Pollution Modelling and Multiple-Output Production*
Abstract: The Memorandum was originally published as Finn R.
Førsund, “Pollution Modelling and Multiple-Output Production Theory”
Discussion Paper #D- 37/1998, Department of Economics and Social Sciences,
Agricultural University of Oslo. The materials balance principle points to
the crucial role of material inputs in generating residuals in production
processes. Pollution modelling must be of a multi-output nature. The most
flexible transformation function in outputs and inputs used in textbooks is
too general to make sense in pollution modelling. Specifying bads as if
they are inputs, although defendable on a macro Level, hides explicit
considerations of various modification activities. A complete taxonomy of
inputs as to the impact on both residuals and marketed Products as joint
outputs, is derived, based on factorially determined multi-output
Production, thus providing information for choice of policy instruments.
Keywords: multiple-output Production; factorially determined multi output production; pollution; bads; purification; modification; (follow links to similar papers)
JEL-Codes: D62; Q50; (follow links to similar papers)
27 pages, December 23, 1998
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Full text versions of the paper:
- This paper is forthcoming as:
Førsund, Finn, 'Multi-equation modelling of desirable and undesirable outputs satisfying the materials balance', Empirical Economics.
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