Design And Implementation Of Environmental Regulation Mechanisms Of Effect

The complete environmental regulation theory must resolve the following three key problems:(1) Why to implement environmental regulation? Once regulation, how to handle the relationshipbetween government and market? (2) How to assign environmental property rights betweenpolluters and victims? Especially, why do the environmental regulation mechanisms aiming atpolluters become a predominating institutional arrangement? (3) How to design environmentalregulation mechanisms which can make a tradeoff between economic growth and environmentalprotection? This dissertation provides answers to these three problems. This dissertation isarranged as following:Chapter 1. Introduction. This chapter includes the presentation of problems, the definition ofresearch range, and the innovations and drawbacks of this dissertation, and so on.Chapter 2. Market Failure, Government Failure, and the Evolution of the EnvironmentalRegulation Theories. As to environmental problems, the public interest school thinks it is themarket failure that lead to the environmental pollution. Which makes the government interventionnecessary. On the contrary, the interest group school thinks the govemment failure is just a realtreat to environment. Therefore, Chapter 2 launches a survey on market failure and governmentfailure from the view of microeconomic factors and the economic policy empirical evidencefactors respectively. Chapter 2 points out that the public interest school and the interest groupschool exist common drawback, which is they compare ideal government with actual market, oractual government with ideal market. Actually, market failure and government failure all causeenvironmental problems. Therefore, only the combination of government regulation and marketmechanism can resolve the environmental problems efficiently, government regulation or marketmechanism does not work alone. Along with people's deep understanding the governmentfunction and the market function gradually, the environmental regulation theory with thecomparative institutional analysis angle of view starts to give up the traditional oppositionstandpoint, and thinks the relationship between actual market and actual government iscoexistent and complementary. They are different forms of contracts and governance structures,and are one of the social strategies to protect environment and make the individual keep goodbehavior.Chapter 3. The Efficient Assignment of Environmental Property Rights. The environmentalregulation theory with the comparative institutional analysis angle of view emphasizes thatefficient market and impartial government are all necessary for environmental protection. Thisprinciple is executed to protect environment by the design and implementation of market-basedregulation mechanisms. However, the clear definition of environmental property rights is anecessary precondition for the design and implementation of any regulation mechanisms invarious environmental governance contracts. Therefore, the environmental property rights stillmaintain collective appearance not private property rights. Because of the existence of two-sidemoral hazards, simply shifting environmental property rights will not, in general, result in efficientavoidance allocation decisions by polluters and victims. Therefore, such simple shifting does not,generally speaking, result in a competitive equilibrium that is a Pareto optimum. Comparingdifferent avoidance allocations arising from two different patterns of environmental property rightsassignment is thus a comparison of two inefficient equilibria. This comparison helps to identify "the cheapest cost avoider" and confirm which pattern is more efficient.Chapter 4. The Design of the Market-Based Environmental Regulation Mechanisms.Although the assignment of environmental property rights has been a pending theoreticalproblem since Coase(1960), a number of environmental regulation mechanisms aiming atpolluters have already existed. From the following four dimensions, pollution reduction efficiency,the regulation cost allotment effect, uncertainty property, and the degree of incentive on pollutionreduction technology progress, Chapter 4 makes a comparison of function among themarket-based environmental regulation mechanisms. The comparison shows that themarket-based environmental regulation mechanisms have an obvious advantage over theconventional "command-and-control" type mechanisms in cost efficiency and incentive on theinvention and spread of pollution reduction technology; so that the establishment of theenvironment policy is not a simple choice between the market-based regulation mechanisms and"command-and-control" type mechanisms. For the sake of satisfying the requirement of efficiency,feasibility and equitable allocation, the combination of these two types are needed. There is nofixed model in government intervention, and any mechanism cannot achieve the environmentalprotection goal independently. Both market-based mechanisms and "command-and-control"mechanisms are all helpful to protect environment. In particular, which kind of regulationmechanism is more efficient is determined by various characteristics of the environmentalproblem and the social, political, and economic situation. As a result, we should analyze the realchallenge that all participants will face in the process of environmental regulation, then choosethe best regulation mechanism to protect environment.Chapter 5. The Practice of the Market-Based Regulation Mechanisms in the United Statesand Europe. To prove the accuracy of conclusions derived from Chapter 4 further, Chapter 5makes a survey on the practice of market-based mechanisms in the United States and Europe.The survey shows that a number of environmental regulation mechanisms are widely used in theUnited States and Europe, and these mechanisms play an important role in pollution reductionand cost efficiency. The survey shows that the transferable emission permits mechanism is usedmore and more frequently in the United States, and the effluent charge mechanism has not beenneglected. A few effluent charge mechanisms are used in a great deal. In addition, thegovernment subsidy reduction mechanism is also often used to protect environment in the UnitedStates. In Europe, more and more people pay attention to the transferable emission permitsmechanism. The core principles of this mechanism are spreading and some European countrieshave already tried to adopt it to protect environment. For all that, the effluent charge mechanismis still a main tool for European countries to control pollution, and the transferable emissionpermit mechanism is placed in the edge position so far. Because of the low level of charge in alarge number of European countries, generally speaking, the financing function of the chargemechanisms exceeds their pollution reduction effect. However, these mechanisms still bringabout influence on the people's behavior. To some extent, they are helpful for Europeancountries to achieve their environmental regulation goal.Chapter 6. The Influence of Sulfur Dioxide Emission Tax on Chinese Economy. Owing tosulfur dioxide emission's serious impact and its quantity rebounded in China last few years,Chapter 6 selects sulfur dioxide emission as research object. Using Chinese social accountingmatrix balance sheet of 2002 year as data base, Chapter 6 launches a simulation analysis toexpose sulfur dioxide emission tax's pollution reduction effect and its influence on Chinese economy. This simulation analysis is carried out on the basis of a static computable generalequilibrium (CGE) model. This simulation analysis indicates that the sulfur dioxide emission taxefficiently promotes adjustment on economic structure and energy consumption structure. Thesulfur dioxide emission tax not only achieves its goal but also does not impose a greatly negativeinfluence on Chinese economy. To some extent, this proves the conclusion of Chapter 4 andprovides theoretical basis for further putting forward the policy suggestions.Chapter 7. Main Conclusions and Policy Suggestions. On the basis of concluding thedissertation, Chapter 7 puts forward policy suggestions on how to design and implement themarket-based environmental regulation mechanisms in China.