Question

15 marks) Describe the conceptual issues associated with externalities in both space and time. Discuss policy options for the control of regional pollutants such as acid rain. Analyze the level of economic efficiency of each option. Please explain the full question, but do not copy and paste from the internet.

Answer 1

Urban economics has its branches.Each branch are named as Spatial and geographical economics. externalities of both space and time are summed in spatial economics.this branch is more realistic and newly developed.Environment and preferences are 2 determinants of choice.environment has a very important aspect which is known as Spatial dimension.spatial externality concept can be described with an example.A certain topography say 'S' is considered,where agents are distributed.Every agent releases an externality which puts an impact on other agent all over 'S'. thus each agent face some or other externalities from other agents all along 'S'.This is named as Spatial externality.Level of contribution in externality depends on the direction or distance bof externality source.where one receives 2surfaces which are interacting.
Natural as well as man made factors contribute to Acid rain. Due to excessive pollution hot air constitute of nitrogen oxide in high content,which mixes with rain to form Acid rain.it has emerged as a global issue.There are policies takeb to curb acid rain as it punches its effect on organisms, vegetation,water bodies etc.The clean Air act had its amendments for acid rain.this included:
1) power plants need to have a check on release sulphur dioxide and nitrogen oxide.
2) implementation of cap and trade programs.
3) catalytic converters are fit in vehicles which emitted huge amounts of nitrogen oxides.
Economic efficiency to each efforts were dramatic.As per National Emissions Inventory, sulphur oxide release in 2005 decreased to 11.4million from 26million in 1980.nitrogen oxide fell from 27million to 16.3 million.