Environmental Policy

Public Choice and the Enviornment

Environmental Externalities

Pollution is negative externality: an activity that imposes costs on others

Without intervention or internalization, goods with negative externalities are over produced, consumed realtive to the social optimum

Dye points out that government are also polluters, can shift costs and lwoer taxes for citzens

Costs of Regulation

Benefits of relation to costs

Public choice theory requires that environemntal policieds be evaluation in terms of net benefit

Pollution reduction in general follows patterns of decreasing marginal benefits and increasing marginal costs

Solid Waste Disposal

-each American produces about 5 pounds of solid waste per day and the nation spends billions annualy hauling waste

-disposed of via landfills, incineration, and recycling

-about 1/3 of solid waste is recovered for reuse, but excess of recyclable materials

Hazardous Waste

-waste that poses a threat to public health of the environment

-EPA has authority

Water Pollution

-measured in terms of biochemical oxygen demand

Global Warming Climate Change II

Carbon tax, cap and trade, cap and trade (no auction)

-the way the supply and demand raises