New York City will implement its first congestion charge program by the end of 2023... perhaps. The charge was passed in 2019 but has faced delays until present. Unsurprisingly, New Yorkers don't love it... but it will grow on them (if you'll forgive my out of sample prediction). The figure below reports percent of residents supporting congestion charges across five different cities:
In history, even business owners don't oppose the tax. In theory, demand falls for businesses within the congestion zone as it becomes more expensive to access these places. However, demand can also rebound for these places as customers realize reductions in the time costs of travel to get into the city. Leape (2006, Journal of Economic Perspectives) discusses survey results suggesting congestion pricing is OK by many commercial places:
"A survey of 500 firms carried out in early 2004 found that 72 percent of
businesses felt that the road charging experiment was working (with 14 percent
saying it was a failure) and 58 percent felt it improved London’s image (with 15
percent saying it gave London a bad image to outsiders). Overall, a plurality of
firms felt the impact on London’s economy was neutral (32 percent) with equal
numbers identifying positive and negative effects (26 percent) (Clark, 2004)."
All the while, vehicle entry to London fell by 27% and time spent sitting at idle or traveling less that 6mph fell by 33%.
From NPR on February 8th (Residents can return home after crews burned chemicals in derailed tanker cars):
"About 50 cars, including 10 carrying hazardous materials, derailed in a fiery crash Friday night on the edge of East Palestine. Federal investigators say a mechanical issue with a rail car axle caused the derailment."
The derailed cars belong to Norfolk Southern who worked with the EPA to conduct a controlled burn of the chemicals, causing an evacuation of the area:
"Authorities in East Palestine had warned that burning vinyl chloride that was in five of the derailed tanker cars would send hydrogen chloride and the toxic gas phosgene into the air."
Hazardous transport derailments happen from time to time. In 2005, Norfolk Southern also had a train accident in which two of its trains collided due to a faulty railroad switch (image below).
The EPA regulates emissions transport by requiring all hazard-carrying train companies to register with the EPA, to maintain an accurate manifest of the chemical aboard, and to report and move swiftly to remediate any spill or leak. So, it appears the approach is one in which we recognize that train crashes are infrequent, but when they occur the most important thing is to have an accurate idea of what the heck we just spilled into the environment (so we can quickly remediate).
While Norfolk Southern failed to timely-report the 2005 incident (and paid a fine), it appears they followed protocol with this weeks incident. Still, they are being sued for economic damages by local businesses and residents. And they may face civil suit payments for violations of the Clean Water Act. In 2005, they paid nearly $4M for the spill of several tons of cholrine as well as diesel fuel into the water supply.
*All information for the 2005 Graniteville, SC spill can be found here: EPA Report Graniteville Spill
The US government did not shut down in FY 2023. That is immensely unremarkable...
But, I had a social media memory pop up about the most recent shutdown in the US, so I'm going to write about them. It was the longest shutdown in US history: 35 days (December 22nd 2018 to January 25th 2019) because agreement could not be reached to fund a giant wall between the United States and Mexico. The federal government has had major shutdowns under each of its last three presidents, so it will probably happen again soon. *See the end of this post for a quick primer on how shutdowns occur.
Flashback 10 years: I was in grad school during a sixteen-day shutdown in 2013 under President Obama and was deep in literature on the local impacts of EPA Superfund remediation. Several papers estimate the impact of cleanups on local housing markets (when they are discovered, housing prices fall; when they are cleaned, housing prices increase). I remember thinking, 'WHAT A HORRIBLE GIFT a shutdown is researchers!' Horrible because shutdowns are very costly (380,000 federal employees were furloughed due to the 2019 shutdown), but a gift because shutdowns may be a true, sharp, random shock to government programs that are uncorrelated with local characteristics. They hurt... but, they give us a good shot at some causal estimates of program impacts!
But... thankfully... this line of research is pretty much a non-starter in environmental... I think. Today (2.9.2023) I searched "government shutdown" in JAERE, JEEM, REEP, and ERE and found 0 results of environmental econ papers that work with government shutdowns. And that may good news for society... because when shutdowns happen, the EPA mostly stays operational if it involves human health. The EPA actually regularly publishes a contingency plan for government shutdown. All cleanups underway (or site discoveries) that involve immediate harm to human health continue operation. Benign waste sites and work-in-progress at safe sites get halted.
Good for society, bad for researchers. If a Superfund site does experience a shutdown pause, it's likely becuase it is not a risk to human health... which means it is perhaps not located near a large population, and potentially correlated with other local characteristics. Darn... exogeneity ruined.
