IDEAS home Printed from https://ideas.repec.org/a/aea/aecrev/v101y2011i5p1649-75.html

Environmental Accounting for Pollution in the United States Economy

Author

Listed:
  • Nicholas Z. Muller
  • Robert Mendelsohn
  • William Nordhaus

Abstract

This study presents a framework to include environmental externalities into a system of national accounts. The paper estimates the air pollution damages for each industry in the United States. An integrated-assessment model quantifies the marginal damages of air pollution emissions for the US which are multiplied times the quantity of emissions by industry to compute gross damages. Solid waste combustion, sewage treatment, stone quarrying, marinas, and oil and coal-fired power plants have air pollution damages larger than their value added. The largest industrial contributor to external costs is coal-fired electric generation, whose damages range from 0.8 to 5.6 times value added. (JEL E01, L94, Q53, Q56)

Suggested Citation

  • Nicholas Z. Muller & Robert Mendelsohn & William Nordhaus, 2011. "Environmental Accounting for Pollution in the United States Economy," American Economic Review, American Economic Association, vol. 101(5), pages 1649-1675, August.
    • Handle: RePEc:aea:aecrev:v:101:y:2011:i:5:p:1649-75
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.101.5.1649
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    File URL: http://www.aeaweb.org/aer/data/aug2011/20090938_data.zip
    File Function: dataset accompanying article
    Download Restriction: no
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. A. Myrick Freeman III, 2002. "Environmental Policy Since Earth Day I: What Have We Gained?," Journal of Economic Perspectives, American Economic Association, vol. 16(1), pages 125-146, Winter.
    2. Viscusi, W Kip & Aldy, Joseph E, 2003. "The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World," Journal of Risk and Uncertainty, Springer, vol. 27(1), pages 5-76, August.
    3. Tol, Richard S. J., 2005. "The marginal damage costs of carbon dioxide emissions: an assessment of the uncertainties," Energy Policy, Elsevier, vol. 33(16), pages 2064-2074, November.
    4. Janusz R. Mrozek & Laura O. Taylor, 2002. "What determines the value of life? a meta-analysis," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 21(2), pages 253-270.
    5. Kirk Hamilton, 1996. "Pollution And Pollution Abatement In The National Accounts," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 42(1), pages 13-33, March.
    6. Robert D. Cairns, 2000. "Accounting For Resource Depletion: A Microeconomic Approach," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(1), pages 21-31, March.
    7. Muller, Nicholas Z. & Mendelsohn, Robert, 2007. "Measuring the damages of air pollution in the United States," Journal of Environmental Economics and Management, Elsevier, vol. 54(1), pages 1-14, July.
    8. Mun S. Ho & Chris P. Nielsen (ed.), 2007. "Clearing the Air: The Health and Economic Damages of Air Pollution in China," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262083582, December.
    9. Gundimeda, Haripriya & Sukhdev, Pavan & Sinha, Rajiv K. & Sanyal, Sanjeev, 2007. "Natural resource accounting for Indian states -- Illustrating the case of forest resources," Ecological Economics, Elsevier, vol. 61(4), pages 635-649, March.
    10. repec:reg:rpubli:282 is not listed on IDEAS
    11. Nicholas Z. Muller & Robert Mendelsohn, 2012. "Efficient Pollution Regulation: Getting the Prices Right: Corrigendum (Mortality Rate Update)," American Economic Review, American Economic Association, vol. 102(1), pages 613-616, February.
    12. Leontief, Wassily, 1970. "Environmental Repercussions and the Economic Structure: An Input-Output Approach," The Review of Economics and Statistics, MIT Press, vol. 52(3), pages 262-271, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nicholas Z. Muller, 2014. "Toward the Measurement of Net Economic Welfare: Air Pollution Damage in the US National Accounts–2002, 2005, 2008," NBER Chapters, in: Measuring Economic Sustainability and Progress, pages 429-459, National Bureau of Economic Research, Inc.
