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Cost benefit analysis of the sulfur dioxide emissions control policy in Japan

Author

Listed:
  • Ikuho Kochi

    (Hiroshima University)

  • Shunji Matsuoka

    (Hiroshima University)

  • Mushtaq Ahmed Memon

    (Hiroshima University)

  • Hiroaki Shirakawa

    (Hiroshima University)

Abstract

This study attempted to examine the economic efficiency of the sulfur dioxide (SO2) emissions control policy in Japan using a cost-benefit analysis (CBA). The SO2 emissions control policy is divided into three stages by epochal policy decisions. Reducing the incidence of chronic bronchitis and asthma are the two main policy benefits considered in this study, and they are estimated mainly based on the cost of illness approach. Policy costs have been derived from private sector investments for pollution control to meet the pollution standards under command and control (CAC) regulations. The estimated results, using a social discount rate of 2.5%, indicate a cost-benefit ratio of 5.39 in stage 1 (1968–1973), 1.18 in stage 2 (1974–1983), and 0.41 in stage 3 (1984–1993). This result indicates that the CAC in Japan used to have strong efficiency but that this efficiency has decreased over time. Our paper suggests that it is necessary to reconsider policy approaches in light of policy efficiency and in moving from SO2 to new target priority pollutants.

Suggested Citation

  • Ikuho Kochi & Shunji Matsuoka & Mushtaq Ahmed Memon & Hiroaki Shirakawa, 2002. "Cost benefit analysis of the sulfur dioxide emissions control policy in Japan," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 4(4), pages 219-233, March.
    • Handle: RePEc:spr:envpol:v:4:y:2002:i:4:d:10.1007_bf03354017
    DOI: 10.1007/BF03354017
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    Keywords

    CBA; SO2 emissions; Japan; Cost of illness; Willingness to pay;
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