Advanced Economics of the Environment and Climate Change

Course content

The teaching in this course may be changed to be taught either fully or partly online due to COVID-19. For further information, see the course room on Absalon. The time, place and type of assessment used for the exam may also be changed due to COVID-19, and any further information will be announced under the panel “Exam”.

The course introduces advanced economic concepts relevant for analyzing problems and policies relating to the environment, natural resources and climate change, using theories and analytical tools from microeconomics and macroeconomics. Additionally, the course introduces optimal control theory, which is applied to various problems within environmental and resource economics.




MSc programme in Economics – elective course


Students that have taken the course "Economics of the Environment and Climate Change" in the spring 2020 can take the "Advanced Economics of the Environment and Climate Change"- course.


Due to similarity in the Syllabus it is not allowed to take the course and the exam in "Advanced Economics of the Environment and Climate Change (AØKK08402U)" if the following former courses already has been taken and passed: 

  • "Economics of the Environment, Natural Resources and Climate Change" (AØKK08382U and AØKA08227U)
  • "Miljø-, ressource- og klimaøkonomi" (AØKK08094U).


Learning outcome

After completing the course, the student is expected to be able to:



  • Account for mondern theories of economic growth and the environment.
  • Explain and evaluate the mechanisms behind optimal growth with scare natural resources.
  • Debate optimal management of exhaustible and renewable natural resources.
  • Identify and discuss the assumptions underlying standard Integrated Assessment Models of climate change.
  • Discuss optimal climate policies
  • Account for estimation of an economys Green GDP.
  • Reflect on the implications of uncertainty for optimal environmental policy with a focus on climate change
  • Discuss the economic issues and incentives relating to international negotiations on climate policy.



  • Master the standard mathematical method for static optimization subject to constraints to analyze environmental policy problems such as the determination of the optimal level of pollution abatement and the optimal environmental tax rates. (evt ny sætning)
  • Master optimal control theory to solve dynamic optimization problems subject to constraints such as the determination of the optimal extraction of natural resources and the optimal pace of reduction of greenhouse gas emissions.
  • Evaluate and compare environmental policy goals and discuss the role of the state and the market in the implementation of the environmental policy goals.
  • Debate and present central parts of economic theories and models of the environment, natural resources and climate change in a clear and correct language.   



  • Plan and carry through a critical evaluation of the strengths and weaknesses of the environmental theories and models.
  • Conduct critical analyses and discussions of important real-world problems of environmental and climate policy.


The teaching will consist of a combination of lectures presenting the relevant theories and evidence and class instruction in solving exercises that involve applications and extensions of the theories presented in the lectures as well as training in the application of the mathematical analytical tools used in the course, including optimal control theory.

As a complement to the ordinary lectures, the course will include a couple of guest lectures by Danish experts who will present examples of practical applications of the theories presented in the course.

The syllabus consists of a selection of scientific papers by leading authors in the field plus lecture notes. A detailed list of the syllabus will be posted in Absalon at the beginning of the course.


The student should have followed courses similar to Microeconomics I and II, Macroeconomics I and II, Mathematics A and B at the Bachelor of Economics, University of Copenhagen.

Knowledge of environmental economics corresponding to the curriculum of the course "Economics of the Environment and Climate Change" from the Spring 2020.

2 hours lectures 1 to 2 times a week from week 36 to 50 (except week 42).
2 hours exercise classes a week from week 36 to 50 (except week 42).

The overall schema for the Master can be seen at KUnet:
MSc in Economics => "Courses and teaching" => "Planning and overview" => "Your timetable"

Timetable and venue:
To see the time and location of lectures and exercise classes please press the link/links under "Timetable"/​"Se skema" at the right side of this page. E means Autumn. The lectures are shown in each link.

You can find the similar information in English at
-Select Department: “2200-Økonomisk Institut” (and wait for respond)
-Select Module:: “2200-E20; [Name of course]””
-Select Report Type: “List – Weekdays”
-Select Period: “Efterår/Autumn – Weeks 31-4”
Press: “ View Timetable”



The teaching assistants gives the students individual written feedback at the mandatory assignments.

The lecturer gives collective oral feedback in the lectures.  

7,5 ECTS
Type of assessment
Written assignment, 3,5 hours
Due to the Corona crisis, the Board of Study has decided to change the regular exams and the re-sit exams in the autumn semester to written online take-home exams. Both exams are still individual.

During the exam, it is not allowed to communicate with others about the exam assignment nor the solution at all. It is also prohibited to distribute data regarding the solutions to anyone. If this or alike actions happens, it will be regarded as cheating and plagiarism.

Please
- https:/​/​​newsroom/​study-messages/​Pages/​Information-about-the-winter-exams-at-the-Department-of-Economics.aspx
- https:/​/​​newsroom/​study-messages/​Pages/​Information-on-rescheduled-PBV-winter-exams-.aspx
All aids allowed
Marking scale
7-point grading scale
Censorship form
No external censorship
for the written exam. The exam may be chosen for external censorship by random check.
Criteria for exam assessment

Students are assessed on the extent to which they master the learning outcome for the course.


To receive the top grade, the student must with no or only a few minor weaknesses be able to demonstrate an excellent performance displaying a high level of command of all aspects of the relevant material and can make use of the knowledge, skills and competencies listed in the learning outcomes.

Single subject courses (day)

  • Category
  • Hours
  • Lectures
  • 42
  • Class Instruction
  • 28
  • Preparation
  • 133
  • Exam
  • 3
  • English
  • 206