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Environmental Economics and Policy

Research cluster

The Environmental Economics and Policy Cluster combines research expertise from different disciplinary perspectives – primarily, but not exclusively, economics and human geography – in order to both inform and challenge environmental policy.

Our research draws on a focused array of expertise in geography, political science and economics

The Environmental Economics and Policy Cluster combines research expertise from different disciplinary perspectives – primarily, but not exclusively, economics and human geography – in order to both inform and challenge environmental policy.

Our resulting research agenda addresses issues within and between environmental and development economics, the political ecology of development, and the study of environmental governance and regulation. These are very different perspectives, in turn informed by distinct theories and conceptual frameworks and explored using a range of methodological approaches. Each perspective provides an important lens with which to view an overlapping set of environmental policy challenges. Common to all of this work, whether it entails quantitative and qualitative approaches, is a commitment to robust evidence-based research that is both informed by theory and relevant to the rich set of policy-relevant debates within environmental studies and sustainability science. 

Research focus

Research produced by Cluster members can be situated in a variety of topic areas including sustainability and development, human wellbeing and behaviour, as well as environmental justice and environmental security.

Common to all our research is the desire to not only inform the design of public policies for the environment but also to challenge and improve existing policies and governance options. We conduct this research across the world and at a number of scales of governance, with particular empirical regional expertise in Latin America, the Middle East, and South, East, and Southeast Asia as well as substantial expertise in European environmental and climate policy.

Our work includes understanding how people construct livelihoods, such as in urban communities in the context of global resource chains or rural settings entailing community forest management or adaptation to climate change. It also addresses how nations measure and evaluate long-term development as well as how development prospects are affected by the way in which global resources are governed.

Further examples of what we do links our work not just to public policy and environment but it makes clear the significance of market and civil society actors in our evolving work on sustainable finance and the role of private sector institutions in this context. Fostering connections with concerns in mainstream empirical economics to identify causal relationships is another important strand of our work. In doing so, this permits a richer understanding of the way in which, for example, urban air pollution affects peoples’ life prospects or how environmental policy influences technological change. 


The cluster has attracted substantial grants from the European Commission, British Government and the Alcoa Foundation. The biggest achievement in terms of grant application has been the successful bids for an ESRC Centre for Climate Change Economics and Policy (CCCEP) and the Grantham Research Institute on Climate Change and the Environment.

As a result, we enjoy close links with the Grantham Research Institute, chaired by Lord Stern of Brentford, as well as the research programmes of CCCEP. With these awards, the LSE has emerged as one of the leading places in the world to research and study the environment and climate change.

Academic staff

Prof Giles Atkinson, Professor of Environmental Policy

Dr Julia Corwin, Assistant Professor in Environment

Prof Simon Dietz, Professor of Environmental Policy

Dr Eugenie Dugoua, Assistant Professor in Environmental Economics

Prof Ben Groom, Professor of Environment & Development Economics

Dr Nancy Holman, Associate Professor of Urban Planning

Prof David Jones, Emeritus Professor of Geography & Environment

Dr Michael Mason, Associate Professor of Environmental Geography

Prof Susana Mourato, Professor of Environmental Economics

Prof Eric Neumayer, Professor of Environment & Development

Dr Charles Palmer, Associate Professor of Environment & Development

Dr Kasia Paprocki, Assistant Professor in Environment

Dr Richard Perkins, Associate Professor of Environmental Geography

Dr Sefi Roth, Assistant Professor of Environmental Economics

Dr Thomas Smith, Assistant Professor in Environmental Geography

Dr Nora Sylvander, LSE Fellow in Environment

Dr Meredith Whitten, ESRC Postdoctoral Fellow

Dr Jason Wong, LSE Fellow in Environmental Economics


Research projects

The Effectiveness of Community Conservation Agreements in Lore Lindu National Park, Sulawesi, Indonesia

Staff involved: Dr. Charles Palmer

In collaboration with: Prof. Stefanie Engel (ETH Zurich, Switzerland); Prof. Alex Pfaff (Duke University, US); Stability of Rainforest Margins in Indonesia (STORMA), Germany & Indonesia.

Funding: Robert Bosch Foundation, Germany. 

