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Lecture notes 1, 4910 spring 2005, FRF Spatial environmental models

Transfer coefficient. Source (Point, Mobile, Diffuse). a ij. Environmental receptor. Lecture notes 1, 4910 spring 2005, FRF Spatial environmental models. Spatial configuration Key variable: transfer coefficient a ij. The Generic model of spatially distributed pollutants.

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Lecture notes 1, 4910 spring 2005, FRF Spatial environmental models

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  1. Transfer coefficient Source (Point, Mobile, Diffuse) aij Environmental receptor Lecture notes 1, 4910 spring 2005, FRFSpatial environmental models • Spatial configuration • Key variable: transfer coefficient aij

  2. The Generic model of spatially distributed pollutants • Source abatement cost function • Deposition of pollutants in the environment

  3. Uniformly distributed pollutants • Uniform mix: multiple recipients

  4. Non-uniformly distributed pollutants • Non-uniform mix:

  5. Structured transfer: river pollution • At receptor j: a ranking of transfer coefficients starting upstream at source 1 and ending at nearest source Nj

  6. The spatial social problem • General social problem formulation with damage function

  7. The spatial social problem, cont. • The general first order condition • Non-uniformly mixed: Source marginal abatement cost equal to social marginal damage weighted with transfer coefficients. NB! In general different marginal costs between sources.

  8. Cost effective solutions, cont. • River pollution • Uniformly mixed • Marginal abatement cost equal for all sources and equal to total marginal damage

  9. The pollutant tax solution • Source decision problem • The tax on pollutants is source specific, and should be set equal to the weighted marginal damage in the optimal case. • Uniform distribution: tax rate equal for sources

  10. Ambient standard • Environmental service of receptors • Damage function • The physical ambient standard is the level of deposition of pollutants, dj

  11. Environmental policy in practice • Formulating limits for dj; dj* • Social problem: • The Lagrangian (Economists’ mathematical manual; Kuhn – Tucker, maximisation)

  12. Environmental policy in practice, cont. • First order conditions • Interpretation: Marginal abatement costs equal to shadow prices on ambient constraints weighted with transfer coefficients

  13. Environmental policy in practice, cont. • Interpretation of shadow price • Envelope theorem • Shadow price positive for binding constraints

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