Peter J Wilcoxen > PAI 777 Economics of Environmental Policy

General Information, Textbooks and Requirements

Spring 2015

General information about the course. 

Contact Information

Office: 426 Eggers 
Office Hours: Tuesday and Thursday, 10:30-12:00, or by appointment. 
Email: wilcoxen at 

Course Content

This course covers the economics of the environment, including pollution control and the use of natural resources. Key topics include: (1) the economic theory of externalities and common property; (2) the optimal use of resources across time and under conditions of uncertainty; (3) policies for managing resources or pollution, including taxes, quotas, permit systems, regulation, liability laws, and recycling policies; and (4) tools for assessing non-marketed costs and benefits, including risk assessment. The course heavily emphasizes learning by doing and will cover the design, solution and analysis of appropriate mathematical models.


This course requires PAI 723 Managerial Economics or an equivalent course on microeconomics at the graduate level. There is no specific math prerequisite but please be aware that the course will use algebra and geometry extensively in lectures, exercises and exams.  Calculus is not required.


The two books below are highly recommended and used copies run about $30-$40 online.  However, copies will be available on reserve at Bird Library and most of the articles from the Stavins volume could be obtained through JSTOR.  The EPA document is available on the web.  It's probably best not to print it out: it's quite long and detailed and we'll only use parts of it.  Finally, additional readings will be posted as PDF files on Blackboard.

Assignments and Grading

Grades will be based on two take-home exams (20% each, to be handed out around Wednesday, February 25th, and Monday, April 20th and due in class a week later), a 10-15 page paper (40%, see below for key dates), and a series of exercises throughout the semester (20%). There will not be a final exam.

Paper: A prospectus will be due on Wednesday, March 4th (just before spring break), and the final version will be due on Friday, May 1st (during final exams).  The assignment is described in more detail on the following page: About the Paper.  Both the prospectus and the final paper will be submitted electronically via Blackboard.

Exercises: Due at the beginning of class. Grading will be on a 5 point scale: 5 for excellent work, 4 for good, 3 for an honest attempt and 0 otherwise. You'll need to do the exercises in order to do well on the exams. You may work on the problem sets in groups of up to three students. When working in a group, please turn in a single set of answers for the group and be sure to list each member's name.


Working in groups is encouraged on exercises but be sure to limit the group to no more than three students and list everyone on the answer you submit. On exercises involving spreadsheets, the spreadsheets may be shared within a group but NOT between groups.  Working in groups is not allowed on the paper or the exams.


Accommodations can be made in exams and assignments for students with disabilities. If you believe you need accommodations, please contact the Office of Disability Services (ODS) as soon as possible. ODS will help you with the University procedure for arranging appropriate accommodations for all of your classes.

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Peter J Wilcoxen, The Maxwell School, Syracuse University
Revised 01/11/2015