Economics of Energy and the Environment
Tuesday / Thursday 9 AM
O’Neill Library 257
Instructor: Richard Sweeney
Office: Maloney Hall 385A
- Tuesday: 4:15 pm – 5:00 pm
- Thursday: 4:15 pm – 5:00 pm
Graduate Assistant: Paul Sarkis
Course website: http://www.richard-sweeney.com/energy-econ/
All materials and required assignments will be placed on Canvas. When in doubt, defer to Canvas.
This course provides an overview of recent research in energy and environmental economics, with an emphasis on connecting policy questions of interest to available data and econometric methods.
In the first few weeks, the emphasis will be on using econometrics for causal policy analysis. We’ll review key concepts through examples looking at the impacts of pollution from energy consumption on human health.
The remainder of the course will focus on specific aspects of energy markets. Energy markets have many unique features and institutional details, and understanding these is essential for designing effective policy. For electricity, oil and natural gas markets, we will first review the theoretical justifications for government intervention. We will then turn to the empirical evidence to see what recent economic scholarship has to say about a variety of energy policy questions, including: What is the best way to promote renewable energy? Should we ban fracking? What are the net benefits of building pipelines? Should we be more energy efficient?
Microeconomic Theory (ECON2201 or ECON2203) and Econometric Methods (ECON2228) are (strict) prerequisites for this course. I will assume that you remember all important concepts from both courses, although we will do a quick overview of econometrics during the first two weeks of class.
Environmental economics (Econ 2277) is recommended but not required.
There is no textbook for this course. The material will consist of lecture notes and academic articles which will be posted on Canvas.
For a concise (affordable) introduction of environmental economics and policy, see Markets and the Environment (2nd edition), by Nathaniel Keohane and Sheila Olmstead.
For a more formal treatment of environmental economics, checkout (less math) The Economics of the Environment (1st Edition), by Peter Berck and Gloria Helfand, or (more math) Environmental Economics (2nd Edition), by Charles Kolstad.
For a fantastic (affordable) introduction to the econometric methods we will use in this class, I highly recommend “Mastering ‘Metrics: The Path from Cause to Effect,” by Joshua D. Angrist and Jörn-Steffen Pischke.
All of the empirical tools used are also covered in “Introductory Econometrics: A Modern Approach,” by Jeffrey Wooldridge.
There will be one or two required readings for each class (tentative list in the course calendar). It is essential that you complete these readings before class in order to contribute to and benefit from the discussion. To facilitate this, students are required to submit answers to one or two short questions about the readings the night before each class. Failure to submit answers by midnight will reduce your participation grade.
Questions will be listed on Canvas along with the posted reading for each class. On some days, the readings will be divided up amongst the class. Please make sure you read each Canvas assignment carefully to avoid extra work.
Problem sets – 30 percent
- There will be 4 problem sets.
- All problem sets must be submitted through Canvas before class on the due date. Solutions will be posted at the start of class, and, as a result, late problem sets will not be accepted.
- You are allowed to work in groups, but each person must hand in their own problem set. Please note your group at the top of your submission.
- The problems sets will involve using Stata. Students must submit their (own) Stata code as well as a separate document writing up their answers to the problems.
Participation: 20 percent
Students are expected to be engaged in class. If I feel that this is not happening I will resort to cold calling and quizzes to gauge preparedness.
As was mentioned above, students will be asked to submit a short response to the reading before class each day (except when problem sets are due). Failure to submit a response will reduce your participation grade.
There will also be one or two “blog entry” style assignments, which will count towards participation.
Final Paper: 50 percent Working in groups of two or three, students must write a research paper on an energy or environmental issue of their choosing. This will be discussed in detail in class, but please note the paper related dates on the course calendar.
Attendance policy: Attendance is mandatory. 3 absences will be allowed (for any reason). Beyond that, I will drop 1 point off your final grade for each absence. If you do not think you will be able to attend lecture, do not take this course.
Seating policy: To facilitate attendance taking and classroom discussion, students will be required to sit in the same seats every class. Seats will be set on the third class.
Laptop policy: Unless presenting, the use of laptops will not be allowed in class. If you need to use a laptop for medical reasons, please come speak to me after class.
Lecture slides: Will be posted on the course website prior to each class. I strongly suggest you print them out and take notes on them during class.
Email: I am typically off email by 9 pm. I will try to be more available right before assignments are due, but please plan your questions accordingly.
Academic integrity: Students are advised to carefully review and abide by the university’s policies on academic integrity. Any instances of cheating or plagiarism will be reported to the Dean’s office without exception.