The EU is pushing for lower CO2 standards, beginning with a 20% decrease in pollution output and hopefully leading to 30% of 1990 levels. This is an example of a command and control policy (CAC). Today, most policies are CAC’s, offering direct control, with the same standards set for all those responsible. Twenty Percent sounds good and 1990 levels were lower than those today, but it may not be the best, economically efficient solution.
Each individual company from these industrialized nationshas a different level of CO2 output, and some can decrease emissions cheaper than others. These developing nations mentioned are the real life example. These standards would likely inhibit economic expansion. Their position is warranted. The economically efiicient solution includes alternatives such as an emissions tax or permits to pollute that can be tradable. This reaches the optimum level of pollution abatement because equity is not considered; it’s not as costly overall to society. These growing countries can continue to expand yet lower pollution as well because those that pollute are responsible for purchasing these permits. The possibility of trading is important too because some can reduce pollution levels easier than others.
The text I spent a half hour writing didn’t get posted for some reason. This is just the excerpt from the article. I basically went into economically efficient alternatives to aid the developing countires mentioned. I just don’t have it in me to do it all again. It’s upsetting.
Comment by colecom — February 20, 2007 @ 7:19 am