Ecological Economics Lecture 1 Tiago Domingos Assistant Professor Environment and Energy Section Department of Mechanical Engineering Doctoral Program and Advanced Degree in Sustainable Energy Systems Doctoral Program in Mechanical Engineering Doctoral Program in Environmental Engineering

Assessment Problem sets and small projects (possibly related to term paper) –groups –only a random sample is graded –40% Final examination –Individual –30% Term paper –Individual or Groups –30%

Syllabus I Scale (ecology), distribution (ethics), efficiency (economics), constraints (thermodynamics) Formal analogy –Microeconomics and thermodynamics –Biophysical valuation –Industrial ecology, industrial metabolism Substantive integration –Thermodynamics and ecology: DEB –Thermodynamics and economics: Ayres Epistemology and sociology of science Ethics and welfare Static vs. intertemporal optimisation –Lagrangian multipliers –Maximum principle

Syllabus II Microeconomics –Review of consumer theory –Review of producer theory –Review of market structures –Game theory –Evolutionary and institutional economics Pollution economics; pollution control instruments

Market Equilibria and Externalities y MPC MPB MSC Market equilibrium Social optimum

Syllabus III Ecological and economic networks –Life Cycle Analysis –Input-Output Analysis –Computable General Equilibrium Models –Indicators of environmental responsibility Economic valuation methods Intertemporal choice and uncertainty –Discount rate –Cost-benefit analysis;

Syllabus IV Sustainable development –Weak vs. strong sustainability –Economic growth theory Neoclassical and endogenous Ayres –Economic theory of sustainable development –Biophysical and other indicators of sustainable development Index of sustainable economic welfare Ecological footprint Human Appropriation of Net Primary Production EcoIndicator95, EcoIndicator99 –Environmental Kuznets hypothesis

Readings for the Next Lecture Varian, Intermediate Microeconomics –Consumer theory: chapters 2, 3, 4, 5, 6. Common and Stagl, Ecological Economics –Introduction to Ecological Economics: chapter 1.

“Empty World” Economics Costanza, R., J. Cumberland, H. Daly, R. Goodland, R. Norgaard (1997). An Introduction to Ecological Economics. St. Lucie Press, Boca Raton, FL, USA.

“Full World” Economics Costanza, R., J. Cumberland, H. Daly, R. Goodland, R. Norgaard (1997). An Introduction to Ecological Economics. St. Lucie Press, Boca Raton, FL, USA.