The Political Economy of Environmental Scarcity
In this chapter, we review some of the principles which should govern environmental policy, we study some of the implications of these principles and we indicate why the political process often deviates from them. The center of the stage is dominated by the opportunity costs principle which requires that the opportunity costs of using the environment as a receptacle of wastes as well as a public consumption good have to be taken into account. In a decentralized economy, these costs have to be attributed to the subsystems of the economy, for instance through the polluter pays principle. Additional requirements for environmental policy are the principle of long-run orientation and the principle of interdependence. The chapter also briefly looks at environmental legislation in the last twenty years.
KeywordsOpportunity Cost Environmental Policy Free Rider Late Sixty Mental Medium
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- 1.One pragmatic approach in this context is the Victim-Pays-Principle or the Benefitor’s Principle (Nutznießer-Prinzip) stressed by Meissner (1985). Note, however, that this principle merely is a way of financing; it does not solve the free rider issue.Google Scholar