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Environmental debate

This photo shows a protest against the Keystone XL Pipeline for tar sands at the White House in 2011.
Across the country, countless people have protested, even risking arrest, against the Keystone XL Pipeline. (Credit: modification of image by “NoKXL”/Flickr Creative Commons)

Keystone xl

You might have heard about Keystone XL in the news. It is a pipeline system designed to bring oil from Canada to the refineries near the Gulf of Mexico, as well as to boost crude oil production in the United States. While a private company, TransCanada, will own the pipeline, U.S. government approval is required because of its size and location. The pipeline is being built in four phases, with the first two currently in operation, bringing oil from Alberta, Canada, east across Canada, south through the United States into Nebraska and Oklahoma, and northeast again to Illinois. The third and fourth phases of the project, known as Keystone XL, would create a pipeline southeast from Alberta straight to Nebraska, and then from Oklahoma to the Gulf of Mexico.

Sounds like a great idea, right? A pipeline that would move much needed crude oil to the Gulf refineries would increase oil production for manufacturing needs, reduce price pressure at the gas pump, and increase overall economic growth. Supporters argue that the pipeline is one of the safest pipelines built yet, and would reduce America’s dependence on politically vulnerable Middle Eastern oil imports.

Not so fast, say its critics. The Keystone XL would be constructed over an enormous aquifer (one of the largest in the world) in the Midwest, and through an environmentally fragile area in Nebraska, causing great concern among environmentalists about possible destruction to the natural surroundings. They argue that leaks could taint valuable water sources and construction of the pipeline could disrupt and even harm indigenous species. Environmentalist groups have fought government approval of the proposed construction of the pipeline, and as of press time the pipeline projects remain stalled.

Of course, environmental concerns matter when discussing issues related to economic growth. But how much should they factor in? In the case of the pipeline, how do we know how much damage it would cause when we do not know how to put a value on the environment? Would the benefits of the pipeline outweigh the opportunity cost? The issue of how to balance economic progress with unintended effects on our planet is the subject of this chapter.

Introduction to environmental protection and negative externalities

In this chapter, you will learn about:

  • The Economics of Pollution
  • Command-and-Control Regulation
  • Market-Oriented Environmental Tools
  • The Benefits and Costs of U.S. Environmental Laws
  • International Environmental Issues
  • The Tradeoff between Economic Output and Environmental Protection

In 1969, the Cuyahoga River in Ohio was so polluted that it spontaneously burst into flame. Air pollution was so bad at that time that Chattanooga, Tennessee was a city where, as an article from Sports Illustrated put it: “the death rate from tuberculosis was double that of the rest of Tennessee and triple that of the rest of the United States, a city in which the filth in the air was so bad it melted nylon stockings off women’s legs, in which executives kept supplies of clean white shirts in their offices so they could change when a shirt became too gray to be presentable, in which headlights were turned on at high noon because the sun was eclipsed by the gunk in the sky.”

The problem of pollution arises for every economy in the world, whether high-income or low-income, and whether market-oriented or command-oriented. Every country needs to strike some balance between production and environmental quality. This chapter begins by discussing how firms may fail to take certain social costs, like pollution, into their planning if they do not need to pay these costs. Traditionally, policies for environmental protection have focused on governmental limits on how much of each pollutant could be emitted. While this approach has had some success, economists have suggested a range of more flexible, market-oriented policies that reduce pollution at a lower cost. We will consider both approaches, but first let’s see how economists frame and analyze these issues.

Questions & Answers

GIVEN: D= 10-5P S= 20P/2 A) COMPUTE FOR THE EQUILIBRIUM PRICE AND EQUILIBRIUM QUANTITY. B) IF THE PREVAILING PRICE IS BELOW EQUILIBRIUM PRICE, WHAT HAPPENS IN THE MARKET? C) IF THE PREVAILING PRICE IS BELOW THE EQUILIBRIUM PRICE, WHAT ARISES IN THE MARKET?
joecel Reply
Hello
Momodu
yes
Kainnat
In the same system, men with better jobs receive larger payments. What economic principle is applicable to this situation? ​
Mary Reply
idont no eh
Jhondel
what is scarcity
Kuzivaishe Reply
How economist think?
Muhammad Reply
what's supply
Gifty Reply
what's demand
Gifty
Hi
Isaac
hi
Adil
hello
Kuzivaishe
What is scarcity
GANJER Reply
the unavailability of resources to satisfy human needs and wants
Sepiso
which book is the best book for learning economics
Jonibek Reply
principal economic
Ibrahim
factor affecting or influencing changes in supply
Sham Reply
Price of goods/commodities. Quantity demanded price of raw materials. Cost of transportation. Taste and fashion weather Government policy etc
Enoh
insecurity hoarding
Enoh
What is economics
Khurram Reply
we study how to allocate scare resouces to satisfied unlimited wants.
Adil
Scenario affecting change in income in demand
Janiz Reply
what economic
guuguule Reply
it is the situation where by im a market there is only one supplier and producer of a certain comodity that has no close substitute or competitor
Sepiso Reply
yes
Alhaji
what is demand and supply
Alhaji
demand is the amount of a goods or service that consumers are willing to buy at a particular price, while is to provide something,to make something available for use.
jago
I need a scenario affecting change in income (demand)
Janiz
what is Economics?
Pintu Reply
Is the study of human behaviour as a relationship between ends and scares mean which have alternative use
Alhaji
yes
Tawa
what is monopoly
Alhaji
what are the difficultés if retail prix index for calculating thé value of money
Oscar
hmm OK wait
Castino
what is labour
Mamudou Reply
LABOUR is a measure of work done by human being
Blessing
It is all form of human effort use to utilize in production
Alhaji
Why is scarcity a foundermental problem in economics
Alhaji
Why is scarcity a foundermental problem in economics
Alhaji Reply
scarcity occur unbalance demand and supply at this time cost goods increase then inflation very increase
Tesfaye
scarcity is a foundermental problem because its a natural situation and it affects the world at Large.in other words,it's limit in supply relating to deman
Akwosih

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Source:  OpenStax, Principles of economics. OpenStax CNX. Sep 19, 2014 Download for free at http://legacy.cnx.org/content/col11613/1.11
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