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Table of Contents

  1. Topic pack - Microeconomics - introduction
  2. 1.1 Competitive Markets: Demand and Supply
  3. 1.1 Competitive Markets: Demand and Supply - notes
  4. 1.1 Competitive markets - questions
  5. 1.1 Competitive markets - simulations and activities
  6. 1.2 Elasticities
  7. 1.2 Elasticities - notes
  8. Section 1.2 Elasticities - questions
  9. Section 1.2 Elasticities - simulations and activities
  10. 1.3 Government intervention
  11. 1.3 Government Intervention - notes
  12. 1.3 Government intervention - questions
  13. 1.3 Government intervention - simulations and activities
  14. 1.4 Market failure
  15. 1.4 Market failure - notes
  16. Section 1.4 Market failure - questions
    1. Market failure - short answer
    2. Externalities - short answer
    3. Externalities & allocative efficiency - short answer
    4. Externalities - self-test questions
    5. Public goods - short answer
    6. Merit goods - short answer
    7. Demerit goods - short answer
    8. Types of goods - self-test questions
    9. Government responses - short answer
    10. Common access resources - activities
    11. Overexploitation - questions
    12. Sustainability - report
    13. Plastic bags - carrying the weight of the environment?
    14. Running cars on biofuels can be unethical
    15. Cement - the hidden polluter?
    16. African roses - a sign of change
    17. Congestion charging
    18. Putting a price on carbon
    19. Power bills to soar in 'green reforms'
    20. Beyond Kyoto
    21. Economic growth cannot continue
    22. The rush to find Jade
    23. Chopstick tax
    24. Taxing light bulbs - that's a bright idea
    25. Trading pig excrement
    26. Congestion pricing
    27. Packaging tax
    28. Airport expansion plans
  17. Section 1.4 Market failure - simulations and activities
  18. 1.5 Theory of the firm
  19. 1.5 Theory of the firm - notes (HL only)
  20. Section 1.5 Theory of the firm - questions
  21. Section 1.5 Theory of the firm - simulations and activities
  22. Print View

Trading pig excrement

Trading pig excrement - a particularly smelly form of market failure

Pig meat accounts for nearly 40% of global meat consumption. Pigs emit methane from their nether regions (excrement) and these are a contributory factor to global warming. Under EU rules for emissions, this increases farmer's costs. So what's the solution? Well agricultural firms can capture the methane and then use it as a bio-fuel rather than allowing it to be emitted into the atmosphere. Farmer's will then be able to claim carbon credits under EU emissions trading market.

No, this really isn't an April Fool! Read the following articles: Pig manure means big bucks and Where there's muck, there's brass and answer the questions below. You can read these in the windows below, or follow the previous link to read the article in a separate window. Then answer the questions below questions below.


You may also like to read the following articles relating to recycling methane from pigs:


Question 1

Explain why methane emissions are considered a form of market failure.

Question 2

Using diagrams, as appropriate, show how methane emissions from pig waste may result in a misallocation of resources.

Question 3

Using the diagrams from question 2, show the impact of using technology to collect the methane from pigs and sell it or use it to gain carbon credits.

Question 4

Examine how the EU carbon emissions trading system help to reduce emissions of greenhouse gases.

Question 5

Evaluate two policies that the government could implement to encourage the use of alternative fuels like the new pig fat bio-diesel.