There may be other interesting environmental questions to answer with shutdowns, however. For example, I found a paper by Todd Gabe in Applied Econ Letters estimating the impacts of shutdown-induced National Parks closures on local tourism and gate fees. Insofar as we don't get to observe high quality counterfactual data in a world where massive national parks don't exist, government shutdowns may provide us the opportunity to value the local impacts (hey, John! Talking about valuation over here!).
**A quick primer: each year, congress has to pass twelve budget appropriations to fund crucial entities, like many of the EPAs activities. The twelve bills are consolidated into one large appropriations bill and usually passed at the end of the year. If congress can't pass the bill, they can pass a "continuing resolution" which uses the previous year's budget to fund activities until the new appropriations pass. If they can''t do either of those, the government shuts down until the appropriations pass. The BIG result is that many government programs come to a screeching halt.
While teaching emissions control policies this last week to my undergraduates, I revisited my signature of the Economists’ Statement on Carbon Dividends (now signed by over 3600 economists). It’s been four years since the origin of the statement, and despite it being the most agreed-upon policy statement in the history of economics, no federal greenhouse gas emissions charge exists today.
At the time (January of 2019), the earth sat at about 1 degree Celsius above long-term average predictions, gaining at about 0.2 degrees Celsius each decade on average. That puts us above the 1.5 degree threshold set by the Paris Agreement in 2015 by around 2050. I’ll be alive for this…
As an aside: when I think about 0.2 degrees in a decade I think about turtles…
“A few degrees make a huge difference. At sand temperatures of 31.1 degrees Celsius (88 degrees Fahrenheit), only female green sea turtles hatch, while at 27.8 degrees Celsius (82 degrees Fahrenheit) and below, only males hatch.” – Buis (2019) “A degree of Concern: Why Global Temperatures Matter”
Back to the point…what initially attracted me to the economists’ statement was its simplicity; the way it seemed to cut through all of the common issues of aggressive climate policy. A carbon tax with a border adjustment and level dividend checks to all US households. Put a bow on it! It avoids all the costly, small-sided, industry-by-industry negotiations of thresholds or a la carte subsidy creation. It’s nearly immune to rent-seeking by lobbyists. In fact, an emissions charge provides the incentive for polluters to do BETTER than these thresholds, avoiding the tax altogether if possible (0 emissions). I was in love.
Then, the Inflation Reduction Act (strange name for a climate bill, but I’ve always enjoyed aligning economic and environmental incentives, so I dig it) dropped in 2022 with no emissions charge. The largest, most coherent climate strategy of all time in the US came to be and the near-entirety* of my profession was ignored! WHAT!?! I’m grateful khakis are coffee-stain colored. How are we to react to this?
My gut was to get pissed at politics. K-street won again... a lot of subsidies in this bill! But, in theory, subsidizing a perfect substitute can serve as an implicit (and equal) tax on the unsubsidized good, ceteris paribus. For example, power generation is a quarter of the GHG emissions problem (EPA). By some estimates, the carbon dividend policy’s emissions reductions would be achieved largely through the power sector (80% of emissions reduced, according to a Columbia University Center on Global Energy Policy report by Kaufman and Gordon, 2018). The Inflation Reduction climate bill provides payments to prevent nuclear decommissions, as well as tax credits for renewable energy generation. According to a blog post by Noah Kaufman just last week, this amounts to a $70/ton implicit emission charge on natural gas and $30/ton charge on coal… not perfect substitutes, but substitutes all the same.
So, perhaps just as the major climate bill is hidden in an inflation bill, our beloved carbon tax is dressed as a subsidy for strong carbon substitutes. If power generators (and perhaps households) do not switch to the cleaner, cheaper inputs, they are taxing themselves. And I do like Paul Krugman’s argument here as well… the carbon tax is good at incentivizing firms to find new ways to reduce emissions (using given tech), but weak in getting firms to discover new technologies to reduce. In his NYT opinion piece, he notes that the massive cost reductions for renewable energy got their big nudge from government aid. That is, of course, in the absence of a carbon tax… we don’t have a world where we observe tech advancements under a carbon tax. But, given the cross-aisle political throwdowns that happen with anything named “tax”, perhaps green energy subsidies (aka implicit dirty-energy taxes) are as good as we can do?
