FINAL TERM PAPERThe simplest rule is to look at a sample of pa.docx

FINAL TERM PAPER
The simplest rule is to look at a sample of papers in our course
reading list outline as guide for the components of a good
paper.
1. Introduction: contains relevance of the paper, research
objectives, hypothesis
2. Literature review: a narrative, not an annotated bibliography
of the relevant literature
There needs to a be clear relationship between your research
objectives and literature cited
You need to identify what the literature has done, and existing
gaps that you will address
3. Data: If doing an empirical paper or extension of any labs or
empirical paper:
What data and variables you will use to answer your objectives
How each variable attempts to proxy for what exactly you want
to measure
You may use variables used in class but I will be providing
extra variables
Clearly, if you use new variables, that adds value to your paper,
inching you closer to A!
4. Methods: discussion of what you did: empirical analysis,
comparative qualitative analysis, critical review and assessment
with details on criteria used for assessment, etc
5. Results: summarize results in Table (If extending labs: see
the papers we used in class as model) and how tabulated results
are discussed

6. Analysis: check empirical papers we discussed in class on
how to discuss results and analysis
7. Conclusions
8. References
If the final paper has to be an extension and improved version
of the labs, there needs to be substantial additional content and
analysis. If there is hardly any difference in the content between
any of our labs and your paper, you get a zero in the final paper.
ASSESSEMENT INSTRUMENT FOR FINAL TERM PAPER
Spring 2020
EC 230: Special Topics in Environmental Economics
Department of Economics, University of Vermont
Donna Ramirez Harrington
([email protected])
COURSE SYLLABUS
Class Hours 8:30-9:20 am MWF Location Lafayette L200

Office Hours 12-1pm M, 1-2pm W or by appointment
Location 231 Old Mill
Prerequisites EC 170, EC 171 and EC 172
Course Objectives
1. To describe the market failure that arises as a result of
environmental externalities and apply different
economic models to asses and compare different environmental
policy instrument (standards, taxes, permits)
using various criteria: efficiency, equity cost-effectiveness,
enforceability, dynamic incentives.
2. To learn some fundamental tools and apply basic methods of
research to undertake research in environmental
economics.
3. To understand real world applications of these policy
instruments and asses the features that influenced
successes and challenges
4. To examine the political economy of environmental policy
instrument choice and implementation; describe
and differentiate between different theories of regulation as
applied to environmental policy; to test the
different theories of regulation using real world data
5. To develop an understanding of the relationship between
environmental quality and economic growth;
examine the theory for why the can be a positive or negative

relationship; develop hypotheses about the
relationship and use real world data to test the relationship
6. To estimate benefits from environmental policy using one
specific valuation technique (travel cost approach);
assess its strengths and shortcomings;
Instruction Materials and Learning Strategies
Journal Articles are all posted on Bb – See course outline
with the structure of each assigned reading. The
empirical ones that involve econometrics are a bit more
challenging.
on the day each is scheduled to be discussed in
class. So be prepared to come to class with your notes on those
readings. During the 5-8 minute pop quiz, I
will allow you to look at your notes but I will NOT allow a
copy of the paper. On other times, there will be no
pop quiz but you will be required to submit as a summary of the
paper or answers to the guide questions.
class, the class time is devoted to filling in the
details about the paper that are not necessarily covered by the
guide questions.

Textbooks: Only selected chapters are assigned - either posted
on Bb or on Course Reserve (CR)
Microeconomics 2nd ed , Chapter 17.
Economics: An Introduction, The McGraw-Hill, selected
chapters- 7th ed
https://www.amazon.com/s/ref=dp_byline_sr_book_1?ie=UTF8
&text=Austan+Goolsbee&search-alias=books&field-
author=Austan+Goolsbee&sort=relevancerank
&text=Steven+Levitt&search-alias=books&field-
author=Steven+Levitt&sort=relevancerank
&text=Chad+Syverson&search-alias=books&field-
author=Chad+Syverson&sort=relevancerank
2
Course Outline: Topics and Reading List
I. MARKET MODELS TO ANALYZE ENVIRONMENTAL
ISSUES (3 weeks)
A. Economic Theory 1 (Market Model)
How do we use and apply market models to (a) understand and

(b) solve environmental problems? How does
competitive market equilibrium differ from allocative efficient
solution when we have environmental
problems?
GLS Chapter 17: Externalities, Property Rights [Bb]
Adam B. Jaffe, Richard G. Newell and Robert N. Stavins, “A
tale of two market failures: Technology and
environmental policy,” Ecological Economics, Volume 54,
Issues 2–3, 1 August 2005, Pages 164-174
B. Economic Theory 2 (Modified Market Model: MD-MAC
Model)
How do we adapt the market model and focus on pollution (not
output) as the variable of interest? How do
we compare policy instruments using this model in terms of (a)
distributional impacts and (b) efficiency
under certainty and uncertainty?
FF Chapter 5
Instrument choice under certainty:
Don Fullerton. (2001) “A Framework to Compare
Environmental Policies” Southern Economic Journal
Vol. 68, No. 2, pp. 224-248

*Lawrence H. Goulder, Ian W. H. Parry, (2008) Instrument
Choice in Environmental Policy, Review of
Environmental Economics and Policy, Volume 2, Issue 2, Pages
152–174,
Incentive for innovation:
Milliman, S.R. and R. Prince (1989) “Firm incentives to
promote technological change in pollution
control,” Journal of Environmental Economics and
Management, 17; 247-265.
Instruments choice under uncertainty:
GLS Chapter 17, pp 668-671 sections on efficient level of
pollution and price vs quantity mechanisms
* Sterner, T. (2003) “Role of Uncertainty and Information
Asymmetry” In Policy Instruments for
Environmental & Natural Resource Management, Ch13, RFF
Press
=============================== QUIZ 1 (IN-CLASS)
================================
II. RESEARCH METHODS AND INTRO TO LABS (1 week)
How do we undertake research in environmental economics?

How do we test economic theory using data? How
do we effectively read academic journal articles? What
resources are available to help us conduct research?
A. OLS LAB
What is ordinary least squares and how do we implement it
using Excel? How can we use it to characterize a
demand curve and production function?
Boardman Appendix to Chapter 12
Extra Handouts and Links posted on Bb
LAB #1 (Data and handouts will be provided)
B. READING LAB
How do we effectively summarize a paper? How do we find the
supporting evidence within the paper for the
conclusions? How do we interpret the tables? How do we relate
those results back t the objectives?
Foulon, J. P. Lanoie and B. Laplante (2002). “Incentives for
Pollution Control: Regulation or Information?”
Journal of Environmental Economics and Management, 44(1):
169–187.
C. *UVM LIBRARY, AND RESOURCES LAB

What resources do we have to do research in environmental
economics? (Journal articles, books, data, etc)
Visit from Liaison Librarian Scott Schaffer (Maybe staff from
Writing Center as well)
https://www.sciencedirect.com/science/article/abs/pii/S0921800
905000303#!
905000303#!
905000303#!
https://www.sciencedirect.com/science/journal/09218009
https://www.sciencedirect.com/science/journal/09218009/54/2
3
III. ENVIRONMENTAL POLICY INSTRUMENTS
A. Different Types (3 weeks)
How have policy instruments been implemented in the US or
Canada? What design features made them
effective? How do we use our models in Module 1 to analyze
these instruments? How can we use these
papers to motivate a term paper/research project/thesis? How
can we use these papers to assess current
events related to US environmental policy?

Standards and the Rebound Effect from Energy Efficiency
Policy
+ Meyer, R, “The Trump Administration Flunked Its Math
Homework,” The Atlantic Monthly, 31 October 2018,
https://www.theatlantic.com/science/archive/2018/10/trumps-
clean-car-rollback-is-riddled-with-math-errors-
clouding-its-legal-future/574249/
*Portney, P., I. Parry, H. Gruenspecht and W. Harrington
(2003). “Policy Watch: The Economics of Fuel Economy
Standards” Journal of Economic Perspectives, 17(4): 203-217.
Kenneth Gillingham, David Rapson, Gernot Wagner, The
Rebound Effect and Energy Efficiency Policy,
Review of Environmental Economics and Policy, Volume 10,
Issue 1, Winter 2016, Pages 68–88.
Taxes and the British Columbia Carbon Tax
+Porter, E. “Does a Carbon Tax Work? Ask British Columbia,”
The New York Times, 1 March 2016,
https://www.nytimes.com/2016/03/02/business/does-a-carbon-
tax-work-ask-british-columbia.html
*Murray, B.C. and N. Rivers, (2015), British Columbia’s
Revenue-Neutral Carbon Tax: A Review of the Latest
“Grand Experiment” in Environmental Policy,” Nicholas
Institute Working Paper 15-04, Duke University.

