Benefits, costs WTP – demand Benefit – area under the curve Opportunity Cost Marginal Cost...

Benefits , costs

• WTP – demand• Benefit – area under the curve• Opportunity Cost• Marginal Cost• Equimarginal cost

McGraw-Hill/Irwin

Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved.

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Economic Effficiency

• Efficiency• Equity• Market system• Social cost – External cost• Public goods

– Private cost

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Economics of “Quality”

• Pollution control– Damage function• Pollution categories – source, dispersion• Ambient, emissions

– Abatement cost function

• “Socially efficient” level of pollution!

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Benefits, costs WTP – demand Benefit – area under the curve Opportunity Cost Marginal Cost...

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