IDEAS home Printed from
   My bibliography  Save this paper

Relative Efficiency of Voluntary Versus Mandatory Environmental Regulations (The)


  • Wu, JunJie
  • Babcock, Bruce A.


Increased use of voluntary programs for environmental protection as an alternative to mandatory approaches raises the issue of the relative efficiency of the two approaches. This paper analyzes the efficiency of voluntary programs relative to mandatory programs in agriculture. Under the voluntary program producers adopt a land conservation practice and, in turn, the government provides technical and financial assistance. The voluntary program is more efficient than a program that mandates adoption if and only if the deadweight losses of government expenditures under the voluntary program are less than the difference between private and public costs of government services plus the additional implementation costs of the mandatory program. This necessary and sufficient condition is more likely to be satisfied when (a) the deadweight loss from raising government revenue is zero or small, (b) government services are less rival, (c) the costs of government services are lower than what farmers would have to pay for equivalent private services, (d) the number of farms in the program is large, and (e) the saving in implementation costs under the voluntary program is large and increases rapidly with program acreage.

Suggested Citation

  • Wu, JunJie & Babcock, Bruce A., 1999. "Relative Efficiency of Voluntary Versus Mandatory Environmental Regulations (The)," Staff General Research Papers Archive 1014, Iowa State University, Department of Economics.
  • Handle: RePEc:isu:genres:1014

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    1. Scott L. Johnson & Richard M. Adams & Gregory M. Perry, 1991. "The On-Farm Costs of Reducing Groundwater Pollution," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(4), pages 1063-1073.
    2. Dewees, Donald N, 1983. "Instrument Choice in Environmental Policy," Economic Inquiry, Western Economic Association International, vol. 21(1), pages 53-71, January.
    3. Harrington, Winston, 1988. "Enforcement leverage when penalties are restricted," Journal of Public Economics, Elsevier, vol. 37(1), pages 29-53, October.
    4. Harford, Jon D., 1978. "Firm behavior under imperfectly enforceable pollution standards and taxes," Journal of Environmental Economics and Management, Elsevier, vol. 5(1), pages 26-43, March.
    5. Stranlund John K., 1995. "Public Mechanisms to Support Compliance to an Environmental Norm," Journal of Environmental Economics and Management, Elsevier, vol. 28(2), pages 205-222, March.
    6. 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.
    7. Adar, Zvi & Griffin, James M., 1976. "Uncertainty and the choice of pollution control instruments," Journal of Environmental Economics and Management, Elsevier, vol. 3(3), pages 178-188, October.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Strauss, Peter & Leone, Antonio & Ripa, Maria & Turpin, Nadine & Lescot, Jean-Marie & Laplana, Ramon, 2006. "Using critical source areas for targeting cost-effective best management practices to mitigate phosphorus and sediment transfer at the watershed scale," MPRA Paper 66256, University Library of Munich, Germany.
    2. Khanna, Madhu & Isik, Murat & Zilberman, David, 2002. "Cost-effectiveness of alternative green payment policies for conservation technology adoption with heterogeneous land quality," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 27(2), August.
    3. Feng, Hongli & Kling, Catherine L. & Kurkalova, Lyubov & Secchi, Silvia, 2006. "Subsidies! The Other Incentive†Based Instrument: The Case of the Conservation Reserve Program," ISU General Staff Papers 200610010700001366, Iowa State University, Department of Economics.
    4. Juutinen, Artti & Mäntymaa, Erkki & Ollikainen, Markku, 2013. "Landowners’ conservation motives and the size of information rents in environmental bidding systems," Journal of Forest Economics, Elsevier, vol. 19(2), pages 128-148.
    5. Feng, Hongli & Kling, Catherine L. & Kurkalova, Lyubov A. & Secchi, Silvia, 2007. "Cac Versus Incentive-Based Instruments in Agriculture: The Case of the Conservation Reserve Program," Staff General Research Papers Archive 10796, Iowa State University, Department of Economics.
    6. Juutinen, Artti & Mantymaa, Erkki & Monkkonen, Mikko & Svento, Rauli, 2008. "Voluntary agreements in protecting privately owned forests in Finland -- To buy or to lease," Forest Policy and Economics, Elsevier, vol. 10(4), pages 230-239, February.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:isu:genres:1014. 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: (Curtis Balmer). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.