Advantages of mbis, Public Economics

Advantages of MBIs

There are several advantages of economic instruments such as:

i) These are efficient in allocation of resources;

ii) They provide incentives for innovations in clean technology;

iii) They are more appropriate when policy emphasis is shifted towards a preventive measure,

iv) They can be an important source of revenue for the government.

In fact, the MBIs are considered to provide 'double dividend', in the sense that they control pollution on the one hand, and generate revenue on the other. The revenue generated through MBIs can further be utilized for environmental protection.

In order to achieve the objectives, MBIs use the market system to evolve two kinds of policy measures such as

i) Administered price, and

ii) Administered market.

In the case of administered price, existing price of polluting good is modified through policy measures to include the social cost of environmental degradation. In this situation obviously, environmental valuation quires special significance in advocating the administered price concept. Hence, administered price either creates price or modifies the existing price to reflect the environmental impact. Similarly, administered market creates a market for environmental pollution, which did not exist before. Tradable permits are the best example for this concept as it creates market for 'pollution abatement' (that is, removal of pollution) through emission trading. The flexibility of MBIs is reflected through selection of appropriate technology for pollution control which minimises cost of compliance but, without any interference of the regulatory authorities.

 

Posted Date: 12/18/2012 6:53:51 AM | Location : United States







Related Discussions:- Advantages of mbis, Assignment Help, Ask Question on Advantages of mbis, Get Answer, Expert's Help, Advantages of mbis Discussions

Write discussion on Advantages of mbis
Your posts are moderated
Related Questions
Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

1. is pareto improved demonstrated using the edgeworth box daigram?

The other type is called ex-post heterogeneity which refer to the conflict (of interests) arising due to distributional implications of the public policy. Thus when a public polic

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Sustainability, more recently referred to as ‘sustainable development', came from the idea of integrating economic development and environmental protection. The concept is based on


Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

QUESTION (i) ‘The area of E-Government encompasses three major domains. These domains address the problems that Government is too inefficient and ineffective; too selfserving a

In the wake of the Asian financial crisis, policymakers, governments, and academics around the world are busy devising ways to reform the global financial architecture. The plethor

Public Finance was always dealing with intervention through fiscal instruments, including federal relationships between different tiers of governments and later on it subsumed Publ