Environmental Quality and Residuals Management: Report of a Research Program on Economic, Technological, and Institutional Aspects

By Allen V. Kneese; Blair T. Bower | Go to book overview

solution Pareto-inferior to the grid-trading solution to the same problem. However, there is still no unanimity; therefore constraints continue to be added, on advice of the staff, to ease the pain in suburb C, the only N package vote remaining. The three easiest to meet SO2 limits in suburb C were then added to the regional model. Adding these constraints results in adding three more Y grids (total 22), and when the grid-voting sections are aggregated again by municipality, they reveal that a unanimous Y vote has been achieved. All five municipalities favor the package, although only eleven grids favor the DOD level and three grids disapprove of the package. This solution is also Pareto-inferior to the earlier solution. The three grids that disapprove of the solution are, unfortunately for them, each in a different municipality. This analysis shows that councils of governments do not aggregate preferences as effectively as does vote trading by smaller subareas represented by the grids.


Concluding Comment

The above analysis of a hypothetical region demonstrates how a political dimension can be explicitly incorporated into an economic-technologic- ecologic analysis of REQM in a region. The multiple components of the preference vectors for each subarea of a region set the stage for a social choice process to come into play. The analytical process for aggregating preferences into social choices takes account of intensities of preferences as well as numbers for and against any issue. When preference vectors reflecting these intensities are combined, they reveal opportunities for vote trading, and vote trading provides the key to arriving at stable social choices.

The politicized regional REQM model provides an effective instrument for analyzing the results of alternative REQM options in terms of levels of ambient environmental quality and distributions of benefits and costs. It permits determining which patterns most closely fulfill the sets of preferences for alternative outcomes. This is a very useful characteristic because --to reiterate--seldom, if ever, can all relevant damage functions be defined in monetary terms. The politicized model also enables us to analyze the effects on decisions of alternative patterns of representative government. Given the fact that governmental structures, rather than technology as such, are very often the key to achieving improved ambient environmental quality, this attribute is important.

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