Environmental Emissions and Production Economics: Implications of the Materials Balance
AbstractIn modeling emissions, the literature has usually specified an explicit emission function, or treated emissions as a production input. We examine the validity of these approaches, taking into account the materials balance principle. We show that a technology can equivalently be described by (i) a production function with material and nonmaterial inputs and bounded marginal product of the material input, (ii) a well-behaved production function with emissions as an input, and (iii) a well-behaved emission function, if the materials balance is accounted for as an additional condition. We offer a forma derivation of common, but not rigorously established modeling approaches. Copyright 2007, Oxford University Press.
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Bibliographic InfoArticle provided by Agricultural and Applied Economics Association in its journal American Journal of Agricultural Economics.
Volume (Year): 89 (2007)
Issue (Month): 2 ()
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