Evaluation of how Market-Based Policies deal with Global Environmental Essay

Evaluation of how Market-Based Policies deal with Global Environmental Problems - Essay Example According to the paper findings most policy makers are advocating for the reduction of regulations in an effort to make sure that the market fully protects the environment. One of the main market instruments or policies is the discharge fee system, which considers a tax or fee on the generated pollution. This method is effective in a situation whereby the costs of reducing pollution is equal to the amount of charges paid. As the report stresses the instrument is beneficial in guaranteeing substantial savings on the costs incurred to control pollution as compared to other instruments such as the Command and Control that forces companies to reduce their rate of pollution at the same rate or use similar equipment. The tax or discharge programs have been in use in an effort to reduce the production of toxic chemicals and enhance sound mechanisms of dealing with solid wastes through charging people based on the garbage they discard. There is a downside to adopting the discharge fee instrument in curbing environmental problems. This is a conventional method that has been proposed by various economists since they are not necessarily concerned with the level or rate of pollution but are focused on determining its impacts. This approach has numerous limitations, considering that calculating of the costs incurred as a result of the negative impacts of pollution is a strenuous task. This means that choosing the suitable level of tax can be tedious and complex.