This article offers an account of the economics of the environment. I sketch the subject's motivation and scope, and try to identify what we know and what we don't as yet know about matters of concern. This demands brazen selection, and I haven't avoided it: for the most part, the article explores the interface of rural poverty and the environmental resource-base in poor countries. A contrast is drawn between geographically localized resources and the global commons. The role of property rights, both private and collective, and their implied resource allocation mechanisms are studied. Criteria for social cost–benefit analysis of projects and policies are derived, and their link with the concept of net national product is drawn.

To protect the elephant, trade in ivory has been banned since 1990. In this paper, we demonstrate that this ban's effect on elephant populations is ambiguous. Depending on the discount rate, among other things, the trade ban can either increase or decrease optimal population size. If the decision-maker's discount rate exceeds a certain threshold, the optimum stock of elephants is greater with a trade ban. Since the threshold is in the range of possible social discount rates, the success of the trade ban in promoting elephant conservation will vary spatially and temporally, depending on the characteristics and level of development of countries with significant elephant populations.

This paper models joint implementation (JI) for emission reduction between a developed and a developing country. When the per unit price of JI abatement is negotiated, the relative pay-offs deviate from the ratio of bargaining powers. When firms bargain, country-wise gains can increase with a greater abatement target. But if the governments bargain, the developing country's gains increase at the expense of the developed country as the target increases. However, the Pareto optimal JI can be achieved only when the governments negotiate over both abatement and transfer.

The paper reviews two alternative rules for allocation of property rights in a global greenhouse-gas emissions budget, assuming implementation of a tradablequota arrangement. These are the per capita rule and no-regrets-for-the-South (NRFTS) rule. The operation of a quota market under these alternative regimes is simulated on a spreadsheet, using 1990–1 data from 125 countries. A significant result is that once the South has secured a quota allocation based on the per capita principle, it stands collectively to lose from progress in abatement technology because of the strong link from technical progress to the world market price of quota. The more restricted NRFTS rule gives the South smaller gains from the quota system, but enables it to retain some of the rents from its own technical progress. Some implications for the South's position in future negotiations are noted.