EC238 Chapter 4: Environmental Economics Chapter 4
Document Summary
Ambient standard a standard that designates the quality of the environment to be achieved, typically expressed as a maximum allowable pollutant concentration. Technology-based standard a standard that designates the equipment or method to be used to achieve some abatement level. Performance-based standard a standard that specifies a pollution limit to be achieved but does not stipulate the technology. Two key implications: are standards set to achieve allocative efficiency, given some environmental objective, is that objective being achieved. Additional social gains as pollution abatement increases. Measured as reduction in damages or costs caused by pollution (i. e. , reduction in mec) Sum of all polluters marginal abatement costs plus government"s marginal cost of enforcement. Macmkt is the sum of all polluters" individual marginal abatement cost (mac) functions. Change in government"s cost of monitoring and enforcing abatement. Measures the change in cost from reducing pollution, using least-cost method. Equals forgone mp if the least-cost abatement method is to reduce output.
