Chapter 7 Questions
1. What is meant by the term the "tragedy of the commons?" Which of the following are result of this tragedy?
a. the fate of the California condor
b. the fate of the great whale
c. the high price of walnut wood used in furniture
"Tragedy of the commons" is when an individuals personal share of profit from its exploitation is greater than his or her share of the resulting share of the resulting loss. A result of this tragedy is the high price of walnut wood used in furniture.
2. What is meant by risk-benefit analysis?
It means that the riskiness of a present action in terms of its possible outcomes is weighed against the benefit, or value, of the action.
3. Cherry and walnut are valuable woods used to make fine furniture. Basing your decision on the information in the following table, which would you invest in?
a. a cherry plantation
b. a walnut plantation
c. a mixed stand of both species
d. an unmanaged woodland where you see some cherry and walnut growing
I would invest in a mixed stand of both species because if everyone focuses on one type of tree then there wouldn't be enough for everyone to maintain. So, that type of tree would become extinct.
4. Bird flu is spread in part by migrating wild birds. How would you put a value on (a) the continued existence of one species of these wild birds; (b) domestic chickens important for food but also a major source of the disease; (c) control of the disease for human health? What relative value would you place on each (that is, which is most important and which least?) To what extent would an economic analysis enter into your valuation?
A. I would put value by talk around the world about the importance of these one species of these wild birds. So, if more people are aware of these birds then they would become popular which leads to more tourists in the area where the birds live in. $12,000
B. I would put value on domestic chickens important for food but also major source of the disease. So, if people want to risk and keep the chickens there would be a higher value ($45,000). But if people want to get rid of the chickens then there wpuld be a lower value and wouldn't be as risky ($10,000).
C. I would put value on control of the disease for human health by
5. Which of the following are intangible resources? Which are tangible?
Intangible:
Tangible:
6. What kind of future value is implied by the statement "Extinction is forever?" Discuss how we might approach providing an economic analysis for extinction.
The kind of future value is implied by the statement "Extinction is forever" is that when something is extinct, there's no going back and reviving it again. We might approach providing an economic analysis for extinction by once the specie goes extinct, there's no way of the specie to support the economy in a way that is useful.
7. Which of the following can be thought of as commons in the sense meant by Garret Hardin? Explain your choice.
A) Tuna fisheries in the open ocean. People want more tuna that fishermans overfish rather than letting the fish reproduce. So there would be enough for everyone.
key terms:
Commons
A land owned publicly, with area access for private uses.
Direct Costs
Those borne by the producer in obtaining, processing, and distributing a product passed directly on to the user or purchaser.
Environmental economics
How to persuade people, organizations and soiety at large to act in a way that benefits the environment, keeping it as free as possible of pollution and other damage, keeping our resources sustainable and accomplishing these goals within a domestic framework.
Externality
Costs or benefits that don't show up in the price tag.
Indirect Cost
Same definition as externality.
Intangible factor
One you cant directly touch, but you can value it as with the beauty of the slope before the mudslide.
Natural capital
Ecological systems that provide public service functions.
Policy instruments
What we do, what we can do, and how we do it.
Public-service functions
Forests absorb particulates, salt marshes convert toxic compounds to nontoxic forms, wetlands and organic soils treat sewage.
Risk-benefit analysis
Riskiness of a present action in terms of its possible outcomes is weighed against the benefit, or value, of the action.
Tangible factor
One you can touch, buy seller
a. the fate of the California condor
b. the fate of the great whale
c. the high price of walnut wood used in furniture
"Tragedy of the commons" is when an individuals personal share of profit from its exploitation is greater than his or her share of the resulting share of the resulting loss. A result of this tragedy is the high price of walnut wood used in furniture.
2. What is meant by risk-benefit analysis?
It means that the riskiness of a present action in terms of its possible outcomes is weighed against the benefit, or value, of the action.
3. Cherry and walnut are valuable woods used to make fine furniture. Basing your decision on the information in the following table, which would you invest in?
a. a cherry plantation
b. a walnut plantation
c. a mixed stand of both species
d. an unmanaged woodland where you see some cherry and walnut growing
I would invest in a mixed stand of both species because if everyone focuses on one type of tree then there wouldn't be enough for everyone to maintain. So, that type of tree would become extinct.
4. Bird flu is spread in part by migrating wild birds. How would you put a value on (a) the continued existence of one species of these wild birds; (b) domestic chickens important for food but also a major source of the disease; (c) control of the disease for human health? What relative value would you place on each (that is, which is most important and which least?) To what extent would an economic analysis enter into your valuation?
A. I would put value by talk around the world about the importance of these one species of these wild birds. So, if more people are aware of these birds then they would become popular which leads to more tourists in the area where the birds live in. $12,000
B. I would put value on domestic chickens important for food but also major source of the disease. So, if people want to risk and keep the chickens there would be a higher value ($45,000). But if people want to get rid of the chickens then there wpuld be a lower value and wouldn't be as risky ($10,000).
C. I would put value on control of the disease for human health by
5. Which of the following are intangible resources? Which are tangible?
Intangible:
- The view of Mount Wilson in California
- Clean Air
Tangible:
- A road to the top of Mount Wilson
- Porpoises in the ocean
- Tuna in the ocean
6. What kind of future value is implied by the statement "Extinction is forever?" Discuss how we might approach providing an economic analysis for extinction.
The kind of future value is implied by the statement "Extinction is forever" is that when something is extinct, there's no going back and reviving it again. We might approach providing an economic analysis for extinction by once the specie goes extinct, there's no way of the specie to support the economy in a way that is useful.
7. Which of the following can be thought of as commons in the sense meant by Garret Hardin? Explain your choice.
A) Tuna fisheries in the open ocean. People want more tuna that fishermans overfish rather than letting the fish reproduce. So there would be enough for everyone.
key terms:
Commons
A land owned publicly, with area access for private uses.
Direct Costs
Those borne by the producer in obtaining, processing, and distributing a product passed directly on to the user or purchaser.
Environmental economics
How to persuade people, organizations and soiety at large to act in a way that benefits the environment, keeping it as free as possible of pollution and other damage, keeping our resources sustainable and accomplishing these goals within a domestic framework.
Externality
Costs or benefits that don't show up in the price tag.
Indirect Cost
Same definition as externality.
Intangible factor
One you cant directly touch, but you can value it as with the beauty of the slope before the mudslide.
Natural capital
Ecological systems that provide public service functions.
Policy instruments
What we do, what we can do, and how we do it.
Public-service functions
Forests absorb particulates, salt marshes convert toxic compounds to nontoxic forms, wetlands and organic soils treat sewage.
Risk-benefit analysis
Riskiness of a present action in terms of its possible outcomes is weighed against the benefit, or value, of the action.
Tangible factor
One you can touch, buy seller