Chapter 23: Ecological Economics

In Limits to Growth the Club of Rome predicted that

Economic collapse is likely if we do not reduce population growth

Things like open space or clean air can be considered a resource because they are

Valued by people

"The Tragedy of the Commons" is based on a view that

Only privatization or strict laws can overcome people's selfish and greedy nature

Which of the following is not a major criticism of the type of analysis in the scenario?

People are willing to answer questions about how much they would spend to save the Amazon rainforest

In economic terms, "demand" is how much of something

People will buy at current prices

The computer models published in the 1972 Limits to Growth predicted _____ in the next century

Population and resource crashes

The graph shows how __________ when economies develop.

Prices fall as quantities increase

An example of an intangible resource is

Satisfaction

Most job layoffs occur as a result of

Seasonal work

T or F: Pollution charges and emissions trading are examples of market-based mechanisms for environmental protection.

True

T or F: The General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO) agreements are primarily negotiated among the largest industrial nations. This tends to keep less-developed countries in the role of resource supplier to more developed countries.

True

T or F: The Grameen Bank is a micro-lender whose business loans assist mainly low-status women.

True

Renewable resources are those that

Will always renew themselves unless we destroy them.

The analysis

includes many subjective judgments

Environmental protection has been proven to __________ the number of available jobs because __________.

Increase; labor is usually substituted for natural resources (as in the case of recycling)

When we purchase a product, the price we pay directly reflects the _____ cost of producing it. If the manufacture of the product degrades the quality of air or water, then the costs of this pollution are termed _____ costs.

Internal; external

A(n) ________ relationship exists between supply and demand. Therefore, when supply is high, demand is _____.

Inverse; low

The use of Gross National Products as an indicator of economic well-being

Is criticized as an inaccurate measure of the quality of life

In 1997, ecological economists put a price on the goods and services provided by natural systems. This estimated annual value ranged from

$16-54 trillion

The management of a wild area by a group of indigenous people such as the management of wild rice beds is an example of

A communal resource management system

In economic terms, "supply" is how much of something

Available on the market

On the supply-demand graph, market equilibrium is marked

C

Which of the following is an example of an open access system?

Cattle grazing on common woodlands and pastures in colonial New England

The economic theory that was originally focused on how the interests and values of individuals relate to larger societal goals is the ______ economic theory.

Classical

. _______ is a nonrenewable resource

Coal

Which of the following is considered social capital?

Community organization

Price inelasticity is when _________ while price elasticity is when __________.

Consumers buy a product regardless of cost; the supply/demand curve is followed

What is the name of the process the lending institution is going through in this scenario?

Cost-benefit analysis

On the classical supply-demand graph, ________ is highest when prices are low.

Demand

Using the supply-demand graph, what happens as the price of a good or service increases?

Demand falls and supply increases

Which of the following is not an effective response to resource scarcity?

Diverting capital (money) to conventional industries

Businesses are now willing to become "green" because

Doing so improves their image and saves money in the end

When a factory pollutes a river, the costs and losses that affect people downstream would be called ______ costs.

External

T or F: In response to criticisms of World Bank policies, the U.S. Congress now insists that all loans for international development be allocated to large projects rather than small ones

False

T or F: What you choose to buy as a consumer does not really influence businesses to produce eco-friendly goods and services.

False

An example of a market-based incentive for environmental protection would be

Fees placed on certain types or volumes of a pollutant

The price/quantity intersection marked "a" in the graph represents a/an ________ economy

Frontier

What author criticized the idea of commonly held resources in "The Tragedy of the Commons?"

Garret Hardin

Which of the following indicators is incorrectly matched with the factors it takes into account?

Gender Development Index-gender and natural resource depletion

Which of the following would not be counted as part of the Gross National Product?

Government purchases

Ecology and economy are both derived from the Greek word "Oikos" meaning

Household

Ecological economics is different from the other economic theories because it recognizes the

Human economy as one part of a dynamic world system

Many businesses are exploring and adopting the "design for the environment." Which of the following is not associated with this approach?

Improving public relations about the business's environmental policies

In response to criticisms of Limits to Growth, a computer model was published in Beyond the Limits that

Includes technological progress and pollution abatement

In a frontier economy, there is usually a relative abundance of __________ because of the inefficiency __________.

Natural resources; of the procedures for gaining access to resources

Which of the following is considered human capital?

Knowledge of history

A steady-state economy would be marked by _____ resource consumption, _____ volume and _____ output.

Low; low; high-quality

Which of the following is an example of a communal property system?

Maine lobster fishing

The function of the World Bank is to administer

Major international development aid

Natural capital is that which is created by

Natural Earth processes

Political economy theory incorporates ______ while neoclassical economic theory incorporates _________.

The issues of social structures and value systems; objectivity and scientific analysis

Which of the following is not true with respect to natural resource economics?

The principles of thermodynamics and co-evolution are incorporated into natural resource economics

The price of natural gas doubles. What would happen to the quantity of natural gas in a market system?

The quantity increases because it is worthwhile to drill into lower quality fields