Microeconomics (7th Edition)
Microeconomics (7th Edition)
7th Edition
ISBN: 9780134737508
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 5, Problem 5.2.7PA
To determine

The marginal cost for the cleanup the last 10 percent of the polluted air.

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What are pollution havens? How are they created or why do they exist? Why do economists think they may change over time and develop policies to reduce pollution?
It’s common to think that reducing pollution is necessarily costly because to reduce pollution we need to tax firms who will then produce less. But can you think of one example in which pollution might not only be unpleasant but might actually reduce production?
There is a saying that a person worried about the source of his next meal is not much concerned about the level of pollution in the nearby stream.  How does this saying reflect that pollution is a first world, as opposed to third world, problem?  Put differently, does the evidence – both over time within economies and across economies at a given time – indicate that the pollution problem gradually cures itself as economies become more prosperous?
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