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Are the costs of pollution abatement lower in Central and Eastern Europe? Evidence from Lithuania

Published online by Cambridge University Press:  01 October 1999

RANDALL BLUFFSTONE
RANDALL BLUFFSTONE
Affiliation:
Harvard Institute for International Development, Harvard University, 14 Story Street, Cambridge, MA 02138. Tel: 617-496-0429. Fax: 617-496-8040. E-mail:[email protected]
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Abstract

It is often claimed that pollution reductions can be achieved at lower cost in Central and Eastern Europe and the former Soviet Union, because more possibilities exist to update production processes and reduce waste. To date, however, there has been little or no systematic evaluation of what the costs actually are in these countries. The main purpose of this paper is to partially fill this research gap using firm-level data from Lithuania. Abatement cost estimates for key air pollutants are presented based on investments made in Lithuania during 1993–4. The paper also attempts to estimate the demand for pollution directly using data on pollution charges from 1994. Using both methods, it is shown that for at least some key pollutants marginal and average abatement costs are probably substantially lower in Lithuania than in western countries.

Type
Research Article
Information
Environment and Development Economics , Volume 4 , Issue 4 , October 1999 , pp. 449 - 470
Copyright
© 1999 Cambridge University Press

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Footnotes

The author would like to thank the US Agency for International Development for providing funding for this research under cooperative agreement EUR-00040A-00-4014. The author would also like to thank officials of the Ministry of Environmental Protection of Lithuania for allowing him the opportunity to conduct the work. Comments by Winston Harrington, Bruce A. Larson, Robert Stavins, and Jeffrey Vincent are gratefully acknowledged. Research assistance was provided by Jurate Varneckiene.