DEMAND FOR ENVIRONMENTAL GOODS C H A P T E R 7 DEMAND FOR ENVIRONMENTAL GOODS ENVIRONMENTAL ECONOMICS – 2e Charles D. Kolstad Copyright © 2011 by Oxford University Press, Inc.

FIGURE 7.1 Marginal willingness to pay (MWTP) for nitrogen oxides (parts per hundred million, pphm) for Boston households at three different income levels. Figures for MWTP are annual, in 1970 US$ per pphm. (Adapted from Harrison and Rubinfeld, 1978.) ENVIRONMENTAL ECONOMICS – 2e Charles D. Kolstad Copyright © 2011 by Oxford University Press, Inc.

FIGURE 7.2 Demand curves and willingness to pay. (a) Gasoline; (b) air pollution. Note that in (b), total damage = −consumer total WTP. ENVIRONMENTAL ECONOMICS – 2e Charles D. Kolstad Copyright © 2011 by Oxford University Press, Inc.

market price of x; Δq, change in environmental good, q. FIGURE 7.3 Marginal willingness to pay for an environmental good. px, price of x; h, demand for x; p*x, market price of x; Δq, change in environmental good, q. ENVIRONMENTAL ECONOMICS – 2e Charles D. Kolstad Copyright © 2011 by Oxford University Press, Inc.

FIGURE 7. 4 Willingness to accept vs FIGURE 7.4 Willingness to accept vs. willingness to pay for a change in quantity of an environmental good (q). ENVIRONMENTAL ECONOMICS – 2e Charles D. Kolstad Copyright © 2011 by Oxford University Press, Inc.