Nancy Carson and Peter Tsigaris published a paper that illustrates environmental issues using the Production Possibility Frontier. It is an easy to design classroom experiment. The game can be used to show how production changes as labour changes initially without paying attention to the pollution (negative externality). Once resources are fully employed in the dirty sector we start shifting them to the clean up sector. Students observe and measure the cost of improving environmental quality. Students can understand why cost is low initially but rises as more clean up takes place. The paper was published in the Journal of Economic Education. Click here to access the article

You can watch an introduction to the game below:

[youtube]http://youtube.com/watch?v=wJMUjJ6fwEM[/youtube]