pollution problem?

Question

The total elimination of pollution would not be in society’s best interest. Why? Using economic
analysis explain how you would determine the optimal level of pollution.

Answer 1

Total elimination might well be seen as being society's best interest if it were either free or profitable.

As things stand, the general perception is that reducing pollution costs, and the law of diminishing returns suggest that the first 90% is going to be much easier (and hence cheaper) to eliminate than the next 90% (i.e. the 90% of the remainder), etc.

So the question is, just how much is reducing pollution worth? The answers range from almost 0 (the stance of most of the local governments in China) to almost anything.

There have been attempts to determine the short-term and direct economic costs of various forms of pollution in an attempt to justify green investments, but in the end, it is more about social values than anything else.

But determining people's values is a tricky proposition in and of itself.

Hint: the phrase "society's best interest" suggests that there is only one society of concern here. That is both obviously true and completely false.