There’s more to pick at in the IRA. For the reasons I disliked clunky, source-by-source regulation, this bill seems to have a lot more transaction costs than a carbon tax would cause. But, I haven’t well-combed the CBOs estimates enough to see if administrative burdens are considered a cost. Additionally, I supported lump-sum revenue distribution for environmental justice concerns. While it appears the IRA’s subsidies to lower energy costs (and incentivize heat pumps and the like) target the vulnerable, there’s more to study about the distributional impacts of to the tax part of the bill… which, to be fair, is a focus of the bill... for another post.
*yes, 3600 = ALL of us
Two economists walk into an AERE happy hour in New Orleans.
One says, “Hey, are you and Economist 3 done providing that awesome public good?”
Two says, “Ya know, we’ve been thinking about providing it again!”
One says, “DO IT! It’s so useful to the world! I love free riding!”
Two sips beer. One sips beer.
Days pass, then… the provision of the public good begins again! Economist One is excited and tweets:
Then… Economist Two pounces:
…damn.
I am Justin Roush, Assistant Professor of Economics at Xavier University, and I am no longer a free rider. Husband, dad of two wrecking balls (two boys), enjoyer of craft beer, triathlete. I research firm pollution. I enjoy thinking about emissions policy and have a growing interest in environmental nudges (I also research behavioral economics). My employer puts a great deal of value on teaching, so I publish in pedagogical outlets as well.
I’ll be dropping in from time to time to contribute. Thanks John and Tim for taxing me for the use of this public good inviting me to write!
The idea of an individual's or a household's carbon footprint is how much that person or household contributes to climate change. All anthropogenic climate change is caused by humans (by definition), so let's take all the humans who have ever lived and divide up the responsibility for climate change amongst them. What fraction of climate change is my fault?
To calculate one's carbon footprint, we look at the things we buy and do. E.g. when I drive my car and burn gasoline, when I run my air conditioner, when I take a flight, or when I eat a steak, I add up all the greenhouse gases emitted in doing those activities and making those products. All those greenhouse gases thus make up my carbon footprint, and therefore are my "fault."
The notion of a carbon footprint has encountered some controversy. The argument against it, summarized in this NY Timed op-ed, is that focusing on individuals' or households' carbon footprints is distracting from the fact that climate change is ultimately the "fault" of big corporations, especially fossil fuel companies. In fact, the notion of a carbon footprint was invented by a PR firm hired by an oil company, BP. According to this argument, that was done to shift the responsibility from the true perpetrators and onto ordinary people just trying to live their lives in a world that's run on fossil fuel. Auden Schendler writes, in the op-ed:
Nor was BP alone among the big oil companies communicating this message. A study by Naomi Oreskes and Geoffrey Supran at Harvard published in May in the journal One Earth found that since 1972, ExxonMobil has consistently used “rhetoric aimed at shifting responsibility for climate change away from itself and onto consumers.”
The counter-argument to this argument is that, while the fossil fuel companies and airlines, etc., are the ones emitting all of these greenhouse gases, they're only doing it to sell stuff to consumers. It's ultimately then the consumers who are to "blame" for climate change; big oil wouldn't be pumping out oil if consumers didn't want to drive cars. This counter-argument is popular among neoliberals and mainstream economists. It's pretty much what I believed.
But then I read this article, and listened to this podcast interview, both by Matt Huber, a geography professor who is writing a book called "Climate Change as Class War." Carbon footprints show that the rich are disproportionately contributing to climate change - they consume more, and pretty much everything consumed by anyone has embedded carbon. But Huber argues that even this degree of regressivity in the contribution of the rich towards climate change is understated, because the carbon footprint is based only on someone's consumption or spending, and not on how they earned the income that they spend. This excerpt has been nagging at me:
Here’s a hypothetical example: take a CEO of an airline company. This person spends eight to twelve hours per day helping to organize a fleet of thousands of planes that emit millions of tons of carbon dioxide per year. As CEO, their income and stock options are primarily derived from this activity, planning and expanding air travel as a commodity for sale.
Now imagine our CEO goes home in their SUV and eats a steak for dinner. Why is this activity the only one we focus on when talking about “carbon inequality”? Surely the SUV and steak are drops in the bucket compared to their everyday role as a titan of aviation capital.
There is a lot in Huber's article that is Marxist, which is maybe off-putting for some people. But even if you're not Marxist, there is a core point in there that seems to me intriguing: why is my carbon footprint based only on my consumption and not on my income sources?
This distinction is analogous to distinction between sources-side and uses-side incidence. Under some policy change, say a tax increase, incidence refers to the distribution of the burden of the tax. There is the uses-side incidence, which is how the tax will affect prices of goods and services. Then there is the sources-side incidence, which is how the tax will affect income, e.g. through affecting the wage or the return to capital. The standard definition of a carbon footprint is thus a uses-side carbon footprint. But can't we also define a sources-side carbon footprint?
