zbMATH — the first resource for mathematics

Pollution control in an uncertain environment. (English) Zbl 0899.90064
Summary: The effects of the threat of occurrence of environmental catastrophes on optimal pollution control are considered. Recent analysis of irreversible events is extended to two types of reversible events: single-occurrence and multiple-occurrence (recurrent) events. While it is possible that the threat of irreversible events induces more pollution, we show that reversible events, under quite general conditions, induce more conservation (less pollution). The analysis is carried out via a simple method (the ‘\(h\delta\)-method’) to identify optimal steady states by comparing steady state policies with small variations from them. For recurrent events the optimal state process must approach a unique steady state from any initial level. In this case, the \(h\delta\)-method characterizes the dynamic behavior of the optimal state process without actually solving for it.

91B76 Environmental economics (natural resource models, harvesting, pollution, etc.)
91B62 Economic growth models
Full Text: DOI
[1] Clarke, H.R; Reed, W.J, Consumption/pollution tradeoffs in an environment vulnerable to pollution-related catastrophic collapse, Journal of economic dynamics and control, 18, 991-1010, (1994) · Zbl 0802.90026
[2] Cropper, M.L, Regulating activities with catastrophic environmental effects, Journal of environmental economics and management, 3, 1-15, (1976) · Zbl 0331.90025
[3] Tsur, Y; Zemel, A, Endangered species and natural resource exploitation: extinction vs. coexistence, Natural resource modeling, 8, 389-413, (1994)
[4] Tsur, Y; Zemel, A, Uncertainty and irreversibility in groundwater resource management, Journal of environmental economics and management, 29, 149-161, (1995) · Zbl 0858.90039
[5] Tsur, Y; Zemel, A, Accounting for global warming risks: resource management under event uncertainty, Journal of economic dynamics and control, 20, 1289-1305, (1996) · Zbl 0875.90228
[6] Tsur, Y; Zemel, A, Pollution control in an uncertain environment, The center for agricultural economic research working paper 9603, (1996 bot, Israel), Rehovot, Israel
This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. It attempts to reflect the references listed in the original paper as accurately as possible without claiming the completeness or perfect precision of the matching.