Acid rain causes greater environmental damage than would occur if coun
tries act cooperatively. Based on new estimates of sulphur abatement c
ost functions and taking into consideration the political changes in E
urope due to the dissaggregation of the USSR and the unification of Ge
rmany, this paper reviews and compares a number of alternative availab
le economic instruments which, if adopted, may encourage implementatio
n of sulphur abatement strategies.