Maler, Karl-Goran and Jeffrey R. Vincent, eds. Handbook of Environmental Economics. Volume 3. Economywide and International Environmental Issues.

Maler, Karl-Goran and Jeffrey R. Vincent, eds. Handbook of Environmental Economics. Volume 3. Economywide and International Environmental Issues. Amsterdam: Elsevier, North-Holland, 2005, 556 pp., $135.00.

Environmental issues do not respect the geographic delineations between political jurisdictions, so it seems natural that a handbook series on environmental economics should include a volume on "Economywide and International Environmental Issues." Despite this compelling justification for the theme of the third and (at least for now) final volume of North-Holland's Handbook of Environmental Economics, the ten chapters in this volume do not form a particularly cohesive whole. This is not a damning criticism, however, as the individual articles are all appropriate for this handbook series. Overall, Messrs. Maler and Vincent have done an excellent job in editing these three volumes. They can hardly be faulted for trying to find a subtitle for this final installment that is more unifying, if ultimately less descriptive, than the "important issues that didn't find their way into the previous volumes."

The first three chapters of this volume are primarily conceptual in nature, and together form a nice core around which a graduate course in environmental sustainability and development could be based. Geoffrey Heal's chapter on "Intertemporal Welfare Economics and the Environment" is a very theoretical but clearly written treatment that guides the reader through the challenging intersection of philosophy and economics that deals with questions of allocations across generations. It also implicitly highlights that economics still remains better suited to answering "how," rather than "what" questions when it comes to normative issues such as intergenerational equity.

Heal and Kristrom's contribution on "National Income and the Environment" is a welcome extension of the first chapter, and moves beyond theory into applications and examples in the final sections. This structure is also followed in Anastasios Xepapadeas's chapter on "Economic Growth and the Environment." Here, the author presents conceptual frameworks throughout most of the chapter, and ends with a discussion of empirical results regarding the environmental Kuznets curve and the relationship between competitiveness and environmental regulation. Lacking from these initial sections of the volume is any meaningful discussion of "happiness accounting" and other attempts to utilize survey methods to quantify subjective utility measures on broad scales. However, this is probably not a critical omission, given the relative novelty of such approaches.

The next two chapters focus on methods to model and measure the impacts of environmental policy. Lars Bergman's contribution is a balanced discussion of the uses, strengths, and weaknesses of CGE models for environmental issues, and the author provides both an overview and words of advice for the practitioner. Pizer and Kopp's chapter covers the other methods available for addressing these issues, and includes a discussion on partial versus general equilibrium that will be illuminating to analysts studying a wide variety of regulations (not just environmental policies). One mild criticism of this chapter is that the discussion of numerical analysis (which focuses on numerical general equilibrium models) is perhaps too brief, given that these approaches are often applied to environmental regulation.

The next three chapters best fit with the volume's stated theme. Anil Markandya's chapter dwells on a favorite topic of discussion for many economists: policies' unintended and perverse effects. His analysis focuses in large part on the environmental impacts of energy policies such as tax breaks, price supports, and subsidized loans for fuel producers; however, he also discusses the indirect consequences of agricultural, transport, and trade policies, and issues surrounding the use of "green" taxes to replace other fiscal instruments. Michael Rauscher continues this general line of inquiry in his essay, which focuses on the interactions between trade, foreign investment, and the environment. Scott Barrett's comprehensive chapter on the theory of international environmental agreements nicely rounds out this section of the volume.

The last two chapters, on biodiversity (by Polasky, Costello, and Solow) and climate change (by Kolstad and Toman), are topical reviews that focus on the economic aspects of these two key areas of environmental concern. While this reviewer does not wish to quibble with the inclusion of these two excellent essays, their presence does raise the question of why this series did not include similar chapters on water quality, hazardous waste disposal, mobile sources, or other specific environmental topics. More generally, one might also ask what the purpose of a handbook series should be. Is it to provide grounding in the literature of a subdiscipline, to comprehensively summarize the state of the art in that field, or is it a place to solicit contributions that otherwise would not exist in more traditional venues? The word "handbook" suggests a focus on methodology or basic principles, but this three-volume collection is broader than that, as are many of the titles in North-Holland's Handbooks in Economics series.

While the individual essays are all well written and worthwhile contributions to the literature, overall, the book is less cohesive than the previous two volumes. Furthermore, those chapters that focus on specific issues are likely to feel "dated" sooner than will some of the other chapters. Regardless, this handbook should be of interest to a large number of researchers, students, and instructors. It is just unlikely that any one reader will be equally drawn to all parts of this volume.

Sean B. Cash

University of Alberta