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Pollution Abatement under Learning by Doing with Heterogeneous Costs

By Yann Bramoull√© and Lars J. Olson


Many environmental policies including the Kyoto Protocol, the Acid Rain Program, the Montreal Protocol and the phase-out of leaded gas are designed to achieve a target level of abatement within a specified period of time. This paper examines how pollution abatement should be allocated over time using heterogeneous technologies characterized by learning by doing. In the presence of learning by doing, conventional economic wisdom regarding the allocation of pollution abatement must be modified. This paper derives the appropriate generalization of the principle that marginal abatement costs are equalized and shows how learning by doing alters the optimal allocation of abatement. The pape

Year: 2002
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