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Non-separability and substitutability among water pollutants: evidence from India

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  • Kumar, Surender
  • Managi, Shunsuke

Abstract

The design and implementation of environmental policy often involve more than one pollutant, and must consider pollution as a byproduct of the production of marketable output. In this paper, we test the implicit assumption in the empirical literature that (1) production of marketable output, pollution and abatement are separable, and (2) different pollutants can be abated separately. Using unique plant-level data in India, we reject the null hypotheses of separability between marketable output and pollutants, and between different pollutants. Firms must incur abatement costs for reducing pollution levels. In addition, complement and substitute relationships between water pollutants are demonstrated with statistical significance.

Suggested Citation

  • Kumar, Surender & Managi, Shunsuke, 2011. "Non-separability and substitutability among water pollutants: evidence from India," Environment and Development Economics, Cambridge University Press, vol. 16(6), pages 709-733, December.
    • Handle: RePEc:cup:endeec:v:16:y:2011:i:06:p:709-733_00
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    Citations

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    Cited by:

    1. Kumar, Surender & Managi, Shunsuke & Jain, Rakesh Kumar, 2020. "CO2 mitigation policy for Indian thermal power sector: Potential gains from emission trading," Energy Economics, Elsevier, vol. 86(C).
    2. Surender Kumar & Rakesh Kumar Jain, 2021. "Cost of CO2 emission mitigation and its decomposition: evidence from coal-fired thermal power sector in India," Empirical Economics, Springer, vol. 61(2), pages 693-717, August.
    3. Md zulquar Nain & Sai sailaja Bharatam & Bandi Kamaiah, 2017. "Electricity consumption and NSDP nexus in Indian states: a panel analysis with structural breaks," Economics Bulletin, AccessEcon, vol. 37(3), pages 1581-1601.
    4. Wei, Chu & Löschel, Andreas & Liu, Bing, 2013. "An empirical analysis of the CO2 shadow price in Chinese thermal power enterprises," Energy Economics, Elsevier, vol. 40(C), pages 22-31.
    5. Imane Bounadi & Khalil Allali & Aziz Fadlaoui & Mohammed Dehhaoui, 2023. "Water Pollution Abatement in Olive Oil Industry in Morocco: Cost Estimates and Policy Implications," Sustainability, MDPI, vol. 15(5), pages 1-19, February.
    6. Aparajita Singh & Haripriya Gundimeda, 2021. "Measuring technical efficiency and shadow price of water pollutants for the leather industry in India: a directional distance function approach," Journal of Regulatory Economics, Springer, vol. 59(1), pages 71-93, February.
    7. Jorge Bonilla & Jessica Coria & Thomas Sterner, 2018. "Technical Synergies and Trade-Offs Between Abatement of Global and Local Air Pollution," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 70(1), pages 191-221, May.
    8. Ambec, Stefan & Coria, Jessica, 2013. "Prices vs quantities with multiple pollutants," Journal of Environmental Economics and Management, Elsevier, vol. 66(1), pages 123-140.
    9. Bonilla, Jorge & Coria, Jessica & Sterner, Thomas, 2012. "Synergies and Trade-offs between Climate and Local Air Pollution: Policies in Sweden," Working Papers in Economics 529, University of Gothenburg, Department of Economics.
    10. Surender Kumar & Hidemichi Fujii & Shunsuke Managi, 2015. "Substitute or complement? Assessing renewable and nonrenewable energy in OECD countries," Applied Economics, Taylor & Francis Journals, vol. 47(14), pages 1438-1459, March.
    11. Huiming Xie & Xiaopeng Wang & Manhong Shen & Chu Wei, 2022. "Abatement costs of combatting industrial water pollution: convergence across Chinese provinces," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(9), pages 10752-10767, September.
    12. Zhang, Ning & Huang, Xuhui & Qi, Chao, 2022. "The effect of environmental regulation on the marginal abatement cost of industrial firms: Evidence from the 11th Five-Year Plan in China," Energy Economics, Elsevier, vol. 112(C).
    13. Nakaishi, Tomoaki, 2021. "Developing effective CO2 and SO2 mitigation strategy based on marginal abatement costs of coal-fired power plants in China," Applied Energy, Elsevier, vol. 294(C).

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