Is it ever possible for an increase in pollution to make society better off? Briefly explain, using a graph like Figure 5.3 on page 154.

Transcribed Image Text:

Cost or Here the marginal benefit from pollution reduction of $300 per ton is higher than the marginal cost of $140 per ton. benefit (dollars per ton) $300 Marginal cost of reducing pollution 260 Here the marginal cost from pollution reduction of $260 per ton is higher than the marginal benefit of $100 per ton. 200 140 100 Marginal benefit from reducing pollution Reduction in 7.0 8.5 10.0 sulfur dioxide emissions (in millions of tons per year) Here the marginal cost from pollution reduction and the marginal benefit are both $200 per ton. Economically efficient level of pollution reduction