Alternative approaches to handling incompatible uses

1. The Pigouvian approach   a. What is the optimal quantity of emissions? units   b. How high should the Pigouvian tax be set?  $/unit 2. Legal options when transaction costs are prohitively high: 2.1 An easement granted to the polluter without liability for damages imposed on the pollutee:   a. What quantity of emissions will result ? units   b. What area(s) measure the total pollution damage?     c. What area(s) measure the welfare loss?   2.2 An easement granted to the polluter with liability for damages imposed on the pollutee, costlessly determined by the court:   a. What area(s) measure the resulting liability?   2.3 An injunction granted to the pollutee without liability for damages imposed on the polluter:   a. What quantity of emissions will result ? units   b. What area(s) measure the total abatement cost?     c. What area(s) measure the welfare loss?   2.4 An injunction granted to the pollutee with liability for damages imposed on the polluter, costlessly determined by the court:   a. What area(s) measure the resulting liability?

Now consider the four incompatible use cases you were assigned to read. Complete the table below to indicate the remedy the court chose in each case:

    (1) Fountainebleau Hotel Corp. v. Forty-Five Twenty-Five, Inc. 114 So.2d 357 (1959)
    (2) Estancias Dallas Corp. v. Schultz, 500 S.W. 2d 217 (1973)
    (3) Boomer v. Atlantic Cement Co. 26 N.Y.2d 219 (1970)
    (4) Spur Industries v. Del E. Webb Development (1972)