Environmental and Resource Economics

, Volume 4, Issue 3, pp 295–304 | Cite as

Pollution standards vs charges under uncertainty

  • Peter Tisato


Conventional analysis of pollution control policy under uncertainty does not properly account for the potential cost effectiveness difference between standards and charges, thus drawing misleading conclusions for the case of inefficient standards. Correcting for this anomaly, the following conclusions can be drawn. When uncertainty involves the position of the marginal damage cost schedule, rather than policy indifference, a charge is always superior to an inefficient standard. When uncertainty is about the position of the marginal control cost schedule, policy indifference may occur, but if it does it must be the case that the slope of marginal damage cost exceeds that of marginal control cost.


Cost Effectiveness Economic Policy Environmental Economic Control Policy Potential Cost 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© Kluwer Academic Publishers 1994

Authors and Affiliations

  • Peter Tisato
    • 1
  1. 1.Economics DepartmentUniversity of Adelaide, ADELAIDEAustralia

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