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Efficient Management of Coastal Marine Nutrient Loads with Multiple Sources of Abatement Instruments

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Author Info

  • Kimberly Burnett

    ()
    (UHERO)

  • James Roumasset

    ()
    (UHERO, and Department of Economics, University of Hawaii at Manoa)

  • Christopher Wada

    ()
    (UHERO)

Abstract

Pollution management based on marginal abatement costs is optimal only if those abatement costs are specified correctly. Using the example of nitrogen pollution in groundwater, we show that the marginal abatement cost function for any given pollution source can be directly derived from a social-welfare maximization problem, wherein controls include both abatement instruments and inputs to pollution-generating production of a good or service. The solution to the optimization model reveals that abatement instruments for each source should be used in order of least marginal abatement cost, and the sources should in turn abate in order of least cost. The least-cost result remains optimal, even when the abatement target is exogenously determined.

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File URL: http://www.uhero.hawaii.edu/RePEc/hae/wpaper/WP_2011-3.pdf
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File Function: First version, 2011
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Bibliographic Info

Paper provided by University of Hawaii Economic Research Organization, University of Hawaii at Manoa in its series Working Papers with number 2011-3.

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Length: 25 pages
Date of creation: Jul 2011
Date of revision:
Handle: RePEc:hae:wpaper:2011-3

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Related research

Keywords: Abatement costs; groundwater pollution; nutrient loading;

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  1. Goetz, Renan U. & Zilberman, David, 2000. "The dynamics of spatial pollution: The case of phosphorus runoff from agricultural land," Journal of Economic Dynamics and Control, Elsevier, vol. 24(1), pages 143-163, January.
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