question archive Understanding different policy options to correct for negative externalities - Carbon dioxide emissions have been linked to increased air pollution
Understanding different policy options to correct for negative externalities - Carbon dioxide emissions have been linked to increased air pollution
Subject:MarketingPrice:2.88 Bought18
Understanding different policy options to correct for negative externalities - Carbon dioxide emissions have been linked to increased air pollution. The following table lists some possible public policies aimed at reducing the amount of carbon dioxide in the air.
For each policy listed, identify whether it is a command-and-control policy (regulation), tradable permit system, corrective subsidy, or corrective tax.
Public Policies
- The government orders every factory to adopt a new technology, which reduces carbon-dioxide emissions into the atmosphere.
- Trees take carbon dioxide out of the air and convert it to oxygen, so the government funds a tree-planting initiative by offering $400 to any citizens who plants a tree.
- The government limits total carbon-dioxide emissions by all factories to 120,000 tons per decade. Each individual factory is given the right to emit 110 tons of carbon dioxide, and factories may buy and sell these rights in a marketplace.
- The government charges factories $400 for every ton of carbon dioxide they emit.
Purchase A New Answer
Custom new solution created by our subject matter experts
GET A QUOTE
Answer Preview
1. A command-and-control policy (regulation). This kind of control by the government dictates to the factories measures to take to minimize pollution to the atmosphere.
2. A corrective subsidy. The government has provided financial assistance of $400 to the citizens to facilitate them to plant trees. In turn, the trees will help to diminish the amount of carbon dioxide in the atmosphere.
3. Tradable permit system. The government has issued to each firm a maximum allowable emission rate of 110 tons of carbon dioxide. The permits can then be traded to companies that need more permits to continue with their operations.
4. Corrective tax. The government has imposed a corrective tax of $400 for each ton of carbon dioxide companies generate. This charge is meant to make the companies pay for polluting the atmosphere.
