Environmental Economics

Sub Topics

Top Keywords

Our Work

Our work covers a range of issues bringing economic analysis into European policy making. We are at the forefront in the analysis and valuation of biodiversity and ecosystem services, including providing a substantial contribution to the key international initiative 'The Economics of Ecosystems and Biodiversity' (TEEB). We also carry out substantial work on the use of market-based instruments, the cost and benefits of environmental policy, the development of sustainability indicators and the uptake of eco-innovation.

In light of current and future environmental challenges and the acknowledged need for Europe to follow a more sustainable growth path, our research aims to contribute to the integration of environmentally-sound economic signals into decision making, encourage resource efficiency and recognise the true value of environmental resources and ecosystems.

IEEP is at the forefront in the analysis of ways of valuing biodiversity and ecosystem services. Institute staff led by Patrick ten Brink have made a substantial contribution to the important international initiative entitled The Economics of Ecosystems and Biodiversity (TEEB), especially the reports addressing policy questions. Our Environmental Economics Programme collaborates extensively with our Biodiversity Programme to improve policy makers’ and the general public’s understanding of the benefits of nature and biodiversity. We also help to develop tools and measures that can improve nature conservation on a global scale, such as Payments for Ecosystem Services (PES) and REDD-plus (Reducing Emissions from Deforestation and Forest Degradation).

We recognise the importance of placing the right price on resources so as to increase the sustainability of consumption and production, as well as the importance of appropriately pricing externalities, in line with the polluter-pays and user-pays principles. We have been exploring how to reflect such prices in the markets, notably by examining the use of market-based instruments including environmental taxes and charges and environmental tax reform (ETR). We have also been assessing the potential for reforming environmentally harmful subsidies (EHS) and exploring incentives that reward pro-environmental behaviour, including green public procurement (GPP). We are also exploring the scope for improvement in environmental standards through eco-innovation in a range of research projects.

IEEP aims to understand and assess the benefits and costs of environmental policy, in order to provide a balanced view to policy makers, both within and outside the EU.

We also work on the development and uptake of indicators of sustainability, recognising that well-being and policy effectiveness cannot be measured only in economic terms, but should also take into account environmental and social implications. In this way we can effectively move beyond reliance on Gross Domestic Product (GDP) as a measure of economic welfare towards a more comprehensive evaluation of societal performance.

More about our work in this area...

Latest in Environmental Economics

Improving measurement to manage through the 7th EAP: the role of indicators and accounting

This policy paper provides a brief overview of the context and state of play in the area of “measurement to manage”. It also outlines the needs for future action in this area and the potential role of the 7th EAP in improving the availability and use of indicators and accounts in the EU.
Socio-economic importance of ecosystem services in the Nordic countries

New TEEB-inspired regional assessment (published on 31 January) shows that nature and its ecosystem services are of high socio-economic significance for the Nordic countries. In order to be truly sustainable, Nordic economic systems need to build on a more comprehensive appreciation and understanding of the value of natural capital.
Reforming environmentally harmful subsidies for a resource efficient Europe

The EU has a long-standing commitment to removing or phasing out environmentally harmful subsidies (EHS). However, progress has been slow and EHS remain an issue in most EU countries. The Eurozone crisis and stagnating economic performance in many countries provide an opportunity to put new momentum behind this agenda.
Increasing regional prosperity by investing in nature: Guidance to mainstream biodiversity

Investment in natural capital through the conservation of biodiversity and ecosystems has a lot to offer for regional development. A new publication authored by IEEP provides guidance on integrating biodiversity into EU Regional Development Fund (ERDF) in 2014-2020.
Resource mobilisation at the heart of CBD COP discussions

The eyes of the world’s biodiversity community are on Hyderabad as Parties to the Convention tackle the pressing challenges faced in implementing the Strategic Plan for Biodiversity 2011-2020, including mobilising sufficient resources to translate the Plan into concrete action.
Estimating the Overall Economic Value of the Benefits provided by the Natura 2000 Network

Estimated benefits provided to EU citizens from the EU’s Natura 2000 Network could be in the range of €200 to €300 billion a year.
Guidance to identify and address incentives which are harmful to biodiversity

