Incentives For Non-pollution

7 Pages 1816 Words

Economic incentives are instruments that use financial means to motivate polluters to reduce the health and environmental risks posed by their facilities, processes, or products. These incentives provide monetary and near-monetary awards for polluting less and impose costs of various types for polluting more, thus supplying motivation for polluters to change their behavior. The report distinguishes seven basic types of incentives: Pollution charges, fees, and taxes; deposit-refund systems; trading programs; subsidies for pollution control, liability approaches; information disclosure; voluntary programs.
Economic incentives offer several advantages that make them attractive environmental management tools. First, economic incentives, in some circumstances, can be structured to achieve larger reductions in pollution than would result from traditional regulations. Second, economic incentives often can control pollution at lower costs than can traditional regulations. Third, the use of economic incentives, in contrast to that of traditional regulations, can more easily control pollution generated by a multitude of small and dispersed sources. Fourth, economic incentives can stimulate technological improvements and innovations in pollution control in situations where traditional regulatory mechanisms may not.
Progressive companies are shifting rapidly from an approach of compliance to one of proactive environmental management. The revolution in thinking has gone through three stages: 1) the widespread business practice in the 1960s and 1970s of coping with environmental crises as they occurred and of attempting to control the resulting damage; 2) the reactive mode in the 1980s of struggling to comply with rapidly changing government environmental regulations and minimizing the costs of compliance; 3) the proactive environmental management strategy in the 1990s, through which corporations began to anticipate the environmental impacts of th...