Environmental Economics and Markets

FOR15 Environmental Economics and Markets

Autumn 2024

  • Topics

    This course in environmental economics if focused on the needs of the firm. It includes how economic tools can be used to assess environmental priorities, and in consequence how the firm can navigate these and is affected. It also places in context how the firm's markets are affected by environmental problems and environmental policies, directly and indirectly.

    This course uses techniques from economics to analyse environmental policy questions. A more advanced course more specialized towards international problems is given at the master level (ENE423 Economics of the Environment and Climate).

  • Learning outcome


    Upon successful completion, the students understand

    • how environmental problems can be modeled as market failures
    • how common government policies such as (among others) taxes and subsidies can be used to correct such market failures by appealing to the firms’ self-interest.


    Upon successful completion, the students

    • Can apply their understanding of environmental problems and government policy to build and analyze economic models that help in designing optimal government policy
    • Can use the idea of market failure and how it is corrected, to focus on the firm in its self-interest
    • Is able to analyse the role of a broader societal interest in the firm, its owners and other stakeholders
    • is able to analyse how the firm and its stakeholders are likely to engage in dialogue on policy
    • Knows the basic methodological challenges and methods used in prioritizing environmental problems and protection
    • Understand the institutions and political economy of environmental issues, including the basic notions of property rights and liability

    General Competence:

    Upon successful completion, the student can

    • use the abovementioned concepts and techniques in an applied setting and to communicate their findings and results.
    • analyse environmental management issues in the light stakeholder interests, institutions, and their evolution.

  • Teaching

    The course consists of lectures and a home assignment.

  • Recommended prerequisites

    Some facility in economic analysis is advisable, but it will also be taught.

  • Credit reduction due to overlap


  • Compulsory Activity

    Home assignment must be approved.

  • Assessment

    Individual term paper. The students will work on the term paper for 20 days, starting in Week 13. The term paper must be written in English.

    An assessment in FOR15 will not be organised in the the non-teaching semester. As of autumn 2023, only mandatory bachelor courses with an individual assessment will have an assessment in the non-teaching semester. This only applies to students with a valid course approval. The retake options that apply at all times are decided by the dean for the bachelor program and will be published in the course description.

  • Grading Scale

    A - F

  • Literature

    Will be provided, parts of Kolstad's book Environmental Economics.


ECTS Credits
Teaching language

Spring. Will be offered Spring 2024.

Course responsible

Assistant Professor Roweno J.R.K. Heijmans, Department of Business and Management Science (main course responsible).

Professor Gunnar S. Eskeland, Department of Business and Management Science.