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Static and dynamic efficiency of pollution control strategies

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  • Doede Wiersma

Abstract

A great deal of the economic literature on pollution control strategies concentrates on the efficiency of environmental policy instruments. Most analytical studies in this field show that market instruments are more efficient with respect to the cost of pollution abatement of a given number of polluters than non-market instruments. According to several analytical studies, market instruments should also be more efficient with respect to innovation in pollution abatement equipment than non-market instruments. In the empirical literature a great number of case studies exist with estimations of the savings of abatement costs of market instruments in a situation without technological progress. Empirical studies about the impact of environmental policy market instruments on the abatement costs in situations with technological progress are lacking. The purpose of this paper is to fill this gap. The paper deals with an empirical estimation of abatement costs for the emission of SO 2 of coal-fired electricity units in the Netherlands from 1985 to 2000. First, the working of market instruments and non-market instruments (the existing environmental policy of the Dutch government) is simulated in a static situation. Second, we analyse the learning effects of flue gas desulphurization. The efficiency advantage of market instruments turns out to be larger in a situation of technological progress than in a static situation. Copyright Kluwer Academic Publishers 1991

Suggested Citation

  • Doede Wiersma, 1991. "Static and dynamic efficiency of pollution control strategies," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 1(1), pages 63-82, March.
    • Handle: RePEc:kap:enreec:v:1:y:1991:i:1:p:63-82
    DOI: 10.1007/BF00305951
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    References listed on IDEAS

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    1. Magat, Wesley A. & Kip Viscusi, W. & Huber, Joel, 1988. "Paired comparison and contingent valuation approaches to morbidity risk valuation," Journal of Environmental Economics and Management, Elsevier, vol. 15(4), pages 395-411, December.
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    4. Paul Joskow & Nancy L. Rose, 1985. "The Effects of Technological Change, Experience, and Environmental Regulation on the Construction Cost of Coal-Burning Generating Units," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 1-17, Spring.
    5. Martin B. Zimmerman, 1982. "Learning Effects and the Commercialization of New Energy Technologies: The Case of Nuclear Power," Bell Journal of Economics, The RAND Corporation, vol. 13(2), pages 297-310, Autumn.
    6. McGartland, Albert M. & Oates, Wallace E., 1985. "Marketable permits for the prevention of environmental deterioration," Journal of Environmental Economics and Management, Elsevier, vol. 12(3), pages 207-228, September.
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    Cited by:

    1. A. Rikun, 1992. "On modeling incentive systems which utilize pollution charges for pollution abatement," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(6), pages 593-604, November.

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