ENVIRONMENTAL 
                    ECONOMICS
                       Peter Kennedy
                    This material may be accessed
                    by any person without charge at
                     web.uvic.ca/~pkennedy
               Posting it to any other website is a violation of copyright
                     ©Peter Kennedy 2021
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                                          CONTENTS
                         1. Introduction and Overview
                         2. Externalities
                         3. Optimal Pollution Control
                         4. Defensive Action
                         5. Optimal Abatement with Multiple Sources
                         6. Pollution Taxes
                         7. Emissions Trading
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                         8. Pollution Taxes when Damage is 
                             Uncertain
                         9. Pollution Taxes when  
                             Abatement Cost is Uncertain
                         10. The Choice Between a Tax and Emissions 
                             Trading
                         11. Transboundary Pollution and Climate 
                             Change
                         12. Stock Pollutants
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     Kennedy: Environmental Economics - T1                                Copyright Peter Kennedy 2021
                                    1. INTRODUCTION AND 
                                             OVERVIEW
                                               OUTLINE
                            1.1   What is Environmental Economics?
                            1.2   The Environment as a Resource
                            1.3   Environmental Policy Design:
                                  An Overview
                            1.4   Sustainability
                            A1 Appendix A1: Social Choice Rules and 
                                  Arrow’s Impossibility Theorem
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     Kennedy: Environmental Economics - T1                                       Copyright Peter Kennedy 2021
                                   1.1 WHAT IS ENVIRONMENTAL 
                                                ECONOMICS?
                                             What is Environmental Economics?
                              • Environmental economics is the analysis of
                                  – externalities associated with resource 
                                    allocation decisions, as they pertain to the 
                                    environment
                                  – policy intervention to correct those 
                                    externalities
                                  –the distributional consequences of 
                                    environmental impacts and policies
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