Figure 6.4 Total and marginal damage and benefit functions, and the efficient level of flow pollution emissions. D(M) B(M) D(M) B(M) Maximised net benefits M * M* M

£ C3 C1 C2 * MA M* Marginal damage Marginal abatement cost M Figure 6.5 The economically efficient level of pollution minimises the sum of abatement and damage costs. £ Marginal damage * C3 C1 Marginal abatement cost C2 M Quantity of pollution emission per period MA M*

Figure 6.6 Setting targets according to an absolute health criterion. Marginal health damage t* MC MH Emissions, M

Figure 6.7 A ‘modified efficiency’ based health standard. Marginal health damage tH* MC MH* Emissions, M

Figure 6.8 A spatially differentiated air shed.

Figure 6.9 Efficient steady-state emission level for an imperfectly persistent stock pollutant. Two cases: {r = 0 and  > 0} and {r > 0 and  > 0}. ** * M* M** M

Figure 6.10 Threshold effects and irreversibilities. Figure 6.10a A threshold effect in the decay rate/pollution stock relationship.  A

Figure 6.10(b) An irreversibility combined with a threshold effect.  A

f(x) a b • • x Figure 6.11 A strictly convex function

D D MS M MD = dD/dM MD MS M Figure 6.12 A non-convex damage function arising from pollution reaching a saturation point.

£ a b C M1 M2 M3 M4 Marginal benefit Marginal damage M M Quantity of pollution emission per period M2 M1 b C a Figure 6.14 A non-convex damage function arising from pollutants harmful at low concentrations but beneficial at higher concentrations. M3 M4