Environmental Economics

Decision Problems in the Control of Acid Precipitation: Nonconvexities and Irreversibilities

The purpose of the paper is to raise and discuss two plausible and somewhat unique aspects of the ecosystem effects of acid precipitation that the authors believe could make the control decision problem especially difficult. Both aspects imply that compromise control measures, where some intermediate level of harm to a variety of ecosystems is now permitted in order to obtain the benefits of a moderate increase now in fossil fuel combustion, could, in economic terms, be the least desirable policy to choose. The authors say that these two aspects suggest that assessments based only upon observed or inferred current market prices will place too low a value on acidification-induced ecosystem effects.
Section II presents a model which outlines a basis for ascertaining the economic losses caused by ecosystem effects of acid precipitation. Section III discusses two somewhat unusual properties of this function and their implications for economically optimal acid precipitation control decisions. A concluding section summarizes the paper and makes some suggestions about maximizing the usefulness of research into the ecosystem effects of acid precipitation.

  • Keywords

    Subject:
    2. Cost-Benefit and Cost Effectiveness Analysis
    2. Cost-Benefit and Cost Effectiveness Analysis - Methodology
    Environmental Media:
    a. Air
    a. Air - Tropospheric
    Authors:
    Crocker, Thomas D.
    Forester, Bruce A.
    EPA Project Officer/ Manager:
    Carlin, Alan
    Geographic Area:
    Study Purpose:
    Methodology Development & Evaluation, Policy Evaluation
    Inventory Record #: EE-0141
  • Participating Organizations

    Research Organization:

    Wyoming, University of
    Guelph, University of
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    Funding Organization:
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  • Report Details
    Type:
    Final
    Date:
    Number of Pages:
    27
    Comment:
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