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A Model of Benchmarking Regulation: Revisiting the Efficiency of Environmental Standards

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  • Joschka Gerigk
  • Ian MacKenzie
  • Markus Ohndorf

Abstract

The conventional economic argument favors the use of market-based instruments over ‘command-and-control’ regulation. This viewpoint, however, is often limited in the description and characteristics of the latter; namely, environmental standards are often portrayed as lacking structured abatement incentives. Yet contemporary forms of command-and-control regulation, such as standards stipulated via benchmarking, have the potential to be efficient. We provide a first formal analysis of environmental standards based on performance benchmarks. We show that under specific conditions, standards can provide efficient incentives to improve environmental performance. Copyright Springer Science+Business Media Dordrecht 2015

Suggested Citation

  • Joschka Gerigk & Ian MacKenzie & Markus Ohndorf, 2015. "A Model of Benchmarking Regulation: Revisiting the Efficiency of Environmental Standards," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(1), pages 59-82, September.
    • Handle: RePEc:kap:enreec:v:62:y:2015:i:1:p:59-82
    DOI: 10.1007/s10640-014-9815-7
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    Cited by:

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    3. Ulrich Morawetz & Dieter Mayr & Doris Damyanovic, 2016. "Ökonomische Effekte grüner Infrastruktur als Teil eines Grünflächenfaktors. Ein Leitfaden," Working Papers 662016, University of Natural Resources and Life Sciences, Vienna, Department of Economics and Social Sciences, Institute for Sustainable Economic Development.
    4. Guichuan Zhou & Wendi Liu & Liming Zhang & Kaiwen She, 2019. "Can Environmental Regulation Flexibility Explain the Porter Hypothesis?—An Empirical Study Based on the Data of China’s Listed Enterprises," Sustainability, MDPI, vol. 11(8), pages 1-14, April.

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    More about this item

    Keywords

    Environmental standards; Command-and-control regulation; Benchmarking; Relative performance mechanism; Contests; L51; Q50; Q58;
    All these keywords.

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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