Pollution, Environment, Global Warming (Exam 2) Flashcards Preview

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Flashcards in Pollution, Environment, Global Warming (Exam 2) Deck (14)
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1

Optimal level of pollution in market

- Determine by comparing marginal benefits against marginal costs

2

Negative externalities

Costs imposed on third parties

3

Positive externalities

Benefits bestowed on third parties

4

Private marginal costs

Marginal costs that accrue to only producers of a good or service

5

Social marginal costs

Marginal costs that accrue to society as a whole

6

Equation relating marginal costs of social with private and externalities

MCsocial = MCprivate + Negative Externality

7

Command-and-control

Direct government regulation of pollution through taxes or emission limits

8

Purpose of taxes and fees

- Increase production costs so producers take into account negative externalities

9

Emission limits

- Place controls/restrictions on specific sources of pollutants (ideally set at socially efficient level of production)

10

Common property resources

- Collectively owned resources

11

Tragedy of the commons

- Normally used to describe overuse of common property resources
- By moving away from common property resources to private; eliminate intervention by government

12

Cap-and-Trade

Upper limit established on emissions; set where marginal social costs of emissions equal to marginal benefits of emissions

13

Tradable pollution rights

- Each polluter given right to emit specific amount of pollutant

14

Carbon offsets

Reductions in emission of CO2 in one place that offset emissions of CO2 elsewhere