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Why Does Environmental Policy in Representative Democracies Tend to Be Inadequate? A Preliminary Public Choice Analysis

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  • Andrea Kollmann

    (Energy Institute, Johannes Kepler University, Linz, Altenberger Straße 69, 4040 Linz, Austria)

  • Friedrich Schneider

    (Institute of Economics, Johannes Kepler University, Linz, Altenberger Straße 69, 4040 Linz, Austria)

Abstract

There is a widespread consensus among the most important players in developed countries (voters, politicians, producers, traditional and green interest groups and bureaucracies) that a shift towards an eco-social market economy is essential for sustainable growth. Nevertheless, market-based instruments have not as yet been implemented satisfactorily in environmental policy. To identify the reasons for this insufficient implementation over the past decade, the Public Choice theory is used. The players’ behavior is analyzed in order to show that their incentives for implementing market-based instruments in environmental policy, instead of command-and-control measures, are surprisingly weak. Knowing the obstacles to implementing market-based instruments provides valuable insight into how to overcome them.

Suggested Citation

  • Andrea Kollmann & Friedrich Schneider, 2010. "Why Does Environmental Policy in Representative Democracies Tend to Be Inadequate? A Preliminary Public Choice Analysis," Sustainability, MDPI, vol. 2(12), pages 1-25, November.
    • Handle: RePEc:gam:jsusta:v:2:y:2010:i:12:p:3710-3734:d:10376
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    More about this item

    Keywords

    public choice and environmental policies; sustainability; voters; government; interest groups; tradable permits; green taxes [D23; D62; D72; D73; H23; Q57; Q58];
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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