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01MAWGD Resources and Environmental Economics

Prof. Blengini, Giovanni Andrea Prof. Shields, Deborah J. A.A.2009/10 Fall Term

KEY TERMS and CONCEPTS General you need these basic concepts to be able to answer the Mineral, Environmental, Energy and Sustainable Development economic questions.
What is economics Scarcity (resources vs needs) Economic efficiency Technological efficiency Production possibilities frontier Economic system definition Who are the actors in economies Value chain, linear vs. circular economy approaches Value added Gross domestic product, what is it in general, whats in and whats not in (no calculations) real vs. nominal value CPI, PPI definitions Income and product flows, basic concepts and simplified drawing Diminishing marginal value Law of demand Demand curve Willingness to pay (WTP)

Total and marginal cost Principle of rising marginal cost Supply curve Shifts vs movements along curves Elastic and inelastic curves Total and marginal revenue Consumer and producer surplus Market failures

Mineral Economics
Material flow cycle Stages of mined raw materials to finish products Main economic characteristics of mineral raw materials Intensity of use Stocks vs. flows Reserves vs. resources Ore and deposits Fixed stock paradigm Static reserve index Opportunity cost paradigm Characteristics of mineral markets Mining/mineral rent What are the main mineral policy categories

Environmental Economics

Common pool resources Public goods Market failure Use versus non-use value Positive and negative externalities Internalizing externalities Social costs Monetary valuation Pigouvian taxes Contingent valuation Optimal pollution levels (according to economists) Polluter pays principle Precautionary principle Eco-efficiency Decoupling Command and control Cost benefit analysis and ratio Present value and net present value calculations

Sustainable Development (SD)


Classic Brundtland definition of SD Three circles of SD and basic understanding of what each covers Inter- and intra-generational equity Types of capital Weak versus strong sustainability Capital-based definition of SD How neoclassical economics and ecological economics differ

Capital substitution Capital definition of sustainability for energy and minerals What is sustainability policy and sustainability-based resource policy Social license to operate Corporate social responsibility SD: goals, principles, criteria and indicators What is the role of engineers in achieving sustainability

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