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Water Pollution Taxes: A Good Idea Doomed to Failure?

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  • Boyd, James

    (Resources for the Future)

Abstract

Water pollution taxes, or effluent fees, have long been advocated by environmental economists as a regulatory approach to cost effectively achieve water quality improvements. The article reviews the arguments in favor of taxes and traces the history of the idea in U.S. policy debates. Particular attention is given to the institutional challenges presented by a tax system and its application in watershed contexts where transport phenomena are important. The article also addresses the question of why effluent taxes are so rarely seen in practice.

Suggested Citation

  • Boyd, James, 2003. "Water Pollution Taxes: A Good Idea Doomed to Failure?," RFF Working Paper Series dp-03-20, Resources for the Future.
    • Handle: RePEc:rff:dpaper:dp-03-20
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    File URL: http://www.rff.org/RFF/documents/RFF-DP-03-20.pdf
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    References listed on IDEAS

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    7. Segerson, Kathleen, 1988. "Uncertainty and incentives for nonpoint pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 15(1), pages 87-98, March.
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    9. Revesz, Richard L. & Stavins, Robert N., 2007. "Environmental Law," Handbook of Law and Economics, in: A. Mitchell Polinsky & Steven Shavell (ed.), Handbook of Law and Economics, edition 1, volume 1, chapter 8, pages 499-589, Elsevier.
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    11. Bohm, Peter & Russell, Clifford S., 1985. "Comparative analysis of alternative policy instruments," Handbook of Natural Resource and Energy Economics, in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 1, chapter 10, pages 395-460, Elsevier.
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    Cited by:

    1. Lori Bennear & Robert Stavins, 2007. "Second-best theory and the use of multiple policy instruments," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 37(1), pages 111-129, May.
    2. Lan , Le & Iftekhar, MD Sayed & Fogarty, James & Schilizzi, Steven, 2020. "Cost of uniform “cut”: Management of declining groundwater in the presence of environmental damages," Working Papers 307434, University of Western Australia, School of Agricultural and Resource Economics.
    3. James Shortle, 2017. "Policy Nook: “Economic Incentives for Water Quality Protection”," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(02), pages 1-11, April.
    4. Sheila M. Olmstead, 2010. "The Economics of Water Quality," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 4(1), pages 44-62, Winter.
    5. James Shortle & Richard D. Horan, 2013. "Policy Instruments for Water Quality Protection," Annual Review of Resource Economics, Annual Reviews, vol. 5(1), pages 111-138, June.
    6. Ian W.H. Parry & Mr. John Norregaard & Mr. Dirk Heine, 2012. "Environmental Tax Reform: Principles from Theory and Practice to Date," IMF Working Papers 2012/180, International Monetary Fund.
    7. James Shortle & Richard D. Horan, 2017. "Nutrient Pollution: A Wicked Challenge for Economic Instruments," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(02), pages 1-39, April.
    8. Weixin Yang & Lingguang Li, 2017. "Efficiency Evaluation and Policy Analysis of Industrial Wastewater Control in China," Energies, MDPI, vol. 10(8), pages 1-18, August.

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    More about this item

    Keywords

    water quality; effluent fees; market-based incentives;
    All these keywords.

    JEL classification:

    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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