POL 107 Lecture Notes - Lecture 7: Tall Stacks, Overgrazing, Indulgence
7 Dec 2015
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Document Summary
The burden it put on regulators; challenges that the private sector would never voluntarily choose to embrace; efforts to diminish some of those regulatory problems through the use of market reforms. Political obstacles: polluters become political adversaries with government, when knowledge is scarce c&c can provide evidence for government incompetence. Cap and trade become the focus of reform efforts in the mid to late 80"s. Epa identifies the total pollution allowed (cap) and distributes permits for that amount subject to trade. Polluters buy and sell permits (trade) based on their cost of operation and how much they pollute. Causes polluters to take responsibility for their pollution and motivates them to innovate. Knowledge demands far less than c&c; reduces costs to polluters and society. New republican president endorses epa"s ideas; not imposing a high cost on many of the industries that backed them; propose using cap and trade.