Rivers, N. and Schaufele, B. (2015) Salience of carbon taxes in
the gasoline market, Journal of
Environmental Economics and Management, 74: pp 23-36.
Tradable Permits and Lessons from Three Decades
+ Kasler, D. “Nearly $1 billion in pollution permits fly off shelf
in California auction,” Capitol Alert , 22 August
2017, https://www.sacbee.com/news/politics-
government/capitol-alert/article168702607.html
Richard Schmalensee, Robert N. Stavins, Lessons Learned from
Three Decades of Experience with Cap and Trade,
Review of Environmental Economics and Policy, Volume 11,
Issue 1, Winter 2017, Pages 59–79.
Information Disclosure and Decentralized Approaches
Christensen, D, “UMass researchers compile lists of 100 worst
polluters,” Daily Hampshire Gazette, 2 August 2019,
https://www.gazettenet.com/UMass-researchers-list-country-s-
top-water-air-greenhouse-gas-polluters-
27421770
*Tietenberg, T. (1998). “Disclosure Strategies for Pollution
Control, “Environmental and Resource Economics
11(3–4): 587–602, 1998.

Kotchen , Matthew J, Voluntary- and Information-Based
Approaches to Environmental Management: A Public
Economics Perspective, Review of Environmental Economics
and Policy, Volume 7, Issue 2, Summer 2013,
Pages 276–295.
=============================== QUIZ 2 (IN-
CLASS)=================================
B. Comparison of Instruments (2 weeks)
For environmental problems that have been addressed using
multiple policies, how have these instruments
fared relative to each other? For the case of climate change,
what factors need to be taken into account when
deciding between policy instruments?
*Taxes vs Subsidies vs Standards
Jaffe, A. and R.N. Stavins (1995). “Dynamic incentives of
environmental regulation: The effects of alternative
policy instruments on technology diffusion.” Journal of
Environmental Economics and Management, 29(3),
1995, S43-63.

Regulation versus Information (Reading lab)
Foulon, J. P. Lanoie and B. Laplante (2002). “Incentives for
Pollution Control: Regulation or Information?” Journal
of Environmental Economics and Management, 44(1): 169–187.
clean-car-rollback-is-riddled-with-math-errors-clouding-its-
legal-future/574249/
clean-car-rollback-is-riddled-with-math-errors-clouding-its-
legal-future/574249/
https://www.nytimes.com/2016/03/02/business/does-a-carbon-
tax-work-ask-british-columbia.html
https://www.sacbee.com/news/politics-government/capitol-
alert/article168702607.html
top-water-air-greenhouse-gas-polluters-27421770
top-water-air-greenhouse-gas-polluters-27421770
4
Taxes versus Permits (Important for Position Paper - Quiz 3):
Robert W. Hahn, “Greenhouse Gas Auctions and Taxes: Some
Political Economy Considerations,” (2009)
Review of Environmental Economics and Policy, 3(2):167–188.
Metcalf, G. (2009). “Designing a Carbon Tax to Reduce U.S.
Greenhouse Gas Emissions,” Review of
Environmental Economics and Policy, 3(1): 63-83.

Keohane, N. (2009). “Cap and Trade, Rehabilitated: Using
Tradable Permits to Control US Greenhouse Gases,”
Review of Environmental Economics and Policy, 3(1): 42-62.
======================= QUIZ 3 (TAKE-HOME -
POSITION PAPER) ======================
IV. ENVIRONMENTAL REGULATION AND INNOVATION
(3 weeks)
Theory of Environmental Regulation
What factors does a regulator consider when targeting firms for
regulation and enforcement? How do different
theories of regulation compare? Be able to define and
differentiate the economic (positive) theory vs public
interest (normative) theory and abatement cost theory.
Dion, C, P. Lanoie and B. Laplante (1998). “Monitoring of
Pollution, Do Local Conditions Matter?” Journal of
Regulat ory Economics. 13: 5-18.
Shadbegian, R. and A. Wolverton (2010), “Location Decisions
of U.S. Polluting Plants: Theory, Empirical
Evidence, and Consequences,” International Review of
Environmental & Resource Economics, 4(1), 1-49.

Porter Hypothesis: Environmental Regulation, Competitiveness
and Innovation
What is the Potter Hypothesis? How does regulation affect a
firm’s innovativeness and competitiveness?
*Carraro, C., .E.De Cian, L. Nicita, E. Massetti and E
Verdolini, (2010), “Environmental Policy and Technical
Change: A Survey,” International Review of Environmental and
Resource Economics, 2010, 4: 163–219
Stefan Ambec, Mark A. Cohen, Stewart Elgie, Paul Lanoie,
(2013) The Porter Hypothesis at 20: Can Environmental
Regulation Enhance Innovation and Competitiveness?, Review
of Environmental Economics and Policy, 7(1):2–
22.
Antoine Dechezleprêtre, Misato Sato, (2017) The Impacts of
Environmental Regulations on Competitiveness,
Review of Environmental Economics and Policy, 11(2): 183–
206.
=============================== QUIZ 4 (IN-CLASS)
================================

V. EKC: ENVIRONMENT, DEVELOPMENT AND TRADE
(2 weeks)
How does pollution vary with economic growth/development?
What factors influence the nature of this
relationship? What is the role of environmental policy, trade
and trade policy in this relationship?
Pugel Chapter 13 [Bb]
Richard T. Carson, The Environmental Kuznets Curve: Seeking
Empirical Regularity and Theoretical Structure,
(2010) Review of Environmental Economics and Policy,
Volume 4, Issue 1, Pages 3–23,
Dasgupta, S. B. Laplante, H. Wang and D. Wheeler (2002)
“Confronting the Environmental Kuznets Curve” The
Journal of Economic Perspectives, 16(1):147-168
Cole, M. (2004). “Trade, the pollution haven hypothesis and the
environmental Kuznets curve: examining the
linkages,” Ecological Economics, 48:71-81.
*List, J. and C. Gallet (1999). “The environmental Kuznets
curve: Does one size fit all?” Ecological Economics,
31:409-423

============================ QUIZ 5 (TAKE-HOME)
================================
5
Getting Started on your Term Paper
Where to Start Looking for Possible Topics:
Review of Environmental Economics and Policy
Example:
Tom H. Tietenberg, Reflections—Carbon Pricing in Practice,
Review of Environmental Economics and
Policy, Volume 7, Issue 2, Summer 2013, Pages 313–329
International Review of Environmental & Resource Economics
Example:
Shadbegian, Ronald and Ann Wolverton, Location Decisions of
U.S. Polluting Plants: Theory, Empirical
Evidence, and Consequences. International Review of
Environmental & Resource Economics; 2010, Vol. 4

Issue 1, p1-49, 49p
Example of Possible Topics
Comparison of different environmental standards
Comparative analysis of empirical evidence on environmental
regulations and pollution (enforcement
compliance)
Technical change and innovation relationship for different
sectors or different environmental problems
Environmental regulation and different measures of economic
performance
Energy efficiency gap
Decentralized approaches to environmental policy: eco-
labelling, information disclosure, voluntary approaches
Comparative analysis of different tax policies across counties or
for different pollutants: RGGI vs EU-ETS
Comparative analysis of different tradable permit regimes
policies across counties or for different pollutants
Behavioral economics and environmental policy
Environmental policy and trade policy or environmental policy
and economic growth
Environmental policy in developing countries (comparative
analysis with developed countries or US)

Other Important Dates
Last day add w/o instructor permission Jan 17, F
Martin Luther King Day (no class) Jan 20, M
Last day add/drop/audit/P/F Jan 27, M
Spring recess (no class) Mar 9-13,
M-F
Last day to withdraw Mar 27, F
Last day of EC 230 class May 1, F
Paper due May 7, Th,
12 noon
Tips for Success
1. As a general rule, every hour of class time requires 2-3 hours
of out-of-class reading (before and after the
lecture) and doing homework and practice questions to fully
understand the material.
2. Read the relevant readings (see calendar) before coming to
class. The guide questions for journal articles

provide you some direction on the main points. Take good
notes during lectures, they supplement your
readings. Your performance in class starts on how well you
take down notes. Find a go-to person for notes in
case you miss class or simply just to help compare and
supplement each other’s notes.
3. Quizzes, HWs, pop quizzes and other lab/writing assignments
involve a variety of skills- analysis of graphs,
numerical examples and essay, you need to master all skills. Be
self-aware of your strengths and weaknesses
and seek out study partners that will complement your
strengths. Seek out other students for study groups;
practice numerical problems solved in class. For quizzes, try to
come up with potential questions and share
them with each other. Assigned HW writing assignments
questions and pop quizzes are a good set of sample
exam questions. Try to make variations of those.
4. Draw and redraw graphs for better understanding. The graphs
we construct in class may be scanned and posted
on Bb, but to fully understand the material, you need to learn to
draw the same graphs on your own rather than
just staring and interpreting at static ones. You will be required
to draw graphs for HWs and quizzes.
6

