PETER A. VICTOR

This short book that was translated into several languages, begins with a brief historical survey of the ways in which economists from Adam Smith to 1970, thought about pollution. In the 1960s a few economists, realizing the inadequacies of earlier approaches, introduced the concept of materials balance which recognizes the underlying physical characteristics of economic activity and its links with the natural environment. A detailed account is given of microeconomics and pollution, in which emphasis is placed on the pollution caused by individual producers and consumers. The macroeconomic approach is also considered in which regional and national environmental aspects of economic activity are analyzed with the use of highly aggregated models

The author surveys the attempts made to bridge the gap between microeconomics and macroeconomics with the use of input-output analysis suitably adapted to include environmental sectors. He demonstrates that simultaneous analysis of numerous industrial sectors producing many outputs makes it possible to learn about regional and national consequences for pollution and the environment of many types of consumption and production.