What do natural resource economists do?

As new students begin to study the discipline of natural resource economics, there is often a great deal of confusion about what the topic is really about. This is especially the case when students are coming from backgrounds with only limited exposure to economics (e.g. EVS, where you've only had one or two econ classes before this one).

Generally speaking, economists try to solve problems using a combination of theory, empirical analysis (data, statistics, math), and intuition. For example, macro economists try to address issues such as how to keep an economy growing without significant inflation. Natural resource economists try to solve problems associated with scarce natural resources.

Some examples from my work include: How to maximize fishery value while balancing the competing needs of commercial and recreational fishers and maintaining a biologically sustainable stock? How can Caribbean tourism grow without harming marine turtle popluations? What regulations would maximize the net gains to society from white tailed deer populations? In the face of depleted stocks, will a nation's supply of seafood increase or decrease with financial incentives to curtail fishing effort?

Obviously, these are complex issues that require interdisciplinary effort. One of the things that I really love about what I do is that I work side-by-side with biologists, policy makers and resource users to address these problems.

Here are links to two excellent essays that provide a nice perspective on the economic view of the environment.

The second essay covers non-market valuation, which we will cover in detail later in the term. It makes a good read now however, as it sets the stage for much of what we're covering at the beginning of the class (e.g. the anthropocentric view of value).

How do Economists Really Think About the Environment (Fullerton and Stavins, RFF, 1998)

Economic Values without Prices (Loomis, Choices, 2005)

Krugman on Carbon from China

Paul Krugman's column from Friday's NY Times paints a depressing picture of China's willingness to curb carbon emissions.

Notably, China plans to continue growing at a rapid pace relying principally on coal power.

If this is the case, what will be the implications of emissions reduction policy here in the U.S. and in Europe?

Background reading:

Last week the NY Times notes that China is building cleaner coal plants

Blog post on Nader discussing tax vs. cap-and-trade

Blog post on Al Gore and "The Climate for Change"

And a few short readings on cap-and-trade vs. carbon taxes:

gristmill

Greg Mankiw

Environmental Defense Fund

The Carbon Tax Center

Common Tragedies response to the CBO

Welcome ECN/EVS 330 Students

Welcome to the natural resource economics blog.

This purpose of this blog is to allow for online discussion of natural resource econ news for students at UNC Wilmington and UWI Cave Hill.

I'll post links to news articles, questions for discussion and tips to relevant on-line material throughout the term. My goal is for us all to learn from each other.

For those of you in ECN/EVS Summer Session 1 at UNCW, please feel free to browse and respond to older content on the blog. As far as class participation (your grade), I'll only be monitoring content from this week forward.

Best,
-PS

Mercury and Seafood

The U.S. Geological Survey has released a new study detailing the process by which mercury gets into seafood.

Read the highlights here.

Krugman on Cap & Trade

From yesterday's NY Times.

and here's an alternative perspective from Vaclav Klaus (President of the Czech Republic) over at Real Clear World.

EU fisheries over-capitalized; system broken

From ENN: "EU fishing policy not working"

Uncertian property rights lead to a "race to fish", excess fleet capacity and diminished stocks.
A system of transferrable quotas might be the answer... wow, who would've thought it?

Why is it taking so long for everyone to figure this out?

Options:

1. Make hard choices now that will upset some current fishers, but allow society to enjoy fish forever
2. Follow business as usual so that fishers are not upset in the short term; destroy fisheries in the long term

The limits to wind and solar

From the Washington Post

Friedman prefers carbon tax to cap & trade

Here's his piece from yesterday's New York Times.

Theoretically, the efficiency and outcomes of a carbon tax and a cap & trade system should be the same. Practically, the tax requires us to "get the price right" while the trade system requires us to "get the quantity right".

Friedman seems to be arguing for the tax on the grounds of political acceptance, which is usually the opposite of what we hear. One of the main arguments against a carbon tax is that it contains the word "tax", which will immediately turn people off. Considering the recent debacles in the financial world, the black box mystery of cap & trade might indeed be more of a turn off.

He also argues for having the discussion of carbon policy be framed in terms of national security rather than in terms of climate change. I agree with this, though I'd add saving money at the household level to that thought. Those that don't believe that humans are affecting the climate aren't going to change their minds very easily, so telling them that the tax will help a problem that they don't believe exists is a waste of time. If however, you can argue that the same actions will make us better off as a nation for other reasons and save them money, then you're more likely to get buy-in.

Friedman handles the macro concerns nicely. For the micro, driving a fuel efficient vehicle, re-using plastics, composting veggie waste in your garden, eating less meat and using less water will save you lots of money. No one can argue against that, no matter what they believe about climate change.

Thoughts?

Venezuela bans trawl-fishing, seizes vessels

Short article over at Caribbean Net News.

Well, that's one way to stop destructive fishing practices.

Does anyone have more info about this?

Iceland: Banks & fish

Here's a great article from Vanity Fair's Micheal Lewis about the rise and fall of Iceland's financial industry.

It is a long article, but well worth the read.