Tentative Class Calendar
Week
Module
MONDAY WEDNESDAY FRIDAY
1
J
13
Intro, Market model review
[GLS 17]
15
Market Model:
Externalities, Taxes,
Subsidies, Property Rights
[GLS 17]
17
Market Model: Tale of Two
Market Failures [Jaffe et al]
2

20
MLK Day–
No Class
22
Market Model: Tale of Two
Market Failures [Jaffe et al]
24
MD-MAC Model Incentive
for Innovation
[Milliman and Prince]
3
27
MD-MAC Model Incentive
for Innovation
[Milliman and Prince]
29
MD-MAC Model
[Fullerton]
31

MD-MAC Model
[Fullerton]
4
F
3
Instrument Choice under
Uncertainty
[GLS 17, Sterner]
5 QUIZ 1 (IN CLASS) 7
LAB #1: OLS LAB /
READING LAB
5
10
Standards
[FF11; Gillingham et al]
12
Standards

[FF11; Gillingham et al]
14
Taxes
[FF 11; Rivers and Schaufele]
6
17
Presidents’ Day-
No class
19
Taxes
[FF 11; Rivers and
Schaufele]
21
Permits
[Schmalensee and Stavins]
7
24
Permits
[Schmalensee and Stavins]

26
Decentralized Approaches
[FF10; Kotchen]
28
Stds,vs Taxes vs Subsidies
[Jafe and Stavins]
8
M2
Regulation vs Information
[Foulon et al]
Taxes vs Permits
[Review/Hahn]
9-13 March - SPRING RECESS – no class
9
16
Taxes vs Permits
[Metcalf]
18

Taxes vs Permits
[Keohane]
20
Theory of Regulation
[Dion]
10
23
Theory of Regulation
[Dion]
PROPOSAL DUE
25
LAB #2: THEORY OF
REGULATION
QUIZ 3 DUE
27
Porter Hypothesis
[Ambec et al]
11

30
Porter Hypothesis
[Ambec et al]
A1
Porter Hypothesis
[Dechezleprêtre and Sato]
3
LAB #3:-PORTER
HYPOTHESIS
12
6
LAB #3:-PORTER
HYPOTHESIS
EKC
[Pugel]
ANNOTATED BIB DUE
13

13
EKC
[Carson]
15
EKC
[Dasgupta et al]
17 LAB #4: EKC
14
20 LAB #4: EKC 22
EKC
[Cole]
24
EKC
[List and Gallet]
QUIZ 5 DUE
15
27 Paper presentations 27 Paper presentations M 1 Paper
presentations
Exam

Week
THURSDAY, MAY 7, 12 NOON
FINAL PAPER DUE
Grading System
90/93/97=A-/A/A+ 80/83/87=B-/B/B+ 70/73/77=C-/C/C+
60/63/67=-/D/D+ <60=F
30% HW/LABS Written summaries of assigned readings; lab
reports
30% QUIZZES In-class or take-home (see outline)
30% PAPER See policies for components
10% PART Class participation (all semester)
7
Other Important Dates
Last day add w/o instructor permission Jan 17, F
Martin Luther King Day (no class) Jan 20, M

Last day add/drop/audit/P/F Jan 27, M
Spring recess (no class) Mar 9-13, M-F
Last day to withdraw Mar 27, F
Class Policies
1. Attendance. You are allowed only 4 unexcused absences.
University policy: “In the event of illness requiring
hospitalization or extended absence from classes because of a
medical condition, with permission from the
student, a designated member of the Primary Care/Women’s
Health staff will notify the student's Dean's Office
who will then be in touch with the student’s faculty.” I reserve
the final authority to excuse other types of
absences, and final authority on deciding on missed homeworks
and quizzes. No make-ups for labs, debates, all
oral presentations.
2. Class Participation. Class participation is a considerable part
of your grade – you may be asked to be a presenter
of an assigned reading, a discussant, and overall participation.
There is no opportunity for you to be graded for
participation and you cannot make up for missed class
participation due to an absence. Showing up everyday

does not guarantee you will pass (get 60%) for the class
participation component. You actually have to
contribute to the intellectual discussion in class. If you
routinely just sit in class, you will get 0% on overall
class participation.
3. Labs. Everybody is expected to bring his/her laptop to class
for labs. You are also expected to have professional
version of Excel. Check UVM bookstore for UVM student/staff
discounts on MS suite of programs
(professional edition).
4. Final Paper. The final paper for this class (approx. 15-20
pages) can cover any topic you wish. The topic may
or may not be directly related to any of our modules. I need to
approve your topic first (see outline for due
date). I will provide suggested topics in class as we go along.
See guidelines and assessment criteria.
-5 ppt
slides)

5. Office Hours and Email. Office hours are designed to help
students with difficult concepts and challenging
exercises. Office hours are not designed for personal tutorial
sessions for students who miss classes, come late
or leave early. I do not make a habit of explaining exams,
lectures, assignments by email. If you need
something clarified, come to my office hours or you can speak
with me before or after the class. Emails are for
setting appointments or for letting me know about medical-
relate absences. See attendance policy above.
6. Special Considerations. I will follow University of Vermont
policies regarding student athletes, special
religious events, notetaking needs and learning disabilities (via
SAS), proctoring needs and extra examination
time (via EPC), etc. Please be aware that there are deadlines
for informing me of your special needs. Missing
the deadline would mean you will not be given any special
considerations. You are responsible for scheduling
exams with EPC. You are required to set an appointment to
meet with me in person if you are sending me an
SAS or EPC letter. I will not accept any request unless I meet
with you in person.
8

Guidelines for Position Paper (Quiz #3)
Based from:
http://www.xavier.edu/library/students/documents/position_pap
er.pdf
Your position paper should have the following parts:
An introduction (5 points)
The introduction should identify the issue and state your
position - written in a way that catches the reader’s attention
– why taxes vs tradable permit for
climate change mitigation is more suitable
The body (45 points)
The body of the position paper may contain several paragraphs.
Each paragraph should present an idea or main concept that
clarifies a portion of the position statement and is supported by
evidence or facts (I suggest each paragraph should deal with
one criterion that compares both taxes and tradable permits and
makes an argument for the position you are trying to
defend. Evidence or facts has to come from actual examples of
countries/regions that have used a tax or tradable permit for
climate change. This is where the readings posted on Bb would
be important. Evidence can be primary source quotations,
statistical data, interviews with experts, and indisputable dates

or events (Again, based form your readings not from your
own opinion or interviews). Evidence should lead, through
inductive reasoning, to the main concept or idea presented in
the
paragraph. (Make sure you cite evidence that would help your
assertion in that paragraph). The body may begin with some
background information and should incorporate a discussion of
both sides of the issue. (This means that the body should
also contain a recognition of the similarities of both sides as
well as debunking of the strengths of the other side and making
a further case for how those strengths are not as important or
how your side can be revised or adapted to go around about
an apparent weakness)
A conclusion (10 points)
The conclusion should summarize the main concepts and ideas
and reinforce, without repeating, the introduction or body of
the paper. It could include suggested courses of action and
possible solutions
would you propose this policy?)

you are defending considering its weaknesses and how to
highlight its strengths)
Guidelines for Labs
Excel File Submission Quantitative Component
Link on Bb were you can
o Download the data and extra reference materials
o Download the handout (I will distribute them in class too)
o Submit your Excel spreadsheets
to do the same thing to your Excel file.
ggest the following
links, we will have a short lab:
http://www.microsoft.com/mac/excel/getting-started-with-excel
https://www.youtube.com/watch?v=B9mSM9B01o4
should be enough time to both teach you what needs to be done
and
for you to complete answering the other the questions on your
own.
the end of the last lab session. No extensions. It will be part of
your quiz grade (Quiz 4, 5, 6) that is related to that lab.
Analysis and Discussion for labs

