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Emission damages caused by small-scale polluters such as farms, vehicles, homes and small businesses are often location-specific and such polluters are often regulated through a combination of location-differentiated cleaner technology standards and uniform, ʻdirtyʼ input regulation. We investigate how such regulations should be designed and combined under realistic assumptions. We find that if the available cleaner technologies are 'emission capturing' (e.g., end-of-pipe filters), they should be encouraged in both high and low damage areas, while if they are 'input displacing' (i.e., facilitating replacement of dirty input by cleaner input), they should be encouraged in high damage areas, but discouraged in low damage areas. Dirty input use should always be discouraged and the optimal regulation intensity may be substantial, particularly if the available cleaner technologies are input displacing. [ABSTRACT FROM AUTHOR]

Focuses on the characterization of non-point emission problems such as pesticide, nitrate and phosphorus pollution of lakes and ground water. Proposal of regulatory mechanisms for stochastic non-point emissions; Implementation of optimal abatement vector in dominant strategies; Increase in marginal damage from concentrations above a critical level.

Describes a nitrogen based deposit refund system for regulating agricultural nitrogen emission in Denmark. Application of regulator monitoring costs; Introduction of incentive regulation of non-point nitrogen emission; Policy implication of agricultural emission of nitrates.