Developed and tested by IEEP, this guidance document is a tool to identify incentives harmful to biodiversity to help the UK draw up a reform roadmap and thus meet a commitment under the CBD.
Benefit Assessment Manual for Policy Makers: Assessment of Social and Economic Benefits of Enhanced Environmental Protection in the ENPI countries

This benefit Assessment Manual, originally for internal use, has been turned into a Benefit Assessment Manual for policy makers and experts for wider dissemination and provides an understanding of the methodologies applied for the country benefit assessments.
Analysis for European Neighbourhood Policy (ENP) Countries and the Russian Federation on social and economic benefits of enhanced environmental protection – Egypt Country Report

There are considerable benefits from taking immediate action to address the environmental problems facing Egypt, including in the area of air pollution, water quality and infrastructures and waste management, and safeguarding its natural heritage.
Regional Synthesis Report: ENPI South - Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, occupied Palestinian territory, Syria and Tunisia

Investing in improving environmental standards in the ENPI South countries would offer huge benefits in terms of cost savings, improved security (food, water, energy and climate), and improved quality of life.
Consolidated report: Qualitative analysis key results and policy implications

There are still needs and opportunities for using sustainability indicators at different stages of the policy processes across all environmentally relevant policy areas.
Opportunities for a better use of indicators in policy-making

There remain a wide range of opportunities for making use of sustainability indicators at different stages of the policy process across all environmentally relevant policy areas.
Value of ecosystem services – putting the ‘green’ into green economy

Presentation by Marianne Kettunen of IEEP on the value of ecosystem services in the context of green economy at Nordic conference on Green Growth, in Oslo, Norway March 2012.
The benefits associated with Sites of Special Scientific Interest in England and Wales

A report on the benefits provided to society by Sites of Special Scientific Interest (SSSIs) in England and Wales was just published. The study, led by GHK with support from others including IEEP, examines the range of ecosystem services provided by the network of SSSIs and estimates the monetary value of protecting them.
Taking into account opportunity costs when assessing costs of biodiversity and ecosystem action

The study provides an estimate the costs of biodiversity action in the EU with special consideration of opportunity costs.
Cutting-edge Book on the Economics of Ecosystems Out Now

Described by Nicholas Stern as a 'landmark' work, a full account of The Economics of Ecosystems and Biodiversity, edited by institute staff, is now published by Earthscan.
The Economics of Ecosystems and Biodiversity in National and International Policy Making

The study demonstrates the value of ecosystems and biodiversity to the economy, society and individuals. It underlines the urgent need to transform our approach to natural capital, and demonstrates how we can practically take into account the value of ecosystems and biodiversity in policy decisions to promote the protection of our environment and contribute to a sustainable economy and to the wellbeing of societies.
Valuing and Conserving Ecosystem Services: a Scoping Case Study in the Danube Basin

The report for WWF provides an assessment of the value and status of some key ecosystem services in the Danube Basin, and some policy instruments to support them.
The Cost of Policy Inaction - the Case of not Meeting the 2010 Biodiversity Target - Executive Summary

This Summary presents the results of the study of “The Cost of Policy Inaction (COPI): The case of not meeting the 2010 biodiversity target”...
TEEB for National and International Policy Makers 2009

TEEB for Policy Makers is a report for national and international policy makers on The Economics of Ecosystems and Biodiversity. It looks at the global biodiversity crisis, the ecological, economic and ...

1 2

Highlights

Cutting-edge Book on the Economics of Ecosystems Out Now

Described by Nicholas Stern as a 'landmark' work, a full account of The Economics of Ecosystems and Biodiversity, edited by institute staff, is now published by Earthscan.
The Economics of Ecosystems and Biodiversity in National and International Policy Making

The study demonstrates the value of ecosystems and biodiversity to the economy, society and individuals. It underlines the urgent need to transform our approach to natural capital, and demonstrates how we can practically take into account the value of ecosystems and biodiversity in policy decisions to promote the protection of our environment and contribute to a sustainable economy and to the wellbeing of societies.