To extend Huber's example from above: consider an executive at a fossil-fuel company who happens to be very "green" in his personal consumption - he walks or bikes to work, is vegetarian. Consider also a schoolteacher, who has to commute far to work each day to live in an affordable neighborhood, and drives a minivan to take her kids to childcare, so gets low fuel economy. The teacher has a higher carbon footprint (based on the standard definition). But does she really hold more "blame" for climate change than a fossil-fuel executive?
(I'm putting scare quotes around words like "blame" and "fault" to keep in mind that there aren't objectively correct answers to how we divide this up - the climate doesn't care who is responsible for the greenhouse gases, it just keeps warming. I'm not suggesting that the income-based footprint might be "more correct" than the consumption-based on, just that they are two alternate ways of defining footprints.)
There is a great new policy forum article in Science defending the use of the social cost of carbon (SCC) in climate policy analysis, written by four great environmental economists (Joe Aldy, Matt Kotchen, Robert Stavins, and James Stock). While I enjoyed reading the article, I am not sure that I endorse its conclusion.
The background: for the last thirty-plus years, the economics profession has been studying climate change through integrated assessment models (IAMs), pioneered by William Nordhaus, who was awarded the Nobel Prize in 2018. These IAMs include specifications of the costs and benefits of reducing greenhouse gases, and so they can be used to calculate the "efficient" path of emissions reductions (i.e. the path that maximizes net benefits according to the model) and to calculate the marginal damages of each unit of carbon emitted along the efficient path, the so-called SCC. Then, this SCC can be smacked on to carbon emissions in the real world to get the real world to behave like the efficient outcome in the model.
Then, there have been some critics of the use of IAMs and the SCC, including from among the economics profession. Robert Pindyck has been very critical of the false level of certainty implied by IAMs. (He has a paper titled "Climate Change Policy: What do the Models Tell Us?", and the first sentence of the abstract answers "Very little.") Pindyck writes:
These models have crucial flaws that make them close to useless as tools for policy analysis: certain inputs (e.g., the discount rate) are arbitrary, but have huge effects on the SCC estimates the models produce; the models' descriptions of the impact of climate change are completely ad hoc, with no theoretical or empirical foundation; and the models can tell us nothing about the most important driver of the SCC, the possibility of a catastrophic climate outcome. IAM-based analyses of climate policy create a perception of knowledge and precision, but that perception is illusory and misleading.
More recently, Nicholas Stern and another Nobel-prize winner, Joseph Stiglitz, have released a working paper that also criticizes IAMs and the SCCs they produce for neglecting, among other things,
...the immense risks and impacts on distribution across and within generations; the many failures, limitations or absences of key markets; and the limitations on government, both in offsetting these failures and distributional impacts.
Stern and Stiglitz propose an alternative to the SCC, which can be called a "target-consistent price." The SCC uses the costs and benefits in the IAM to calculate the efficient level of emissions and associated price. The target-consistent price treats the target as exogenous, whether that target is a specific emissions reduction level, or a specific temperature threshold, and then uses the IAM to calculate the cost-effective (i.e. least-cost) path to achieve that target. The target-consistent price is the associated price of carbon for that cost-effective path. So the difference between the SCC and the target-consistent price is that the SCC uses a cost-benefit analysis while the target-consistent price uses a cost-effectiveness analysis.
These critiques of IAMs and the SCC by economists are similar to critiques by non-economists, who have argued that IAMs like Nordhaus's DICE model have yielded policy prescriptions that are not nearly ambitious as they should be.
The recent article by Aldy, Kotchen, Stavins, and Stock defend the use of IAMs and calculation of the SCC. The basic idea is that SCCs are fundamentally sound, and we (scientists and economists) should be working to improve the calculation of the SCC and its use in climate policy design rather than throw it out and settle for mere cost-effectiveness analysis. It was the Trump administration, after all, that effectively rewrote the rules to set the SCC to near-zero, while the Biden administration is bringing back legitimate policy analysis and science in its calculation.
I like the article and agree with most of the points it raises but am not sure that I endorse its conclusion. There are two ways of defending or attacking the SCC: on pragmatic grounds and on existential grounds. In either case, I don't know that we need or want an SCC, or that an SCC is preferable to something like Stern and Stiglitz's target-consistent price.
