Alternative policies for the control of air pollution in by Robin W. Bates

By Robin W. Bates

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In particular, such a definition must be set in a usable analytical framework. This paper attempts to show how appropriate economic incentives in the economy at large, and the use of specific economic instruments targeted at air pollution, can make an important practical contribution to sustainable development. The focus here is on the use of a common natural resource, namely the air we breathe, and ways in which it can be protected. The paper argues that, although free market forces alone may not achieve sustainable development, they can help us to make progress towards it through better resource management.

Second, the Polish legal standards differ in important respects from representative West European standards, but the costs of meeting the two alternative sets of standards in Poland do not appear to be widely different. The costs of the strict German standards, on the other hand, are significantly higher, underscoring a need for corresponding benefit assessment to determine the value to Poland of such standards. Third, there are clear cost savings from using incentive-based policy instruments, even though the exact size of the savings cannot be precisely identified.

The model includes as decision variables both the operation of existing plant and equipment and investment in new equipment, 8 As described in the next chapter, the iteration process is more intricate when demands must be adjusted to reflect delivered cost increases and emission charges must be adjusted to satisfy specified emission targets. Page 17 including investment in cleaner new plant or environmental retrofit. Existing plant may also be scrapped before it is fully depreciated. Because the sequences of energy supply and conversion activities are the solution of a dynamic optimization problem, they take into account the intertemporal linkages among decisions noted above.

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