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DRPS : Course Catalogue : School of Geosciences : Postgraduate Courses (School of GeoSciences)

Postgraduate Course: Climate Change Economics (PGGE11266)

Course Outline
SchoolSchool of Geosciences CollegeCollege of Science and Engineering
Credit level (Normal year taken)SCQF Level 11 (Postgraduate) AvailabilityNot available to visiting students
SCQF Credits20 ECTS Credits10
SummaryClimate Change Economics (CCEcon) is designed for students with little or no economics background. It provides such students with a solid understanding of the economic theories and analytical frameworks that are employed in climate change economics. The course is organised around key questions that relate to real-world problems for climate policy makers. This problem-solving focus will help to focus the delivered material and the students¿ study on those dimensions which matter in applying such concepts and ideas.
Course description Climate Change Economics (CCEcon) provides students with a strong understanding of the economic theories and analytical frameworks that are applied in the literature of environmental economics in general and climate change economics in particular. Bearing in mind that the course is targeted at students with little or no economics background, the course is organised around key questions that relate to real-world problems for climate policy makers.

(1): What are the costs of climate change?
The concepts of markets, market mechanisms and the efficient allocation of scarce resources; discounting; externalities; market failures; non-market costs; valuation methods (revealed, stated); and the Social Cost of Carbon.

(2): What are the costs of responding to climate change?
Abatement costs and the interactions between climate change, climate policy and technology policies. Cost-benefit analysis. Comparison with regulation. The Shadow Cost of Carbon.

(3): What are the right economic policy measures for responding to climate change?
Carbon taxes, carbon markets and hybrid mechanisms (floor prices, ceiling prices, etc.). Distributional and equity effects ¿ who pays and who gains? What is fair and who decides?

(4): How do we cope with uncertainty in our economic knowledge?
Typology of types of uncertainty; economics of catastrophes; fat tails and the Dismal Theorem.

(5): How do we understand the interactions between economy, society and the environment?
Tools and methods such as Computable General Equilibrium Models (CGEMs), Integrated Assessment Models (IAM) ¿ their uses and abuses.

(6): How do we change the behaviour of individuals and households to become more low-carbon and climate change aware?
Behavioural psychology and economics and its contribution in understanding consumption and decision-making by households and individuals; nudging.

(7): How do we change the behaviour of the State and major companies to focus more on the net zero carbon target?

Evolutionary economics and its contribution to understanding long-term change in socio-technical and economic terms; Kondratieff Long Waves.

(8): Do we over-consume and, if so, why? How can we create more sustainable economies?
Critical perspectives on welfare theorem and standard utility theory. Steady-state economics and de-growth; Circular Economy; towards a new understanding of ¿value¿ and wellbeing.
Entry Requirements (not applicable to Visiting Students)
Pre-requisites Co-requisites
Prohibited Combinations Other requirements None
Course Delivery Information
Academic year 2020/21, Not available to visiting students (SS1) Quota:  40
Course Start Full Year
Timetable Timetable
Learning and Teaching activities (Further Info) Total Hours: 200 ( Programme Level Learning and Teaching Hours 4, Directed Learning and Independent Learning Hours 196 )
Assessment (Further Info) Written Exam 0 %, Coursework 100 %, Practical Exam 0 %
Additional Information (Assessment) Assessment One: Policy brief to Government Minister on climate change economic policy (1000 words). Worth 30%«br /»
«br /»
Assessment Two: Final report either from a choice of questions OR proposed by the student (3000 words). Worth 70%«br /»
«br /»
There will also be class exercises, mostly numerical and using Top Hat, that will not be formally recorded. «br /»
Feedback Formative feedback: There will be three types of formative feedback. (a) half-way through the course, each student will be invited to a meeting with the CO to discuss their comprehension of the course materials and concepts. If there are issues arising from these meetings, the CO will modify the course content in the 2nd half of the course and may arrange to rehearse some topics if they have not been understood first time around. (b) Formative feedback will be provided on the topics and outline of the Policy Brief (assignment one). (c) Formative feedback will be provided on outlines of the final report in time for the feedback to be useful in preparing the final document. Summative feedback will be provided on both the Policy Brief and the Final Report. The in-class exercises using Top Hat will provide students (and the CO) with immediate feedback on performance and understanding.
No Exam Information
Learning Outcomes
On completion of this course, the student will be able to:
  1. To understand key concepts from economics that are used in climate change and carbon management policy making.
  2. To have the knowledge and understanding to recognise and assess the economic dimensions of a wide range of climate change and carbon management policy challenges.
  3. To have the capability to articulate and critically evaluate the key assumptions underpinning climate change economics as used in carbon management.
  4. To be able to communicate and explain the key economic issues of carbon management with non-economist stakeholders.
Reading List
Hanley, N., Shogren, J. & White, B. (2019), Introduction to Environmental Economics. OUP

Charles Kolstad (2011), Intermediate Environmental Economics, 2nd Edition OUP
Additional Information
Graduate Attributes and Skills Knowing: Knowledge and understanding of core concepts and debates in climate change economics (appropriate for a Level 11, 20 credit course)
Acting: Experience in applying different assumptions, parameters and variables to a range of economic problems and in observing, interpreting and debating the outcomes. Experience in a range of methods and analytical tools such as CBA, CV, etc. (appropriate for a Level 11, 20 credit course)
Being: Articulation of own values with respect to climate change economics, e.g. own approach to defining and measuring 'value', 'wellbeing', etc. (appropriate for a Level 11, 20 credit course)
KeywordsClimate change economics,carbon pricing,carbon taxation
Course organiserDr Frances Warren
Course secretaryMs Heather Penman
Tel: (0131 6)50
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