We will discuss the lab results and relate them with the papers
we discuss under that module. Note also that the quizzes
following the labs may cover largely the lectures and readings
for that module and will test you on your knowledge of
economic
theory, the assigned paper and interpretation of results. In these
quiz questions, you may be required to do any combination the
following.
o A brief discussion of the variables used in the Excel exercise
and relate them to the topic at hand and the article(s)
assigned/discussed in that module.
o Analysis of the results – their economic meaning and
interpretation.
o Discussion of the relevance of the results to economic theory
and policy
o Discussion of your results relative to other papers discussed
in class or another new assigned article
As you can see, understanding of the readings that we will
discuss before the Lab session is very important. Hence, you
need to
do the readings as they are assigned so you will not cram
several weeks-worth of readings in a week to do the quiz. Once
you
fall behind in the readings, you cannot turn in a successful
write-up.
http://www.xavier.edu/library/students/documents/position_pap

er.pdf
http://www.microsoft.com/mac/excel/getting-started-with-excel
https://www.youtube.com/watch?v=B9mSM9B01o4
9
Guidelines for Term Paper
You may choose any topic you wish (subject to my approval and
suggestions) or make a significant empirical
extension of any of the labs. Note that you need to first submit
a proposal (outline with a list of reference) and an
annotated bibliography
If you chose to do the empirical extensions the final paper
should be a significantly improved and extended version
of your quantitative exercise for those labs. You are required
to use extra data which you can collect on your own
or choose from the extra data I can provide. Suggestions on
extensions for the final paper will be given as we finish
each Lab.
See below for detailed guidelines for the three sequential
requirements. See calendar for due dates. You will also be
asked to submit peer evaluation of the outline and annotated
bibliography of another student in class, It is part of

your grade. The assessment instrument is provided.
1. Term Paper Proposal/Outline
Parts of the Proposal:
Title
Abstract
Background and Statement/Description of Research Question(s)
You may have one general research question or several small
but inter-related sub-research questions.
Make sure your research questions are not mere descriptions but
they analyze things: Make sure you do not
only describe or identify but more importantly asses, evaluate,
examine, critique, compare, estimate.
Relevance of Research Questions/Contributions to the Literature
Provide the gaps in the literature and how your study
contributes to it. Provide also relevance from policy
perspective, if applicable.
Economic Theory
Describe the economic theory that you will use to analyze your
research problem. This involves identifying and

describing the economic concepts that you will use.
Methodology and Analysis
Identify whether you will conduct a qualitative or quantitative
analysis
If qualitative: how will you conduct your analysis? What
evidence will you be looking for in the literature to
answer your research questions that asses, evaluate, examine,
critique, compare?
If quantitative, provide a brief description of data sources and
the type of statistical or modelling analysis you
will use.
References
2. Annotated Bibliography
An annotated bibliography is a list of citations to articles (or
books) followed by a short descriptive and evaluative
paragraph (about 200 words (approx. half a page worth, doubles
spaced). The annotation is meant to inform the
reader and demonstrate the relevance, accuracy, and quality of
the sources you cited in relation to your research
question. Unlike abstracts, annotations are descriptive and

critical.
Submit an annotated bibliography of at least 5 journal articles
that will allow you to answer your research questions.
These 5 articles should be in addition to what is included in the
class reading list. Type your annotated bibliography
using 12 font, double spaced.
10
Parts of the Annotated Bibliography:
1. **Attach your graded proposal.
2. Summary of research questions. It may be a revised list of
research questions from your proposal. To make
it easier for you (and me) to evaluate the relevance of your
references, make sure your research questions
are in bullet form.
3. Annotated bibliography of the 5 references. You may do more
than 5, with no extra points. I would
imagine you will need more than 5 to complete your paper. But

at this stage of the paper writing process,
you are required to have read and understood 5 papers.
tion of what part(s) of the paper (method,
model, findings, conclusions) are relevant for
your paper.
reference is answering/addressing. At least three
of the five papers need to do more than provide background
material for the topic, i.e., at least three
papers need to provide evidence (even qualitative ones),
methods, or insights for analysis
to this paper and a description of how are
they related (method, model, findings, conclusions).
3. Final Draft of Term Paper
The simplest rule is to look at a sample of papers in our outline
as guide for the components of a good paper.
Parts of the Final Paper:
1. **Attach your graded annotated bibliography

2. Introduction: contains relevance of the paper, research
objectives, hypothesis
3. Literature review: a narrative, not an annotated bibliography
of the relevant literature
There needs to a be clear relationship between your research
objectives and literature cited
You need to identify what the literature has done, and existing
gaps that you will address
4. Data: If doing an empirical paper or extension of Module 4 or
5 or any empirical paper:
What data and variables you will use to answer your objectives
How each variable attempts to proxy for what exactly you want
to measure
You may use variables used in class but I will be providing
extra variables
Clearly, if you use new variables, that adds value to your paper,
inching you closer to A!
5. Methods: discussion of what you did: empirical analysis,
comparative qualitative analysis, critical review
and assessment with details on criteria used for assessment, etc
6. Results: summarize results in Table (If extending labs: see
the papers we used in class as model) and how

tabulated results are discussed
7. Analysis: check empirical papers we discussed in class on
how to discuss results and analysis
Conclusions
References
If the final paper has to be an extension and improved version
of the labs, there needs to be substantial additional
content and analysis. If there is hardly any difference in the
content between any of our labs and your paper, you get
a zero in the final paper.
11
ASSESSMENT FORM / CRITERIA FOR
OUTLINE/PROPOSAL
General Structure (5 points)
____ My outline has all the necessary sections/components
(see next page)

____ My outline is NOT matching or a copy of one section (or
subsection) of one paper
from the literature.
____ My outline is typed (12 font, double spaced, max of 5
pages).
____ I have run a spell check.
Content (40 points)
____ My outline is not a chronological description of events on
a particular topic.
____ I am incorporating and applying economic theory in my
research and I have
identified and explained that relevant economic theory in my
outline.
I have described the academic and/or policy significance of my
research and I
have clearly identified how my paper contributes to the relevant
literature
____ My outline emphasizes analysis rather than description.
References (15 points)
____ My outline/proposal includes a list of at least 5
references.
____ My references are peer-reviewed articles.

____ At least 2/3 of my references are economic references
(from the database Econlit).
____ I have read at least the abstract of all the references
provided to make sure they
are appropriate for my research. (DRH Note: An annotated
bibliography due later
will ensure you read have all articles and can explain in your
own words how
each contributes to your research)
Optional: Only if doing empirical/quantitative analysis (part of
the Content)
____ I am incorporating description of data sources in my
outline.
____ I have identified the type of quantitative analysis I will
undertake (regression
analysis, or elasticity estimate, etc).
12
ASSESSMENT FORM / CRITERIA FOR ANNOTATED
BIBLIOGRAPHY
__________ (10 points) Attach your graded proposal.

__________ (15 points) Summary of research questions. It may
be a revised list of research
questions from your proposal. To make it easier for you (and
me) to evaluate the relevance of
your references, make sure your research questions are in bullet
form.
__________ (30 points for each reference=150 points)
Annotated bibliography of the 5
references. You may do more than 5, with no extra points. I
would imagine you will need more
than 5 to complete your paper. But at this stage of the paper
writing process, you are required to
have read and understood 5 papers.
Paper
1
Paper
2
Paper
3
Paper
4

Paper
5
Proper reference citation (5 points each)
Description of research question and its findings
(5 points each)
Clear identification of what part(s) of the paper
(method, model, findings, conclusions) are relevant
for your paper (10 points).
Identification of which research question (above) the
reference is answering/addressing.
At least three of the five papers need to do more than
provide background material for the topic, i.e., at
least three papers need to provide evidence (even
qualitative ones), methods, or insights for analysis (5
points each)
Identification of which of the other paper(s) cited is

related to this paper and a description of how are they
related (method, model, findings, conclusions). (5
points each each)
Total
13
ASSESSEMENT INSTRUMENT FOR FINAL TERM PAPER
14
ASSESSMENT FORM / CRITERIA FOR FINAL PAPER ORAL
PRESENTATION
1. The relevance/motivation of the study was clearly presented.
STRONGLY DISGAGREE DISAGREE NEUTRAL AGREE
STRONGLY AGREE
1 2 3 4 5
2. The main research question(s) was/were clear and explicitly

stated.
STRONGLY AGREE
1 2 3 4 5
3. The methods used were clearly explained.
STRONGLY AGREE
1 2 3 4 5
4. The results were clearly described and were related to the
research objectives.
STRONGLY AGREE
1 2 3 4 5
5. The conclusions were clearly backed by the findings of the
study.
STRONGLY AGREE
1 2 3 4 5
15

NAME ___________________________
POSITION ___________________________ (Tax or Permits)
ROLE ___________________________
ASSESSMENT FORM / CRITERIA FOR INDIVIDUAL
DEBATE PERFORMANCE
1. The argument(s) was/were explicitly stated
STRONGLY AGREE
1 2 3 4 5
2. The argument(s) presented was/were backed by evidence
STRONGLY AGREE
1 2 3 4 5
3. The evidence presented were clear and appropriate
STRONGLY AGREE
1 2 3 4 5
4. The presentation was clear and coherent

STRONGLY AGREE
1 2 3 4 5
OTHER COMMENTS
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________
_____________________________________________________
________________________________

