Economics and Environment Policy Essay Example | Topics and Well Written Essays - 1500 words

Economics and Environment Policy - Essay Example It would be very relevant to quote a few sentences regarding the definition of Environmental economics laid down by the National Bureau of Economic Research Environmental Economics program. "undertakes theoretical or empirical studies of the economic effects of national or local environmental policies around the world. Particular issues include the costs and benefits of alternative environmental policies to deal with air pollution, water quality, toxic substances, solid waste, and global warming." (para 6) According to Davis Lamb the environmental economics' focal point is to centralise on the perception of externality of environment. In other word some or more of the outcomes of a commotion are not evaluated in accordance to its fiscal result. As an example he states that when the pollution level of a given state reaches its optimum level the price of the producer of this pollution subject should be taken into consideration otherwise the balance would be in the brink of commotion. Therefore it is encouraged to formulate the outcome of a polluting medium in respect of utility oriented price format. "in connection to public goods (goods that are "non-excludable" and "non-rival" - that is, they are open to all). Visitors to an open-access recreational area will use the resource more than if they had to pay for it, leading to environmental degradation. This of course assumes that there is no other policy instrument (for example, permits, regulation) being used to control access." (Lamb, 2006, 148) In economic terminology, according to, Davis Lamb in his book Cult to Culture: The Development of Civilization on the Strategic Strata, "these are examples of market failures, and that is an outcome which is not efficient in an economic sense. Here the inefficiency is caused because too much of the polluting activity will be carried out, as the polluter will not take the interests of those adversely affected by the pollution into account. This has led to controversial research into measuring well-being which tries to measure when pollution is actually starting to affect human health and general quality of life". (Lamb, 2006, pg 149) Therefore it is quite evident that the prime concern of the subject environmental economics is to formulate logical outcome and settlement of the issue of pollution and control thereby saving the environment. To attain this objective there are four major solution schemes present as effective tool. Along with these four there are also other alternative tools that are quite logical in implementation. The four basic formulations could be enumerated as Better defined property rights Taxes and tariffs on pollution or Removal of "dirty subsidies" Quotas on pollution Environmental regulations According to the Coase Theorem the assigning property rights is based on a fact that there is all probability that this application would lead to an optimal solution of environmental policies of economics whereby in accordance to regardless of who receives them, the basic