User:CameronKnox
Course:Econ371/UBCO2024WT1/Reflections[CameronKnox]
Going into this semester I had a very rigid and limited understanding of the economics side of environmental issues. After our course so far I have been able to expand my understanding of how decisions are made and the common tools we use to make those decisions.
The first concept that helped me is the classification of open access goods, this helped me better understand resource management problems, such as fishing, and that without implementations of quotas or permits we will run into problems of scarcity and inequality shown by the “tragedy of the commons”. Before learning about this I thought that permits were more of a money grab way to capitalize on people who are trying to feed themselves and not the necessary management of a rival, non-excludable good.
Secondly, being introduced to the concept of the statistical value of a life has opened my understanding of how certain economic decisions are made, at first the concept of assigning a value to someone's life before performing a CBA to determine if a project should be undertaken made me feel fairly uncomfortable as as I didn't think it was ethical to put any value on anyone's life, however, I now know that without these tools it would be hard for policy makers to come to any rational solution when comparing the costs and benefits of a potentially life saving solution. Although I do still feel a little uneasy with the concept, I can at least understand the rationale behind why these decisions are made.
The next group of concepts that were interesting and helpful for me is the valuation methods for non market goods such as hedonic pricing and the travel cost method. The hedonic pricing method helped me change my perspective from thinking some goods were impossible to value due to their intangible benefits (views, clean air etc), to the fact that economists have tools to assess these benefits, although there can be imperfections it is still very interesting. Similarly for the travel cost method, growing up my family and I were always going on hiking trips and camping trips. We would drive hours to get to these parks that were - for the most part- free. Never once did I even think about why we were willing to drive the hours to these parks, it was just the way it was because these places were “worth it”. Now with the use of the travel cost method I can see why we would all pile into our minivan for a few hours every weekend to get to these beautiful parks while living only a short drive from our local forest.
The concept of a pigouvian tax was unfamiliar to me before this class. A pigouvian tax, such as a carbon tax, is a concept that I hadn't fully grasped before. This concept has helped me see that these taxes can help the market come to a solution through monetary incentives instead of using a heavy- handed regulation. This understanding of carbon taxes and the implications brought with it we have covered in class are very helpful especially as we are heading towards an election with a large focus on carbon taxes and carbon tax incentives, with the new understanding of this topic I can make better decisions for myself and have a better insight to politicians speaking points.
On the subject of politics, I can now also understand that one of the imperfections of environmental economics comes into play when we look at the implications of legal frameworks and ethics, many of these frameworks fall short when we include legality and ethics. An example of this can be seen with a willingness to accept on indigenous locals who would hypothetically accept a certain amount of money to let a factory dump hazardous waste upstream from them. The ethics behind this scenario is disgusting and would play a part in whatever the solution could be. We can also see that by purely using economics we could get to an efficient level of carbon output but when we look at legal constraints we can see that these policies would be impossible. Another imperfection in these frameworks is the lack of consideration for intrinsic values related to goods, an example could be if a forest is a religious space for a certain community the value of that area would go far beyond whatever we are able to measure with our tools, another example could be the value of animals living in a forest, their lives are worth more than they would be worth to harvest, but we have a hard time coming to an exact value.
Overall I can see that although we have covered many topics in class that have opened my mind to how we can measure the values to certain goods, how decisions are made, and how certain policies work, I can also see that many of these concepts have shortcomings that can not be ignored. This has helped show me that although economics is a great and necessary tool, it is also very important that we pause and think about other factors we are unable to measure in order to make proper and thoughtful decisions.