Implementation of Policy Instruments for Chlorinated Solvents: A Comparison of Design Standards, Bans, and Taxes to Phase Out Trichloroethylene
AbstractThis paper studies the Swedish prohibition of the hazardous solvent Trichloroethylene (TCE). Sweden is alone in completely prohibiting its use. The ban has been at best a partial success and illustrates the dilemmas of policymaking. Use has declined but not stopped, largely because the decision to ban TCE was challenged in the courts. Recently, the EU Court of Justice decided in favor of Sweden’s right to have a ban. This article analyzes abatement cost data to show that the cost of replacing TCE is low for most plants, although there appear to be a few firms for which it may be quite high. A crosscountry comparison indicates that the Swedish ban was less effective than the very strict technical requirements in Germany or the tax used in Norway. A tax (or deposit refund scheme) would be a good mechanism to achieve a swift phaseout.
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Bibliographic InfoPaper provided by Resources For the Future in its series Discussion Papers with number dp-01-32.
Date of creation: 01 Sep 2001
Date of revision:
hazardous chemicals; regulation; environmental tax; solvents;
Find related papers by JEL classification:
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
- K32 - Law and Economics - - Other Substantive Areas of Law - - - Environmental, Health, and Safety Law
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- Seema Arora & Timothy N. Cason, 1996. "Why Do Firms Volunteer to Exceed Environmental Regulations? Understanding Participation in EPA's 33/50 Program," Land Economics, University of Wisconsin Press, vol. 72(4), pages 413-432.
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- Dario Bonato & Armin Schmutzler, 2000. "When do Finns Benefit from Environmental Regulations? A Simple Microeconomic Approach to the Porter Controversy," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 136(IV), pages 513-530, December.
- Birkenfeld, Florian & Gastl, Daniel & Heblich, Stephan & Lienert, Ferry & Maergoyz, Mascha & Mont, Oksana & Plepys, Andrius, 2005. "Product ban versus risk management by setting emission and technology requirements: The effect of different regulatory schemes taking the use of trichloroethylene in Sweden and Germany as an example," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-37-05, University of Passau, Faculty of Business and Economics.
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