How do you tell what is the optimum level of acceptable pollution

The level of pollution that maximizes social welfare by equating the marginal cost of additional pollution with the marginal benefit. The concept of the optimal level recognizes that there may be benefits to allowing pollution which would be lost were pollution to be eliminated.

If there is an optimal level of cleanliness, then there is also an optimal level of pollution.

If the marginal cost of pollution abatement is just equal to the marginal benefit from pollution abatement, then we have reached the point where society's welfare has been maximized with respect to environmental quality.

If the marginal benefit of reducing pollution were greater than the marginal cost of reducing pollution, then society would benefit from a reduction in pollution. The benefit would be equal to the amount by which the marginal benefit of the cleanup exceeded the marginal cost of the clean up.

Just as it is possible to have too dirty an environment, it is also possible to have too clean an environment. If the marginal cost of pollution abatement exceeds the marginal benefit from the reduction, then the benefit of cleaning the environment is not worth the expense.

Consequently, further attempts to clean up the environment will result in a reduction in welfare.

Economists have argued that it is not efficient to reduce pollution to zero.

The cost of this reduction would probably exceed the benefits. Waterways and the atmosphere have a natural capacity to assimilate at least some pollution with no associated ill-effects on the environment or humans. To not benefit from this natural assimilative capacity would be wasteful. Moreover, one person's pollution may be another person's consumption. Rafter's prefer a raging river, while boaters prefer a dammed waterway and a calm lake. Teenagers like to blast rap music, while adults prefer the oldies.

The following diagram contains hypothetical curves for the marginal benefits of controlling air pollution and marginal costs of controlling air pollution.

a compound is a molecule made of atoms from different elements.

a. by the combination of an unlimited number of elements

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