IDEAS home Printed from https://ideas.repec.org/a/kap/jproda/v49y2018i2d10.1007_s11123-018-0528-8.html
   My bibliography  Save this article

An iterative approach to the estimation of the abatement costs of harmful emissions

Author

Listed:
  • Alexandre Repkine

    (Konkuk University)

  • Dongki Min

    () (Konkuk University)

Abstract

Abstract The ability to quantify tradeoffs involved in the process of reducing harmful emissions is essential to successful policy-making in the environmental planning area. The approach by Färe et al. (J Econom 126: 469–492, 2005) to computing point estimates of the marginal abatement costs (MACs) of reducing pollution by estimating the directional output distance function has been gaining popularity in recent years. The contribution of this study is to compute MACs as slopes of the iterated parametric production possibilities frontier (PPF) estimated on the basis of the set of efficient projections of observable output combinations obtained from the parameters of directional output distance function. Policy makers are thus provided with the general shape of the production possibilities set for a polluting technology rather than with a set of point estimates of the MACs. We apply our methodology to a balanced panel of seven Korean manufacturing sectors spanning the period between 1999 and 2009, obtaining theoretically consistent concave PPFs based on a large set of directional output distance vectors. Finally, we estimate the parameters of a directional output distance function corresponding to the iterated PPF.

Suggested Citation

  • Alexandre Repkine & Dongki Min, 2018. "An iterative approach to the estimation of the abatement costs of harmful emissions," Journal of Productivity Analysis, Springer, vol. 49(2), pages 123-136, June.
  • Handle: RePEc:kap:jproda:v:49:y:2018:i:2:d:10.1007_s11123-018-0528-8
    DOI: 10.1007/s11123-018-0528-8
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11123-018-0528-8
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Matsushita, Kyohei & Yamane, Fumihiro, 2012. "Pollution from the electric power sector in Japan and efficient pollution reduction," Energy Economics, Elsevier, vol. 34(4), pages 1124-1130.
    2. Coggins, Jay S. & Swinton, John R., 1996. "The Price of Pollution: A Dual Approach to Valuing SO2Allowances," Journal of Environmental Economics and Management, Elsevier, vol. 30(1), pages 58-72, January.
    3. R. Färe & S. Grosskopf & G. Whittaker, 2013. "Directional output distance functions: endogenous directions based on exogenous normalization constraints," Journal of Productivity Analysis, Springer, vol. 40(3), pages 267-269, December.
    4. Park, Hojeong & Lim, Jaekyu, 2009. "Valuation of marginal CO2 abatement options for electric power plants in Korea," Energy Policy, Elsevier, vol. 37(5), pages 1834-1841, May.
    5. Fare, Rolf & Grosskopf, Shawna & Noh, Dong-Woon & Weber, William, 2005. "Characteristics of a polluting technology: theory and practice," Journal of Econometrics, Elsevier, vol. 126(2), pages 469-492, June.
    6. Rolf Färe & Shawna Grosskopf & William L. Weber, 2001. "Shadow Prices of Missouri Public Conservation Land," Public Finance Review, , vol. 29(6), pages 444-460, November.
    Full references (including those not matched with items on IDEAS)

    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:kap:jproda:v:49:y:2018:i:2:d:10.1007_s11123-018-0528-8. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Mallaigh Nolan). General contact details of provider: http://www.springer.com .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.