Question

When the benefits and costs of pollution reduction are known with certainty, which regulatory instrument will result in the efficient amount of pollution abatement?

Answer 1

More than two decade after environment regulation introduce in USA which are best on population control are also called economic instrument.The benefit of this instruments is lower the population effect. These instruments are mostly used to control SO2 emission under the clean air.there are mostly two regulatory instrument which are used in efficient amount of pollution abatement.

"Command and Control Instrument"

The traditional Approach for pollution abatement

In year 1970 the command and control were introduced in environment policy to shape the structure of environmental policy there are mainly part of this instrument technology based and performance based first one indicate the method and equipment to use to meet the target and second one are used to indicate the overall target for each firm, plant and give firm some knowledge how to make the standard. these approach were also best on 'end of pipe' solution. command and control regulation were successful in pollution abatement.

Economic Instrument

The second instrument which are introduced by economists are economic instrument the main reason behind introduction is that it gives same level of pollution abatement in overall lower cost then command and control instrument. the second one reason is market failure of use of heavy plant for pollution abatement.economist felt that this instrument is more cheaper and eco friendly  for environment there are also two more reason for use of such economic instrument is that it is also have dynamic efficiency ( cheaper in the future) and revenue rising.

The classification of economic instruments

Charge permit hybrids,Tradable permits, charges fee or taxes,deposit refund schemes,subsidies.