Negative Externalities

Résumé du document

The 'Sixth Environment Action Program', also known as 'Environment 2010: Our future, Our choice?', devised by the European Commission, highlights how important the scale of action to implement environmental policies is. Even though the classical theory states that markets are able to solve the problem of the allocation of resources efficiently, market failures do exist, and lead to a situation in which markets do not efficiently organise production or allocate goods and services to consumers. As far as environment is concerned, market failures are also known as negative externalities (Pigou), that is to say, that a decision taken by a firm (or the aggregation of all decisions taken by firms), causes costs to the stakeholders more than the person making the decision.

Extraits

[...] In this case, regulation seems the most appropriate response. Some propositions have been made to impose regular, controlled degassing that would avoid any wild cleaning. It is efficient, effective, easy to monitor, a good incentive to modernise boats by installing double cocks, it is flexible and equitable. Unfortunately, so far lobbies have done their best for it not to happen. In this case, it would be no use implementing the tradable permits system for no wild pollution is to be allowed. [...]

[...] Let's take the example of air pollution, a flow pollutant. The primary air pollutants found in urban areas are carbon monoxide, nitrogen oxides, sulphur oxides and hydrocarbons[16] (see document .The pollution of air, damaging human health, the environment and participated to the greenhouse effect leading to global warming has been one of the main issue discussed by scientists over the last few years . In the climat 2005 meeting that occurred in France during the last few days, the focus was put on the necessity to reduce by four carbon dioxide emissions before 2050[18]. [...]

[...] Bibliography Books * Perman. Common. Natural Ressources and Environmental Economics, Person Education Unlimited Glasgow * A.M Freeman III, The Economics of Environmental Policy, John Wiley and sons Canada * Organisation for Economic Co-Operation and Development, Environmental Policies in Japan, OECD, Paris 1977 * Lecture number 2 * Charles T. Stewart Jr, Air Pollution, Human Health and Public Policy, Lexington books, Toronto * The Dobris Assesment, Europe's Environment, European Environment Agency, Copenhagen * Paul.R.Portney, Public Policies for Environmental Protection, The Johns Hopkins University Press, Washington Websites * http://europa.eu.int/ * http://en.wikipedia.org/wiki/ * www.bized.ac.uk * http://www.environment-agency.gov.uk/ * http://www.sante.gouv.fr/ * http://www.liberation.fr/ * http://unfccc.int/ * http://membres.lycos.fr/pow0/Erika.htm * http://fr.news.yahoo.com/ http://europa.eu.int/comm/environment/index_en.htm http://en.wikipedia.org/wiki/Market_failure www.bized.ac.uk Perman. [...]

[...] First of all, there is a lack of well defined and enforceable property rights. A distinction is to be made here between open access and common property goods[6], the latter belonging only to a group of people. For environment services do not pass through markets, they fail to attach price to them and therefore fail to guide their allocation to the highest value uses. Moreover, the environment is often considered as a public good, which, subject to the free rider phenomena, requires the government intervention to correct negative externalities . [...]

[...] Not only is it an economic debate but also a political issue. In today's world, most countries try to implement national environmental policies, as a result of a choice of society. In Japan, the pollution abatement policy appears to be largely non-economic[11], meaning economic benefits are not systematically taken into account, probably because Japan has been suffering greatly from air pollution. Moreover it stands out by the early importance given to local governments in implementing environmental policies in a very hierarchical country[12]. [...]