_____________________________________________________
________________________________
_____________________________________________________
________________________________
ASSESSMENT FORM / CRITERIA FOR DISCUSSANT
16
1. The questions are clearly related to the paper.
STRONGLY AGREE
1 2 3 4 5
2. The questions were beyond the scope of the guide questions
provided.
STRONGLY AGREE
1 2 3 4 5
3. The questions were thought-provoking and generated good
class discussion
STRONGLY AGREE
1 2 3 4 5

17
PEER ASSESSMENT FORM
AUTHOR ___________________________
EVALUATOR ___________________________
After reading the outline/proposal, answer the questions below.
Circle the number.
1. The rationale/motivation of the topic is clear and compelling.
I would like to read the final paper.
STRONGLY AGREE
1 2 3 4 5
2. The paper clearly identifies the gap in the literature that it is
addressing. I am convinced this is an important study.
STRONGLY AGREE
1 2 3 4 5
3. The research question(s) is(are) clearly stated. I know exactly
what the author will do in this paper.
STRONGLY AGREE

1 2 3 4 5
4. The economic theory/concept that this study is building from
is appropriate. The author has a clear understanding of the
economic theory/concepts he/she will use to answer his/her
research question(s).
STRONGLY AGREE
1 2 3 4 5
5. The proposed research method is appropriate.
STRONGLY AGREE
1 2 3 4 5
6. Write more suggestions and comment for improvement not
addressed in any question above. This is the most valuable
part of the peer review. (You may also use the back of this sheet
for more comments)
18
PEER ASSESSMENT FORM / CRITERIA FOR ANNOTATED
BIBLIOGRAPHY

AUTHOR ___________________________
EVALUATOR ___________________________
After reading one annotated bibliography and the research
question, answer the questions below. Circle the number.
1. The summary of the article is clear
STRONGLY AGREE
1 2 3 4 5
2. The connection between the article and one or multiple
research questions is stated explicitly.
STRONGLY AGREE
1 2 3 4 5
3. The relevance of the article in terms of how it will answer
one or multiple research question(s) is clear
STRONGLY AGREE
1 2 3 4 5
4. A connection between this article and another article is
clearly stated and described.

STRONGLY AGREE
1 2 3 4 5
5. Write more suggestions and comment for improvement not
addressed in any question above. This is the most valuable
part of the peer review. (You may also use the back of this sheet
for more comments)
19
List of Presenters and Discussants
Date Author of Paper Presenters Discussants
*Foulon et al 2002 ALL ALL
Portney et al 2003
Feb 7 Gillingham et al 2016
Murray and Rivers 2015
Feb 12 Rivers and Schaufele 2015
Feb 17 Schmalensee and Stavins 2017
Tietenberg 1998

Feb 21 Kotchen 2013
Feb 28 *Jaffe and Stavins 1995
Mar 4 Hahn 2009
Mar 6 *Metcalf 2009 ALL ALL
Mar 16 *Keohane 2009 ALL ALL
Mar 18 Dion et al 1998
Shadbegian and Wolverton 2010
Carraro et al 2010
Mar 27 Ambec et al 2013
Apr 1 Dechezleprêtre and Sato 2017
Apr 10 Carson 2010
Apr 15 Dasgupta et al 2002
Apr 22 Cole 2004
Apr 24 List and Gallet 1999
20
TERM PAPER TOPICS

Presentations: In class, 8:30-9:20, L200Lafayette
Topic Name
April 27
April 29
May 1

21
EC 230 PAPER PRESENTATION AND SUBMISSION
APRIL 27, 29, MAY 1 M, W, F IN CLASS
GUIDELINES
er speaker
-5 slides
jumpdrive before 8:30 am or send me your ppt before 8 am
22
ASSESSMENT FORM / CRITERIA FOR ORAL PAPER
PRESENTATION

1. The relevance/motivation of the study was clearly presented.
STRONGLY AGREE
1 2 3 4 5
2. The main research question(s) was/were clear and explicitly
stated.
STRONGLY AGREE
1 2 3 4 5
3. The methods used were clearly explained.
STRONGLY AGREE
1 2 3 4 5
4. The results were clearly described and were related to the
research objectives.
STRONGLY AGREE
1 2 3 4 5
5. The conclusions were clearly backed by the findings of the
study.

STRONGLY AGREE
1 2 3 4 5
Guidelines for Oral Reporting
Assigned Reporter
There will be 1-2 assigned reporters for each a paper. These
students are required to
questions (guide questions will be provided as we go
along)
-7 minute MS powerpoint presentation to be
submitted (printed NOT emailed)
The presenter will be graded according to content (follow what
we do in “Reading Lab”) and style (clarity,
cohesion). The rubric for evaluation will be provided.
Assigned Discussants

There will be two assigned discussants per paper. These two
students are required to
questions will be provided as we go along)
like everyone else
-3 critical questions about the assigned paper
submitted to me (printed NOT emailed)
The discussant will be graded according to quality of discussant
points / questions to lead to further discussion in
class and how those points relate to other concepts discussed in
class
23
24
EC230
Haoyue QI
Topic: Behavioral Economics and Environmental Policy
Introduction
Behavioral economics (BE) has increasingly attracted more
interest in the field of economics. Unlike the conventional
economic theory, BE focuses on people having cognitive

limitations which makes them arrive at irrational decisions
(Brent et al. 2017). BE also states that people act in a social
context, and issues including status and social approval are
critical to human behaviour. Another key feature of BE is that
people’s behaviour is not motivated only by their material
payoffs.
Research Question: This paper describes each of the BE
characteristics, provides examples of their use in relevant
explaining relevant environmental issues, devising solutions,
and reflecting on possible influence on environmental policy.
DRH: There is no statement describing why using behavioral
economics is important- does it substitute for other theories?
Does it complement them?
Body Paragraphs
1. Cooperation and fairness
i. The distributional effects of both costs and benefits linked
with policies that address environmental issues such as water
pollution, global climate change and car emissions are
important for policymakers globally (Kesternich, Reif &
Rübbelke, 2017).
ii. Cooperation based on conventional economic theory versus
BE
iii. Information about cooperation from BE
2. Self-image, status and social approval concerns
3. Crowding in versus crowding out
4. Context-dependent and incoherent preferences
5. Risk misperception and ambiguity aversion
i. All the areas in public policy in the current society handle
risk, especially in environmental concerns.
ii. Risk misperception
iii. Ambiguity aversion
6. Behavioral limitations of the regulator
This section introduces the recommendations for environmental
policymakers, especially regarding the rules and laws that affect
the public. The main idea from this section is that even when

the policymakers are trying to make decisions good for the
citizens, their priorities are different from those of the citizens.
DRH: I expect that your annotated bibliography and the final
paper will have detailed description of each of these concepts
and how they are applied to environmental phenomena.
This version does not provide substantially more details than
the first one you submitted. I expect the next submission to be
more substantive and to be describing each concept you outlined
above.
There are no methods for analysis. How will you use the BE
concepts above to address your research questions?
Conclusion
This article has discussed information about BE and the way it
affects policy recommendations in environmental economics.
BE is important for economics because it ensures the
environmental economics are closer to reality and are more
relevant.
References
Brent, D. A., Friesen, L., Gangadharan, L., & Leibbrandt, A.
(2017). Behavioral insights from field experiments in
environmental economics. International Review of
Environmental and Resource Economics, 10(2), 95-143.
Carlsson, F., & Johansson-Stenman, O. (2012). Behavioral
economics and environmental policy. Annu. Rev. Resour.
Econ., 4(1), 75-99.
Chen, J. M. (2016). Fables of the Reconstruction: Human
Emotion and Behavioral Heuristics in Environmental
Economics. Studia Iuridica, (63), 77-96.
Ek, C., & Miliute-Plepiene, J. (2018). Behavioral spillovers
from food-waste collection in Swedish municipalities. Journal
of Environmental Economics and Management, 89, 168-186.
Kesternich, M., Reif, C., & Rübbelke, D. (2017). Recent trends
in behavioral environmental economics. Environmental and
Resource Economics, 67(3), 403-411.
Lanz, B., Wurlod, J. D., Panzone, L., & Swanson, T. (2018).

