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Efficiency and Political Economy of Pollution Control with Ancillary Benefits: An Application to NOx Control in the Chesapeake Bay Airshed

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  • Krupnick, Alan

    () (Resources for the Future)

  • Austin, David
  • McConnell, Virginia

    () (Resources for the Future)

Abstract

This paper examines implications for cost-effective allocation of pollution controls when preferences of coalitions organized along regional lines, or according to preferences for air vs. water quality improvements, are accounted for. Results are compared to a base case in which NOx emissions reductions must satisfy only a water quality standard, and total costs are minimized over emissions sources. Relative to base-case result that marginal control costs must be equal across sources, stronger relative preferences for air imply shifting of control toward sources that produce greater ancillary benefits to air quality. Regional differences may require side payments to induce cooperation where benefits are low, but this will not affect how controls themselves should be allocated.

Suggested Citation

  • Krupnick, Alan & Austin, David & McConnell, Virginia, 1997. "Efficiency and Political Economy of Pollution Control with Ancillary Benefits: An Application to NOx Control in the Chesapeake Bay Airshed," Discussion Papers dp-97-34, Resources For the Future.
  • Handle: RePEc:rff:dpaper:dp-97-34
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    File URL: http://www.rff.org/RFF/documents/RFF-DP-97-34.pdf
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    References listed on IDEAS

    as
    1. Montgomery, W. David, 1972. "Markets in licenses and efficient pollution control programs," Journal of Economic Theory, Elsevier, vol. 5(3), pages 395-418, December.
    2. Krupnick, Alan J. & Oates, Wallace E. & Van De Verg, Eric, 1983. "On marketable air-pollution permits: The case for a system of pollution offsets," Journal of Environmental Economics and Management, Elsevier, vol. 10(3), pages 233-247, September.
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    Cited by:

    1. Heberling, Matthew T. & GarcĂ­a, Jorge H. & Thurston, Hale W., 2010. "Does encouraging the use of wetlands in water quality trading programs make economic sense?," Ecological Economics, Elsevier, vol. 69(10), pages 1988-1994, August.

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