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Cost of ecological balance

ENVIRONMENT AND ECONOMICSAN INDIAN PERSPECTIVE· Edited by Rabindra N Bhattacharya·Oxford· New Delhi·Rs 550

Last Updated: Saturday 04 July 2015

-- THE book, written by academicians from various Indian universities including Gopal Kodikodi and edited by Rabindra N Bhattacharya, has been designed to meet the needs of undergraduate and postgraduate students with enough of academic material and case studies. It focuses on theoretical aspects of environmental economics with some generic case studies and lacks practical examples.

Environmental economics is concerned with the impact of the economy on environment, the implication of environment to the economy, and the appropriate way of regulating economic activity so as to strike a balance among environmental, economic and other social elements. The analytics of environmental economics involve concepts such as externality, efficiency, trade-offs, costs and benefits. Worldwide many people struggle to alter their economic institutions, develop economics and raise their standards of living. For this, we have to know how people value environmental quality, how they are hurt when this quality is degraded. We need to find out the beneficiaries and the losers when this quality is improved through policy initiatives. This is where environmental economics comes in. It is a way of examining the various trade-offs involved in environmental issues. It also throws light on why people behave as they do toward the natural environment, how we might restructure the prevailing system and associated practices to rectify harmful outcomes.

Divided into seven chapters the book does not contain any theories original to it, but treats the whole concept with an Indian perspective. While Rabindra N Bhattacharya discusses economics of natural resources in the second chapter, the third chapter is concerned with the regulation of pollution and the economics of environmental policies. M N Murty, who wrote the third chapter, discusses various economic instruments in controlling the pollution by the manufacturers. The economic instruments are categorised into price based instruments, quantity based instruments and mixed instruments. As of now, in India, the cost of pollution does not figure in the total cost production of the service or the goods. The price based instruments come in the form of pollution taxes or subsidies depending on the level of pollution.

The relation between environment and development is very important and relevant particularly in the case of developing countries. Chapter five highlights this inter-linkage and explores the bond between economy and environment in general and poverty in particular. The chapter discusses case studies mainly from India and is especially concerned with the environment in developing countries. Complementary to each other, the last two chapters deal with global economy, international trade and environment. Kalyan Sanyal in sixth chapter tries to answer so many questions related to environmental regulations and international trade and also focuses on the North-South question.

The book ends by discussing transboundary pollution. How environmental degradation occurs in one country affects other countries. Global initiatives are needed to solve issues like climate change and ozone depletion. Economics of environmental issues has an importance in education and this book is a good step towards developing a detailed curriculum for environmental economics at undergraduate and postgraduate levels.

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