EC238 Chapter 5: Chapter 5
Document Summary
The target level of pollution general model: new production technology, different inputs, recycling residuals, treating residuals, opinion based, things that can be measured/observed. Normative statements: based on statements what ought to be . Positive statements: based on what is or will be. Value of damages from pollution is the damage function. Pollution damages negative impacts users of environment experience as of environmental degradation. Damage function: quantity of waste product and value of damages. Marginal damage function: change in damages resulting from additional emissions. Mdc originates at the origin when emissions are zero. For some toxic waste might be above 0 showing first unit produces lots of damage. Total damage costs = area under mdc curve. Marginal abatement cost (mac): relationships between level of emissions and cost of abatement. Abatement measured right to left. Highest level of emissions when abatement = zero.
