Environmental policy for spatial and persistent pollutants (Q1087466)

Traditional economic models of alternative pollution policies notwithstanding, all discharges are persistent to some degree (assimilation is not instantaneous), and their distributions vary spatially. Utilizing an optimal control framework to capture the dynamics of persistence, the efficiency of economic incentives and regulations are juxtaposed when the goal is to obtain arbitrary environmental standards at least social cost. For generality, the considered pollutant is regarded as spatially variant, and standards are allowed to differ among regions. Theoretically optimal policy parameters are derived. As in the case of spatial, nonpersistent discharges, the property of persistence alone is demonstrated to invalidate the typically maintained economic advantage of price-guided policies over regulatory policies.