Abstract
Where pollution reductions come at a cost, how much cost are we willing to pay? ‘The economic theory of efficient pollution control’ looks at how to balance environmental and economic considerations in policy contexts, using the case study of sulphur dioxide emissions and acid rain in Europe. Marginal Abatement Cost, Marginal Environmental Damage, and pollution abatement are considered through government regulation and the Coase Theorem of voluntary negotiation. There are obstacles to international policy agreements on environmental problems; an efficient agreement that takes account of both abatement costs and the pattern of environmental benefits may require different countries to contribute very different amounts of abatement, which may seem inequitable.
