Robust Estimation of Marginal Abatement Cost of Water Pollutant: Evidence from Yangtze River Basin

Abstract

Based on the econometric method of bootstrap for 1000 times, this study estimated the marginal abatement cost of water pollutant, COD and NH3-N, for 9 provinces and 2 municipalities in the Yangtze River Basin from 2001 to 2017 by building a robust estimation model. We found that the marginal abatement cost increases at an average annual rate of 19.47%. The marginal abatement cost in Jiangsu and Sichuan are significantly higher than other regions. Differences in marginal abatement cost make it possible to trade emission rights between regions.