Environmental economists specialize in a branch of economics that incorporates environmental implications into economic analysis. They study the environmental impacts, both positive and negative, of projects and policies from an economic perspective and in turn advise industry and government on the environmental impacts of decisions. In addition to the evaluation process, environmental economists may be involved in developing theories that model the economic value of the environment and how it interacts with other aspects of a region’s economy.
Imagine it is a warm fall day, the sun gleaming off the yellow and gold poplar leaves and the deep green of the neighbouring pines. You are perched on the edge of a slope looking 10 metres down into a beautiful river valley. As an environmental economist, you have been given the tough job of assigning a dollar value to this magnificent vista as part of the municipality’s decision-making process.
Last month, an area developer approached the municipality for permission to subdivide the land around the river valley and build expensive retirement estates. But before the municipality makes a decision, it has asked you to evaluate the economic consequences. This is a complex job, but it is what you are trained to do.
As an environmental economist, you will approach this problem using a variation of the traditional cost-benefit analysis, whereby you outline all the potential benefits to the municipality if it agrees to allow this development, as well as the possible costs. On one hand, you outline the potential revenue gain for the municipality as a result of increased property taxes. You also calculate the benefits of increased economic growth in nearby communities that would result from a large construction project like this one. On the other hand, you need to evaluate the project’s cost in terms of environmental impact.
This is the tricky part: the environment does not have an easily defined dollar value. As part of your comparative analysis, you will use a number of valuation tools and methodologies to assign a monetary value to the river valley’s environmental assets. You will determine the cost of removing half the area’s trees, destroying wildlife habitat, and increasing soil erosion, as well as the cost of the air and water pollution that would result from the construction project.
In addition, the new development would restrict access to the river; you must calculate the potential cost to tourism, outdoor recreation, and the quality of life of nearby residents. As an environmental economist, you are responsible for quantifying the environmental impact of the new development so it can be compared to the monetary gain.
Duties vary significantly from job to job, but the following list includes typical job duties one might encounter as an environmental economist:
Environmental economists work in a variety of locations, including:
In the office:
In the field:
There are a number of places environmental economists can find employment. They include:
If you are a high school student considering a career as an environmental economist, you should have strong marks or an interest in:
In most cases, the minimum education requirement to work as an environmental economist is a university undergraduate degree. If you are a post-secondary student considering a career as an environmental economist, the following programs are most applicable:
Although it is not necessary to become certified in order to work as an environmental economist, many practitioners choose to belong to professional organizations based on the sectors in which they work.
Erik Haites has spent his thirty-year career as a consultant, specializing in environmental economics during the past decade. Today federal and provincial governments, the United Nations Climate Change Secretariat, research institutions and corporations come to him for his expertise in research, analysis, and report writing. The work is challenging, he says, “The cost of hiring a consultant can be high, so people typically hire them when there are tougher issues to analyze. I get challenging things to work on and it’s always changing.”
Even though Erik Haites doesn’t say so, it must have taken a lot of effort to get a bachelor¹s degree in math, a master¹s of business administration, a master’s of science degree and a Ph.D. Even if his education took many years of hard work, Erik makes the path to his current position sound simple; “I got a summer job with a consulting firm after my first year of graduate school. I liked the work and they hired me back after I finished. There was no particular interest in high school or later that led me to it.
I happened to get a job, I liked it and stayed with it.” He has made his career in the field of environmental economics. “In the last few years that has been mostly issues related to the economics of climate change and how to limit greenhouse gas emissions, and in particular emissions trading programs as policies to limit gas emissions.” Emissions trading allows a source (e.g., a factory or smelter) that reduces its gas emissions to gain credits, which encourages everyone to reduce greenhouse gases.