hotelling costs and technical progress (Sweeney
approach)
-
single competitive firm, no stock effects
-
monopoly case (Conrad and Clark versus Neher's competitive
case)
-
NON-MARKET
RESOURCES:
-
Revealed versus Stated Preferences
-
Hedonic property value and wage methods
-
Travel cost methods
-
Random utility model (RUM) methods
-
Contingent valuation and contingent behavior methods
-
Natural Resources Damage Assessment
-
Freeman, A. Myrick (199?) ...Washington, D.C.; Resources
for the Future.
-
Smith, V. Kerry (1997) Estimating Economic Values for
Nature: Methods for Non-Market Valuation, Brookfield: Edward Elgar.
-
Bjornstad, David J., and James R. Kahn (1996) The Contingent
Valuation of Environmental Resources: Methodological Issues and Research
Needs, Brookfield: Edward Elgar.
-
Johansson, Per Olov (1987) The Economics Theory and Measurement
of Environmental Benefits, Cambridge: Cambridge University Press.
-
COMMON-POOL
RESOURCES:
-
AIR:
-
WATER:
-
GLOBAL
CLIMATE:
Will be revised during the quarter.
Last updated: January 2,1997 [3:18pm (Thursday)]
e-mail: tcameron@econ.ucla.edu