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Controlling Urban Air Pollution Caused by Households: Uncertainty, Prices, and Income

Carlos Chavez (), John Stranlund () and Walter Gomez ()
Additional contact information
Walter Gomez: Departamento de Ingenieria Matematica, Universidad de la Frontera Chile

No 2010-2, Working Papers from University of Massachusetts Amherst, Department of Resource Economics

Abstract: We examine the control of air pollution caused by households burning wood for heating and cooking in the developing world. Since the problem is one of controlling emissions from nonpoint sources, regulations are likely to be directed at household choices of wood consumption and combustion technologies. Moreover, these choices are subtractions from, or contributions to, the pure public good of air quality. Consequently, the efficient policy design is not independent of the distribution of household income. Since it is unrealistic to assume that environmental authorities can make lump sum income transfers part of control policies, efficient control of air pollution caused by wood consumption entails a higher tax on wood consumption and a higher subsidy for more efficient combustion technologies for higher income households. Among other difficulties, implementing a policy to promote the adoption of cleaner combustion technologies must overcome the seemingly paradoxical result that efficient control calls for higher technology subsidies for higher income households.

Keywords: efficiency; urban air pollution; nonpoint pollution; environmental policy; uncertainty (search for similar items in EconPapers)
JEL-codes: L51 H23 Q28 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2010-07
New Economics Papers: this item is included in nep-ene, nep-env, nep-reg and nep-ure
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Working Paper: Controlling Urban Air Pollution Caused by Households: Uncertainty, Prices, and Income (2010) Downloads
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