Environmental Economics Problems

This solved assignment delves into the complexities of environmental economic problems. It explores the concept of externalities, examining both positive and negative impacts of economic activities on the environment. The assignment further analyzes greenhouse gas (GHG) mitigation as a public good and its vulnerability to free-rider issues. Lastly, it discusses government policies aimed at reducing emissions through renewable energy expansion, deforestation reduction, and taxation.

Running head: ENVIRONMENTAL ECONOMICAL PROBLEMS
Environmental Economical Problems
Name of the student
Name of the university
Author note

1ENVIRONMENTAL ECONOMICAL PROBLEMS
Table of Contents
Answer 1........................................................................................................................2
Answer 2........................................................................................................................2
Answer 3........................................................................................................................3
References......................................................................................................................4

2ENVIRONMENTAL ECONOMICAL PROBLEMS
Answer 1.
Externality is the consequence of different economic activities that affects third
parties in the surrounding environment in negative and positive way. Pollution emitted by
factories, affects health of individuals is negative externalities and laborers who provide
productivity to the company is positive externalities (De Gouw et al. 2014). Proper pricing
done by government on pollution helps in reducing externalities by implementing tax on
individuals or factories that create pollution. Proper introduction of tax helps in increasing
cost of production or consumption which helps in reducing demand and output of good that
creates negative externalities (Ripple et al. 2014).
Answer 2.
Mitigation of GHG is a public good as other public goods and is vulnerable in
nature for free rider issues. Therefore, economics related to change in climate helps in
identification of Greenhouse gas mitigation as public good. However, adoption of change in
climate is known as private consumption (Elliott and Fullerton 2014). Implications of
mitigation of these are problem related to free rider game is limited in case of the adoption;
however, it changes in case of individual country. In individual countries, green house gases
mitigation is considered as the dilemma game of the prisoner (Ranson and Stavins 2016).

3ENVIRONMENTAL ECONOMICAL PROBLEMS
Answer 3.
Reasons for government to implement policy to reduce emissions
 Proper expansion of usage of renewable energy to be less dependent on the
fossil fuels and coal (Elliott and Fullerton 2014).
 Proper reduction in tropical deforestation to reduce emissions related to
global warming with proper investment of energy related technologies.
 Proper implementation of tax done by government will act as policy
instrument to achieve reduction in Greenhouse gases (Ripple et al. 2014).
 Proper information has to be provided by government for conserving energy
and establish programs will help in reducing greenhouse gases and will be
sustainable for environment and cap trade tax.

4ENVIRONMENTAL ECONOMICAL PROBLEMS
References
De Gouw, J.A., Parrish, D.D., Frost, G.J. and Trainer, M., 2014. Reduced emissions of CO2,
NOx, and SO2 from US power plants owing to switch from coal to natural gas with
combined cycle technology. Earth's Future, 2(2), pp.75-82.
Elliott, J. and Fullerton, D., 2014. Can a unilateral carbon tax reduce emissions
elsewhere?. Resource and Energy Economics, 36(1), pp.6-21.
Ranson, M. and Stavins, R.N., 2016. Linkage of greenhouse gas emissions trading systems:
Learning from experience. Climate Policy, 16(3), pp.284-300.
Ripple, W.J., Smith, P., Haberl, H., Montzka, S.A., McAlpine, C. and Boucher, D.H., 2014.
Ruminants, climate change and climate policy. Nature Climate Change, 4(1), pp.2-5.