Matthew Mitchell

Reflection #1

Participating in this course has truly transformed my perspective on the complex nature of economics and environmental concerns. Before taking this class I believed that economics tended to overlook environmental factors in favour of profit maximization and efficiency because my previous economics courses only covered that. It seemed that environmental considerations were often treated as secondary to the primary objective of economic growth. While going through the course material, my understanding has gradually evolved. I've come to realize that while economics does prioritize efficiency, it does not completely disregard the environment. Instead, we are often presented with frustrating frameworks for addressing environmental issues. A significant shift in my thinking has been acknowledging the intricate trade-offs inherent in environmental economics. This course has prompted me to recognize the complexities involved in environmental decision-making. For example, strict environmental regulations may preserve ecosystems but could also result in job losses in certain industries or increased costs for consumers. This realization has unsettled my view of environmentalism.

On top of that, my perspective on economic models, particularly those centered on utility maximization (where individuals and companies seek to achieve the highest level of satisfaction from their economic decisions), has undergone a substantial shift. These models have proven instrumental in elucidating various behaviours, particularly in understanding how individuals make choices about resource utilization and consumption. For instance, the concept of marginal abatement costs has provided valuable insights into why firms with different technologies may face varying costs when striving to reduce pollution. Understanding that firms seek to minimize costs while achieving a specific level of abatement has emphasized the importance of policies such as carbon taxes or tradable pollution permits in environmental economics.

While I contemplate the topic of economic models, This course has started to make me question their adequacy. The presumption that individuals consistently act as rational beings striving to maximize their efficiency is flawed. Human motivations are often multifaceted, revealing the gaps in this logic. I realize that my actions, such as recycling, shifting away from single-use plastics, and minimizing water and energy consumption, stem from a concern for not just myself, but to allow my future children to live in the world I get to experience rather than for immediate personal gain. This attitude does not neatly align with any utility-maximizing frameworks. Some people are driven by motives beyond self-interest, a complexity that I believe economics sometimes struggles to encapsulate. Economic analysis tends to concentrate on quantifiable elements like costs, benefits, and efficiency. These are still extremely crucial, but they don't always provide a comprehensive perspective on how the world works. Environmental issues frequently carry moral and ethical dimensions that are not possible to turn into numerical values. the intrinsic value of biodiversity or the intrinsic worth of an untouched wilderness is something that can not be put to a definite amount. This is where traditional economics appears ill-prepared to answer.

While studying for the midterm, I realized the potential of economics in addressing environmental challenges. Concepts such as Pigouvian taxes and tradable permits present practical solutions for internalizing environmental externalities and ensuring that the true costs of pollution or resource depletion are reflected in market prices. These mechanisms demonstrate that economics can serve as a potent tool for aligning individual incentives with collective environmental objectives. However, I'm also aware that these solutions are not a universal fix. A one size fits all approach will never solve such a complex problem. Instead, we need to treat this as an adaptive management problem. Another valuable insight I have gained from this course is the significance of integrating economic analysis with broader ethical and philosophical considerations. Economics provides a space for us to contemplate trade-offs and incentives, but it does not dictate our values. This is where philosophy can help us critically evaluate the objectives we are trying to reach, allowing us to leave the world in a state it deserves to be left behind. This course has significantly deepened my comprehension of the intricate balance between economic growth and environmental sustainability. I have developed a newfound respect for the tools and frameworks offered by economics, while also recognizing their limitations. Using multifaceted or interdisciplinary approaches will result in greater chances of success. To summarize, economic models assist in understanding aspects of human behaviour and resource utilization, but they fail to fully encompass the breadth of human values and the ethical complexities of our interaction with nature.

In the future, I hope to help facilitate the integration of interdisciplinary approaches that allow higher precision of economic analysis. We can achieve this through insights from philosophy, ethics, environmental science and more. I look forward to seeing how this course will continue to deepen my understanding of the intricate relationship between economics and the environment.