    2. Xu, Yan & Dietzenbacher, Erik & Los, Bart, 2020. "International trade and air pollution damages in the United States," Ecological Economics, Elsevier, vol. 171(C).
    3. Banzhaf, H. Spencer & Chupp, B. Andrew, 2012. "Fiscal federalism and interjurisdictional externalities: New results and an application to US Air pollution," Journal of Public Economics, Elsevier, vol. 96(5), pages 449-464.
    4. Britt Groosman & Nicholas Muller & Erin O’Neill-Toy, 2011. "The Ancillary Benefits from Climate Policy in the United States," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 50(4), pages 585-603, December.
    5. Pu-yan Nie & Peng Sun & Bill Z. Yang, 2014. "A Dynamic Study on Ecological Disaster, Government Regulation, and Renewable Resources," American Journal of Economics and Sociology, Wiley Blackwell, vol. 73(2), pages 410-442, April.
    6. World Bank, 2014. "Reducing Black Carbon Emissions from Diesel Vehicles : Impacts, Control Strategies, and Cost-Benefit Analysis," World Bank Publications - Reports 17785, The World Bank Group.
    7. Muller, Nicholas Z. & Mendelsohn, Robert, 2007. "Measuring the damages of air pollution in the United States," Journal of Environmental Economics and Management, Elsevier, vol. 54(1), pages 1-14, July.
    8. Mona Ray, 2014. "Redefining the Human Development Index to Account for Sustainability," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 42(3), pages 305-316, September.
    9. Nicholas Z. Muller & Yan N. Oak, 2009. "Characterizing Uncertainty in Air Pollution Damage Estimates," Middlebury College Working Paper Series 0918, Middlebury College, Department of Economics.
    10. Jaramillo, Paulina & Muller, Nicholas Z., 2016. "Air pollution emissions and damages from energy production in the U.S.: 2002–2011," Energy Policy, Elsevier, vol. 90(C), pages 202-211.
    11. Nicholas Z. Muller & Robert Mendelsohn, 2012. "Efficient Pollution Regulation: Getting the Prices Right: Corrigendum (Mortality Rate Update)," American Economic Review, American Economic Association, vol. 102(1), pages 613-616, February.
    12. Muller, Nicholas Z., 2019. "The derivation of discount rates with an augmented measure of income," Journal of Environmental Economics and Management, Elsevier, vol. 95(C), pages 87-101.
    13. LaPlue, Lawrence D., 2022. "Environmental consequences of natural gas wellhead pricing deregulation," Journal of Environmental Economics and Management, Elsevier, vol. 116(C).
    14. Nicholas Z Muller & Akshaya Jha, 2017. "Does environmental policy affect scaling laws between population and pollution? Evidence from American metropolitan areas," PLOS ONE, Public Library of Science, vol. 12(8), pages 1-15, August.
    15. John Loomis & Bryon Allen, 2008. "Using Non Market Valuation to Inform the Choice Between Permits and Fees in Environmental Regulation," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 40(3), pages 329-337, July.
    16. Stavins, Robert, 2004. "Environmental Economics," Working Paper Series rwp04-051, Harvard University, John F. Kennedy School of Government.
    17. Aevermann Tim & Schmude Jürgen, 2015. "Quantification and monetary valuation of urban ecosystem services in Munich, Germany," ZFW – Advances in Economic Geography, De Gruyter, vol. 59(3), pages 188-200, December.
    18. Parry, Ian, 2015. "Designing Fiscal Policy to Address the External Costs of Energy," International Review of Environmental and Resource Economics, now publishers, vol. 8(1), pages 1-56, May.
    19. Natina Yaduma & Mika Kortelainen & Ada Wossink, 2013. "Estimating Mortality and Economic Costs of Particulate Air Pollution in Developing Countries: The Case of Nigeria," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(3), pages 361-387, March.
    20. Chanel, Olivier & Chichilnisky, Graciela, 2013. "Valuing life: Experimental evidence using sensitivity to rare events," Ecological Economics, Elsevier, vol. 85(C), pages 198-205.

    More about this item

    JEL classification:

    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aecrev:v:101:y:2011:i:5:p:1649-75. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.