The pragmatic question is: which type of analysis is going to make the world a better place, which in this context means which is going to lead to more aggressive climate action? (Assuming here that we are all on the same page and want aggressive climate policy, relative to what's actually been enacted.) The implication in the recent Science piece is that relegating ourselves to setting exogenous policy goals and only using economics for cost-effectiveness analysis will put us at the mercy of political whims or administrations who can willy-nilly throw out any justification of aggressive policy. But that is true when using an SCC too! That's just what the Trump administration did. Furthermore, the longstanding critique of DICE and other IAMs is that they are not aggressive enough because they omit many difficult-to-quantify costs of climate change, like tipping points, and they tend to ignore or downplay distributional and equity concerns. This is the heart of Stern and Stiglitz's, as well as Pindyck's, critique of IAMs. Setting clearly-defined policy goals, like a maximum temperature increase, seems likely to increase the support and possibility of getting aggressive climate action done. Of course, that is an open question that will be hard to answer (which type of policy analysis will lead to more aggressive policy?), but it is by no means obvious that the SCC wins.
Beyond the pragmatic justification of the SCC, there is an existential issue with it. Namely, is the SCC in fact a real thing, a meaningful concept for which a concrete value exists in the world (say, $45 per ton), and we just need to find out what it is? Or, is the SCC itself a construct, which exists only within and because of the methodological framework of neoclassical welfare economics? The Science article takes for granted that the SCC is a real thing. But that claim assumes that a valuation of damages to the environment exists. The existence of that valuation is essential to neoclassical welfare economics, but a large literature in ecological economics and philosophy questions its existence.
I am especially interested in this issue since I'm currently in the middle of reading Elizabeth Anderson's 1995 book Value in Ethics and Economics. This is a must-read for economists interested in alternative ways of thinking about policy analysis. Like many ecological economists and some political philosophers like Michael Sandel, Anderson is critical or skeptical of the authority of economic valuation techniques across numerous domains. She and others defend value pluralism, or the incommensurability of values - it is not appropriate to simply put a dollar value on the damages caused by climate (even if those dollar values come from revealed preference studies of people's willingness to pay) and toss that into a benefit-cost analysis. She writes
... Goods can be plural, ... they can differ in kind or quality; they differ not only in how much we should value them, but in how we should value them
It could be that the SCC is bad, not because of the problems and limitations of IAMs that are raised by Stern and Stiglitz and other critics, but because the entire philosophical infrastructure of the valuation of environmental damages is unsound. It's hard for me to fully accept this view, since I've been trained for the past 20 years in neoclassical economic orthodoxy. But there are many compelling arguments in favor of value pluralism that are worth struggling with.
Or, it could be that the existential questions about the SCC aren't important and what matters is the pragmatic effects of using or not using an SCC or cost-benefit analysis in climate policy.
In either case, I think it's an open and important question to ask whether the SCC is worth pursuing or not.
I recently read an article in the journal Economics and Philosophy, written by Lisa Herzog, which has nothing whatsoever to do with environmental economics but nonetheless I think has interesting implications for it and for Pigouvian pricing in particular.
In case you are unfamiliar with it, the journal Economics and Philosophy is a scholarly journal publishing articles on topics related to (wait for it) economics and philosophy. And, often, the philosophy of economics. This is an area that I have become interested in recently, influenced no doubt by my years as an undergraduate philosophy major.
In the article, Herzog addresses and basically dismantles Hayek's model of the price mechanism in markets as being an efficient way of processing and distilling information necessary for buyers and sellers. Hayek's idea is basically that the world is a complicated place, and markets have lots of complicated information about costs, benefits, demands, etc. But, once markets determine a price for something, that price contains all of the information that buyers and sellers need to make their optimal decision. Herzog quotes Hayek: markets process "dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess."
Herzog's argument is that Hayek is ignoring important pieces of knowledge that buyers and sellers need to make morally informed choices and that are missing from the price signal. Without this information, or "epistemic infrastructures, market participants do not act as morally responsible agents: when acting in such markets, it often seems fair to say that they do not know what they are doing." The motivating example is buying clothes made in sweatshops overseas. The price mechanism contains lots of information about production and transportation costs, etc., but it is missing important moral information, like the conditions of the workers and their outside opportunities. Without this information buyers cannot make morally complete (and therefore optimal) decisions.
What does this have to do with environmental economics? Of course, when there are negative externalities (like pollution), the unregulated market price will not reflect those externalities and thus will not provide buyers and sellers the necessary information to make optimal choices. This is not new; this is Pigou, and even the most die-hard Hayekian would admit that market failures like externalities need to be incorporated somehow into the price signal to achieve efficiency. (Aside: maybe it's not actually Pigou, according to this working paper by my colleague Spencer Banzhaf.)
