Efficiency and Equity in Interregional Environmental Management

In addressing environmental issues, the comparative advantage of economists has led them to emphasize efficiency issues, which yield more readily to economic calculus than do equity issues, which fall among the thickets of interpersonal comparisons and value systems. The difficulty in sorting out equity and efficiency issues is comounded in a hierarchical, pluralistic structure like that of the US with conflicting lines of authority at the federal, state, metropolitan, and local levels. Consequently, we have not developed a coherent national policy on certain critical problems, such as the siting of hazardous facilities and the establishment of property rights in environmental resources.