Lecture 3 Notes: EFFICIENCY AND MARKETS
PASTURE 1: CONSUMERS
LEFT BOARD 1: Utility Max and Indifference Curves
Maximize utility from water W and numeraire N (stuff). Budget constraint
Y=pWW+pNN Set up LaGrangian
Get optimal input demands
Lecture 7 Notes: Regulation
1. Connect the readings to an economic issue that we have discussed in class.
Whats interesting about this issue?
2. What influences allowance
prices? 3. Was the program a
4. What should have
Lecture 6 Notes: Coase and Cap-and-Trade
PASTURE 1: CHESHIRE, OHIO AND THE
COASE THEOREM Question: Was this
transaction a good thing?
LEFT BOARD 1:
Left side: Housing
Supply of Leavers
First: original supply of
Lecture 10 Notes: INTERNATIONAL COMPETITION
Draw picture of countervailing
Fundamental problem: the countervailing tariff cant get the price right in the producer
market. So: Overconsumption in producer market. Q
Lecture 12 Notes: THE PORTER HYPOTHESIS
Production function (at the firm level or economy
level): Y = Af(K,L)
Y = Output
A = total factor
productivity K =
L = Labor
Question: How can we decompose a change in
Lecture 8 Notes: TOPICS IN CAP-AND-TRADE
PASTURE 1: THOUGHTS ABOUT THE POWER
PLANT VISIT What was interesting to you about
Review the emissions control regulations the plant is
subject to: -Gas turbine is in NOx Budget
-NSPS: MACT/BACT for the
Lecture 9 Notes: LIABILITY
PASTURE 1: REGULATING RISK
WITH LIABILITY Draw Risk Reduction
Optimum at the intersection.
Question: Why not regulate with liability?
Push question: Force the firm to pay the damage, and it will equate MC with MED.
Lecture 11 Notes: ENVIRONMENTAL KUZNETS CURVES
PASTURE 1: EMPIRICAL RESULTS
Question: How have you seen the EKC where
youre from? Los Angeles vignette
Question: How would you test this formally?
Grossman and Krueger: examine data on a panel of