The behavioral effect of pigovian regulation: Evidence from a
field experiment. Journal of Environmental Economics and
Management, 87, 190-205.
List, J. A., & Price, M. K. (2016). The use of field experiments
in environmental and resource economics. Review of
Environmental Economics and Policy, 10(2), 206-225.
DRH: The references look promising but they were not cited in
the text. Make sure you cite them properly when you provide
more substantive content to your work in the annotated
bibliography stage.
ASSESSMENT FORM / CRITERIA FOR
OUTLINE/PROPOSAL
General Structure (5 points) 4 points
You are missing some sections
____ My outline has all the necessary
sections/components (see next page)
____ My outline is NOT matching or a copy of one section
(or subsection) of one paper
from the literature.
____ My outline is typed (12 font, double spaced, max of 5
pages).
____ I have run a spell check.
Content (40 points) 30 points
There is no real description of economic theory and what
behavioral economics is vis a vis the standard theories we
discussed in class
There as only a list of concepts but no description.
____ My outline is not a chronological description of
events on a particular topic.
____ I am incorporating and applying economic theory in

my research and I have
identified and explained that relevant economic theory in my
outline.
I have described the academic and/or policy significance of my
research and I
have clearly identified how my paper contributes to the relevant
literature
____ My outline emphasizes analysis rather than
description.
References (15 points) 10 pts
The list is good but not cited in the paper
____ My outline/proposal includes a list of at least 5
references.
____ My references are peer-reviewed articles.
____ At least 2/3 of my references are economic references
(from the database Econlit).
____ I have read at least the abstract of all the references
provided to make sure they
are appropriate for my research. (DRH Note: An annotated
bibliography due later will ensure you read have all articles and
can explain in your own words how each contributes to your
research)
Optional: Only if doing empirical/quantitative analysis (part of
the Content)
____ I am incorporating description of data sources in my
outline.
____ I have identified the type of quantitative analysis I
will undertake (regression
analysis, or elasticity estimate, etc).
Parts of the Proposal:
Title
Abstract
Background and Statement/Description of Research Question(s)
You may have one general research question or several small

but inter-related sub-research questions.
Make sure your research questions are not mere descriptions but
they analyze things: Make sure you do not only describe or
identify but more importantly asses, evaluate, examine, critique,
compare, estimate.
Relevance of Research Questions/Contributions to the Literature
Provide the gaps in the literature and how your study
contributes to it. Provide also relevance from policy
perspective, if applicable.
Economic Theory
Describe the economic theory that you will use to analyze your
research problem. This involves identifying and describing the
economic concepts that you will use.
Methodology and Analysis
Identify whether you will conduct a qualitative or quantitative
analysis
If qualitative: how will you conduct your analysis? What
evidence will you be looking for in the literature to answer your
research questions that asses, evaluate, examine, critique,
compare?
If quantitative, provide a brief description of data sources and
the type of statistical or modelling analysis you will use.
References
Qi
BEHAVORIAL ECONOMICS ANNOTATED BIBLIOGRAPHY
6

ASSESSMENT FORM / CRITERIA FOR ANNOTATED
BIBLIOGRAPHY 111/165
____0_____ (15 points) Summary of research questions. It
may be a revised list of research questions from your proposal.
To make it easier for you (and me) to evaluate the relevance of
your references, make sure your research questions are in bullet
form.
___111_______ (30 points for each reference=150 points)
Annotated bibliography of the 5 references. You may do more
than 5, with no extra points. I would imagine you will need
more than 5 to complete your paper. But at this stage of the
paper writing process, you are required to have read and
understood 5 papers.
Paper 1
Paper 2
Paper 3
Paper 4
Paper 5
Proper reference citation (5 points each)
5
5
5
5
5
Description of research question and its findings
(5 points each)
5
5
5
5
5
Clear identification of what part(s) of the paper (method, model,
findings, conclusions) are relevant for your paper (10 points).

8
8
9
8
8
Identification of which research question (above) the reference
is answering/addressing.
At least three of the five papers need to do more than provide
background material for the topic, i.e., at least three papers
need to provide evidence (even qualitative ones), methods, or
insights for analysis (5 points each)
4
4
4
4
4
Identification of which of the other paper(s) cited is related to
this paper and a description of how are they related (method,
model, findings, conclusions). (5 points each each)
Missing
Missing
Missing
Missing
Missing
Total
22
22
23
22
22

Behavioral Economics Annotated Bibliography
Course NameEC230
DRH:
Where are your research questions? I need to be able to check
them against your paper citations
Environmental and Resource Economics, 10(2), 95-143
https://pdfs.semanticscholar.org/85f3/f584f04c6ad75034f1106d
d04dd30b847564.pdf
Brent, Friesen, Gangadharan & Leibbrandt (2017) argue that
most of the decisions about the environment are based on
traditional economic incentives and intrinsic motivations. The
research question that this source answers is What is the
contribution of BE in the management of the environment?
Field experiments have allowed scholars to isolate particular
causal mechanisms that help the advancement of understanding
about the firm and consumer behaviours in the environmental
markets. The article explains the literature used in
environmental economics and focuses on the artefactual and
framed field experiments. This article contributes to the topic of
behavioral economics by offering an overview of experimental
techniques and findings that define environmental economics. It
also contributes to the research topic by introducing some key
terms that have defined the study of BE in the last decade, and
their applicability towards realizing better or more value.
You need to relate it to the other papers you cite –see the
guideline I provided
Which part of the paper is relevant? All of it? The framework ?

The results? The analysis?
Econ., 4(1), 75-99.
https://www.annualreviews.org/doi/full/10.1146/annurev-
resource-110811-114547
Carlsson & Johansson-Stenman (2012) offer an interpretive
survey about the usefulness of behavioral economics on
environmental policy. The main argument of the authors is that
behavioral economics (BE) is important for environmental
economics and that there is a need for modifications to the
normative policy recommendations. The strength of the article
lies in the description of core concepts. The terms that are used
in the paper, such as BE is explained in the introductory page
for easier understanding. The incorporation of scholarly
references such as Neill et al. (1994) increases the authenticity
and credibility of the provided information. A shortcoming of
this article is that it does not provide a direction for future
studies about BE. However, it contributes to the topic of study
by discussing concerns of fairness, social approval, status, and
cooperation. This article discusses the way policy implications
founded on conventional economic theory can be changed
whenever behavioral economics insights are considered.
Which part of the paper is relevant? All of it? The framework ?
The definitions only? The results? The analysis?
https://www.researchgate.net/profile/Jurate_Miliute-
Plepiene/publication/324029998_Behavioral_spillovers_from_fo
od-

waste_collection_in_Swedish_municipalities/links/5afed666a6f
dcc722af53bd7/Behavioral-spillovers-from-food-waste-
collection-in-Swedish-municipalities.pdf
Ek & Miliute-Plepiene (2018) argue that policies that evaluate
the environment must involve all the significant impacts, such
as the future and immediate costs, and the desired impacts on
the chosen variables. In this paper, the authors argue that a
policy that encourages households into recycling a specific
fraction of waste affects their readiness for recycling other
wastes as well. This study contributes to the BE topic by
introducing the aspect of behavioral spillovers and estimating
the policy-driven spillovers within households. A major
weakness of the article is that it focuses on waste recycling in
Sweden. For better analysis, this study needs to focus on many
countries, or at least compare two countries to understand and
evaluate the effectiveness of their waste management practices.
By focusing solely on Sweden, it could give policymakers the
opportunity of implementing waste practices in countries that
have unsuccessful waste management approaches. In the
research paper, I will use the lessons of BE from this source and
relate it to food waste by using the lessons from other countries
that have better management methods.
https://link.springer.com/article/10.1007/s10640-017-0162-3
In this study, Kesternich Reif & Rübbelke (2017) present
information about the trends in BE. It answers the research
question: How does the theory of standard welfare economics
work in a competitive market to cause a Pareto efficient
resource allocation? However, because of the failures in the
market, there are regular inefficiencies. The main argument of

Kesternich, Reif, & Rübbelke (2017) is that the instruments
established using government intervention could overcome
issues from social dilemmas and also prevent inefficient
resource allocation. The strength of the study is the use of
various scholarly articles that support the importance of BE and
show some defining trends in history. However, using many
sources is also a challenge for the article because of the
possible biased information or over-reliance of a qualitative
study that lacks proof. This article contributes to the topic of
study by establishing the basis of research, especially focusing
on the recent trends in the field. We cannot understand our
future without understanding the past. It answers the research
question: what are the trends that have defined BE? And are
these trends dynamic or can they be used in different contexts?
https://www.econstor.eu/bitstream/10419/191496/1/WP17-
01.pdf
The main argument of the authors is that within traditional
frameworks, Pigovian regulation establishes corrective subsidy
or tax to make agents understand external impacts linked with
production or consumption decisions. It answers the research
question: How has the classic understanding of regulation has
considered behavioural agents and the ways they influence
excellent designs in the policy? The idea from the article is that
whenever agents voluntarily exert efforts, the financial
incentives have negative effects. The advantage of this study is
that unlike other resources, it narrows the topic and introduces a
policy approach in the form of Pigovian regulation. The use of
the regulation is a basis for policymakers to develop new

approaches that could apply in new environments and countries
that seek to achieve maximum BE exploitation. This article
contributes to the topic of study by carrying out comparisons of
products and showing that the extent of behavioral effects
reduces with the substitutability between dirty and clean
product options, which reduces emissions.
DRH:
Ok, you are moving in the right direction.
I expect that all these papers and their results will be tackled in
a thematic fashion using a framework /structure /outline you
have devised to synthesize various papers with similar results /
topics together rather than a listing of different results.
In the final paper, I also expect a much deeper discussion rather
than a summary and a more detailed description of the terms,
discussion of behavioral econ versus neoclassical econ and hw
they are the same or how they differ in explaining the same
environmental phenomena
1
BEHAVORIAL ECONOMICS AND ENVIRONMENTAL
POLICIES 5
Behavioral Economics and Environmental Policies

