Environmental Pricing in Transport
Transport activity is inextricably linked with environmental damage. Economists traditionally urge policy makers to adopt pricing solutions, in particular taxes, to reduce environmental damage rather than quantity restrictions or standards. This chapter examines environmental pricing, defined broadly to include emission taxes, product taxes and subsidies and compares it to alternative approaches. We begin with a simple formal model to demonstrate the relative efficiency properties of pricing solutions, before highlighting some of the associated implementation problems. We then extend the scope and realism of the analysis by examining the choice between regulatory instruments in the presence of several market distortions. The basic case for environmental taxes, set at the correct level, is shown to remain. It is impossible to cover all modes and all real world case studies of pricing in this text. Rather, we illustrate our central point in the context of air pollution from car use. However, as we stress in the concluding section, the essential insight from the model applies to a whole range of enviromental problems in the transport sector. Readers interested in surveys of practical experiences are referred to The Policy Issues chapters of Handbook 6. A general introduction to the choice of regulatory instruments to tackle environmental damage can be found in Kolstad (1999).
|Date of creation:||Sep 2002|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +32-(0)16-32 67 25
Fax: +32-(0)16-32 67 96
Web page: http://www.econ.kuleuven.be/ew/academic/energmil
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:ete:etewps:ete0208. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Isabelle)The email address of this maintainer does not seem to be valid anymore. Please ask Isabelle to update the entry or send us the correct address
If references are entirely missing, you can add them using this form.