By Organisation for Economic Co-Operation and Development
Booklet via enterprise for monetary Co-Operation and improvement
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I will, therefore, focus my discussion on two questions: Why is a single instrument not appropriate? What is the best mix of instruments? Before addressing these questions, it is important to recap the general framework of environmental policy objectives and instruments. As far as the economic objective is concerned, there are two main options. One, the so-called first best option, is welfare maximizing. The instrument that may be used, a Pigovian tax for instance, corrects the misleading signal of the market in order to equalize the marginal abatement cost and the marginal external cost.
They find that, for any given percentage reduction in waste disposal, the UCTS is the least costly option, followed by the ADF; the recycling subsidy is the most costly approach. For a 10% reduction in waste from 1990 levels, they calculate that it would be necessary to implement an across-the-board UCTS of $45, an ADF of $85, or a recycling subsidy of $98. Thus, EPR-based policies–the UCTS or an ADF, in this case–are less costly ways to achieve waste-reduction goals than a non-EPR policy, a recycling subsidy.
Journal of Environmental Economics and Management 41: 109–134. 46 Environmental Resources Management (1999), Tradable Certificates for Recycling of Waste Electrical and Electronic Equipment, report to the European Commission (June). pdf. B. Biddle, T. S. J. A. Thompson (2000), Characterization and Processing of Plastics from Minnesota’s Demonstration Project for the Recovery of End-of-Life Electronics, paper presented at Society of Plastics Engineers Annual Recycling Conference, November 8–9, Dearborn, Michigan.