The recent wave of global warming legislation and litigation represents a triumph for climate change activists. But it is in no way a rational, economically sound response to the problems potentially raised by global warming. It ignores the likely costs and benefits of global warming on...

This article evaluates an environmental protection instrument that the literature has hitherto largely overlooked, Dirty Input Limits (DILs), quantitative limits on the inputs that cause pollution. DILs provide an alternative to cumbersome output-based emissions trading and performance...

This paper suggests that a mixture of measures may be needed to encourage renewable energy under the Kyoto Protocol. It explains that the goal of maximizing short term cost effectiveness tends to conflict with the goal of encouraging the long-term technological development that the world will...

This paper investigates the existing Italian regulation regarding theso-called "administration by agreements" and the possibility to adapt the existing legal system to voluntary agreements in the environmental field in the light of the European guidelines on this issue. The research consists of...

We extend the economic theory of regulation to allow for strategic self-regulation that preempts political action. When political "entry" is costly for consumers, firms can deter it through voluntary restraints. Unlike standard entry models, deterrence is achieved by overinvesting to raise the...

Increasingly popular tailored regulation (TR) initiatives like EPA's Project XL allow plants to voluntarily substitute site-specific environmental performance standards for command-and-control regulations that dictate pollution abatement strategies. TR can significantly reduce participants'...

Many economists have studied the effects of political, administrative, and legal institutions on the design and performance of environmental policies. While there have been a number of empirical studies of some institutional effects, not all aspects of enforcement activities have been examined...

This paper asks whether the European Union's (EU) Emissions Trading Scheme has encouraged investment in renewable energy and energy efficiency projects in developing countries. So far, it has produced very little investment in either in spite of the EU's decision to allow credits for projects...

Regulatory reform through the use of economic incentive programs such as emissions-trading markets has become increasingly popular because of the promise of substantial cost savings. However, these prospective economic benefits will not be the sole determinant of whether these reforms will be...

In the realm of environmental policy instrument choice, there is great divergence between the recommendations of normative economic theory and positive political reality. Four gaps stand out. First, despite the advantages of market-based policy instruments, they have been used to a minor degree,...