In protected areas in many developing countries, the overexploitation of forest resources is a recurring theme. A major reason for this observed overexploitation and encroachment is that a large part of the benefits from forest protection occurs beyond the local level, e.g., in the form of biodiversity conservation, carbon sequestration, and watershed services. Top-down policies to conserve these have failed due to the lack of appropriate monitoring and enforcement capacities and because considerations of social fairness prevent government authorities from effectively implementing a purely prohibitive approach. Lore Lindu National Park in Sulawesi, Indonesia, was established by the central government in 1993 via such an approach; boundaries were drawn up and communities relocated without consultation or compensation. The ineffectiveness of this approach is demonstrated by the continued use of Park resources by local communities.

An alternative policy is to translate environmental benefits that occur beyond the local level into real economic incentives for local communities. Beginning in 2001, the Park authorities initiated a co-management approach known as 'community conservation agreements' between the Park and communities living in the vicinity of the Park. Since then, conservation agreements have been facilitated in around 40 communities located in around the Park and with historical claims to forest areas inside the Park, by various NGOs, including the Nature Conservancy (TNC) and CARE International. While there appears to be variation across the agreements made, communities typically commit to complying with specified conservation and forest management rules in return for a more explicit acknowledgement of their property rights over the forest inside the Park along with other benefits such as agricultural assistance.

The general objective of the research is to better understand the emergence of conservation agreements and their influence on actual community land use and extraction behaviour. The impacts to be considered are ecological (impacts on forest in LLNP), social and economic (on community welfare and land usage).

Transboundary Climate Security: Climate Vulnerability and Human Security in the Jordan River Basin

Staff involved: Michael Mason

Visit the project website.

The Impacts of Tropical Biofuel Production on Land Use

Staff involved: Charles Palmer

In collaboration with: Saraly Andrade de Sa (Ph.D. Candidate, ETH Zurich, Switzerland); Prof. Stefanie Engel (ETH Zurich); Center for International Forestry Research (CIFOR), Brazil.  

Funding: (1) Professorship in Environmental Policy and Economics, ETH Zurich; (2) Commission for Research Partnerships with Developing Countries (KFPE), Switzerland; (3) Research Fellow Partnership Programme for Agriculture, Forestry and Natural Resources (RFPP), ETH Zurich. 

There are two emerging trends with regards to rising global demand for biofuels and land use. First, the increase in production of biofuel feedstock demands more land thus placing direct pressure on potential agricultural land currently still under forest cover. Second, the reallocation of agricultural land for biofuels along with other factors such as increasing human populations have led to rising demand and hence, higher prices for agricultural commodities and other foodstuffs. Consequently, rising biofuel demand may be indirectly leading to the expansion of food production into forest frontiers.

To date, most research to evaluate biofuels have focused on their merits for reducing greenhouse gas emissions or fossil fuel use. Focusing on emission or energy use, however, ignores the full range of environmental impacts of biofuels particularly where forests are being felled to make way for biofuel crops. Not only is the carbon storage capacities of forests destroyed but also biodiversity and other environmental services are likely to be lost as well. Many of the economically important biofuels, including Brazilian sugarcane ethanol and Indonesian/Malaysian palm-oil diesel, have greater aggregate environmental costs than fossil fuels. However, there are a number of important indirect effects of biofuels, whether environmental or social, e.g. rising food costs. The empirical evidence for these remains poor. This project aims to empirically demonstrate the strength of the direct and indirect effects of biofuel production on land-use at the forest frontier.

First, the economics of land-use will be developed in order to better understand decision-making in the production of commodities. Second, and on the basis of land-use economics, an econometric model will be estimated using secondary market and remote sensing data. Expert interviews will be conducted to complement the quantitative analysis. Given its leading position in biofuel markets, Brazil has been chosen as the research site of interest for this project. The current lack of quantitative analyses on the impacts of biofuel production on land use, deforestation and food production implies that research outputs could potentially contribute not only to the policy debate on the supposed environmental benefits of biofuels as a strategy to help mitigate climate change but also to the food vs. fuel debate.


See also: research programmes undertaken by the Grantham Research Institute on Climate Change and the Environment