environmental economics

Everyday Christmas: The Gift of the Commons

Clean air. Clean water. We receive these public goods every day without payment

One of the Christmas classics is the Jimmy Stewart movie, It’s a Wonderful Life. George Bailey, Stewart’s character, is despondent about his life but then learns how much he has unknowingly helped others and how grateful they are. It’s heartwarming, if also a bit corny. There’s a flip side to that story: the need to remember …

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Cost-Benefit Analysis: FAQs

Cost-benefit analysis has been a key part of the regulatory process since 1980. Here’s how it works.

Cost-benefit analysis is required for all major regulations. It’s also highly controversial, as well as being a mysterious procedure unless you’re an economist.  These FAQs will tell you what you need to know about how cost-benefit analysis (CBA) fits into the regulatory process, how it works, and why it’s controversial. Q: Let’s start with a …

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Cost-Benefit Analysis and the Biden EPA

The recent rescission of  a Trump rule hints at how the Biden Administration views the role of cost-benefit analysis.

In its closing days, the Trump Administration issued a rule designed to tilt EPA’s cost-benefit analysis of air pollution regulations in favor of industry. Last week, EPA rescinded the rule.  The rescission was no surprise, given that the criticisms of the Trump rule by economists as well as environmentalists. EPA’s explanation for the rescission was …

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Recalculating the Cost of Climate Change

The Biden Administration has already started to revisit this important issue.

“The social cost of carbon” isn’t exactly a household phrase. It’s an estimate of the harm caused by emitting a ton of CO2 over the many decades it remains in the atmosphere.  That’s an important factor in calculating the costs and benefits of climate regulations. For an arcane concept, it has certainly caused a lot …

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We Need an Environmental Dr. Fauci

Much of environmental law is about protecting public health. But the Trump Administration won’t listen.

During the coronavirus crisis, Dr. Anthony Fauci has become the voice of reason. Much of the public turns to him for critical information about public health, while even Trump finds it necessary to listen. In the Trump era, no one plays that role in the environmental area. The result is a mindless campaign of deregulation …

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The Flight From Evidence-Based Regulation

This Administration specializes in arguments for ignoring the evidence.

The Trump Administration’s major deregulatory efforts share a common theme. They assiduously avoid having to rely on scientific or economic evidence. Confronting that evidence is time-consuming and difficult, particularly when it often comes out the other way. Instead, the Administration has come up with clever strategies to shut out the evidence. The effort to repeal …

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From the Grand Canyon to Contaminated Cantaloupes – and More

Five books with fresh perspectives on environmental issues.

Law reviews make little effort to track new books, unlike other journals in other disciplines . So it’s pretty much hit-or-miss whether you learn about relevant new books.  I wanted to share some interesting finds that have crossed my desk, joined a growing pile of unread books, and then slowly left the pile. The subjects …

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Pricing Carbon: What Does It Actually Accomplish?

Pricing carbon may not work the way economists thought.

In theory, pricing carbon should incentivize emissions reductions.  In reality, it is unclear to what extent that takes place unless the carbon price is very high.  This is not to say that pricing carbon is useless, but the main benefits may take different forms. Basically, there are two ways of putting a price on carbon.  …

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Low-Hanging Fruit

A powerful metaphor can be illuminating, but it can also be highly misleading.

The idea of long-hanging fruit is ubiquitous in environmental policy — sometimes in the form of a simple metaphor, other times expressed in more sophisticated terms as an assumption of rising marginal costs of pollution reduction. It’s an arresting metaphor, and one that can often be illuminating. But like many powerful metaphors, it can also …

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Economists vs. Environmentalists: Time for Deténte?

You don’t have to love economics to see it as a possible ally.

Cost-benefit analysis has long been the target of environmentalist ire.  But one lesson of the Trump years has been that economic analysis can be a source of support for environmental policy — it is the anti-regulatory forces who have to fudge the numbers to justify their actions.  Most energy and environmental economists are aghast at …

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