CERP 140 - Introduction to Environmental Economics 2024-2025 PDF

Module 0: Introduction to Environmental Economics CERP 140 Fundamentals of Environmental Economics 1st Semester 2024-2025 Casper Boongaling Agaton  s t i cs...

Module 0: Introduction to Environmental Economics CERP 140 Fundamentals of Environmental Economics 1st Semester 2024-2025 Casper Boongaling Agaton  s t i cs e en n d e o a et n t om of pts etw mic ls tal Pr t io on w b ip ono o To men duc l Ec rv ie nce h s ec mi c n o ta e Co o n o i r o tr n v O mic a ti and o n nv t In me : 1 no l e nt s c E or E en n e R e : ir o l u co 2: nm tem e 3 s f sm v o d E u e l iro sy s u que ses l En M ant o d nv M d o ni As o rt M ee e ch p th T Im Learning Objectives: - Learn or refresh basic economic concepts - Understand the development of environmental economics as a field of study What is Economy? a large number of interrelated activities, which include the production, distribution, and consumption of goods and services also called “economic system” Who are the main actors? Rest of the World (ROW)? HOUSEHOLDS FIRMS GOVERNMENT Closed vs. Open Economy Closed Economy no outside economic activities to the ROW no exports, no imports, and no capital flows composed of households, firms, and the government GDP = C + I + G Gross domestic product (GDP), consumption (C), investment (I), government expenditures (G) Is the Philippines a closed-economy? Closed vs. Open Economy Open Economy interacts freely with the ROW buys and sells goods and services in world product markets buys and sells capital assets in world financial markets composed of households, firms, government, ROW GDP = C + I + G + (X-M) Gross domestic product (GDP), consumption (C), investment (I), government expenditures (G), exports (X), imports (M) Is the Philippines an open economy? Is the Philippines trade deficit (net-importer) or trade surplus (net-exporter)? Philippines had a total export of 73.5B US$ and total imports of 125.9B US$ leading to a negative trade balance of -52.4B US$ (PSA, 2023) What are the Philippines’ major exports? What are the Philippines’ major imports?  Economics - Demand and Supply S P2 (surplus) P* (equilibrium) P1 (shortage) Supply curve - producers Demand curve - consumers D Q*  Environmental Economics S2 S externalities P2 * (new equilibrium) P* (equilibrium) Supply curve - producers Demand curve - consumers D Q2* Q*  Economics vs. Environmental Economics Economy Economics macroeconomics microeconomics Wealth Allocation production consumption Country Externalities Resources distribution Supply / GDP Environmental Demand Economics Economic Functions of the Environment Basic Economic Model Economic Functions of the Environment Model Resources Supplier Services Waste Supplier Assimilator Economics vs Environmental Economics Economics the study of the allocation of scarce resources, including how markets function and how incentives affect people’s, businesses’ and institutions’ behavior Environmental and natural resource economics the application of the principles of economics to the study of how environmental and natural resources are developed and managed studies the economic and financial impacts of environmental policies helps governments design appropriate environmental policies and analyze the effects and merits of existing or proposed policies  Environmental Economics Valuation  Environmental Economics Valuation Externalities  Environmental Economics Valuation Externalities Regulations Questions?