But I think there is a deeper and less obvious point than that. Supposing that there is a Pigouvian price on pollution that accounts for its negative externalities. Does this price still contain the necessary "epistemic infrastructure" for all buyers and sellers to make morally responsible decisions? If the Pigouvian price is "right" then it accounts for the spillover costs, but it's not obvious that these costs are all that is morally necessary to make informed choices. Just like with sweatshops, there potentially are moral considerations above and beyond any cost considerations (even spillover costs) that need to be incorporated. It it not clear that a Pigouvian price would incorporate any of this.
Anyways, some Pigouvian price on pollution is still no doubt better than no Pigouvian price on pollution, but there is potentially a strong argument to be made here based on Herzog's article that any Pigouvian price can't get us enough information to make morally optimal choices.
Last week Treasury Secretary Steven Mnuchin insulted climate activist and Time Person of the Year Greta Thunberg by claiming that she shouldn't talk about climate policy before studying economics and college. When asked about her suggestion for public divestment from fossil fuel companies, Mnuchin said:
Is she the chief economist, or who is she? I'm confused. It's a joke. After she goes and studies economics in college she can come back and explain that to us.
Many environmental (and other) economists were quick to pounce on Mnuchin's comment. Their point was that in fact the theory of market failure is a central component to college economics courses, even introductory or Econ 101 courses. Climate-change-causing pollution is a textbook (literally) example of a negative externality that causes market failure. To claim somehow that taking a college economics class will teach you that we shouldn't regulate climate change is idiotic, goes this argument. Paul Krugman even wrote a NY Times column on the subject:
One can only surmise that Mnuchin slept through his undergraduate economics classes. Otherwise he would know that every, and I mean every, major Econ 101 textbook argues for government regulation or taxation of activities that pollute the environment, because otherwise neither producers nor consumers have an incentive to take the damage inflicted by this pollution into account.
By this account, it's climate activists like Thunberg who really understand textbook economic theory, while libertarian-right-wing-small-government zealots like Mnuchin don't (or won't).
This is all true, and Mnuchin deserves his ridicule. However, I think there is also a sense in which he is (accidentally perhaps) correct. While market failures and externalities are taught in every Econ 101 course (I hope), they are often taught as an afterthought or an aside. The main focus of intro econ courses is more likely the efficient functioning of the market. Many students come out of Econ 101 (which for most is the only economics course they'll take) thinking that basically economics teaches us that markets are great and go a better job than the government can (with some minor exceptions that I can't really remember).
The conservative bias in Econ 101 is real. It's been called Econ 101-ism, or Economism - the idea that the simplest supply and demand, invisible hand, perfectly-functioning markets examples from Econ 101 actually describe the real world, and therefore that the proper policy solution to almost anything is to cut taxes and reduce the size of the government.
So Mnuchin might actually not be wrong - if Thunberg took a college economics class, she might come away from it convinced of the power of markets (though probably not - she's smart enough to see through that I would think). This all points to a problem endemic to all of economics (not just environmental economics), which starts with the way it's initially taught.
The most recent issue of the Journal of Economic Perspectives features a three-article symposium on the 50th anniversary of the Clean Air and Clean Water Acts. (Though that's an iffy anniversary: the CWA was passed in 1972, so it's only 50 with rounding, and the CAA was originally passed in 1963, though the 1970 amendments contained much of the most important stuff.)
In the first article, Janet Currie and Reed Walker provide "a reflection on the 50-year anniversary of the formation of the Environmental Protection Agency, describing what economic research says about the ways in which the Clean Air Act has shaped our society—in terms of costs, benefits, and important distributional concerns."
In the second article, Richard Schmalensee and Robert Stavins discuss the evolution of the CAA over time: "We trace and assess the historical evolution of the Environmental Protection Agency's policy instrument use, with particular focus on the increased use of market-based policy instruments, beginning in the 1970s and culminating in the 1990s."
In the third article, David Keiser and Joseph Shapiro study the CWA and the Safe Drinking Water Act. They summarize four main conclusions: "First, water pollution has fallen since these laws were passed, in part due to their interventions. Second, investments made under these laws could be more cost effective. Third, most recent studies estimate benefits of cleaning up pollution in rivers and lakes that are less than the costs ... Fourth, economic research and teaching on water pollution are relatively uncommon."