In the absence of government intervention, the quantity of pollution will be Q_MKT, the level at which the marginal social benefit of pollution is zero. This is an inefficiently high quantity of pollution: the marginal social cost, $400, greatly exceeds the marginal social benefit, $0. An optimal Pigouvian tax* of $200, the value of the marginal social cost of pollution when it equals the marginal social benefit of pollution, can move the market to the socially optimal quantity of pollution, Q_OPT.
*Pigouvian taxes will be covered in the next section on pollution policy.