AØKK08402U Advanced Economics of the Environment and Climate Change

Volume 2024/2025

MSc programme in Economics – elective 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).


The course is open to:

  • Exchange and Guest students from abroad
  • Credit students from Danish Universities
  • Open University students

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.



Learning Outcome

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



  • Discuss and evaluate mondern theories of economic growth and the environment.
  • Account for and evaluate the mechanisms behind optimal growth with scare natural resources.
  • Account for and discuss optimal management of exhaustible and renewable natural resources.
  • Discuss concepts and theories of environmental sustainability.
  • Discuss and assess how environmental policies affect equity.
  • Identify and discuss the assumptions underlying standard Integrated Assessment Models of climate change.
  • Discuss optimal and second-best environmental policies including climate policies.
  • Account for estimation of an economys Green GDP.
  • Discuss the implications of uncertainty for optimal environmental policy
  • Discuss and evaluate the Green Paradox hypothesis and the concept of carbon leakage.




  • 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.
  • 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.
  • Communicate economic theories and models of the environment, natural resources and climate change in a clear and precise language.



  • Perform advanced model analyses within the field of environmental and climate economics.
  • Evaluate environmental policy goals and discuss the role of the state and the market in the implementation of the environmental policy goals.
  • Perform a comprehensive critical evaluation of the strengths and weaknesses of the environmental theories and models.
  • Critically analyze and evaluate real-world environmental policies.



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 "Microeconomics II", "Macroeconomics I" and "Macroeconomics II", "Mathematics A" and "Mathematics 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", at the Studies of Economics, University of Copenhagen.
Lectures and exercise classes.
The lectures present the relevant theories and evidence. As preparation for the lectures the students have to watch some videos that the lecturer uploads in Absalon before the lectures.

The exercise classes consist of 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.
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-E24; [Name of course]””
-Select Report Type: “List – Weekdays”
-Select Period: “Efterår/Autumn”
Press: “ View Timetable”

Please be aware:
- The schedule of the lectures and the exercise classes can change without the participants´ acceptance. If this occure, you can see the new schedule in your personal timetable at KUnet, in the app myUCPH and through the links in the right side of this course description and the link above.
- It is the students´s own responsibility continuously throughout the study to stay informed about their study, their teaching, their schedule, their exams etc. through the curriculum of the study programme, the study pages at KUnet, student messages, the course description, the Digital Exam portal, Absalon, the personal schema at KUnet and myUCPH app etc.
  • Category
  • Hours
  • Lectures
  • 38
  • Class Instruction
  • 28
  • Preparation
  • 133
  • E-Learning
  • 4
  • Exam
  • 3
  • Total
  • 206


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
On-site written exam, 3 hours under invigilation
Type of assessment details
ITX-exam in the exam venues of the university.
The exam assignment is in English and must be answered in English.
Exam registration requirements

To qualify for the exam the student must no later than the given deadlines during the course:

  • Hand in and have approved 1 out of 2 mandatory assignments.

No aids allowed at the written ITX-exam.



Marking scale
7-point grading scale
Censorship form
No external censorship
at the written exam. The written ITX-exam may be chosen for external assessment by random sample.
Exam period

Exam information:

The exact time and place will be available in Digital Exam from the middle of the semester. 

More information about examination, rules, aids etc. at Master (UK) and Master (DK).


Reexam info:

20 min. oral exam without. preparation.

No aids allowed during the examination. The oral re-examination may be with external assessment.

More information in Digital Exam in August. More information at Master UK) and Master DK)


More info: Master (UK) and Master (DK).

Criteria for exam assesment

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


To receive the top grade "12", 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.


In order to obtain the passing grade “02”, the student must in a satisfactory way be able to demonstrate a minimal acceptable level of  the knowledge, skills and competencies listed in the learning outcomes.