Why Is Environmental Economics Important?

Economics is an old term that has been derived from oikonomics which means political economics. Now it has changed its meanings as well as it is now widely known as Eco-nomics, which means environmental economics. Paul A. Samuelson said that economics is all about making the right choices or preferences for products. Similarly, economics has become about making the right choices about growth or consumption preferences that do not harm the environment in which we live. The environment provides us a shield from all harmful natural forces.  So it is also important to save this caring environment that is ultimately the source of our own existence on this Earth. As Guy McPherson made a strong argument in favor of environmental protection in his blog post

If you think that the economy is more important than the environment, try holding your breath while counting your money

 Professor Guy McPherson has rightly described that one nation cannot progress while destroying their own environment in which they live. One has to take a breath to live, similarly, the economy must be made green for its growth, development and a healthier nation.  Environmental economics has become a crucial part of the policymakers as a society's wellbeing depends not on the higher incomes, but on the better health and eventually on the clean environment. The focus of economists has shifted from welfare to wellbeing.  Moreover, Joseph E. Stiglitz represented the concept of  Green GDP in which not only the consumption of produced goods is taken into account, but also the depletion of natural resources is added into it. He writes in his article that 

Why focus on production of goods, rather than on health, education and environment?

As we all know economics is the study of the allocating the scarce resources that leads to efficiency in an economy. Similarly, environmental economics is related to allocating the resources in such a way that is not harmful to the environment.  Environmental pollution is the result of economic activity.  Industrialization and technological development has deteriorated the environment on a large scale. Deforestation, air pollution, water pollution, and climate change are all the result of economic activity. To combat all these environmental problems economists must develop policies that not only reduce environmental pollution but also increase the well being and happiness of people. Environmental economics can help in making important decisions by the government to reduce pollution.
Pollution is also a problem for economics framework in which a market works.  All kinds of pollutions cause some externalities that lead to market failures. To avoid these market failures, government, economists and environmentalists must work in coordination in order to achieve sustainable growth. development and a happy economy.
Environmental economics is not limited to a closed economy, it is a trans-boundary problem. It crosses the borders and compels the governments of adjacent nations to work together to reduce pollution.
Environmental economics also has a great impact on the consumption behavior of people. It has changed the consumption pattern by inducing consumers to consume products that can be recycled and reused. Environmental-friendly products are encouraged and increase the welfare of people. Moreover, it has led people to use energy-efficient products and has driven the behavior of saving in using products, rather than in terms of income.