Student’s Name
Abstract
Behavioral economics (BE) has increasingly attracted more
interest in the field of economics. Unlike the conventional
economic theory, BE focuses on people having cognitive
limitations, which makes them arrive at irrational decisions. BE
also states that people act in a social context, and issues,
including status and social approval, are critical to human
behaviour. Another critical feature of BE is that people’s
behaviour is not motivated only by their material payoffs.
Understanding BE is vital because the decision-making process
is understood better, alongside providing the possibility of
creating value propositions.
Keywords: Behavioural economics, material payoffs,
environmental policy
DRH:
You highlighted what BE is all about relative to traditional
econ. But there is no mention of how it will help/change
environmental econ
Introduction
Using experiments has increased in different economics areas,
such as environmental economics. Experiments offer reasonably
low cost and powerful methods of examining conventional
issues affecting environmental policy. In the last thirty years,
laboratory experiments were supported by the available high-
quality information needed for assessing policy initiatives in the
environmental area. Various critical information from this work
area was obtained, in different areas, including complying with
environmental regulations and the need for specific trading
features in the environmental markets. At the same time,
different survey information has summarized the importance of
laboratory experiments to address issues in the environment.
Brent, Friesen, Gangadharan & Leibbrandt (2017) argue that

field experiments have become complementary to the laboratory
method used in the field of environmental economics. Alongside
the laboratory experiments, there are also field experiments that
have been carried out in the everyday environment of the
participants without their awareness. These include artefactual,
framed, and natural experiments, such as the randomized control
trials. The field experiments are used because of two vital
features. The field experiments help people to reach conclusions
that are responsible for the particular environment where the
environmental decisions are made and also give room for casual
references.
However, the levels of specificity at times makes it challenging
to compare findings from one point to another. To have a
detailed understanding of the environmental policies that work
in various environments, it is necessary to combine and contrast
the insight provided from the field experiments in
environmental economics. The connection between the field and
theory is a critical consideration in environmental economics,
where consumers have responded to the traditional economic
incentives. Consumers also make decisions relying on the
contributions to protecting the environment to realize the best
benefits for the environment (Brent, Friesen, Gangadharan &
Leibbrandt, 2017). Depending on the environment and context,
individuals and organizations produce various volumes of
pollution, use excessive water or energy, and even misreport
their emissions or usage. Understanding the findings from field
experiments through a theoretical lens is necessary for industry
leaders and policymakers who seek to understand and anticipate
the way specific policy interventions work for the consumers
and their constituents.
DRH; It is not clear to me why your introduction is about
experiments but does not relate it to your title/topic on BE.
There is no statement of your research questions

DRH. Headings/sections should conform to guidelines- see old
syllabus that has parts of a research paper. Below, I show how
you can demonstrate the relationship of each section to each
other and it will help with your ppt slides as well:
I. Introduction - background, research questions, motivation and
rationale for the study (what the outline/proposal is all about)
II. Literature review- past studies, gaps in each and your
contributions (what the annotated literature review is all about)
III. Method- if qualitative: include framework for comparison,
criteria for assessment; if quantitative: data and sources,
variable description, hypotheses , OLS, survey, etc. (using and
applying information you learned from annotated bibliography
stage)
IV. Results – answer each question in I using results from III
and relating your results to results from past literature cited in
II
V. Conclusions, Policy Implications, Directions for Future
Research
The sections in this draft do not have the sections above and it
is not clear what is being achieved by each section – what
question each it answering. You are not supposed to arite a
textbook with different sections for different topics. You are
expected to be communicating answers to research questions,
which up to this point have not been articulated. None of the
statements made here are wrong. They just do not contribute to
a whole.
This is the assessment form: right now you score very low on
all items (1) a D:
Items 1-2 There is no central argument. Even after reading your
proposal and annotated bibliography, there is nothing here that
seems to build from those two submissions.
Items 3-4 Since there are no arguments or assertions made,
therefore I cannot assess avidnce used to answer those
arguments. The sections seem independent of each other and I
do not see the purpose they serve.

Items 5-6 Therefore , there is no integration or synthesis to
speak of. The conclusion does not tie up the independent
sections.
Experimental Methods
The experimental method has been vital in the protection of the
environment. During the 1970s, scientists, including Molina,
Rowland, and Crutzen, showed that chlorofluorocarbon (CFC)
gases that are used in plastic foams spray bottles, and
refrigerators affect the ozone layer. While their ideas were
founded on theoretically understanding the modeling methods
and chemical processes, the experiments identified and
measured the causal effects of CFC on the depletion of the
ozone layer (Carlsson & Johansson-Stenman, 2012). Causal
understanding obtained from experiments is not limited to the
chemical processes alone. There is also increased dependence
on experiments that involve human beings towards developing
new medicine and better decision-making theories. In recent
years, environmental economists have used the experimental
method for generating knowledge about different behaviours
that affect the environment, including standard pool extraction,
pollution, and the conservation of energy. Scholars have used
the natural settings of decision-makers, inviting them to
participate in their experiments. The innovative technology has
given them the room for examining behavioural patterns in
natural resources and environmental users in the field.
A lot of the environmental goods and services, including
rainforests, resource management, and fisheries, have elements
linked with public goods and a shared pool of resources. While
the pure public goods are defined by the non-rivalry and non-
excludability in consumption. Various environmental public
goods are regarded as impure public goods. These goods are not
directly rivalrous, but the challenges of excluding people from
utilizing these resources, and that consuming resource reduces
its availability to other people, suggests that those who use
resources encounter a social dilemma (Carlsson & Johansson-

Stenman, 2012). Plans have been recommended for mitigating
these issues, and some have emphasized on external
interventions from the regulators while others advocate for
community-led initiatives. According to Elinor Ostrom, if
communities can design their usage schemes, enforce rules they
form, and organist themselves, then self-governance and
collective action are successful towards minimizing the effects
of the social dilemmas.
Extrinsic or Intrinsic Motivations: Crowding Out or Crowding
In?
Policymakers in the community and central levels have used
various initiatives towards improving the use of community
resources. Some of the use of resources emphasize on a
regulatory or formal approach and use financial incentives such
as penalties, audits, taxes, and subsidies for motivating people
to use resources in socially optimal ways. Other approaches
have focused on evoking intrinsic motivations for those who use
the resources. Interactions between informal and formal
schemes are necessary for examination, and the field setting is
an ideal environment for exploring the substitutability and
complementarily between the approaches. Chen (2016) carried
out an experiment in Colombia among a group of fishermen who
were using regulatory and informal methods to help them
cooperate with the environment in meaningful ways. The
experiments were framed as a situation where every fisherman
decided on whether or not to clean piers and beaches. Ensuring
the beaches are clean prevents lobster migration, and this makes
it beneficial for everyone involved. Chen (2016) also examined
the effects of non-regulatory and non-monetary incentives on
the pro-social behaviours the related to conserving the
environment by using experiments with groundwater and forest
resources in Bolivia. The more socially connected people make
significant contributions. Therefore, non-regulatory and non-
monetary incentives produce various types of motivation
crowding-out impacts.
Impacts of the Pigovian Regulation

