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Pricing and regulating affect environmental ethics

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  • Bruno Frey

Abstract

Effluent charges and tradeable permits are economically efficient but rarely used. A new explanation for this discrepancy is offered. Pricing may crowd out environmental ethics in the pricing, and via spillovers, also in non-pricing sectors. Pricing may therefore increase pollution, providing a reason why decision-makers tend to reject environmental pricing. Five propositions showing the conditions for counterproductive effects are advanced. They are consistent with available empirical evidence. Regulation by setting standards and subsidies damage environmental ethics less than pricing, because pollution is condoned. Damaging environmental ethics may prevent political action in favor of the environment. Copyright Kluwer Academic Publishers 1992

Suggested Citation

  • Bruno Frey, 1992. "Pricing and regulating affect environmental ethics," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 2(4), pages 399-414, July.
    • Handle: RePEc:kap:enreec:v:2:y:1992:i:4:p:399-414
    DOI: 10.1007/BF00304969
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    13. Bazin, D. & Ballet, J. & Touahri, D., 2004. "Environmental responsibility versus taxation," Ecological Economics, Elsevier, vol. 49(2), pages 129-134, June.
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    15. Gerhard Wegner, 1998. "Environmental (De-) Regulation, Competition, and Policy Rules," Constitutional Political Economy, Springer, vol. 9(3), pages 213-234, September.
    16. Timo Goeschl & Grischa Perino, 2012. "Instrument Choice and Motivation: Evidence from a Climate Change Experiment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 52(2), pages 195-212, June.
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    18. Erik Gawel, 2001. "Intrinsische Motivation und umweltpolitische Instrumente," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 2(2), pages 145-165, May.
    19. Samuel Hess, 1998. "Individual Behaviour And Collective Action Towards The Environment:," Rationality and Society, , vol. 10(2), pages 203-221, May.
    20. Meyer, Claas & Matzdorf, Bettina & Müller, Klaus & Schleyer, Christian, 2014. "Cross Compliance as payment for public goods? Understanding EU and US agricultural policies," Ecological Economics, Elsevier, vol. 107(C), pages 185-194.
    21. Bartels, Lara & Werthschulte, Madeline, 2023. ""More bang for the buck"? Evidence on the effectiveness of an energy efficiency subsidy," ZEW Discussion Papers 23-022, ZEW - Leibniz Centre for European Economic Research.
    22. Eichner, Thomas & Pethig, Rüdiger, 2022. "Kantians defy the economists’ mantra of uniform Pigovian emissions taxes," Ecological Economics, Elsevier, vol. 200(C).
    23. Ying Yan Tan & Rosmini Omar, 2022. "Green Practices and Innovations of Traditional Chinese Medicine (TCM) Industry in Singapore: Idea Worth Sharing," Sustainability, MDPI, vol. 14(18), pages 1-38, September.
    24. Kieninger Pia Regina & Gugerell Katharina & Biba Vera & Auberger Isabella & Winter Silvia & Penker Marianne, 2018. "Motivation Crowding and Participation in Agri-Environmental Schemes – The Case of the Austrian Öpul-Programme in Vineyards," European Countryside, Sciendo, vol. 10(3), pages 355-376, September.
    25. Damien Bazin, 2005. "Firms and their Responsibility towards Nature," Post-Print halshs-01070776, HAL.

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