In the traditional frameworks, the Pigovian regulation
establishes corrective subsidy or tax to ensure agents
understand the external impacts linked with production or
consumption decisions. The market-based techniques, especially
Pigovian regulation, make consumers understand the external
impacts linked with their decisions. Regardless, when there are
behavioral agents that frame changes in prices, it could
backfire. Ek & Miliute-Plepiene (2018) state that the Pigovian
tax is examined against businesses or private individuals for
taking part in a task that causes negative impacts for the
community. The adverse side impacts are costs that are not part
of the market price of the product. These include aspects such
as strains on public healthcare from selling tobacco products,
environmental pollution, and related side impacts that cause
negative, external influence. Economists claim that the costs
from the negative externalities, including pollution to the
environment, are caused by society and not the producers. The
Pigovian tax seeks to discourage actions that impose costs of
production to third parties and the community entirely. Pigou
claimed that the negative externalities prevented a market
economy from attaining equilibrium whenever the
manufacturers fail to factor all the production costs (Ek &
Miliute-Plepiene, 2018). The adverse impacts are correctable
through levying taxes that are equal to the externalized costs. In
an ideal situation, the taxes are equivalent to the external
damage that is caused by the manufacturers, and this reduces
the external costs. BE is shown through the Pigovian tax style,
especially on pollution.
A factory causes pollution and thereby leads to negative
externalities because the affected third parties bear part of
production costs from the pollution. This cost is shown through
health risks or contaminated property. The polluting factory
only considers the private costs and not the external costs.
Pigou always believed that the interventions of the state must
correct the negative externalities, which is believed to be a
market failure. Notwithstanding the criticism of the theories of

Pigou, the Pigovian taxes are standard in modern-day society.
An example of a Pigovian tax is the tax on carbon emissions.
The governments have imposed a carbon emissions tax on any
organization burning fossil fuels. When burned, fossil fuel
produces greenhouse gases that lead to global warming and also
damages the planet in various ways. The carbon tax seeks to
consider the actual costs of burning fossil fuels. The end game
of the carbon tax is ensuring that manufacturers of the carbon
products are those who incur the external costs. An example of
another Pigovian tax that is commonly used in Europe is the tax
levied on plastic bags and paper bags. This has encouraged
consumers to bring their reusable bags from home to prevent
using plastic or paper. Plastic is an example of burning fossil
fuels that cause damages to marine life, while paper bags
promote deforestation. All of these examples of products lead to
negative externality, whose prices fail to consider the costs
incurred by society. The executed taxes are measures for
redistributing costs to the manufacturers and users that produce
these negative externalities.
A Case Study of Food-waste Collections in Swedish
Municipalities
The evaluations of the environmental policy must cover all the
appropriate effects. The most important aspect is the future
benefits and costs that are directly linked with the policy. This
answers the question: Does the policy have the desired impact
on the environmental variable of concern? Are there any direct
costs or factors from the spillover effects? These are some of
the mediated issues by financial incentives. Sweden has
implemented a policy that encourages households into recycling
a particular waste faction that affects readiness for recycling
other waste fractions in the process. The Swedish government,
in 2003, implemented a national target that by 2010, they would
undergo biological treatment of around 33% of the food waste
that is produced from restaurants, households, grocery stores,
and catering facilities. The goal of the target was reducing
waste incineration. While the goal was not met, the Swedish

government refined and updated the target in 2012 (Kesternich,
Reif & Rübbelke, 2017). The implementation of the policies for
biological treatment happened at the local levels, where the
municipalities operate waste management through a private or
public contractor or directly.
By 2015, two-thirds of the Swedish municipalities have initiated
systems for source separation from the food waste. Food waste
is gathered from schools and restaurants. The Swedish
government uses two different techniques for separating wastes
from household foods from the residual wastes. The first system
is where residual and food wastes are placed in various
containers. In the other method, there is only one garbage
container in use. However, the food and residual wastes are still
separated, either into various colored bags or compartments that
are subjected to automatic optical storing in a specialized
facility. All the food waste that is collected is incinerated. In
almost half of the municipalities collecting food waste, the
households must participate. Where there is voluntary sorting,
the economic incentives, including the lower waste rates for the
homes that participate, are used for inducing households to get
involved. Besides, municipalities have monitored the sorting
initiatives to an extent, but the monitoring at household levels
is not possible for multi-family housing, where the wastes have
been deposited unanimously. Different methods are used for
ensuring compliance. For example, single-family households are
informed through mail or telephone that the sorting impacts are
not satisfactory.
Assessment of Effectiveness of BE Protecting the Environment
the effectiveness of these approaches can be explained through
the conventional economic theory. This is obtained from the
standard doctrine, where a person has to pay the lowest possible
taxes and wages, charge the highest rents and prices, and not
give away anything unless the gift provides compensatory
advantages. Through the environmental policies, four aspects
are realized using the conventional economic theory, including
sustained growth of the economy that is measured relative to the

gross national product. The free markets that are not restricted
by the government generally lead to the most effective and
socially maximum resource allocation. Economic globalization
is also caused by conventional economic theories, including the
removal of barriers to the free goods flow and money in all
places in the world, increasing economic effectiveness, creating
employment opportunities, and increasing the choices for
consumers. To this end, the primary duty the government is
offering the necessary infrastructure for advancing and
enforcing the rule of law according to contracts and property
rights. Consumption of energy leads to global and domestic
externalities shown through carbon emissions and air pollution,
while using water reduces the available water for environmental
flows, and leads to possible scarcity for future generations.
There is a substantial duty for economists to determine public
policy because organizations supplying water and energy to the
homes are heavily regulated and public monopolies.
A major theme is that for these markets, extrinsic and intrinsic
motivations guide the final decisions about consumption. Not
only do households conserve water and energy to minimize bills
but also receive utility from the altruism or warm glow linked
with conservation. These dual sets of motivations have opened
up policies that go beyond the traditional economic
incentivization, such as subsidies and prices, to tap into the
moral or social motivations for reducing the consumption of
resources. The availability of various incentives has added
complexity to the environment of choice and making field
experiments the best steps towards disentangling the causal
methods that determine the behaviour of consumers. Economist
has also advocated for the monetary incentives for correcting
the failures within the market, including the externalities.
Regardless, there is a lacking political will or concern about
equity that restricts the use of financial incentives for
promoting the conservation of resources. The political reality
has coincided with the increased use of applied BE that has used
the changes in information or architecture for modification of

consumer behaviour without making significant price changes.
A crucial tool for reducing the energy in households and
consumption of water is the social comparison. The social
comparison tools are made up of information that is sent to
clients to compare their energy or water use to that of the peer
group. The social comparisons have led to essential treatment
impacts that are efficient compared to information-based
approaches, including the conservation tips. Alongside
understanding the kinds of households responding to the social
comparisons, the kinds of actions taken by consumers also offer
insight into the methods that lead to the conservation of
resources. The possible improvements in welfare from the more
investments in the efficiency of energy, alongside proof that
show that social norm comparisons minimize consumption but
discourage new investments, have led to the use of technology
in environmental protection. The standard neoclassical model
argues that people take part in environmentally pro-social
behaviours, including useful public contributions, lower
harvesting of the pool resources, and energy conservation only
when they have the extrinsic motivation of doing so. Therefore,
they contribute nothing to the public good, ignore the impact of
extraction of resources on other people, and are not affected by
the data about energy use. Interactions of social and financial
interventions with the intrinsic behavioral norms is an area of
study that bears fruits. While a lot of work has been executed to
understand various motivations behind conservation, a lot still
needs to be done to understand the interactions of these effects.
Conclusion
As shown, BE focuses on people having cognitive limitations,
which makes them arrive at irrational decisions. Policymakers
in the community and central levels have used various
initiatives towards improving the use of community resources.
Consumers also make decisions relying on the contributions to
protecting the environment to realize the best benefits for the
environment. To this end, environmental economists have used
the experimental method for generating knowledge about

different behaviours that affect the environment, including
standard pool extraction, pollution, and the conservation of
energy. Economists claim that the costs from the negative
externalities, including pollution to the environment, are caused
by society and not the producers. Some of the applied
approaches include the Pigovian tax that discourages actions
that impose costs of production to third parties and the
community entirely. An example of Sweden shows how BE is
used in daily practice, where it has implemented a policy that
encourages households into recycling a particular waste faction
that affects readiness for recycling other waste fractions in the
process. On the same note, social comparisons have led to
essential treatment impacts that are efficient compared to
information-based approaches, including the conservation tips.
This study provides policy recommendations for countries that
have not realized success with better control over their
environments.
References
Environmental and Resource Economics, 10(2), 95-143.
Econ., 4(1), 75-99.
Chen, J. M. (2016). Fables of the Reconstruction: Human
Emotion and Behavioral Heuristics in Environmental
Economics. Studia Iuridica, (63), 77-96.

List, J. A., & Price, M. K. (2016). The use of field experiments
in environmental and resource economics. Review of
Environmental Economics and Policy, 10(2), 206-225.

FINAL TERM PAPERThe simplest rule is to look at a sample of pa.docx

Recommended

Recommended

More Related Content

Similar to FINAL TERM PAPERThe simplest rule is to look at a sample of pa.docx

Similar to FINAL TERM PAPERThe simplest rule is to look at a sample of pa.docx (17)

More from voversbyobersby

More from voversbyobersby (20)

Recently uploaded

Recently uploaded (20)

FINAL TERM PAPERThe simplest rule is to look at a sample of pa.docx