Reducing Pressures on the Environment: Forward-Looking Solutions and the Role of Formal Models

Abstract

Environmental problems result in substantial part as by-products of industrial production. These problems are sufficiently severe as to require independent analysis to determine where the public interest lies, and governmental intervention to assure that it is taken into account, because the profit-seeking orientation of industrial decision-makers is often at odds with avoiding environmental problems. The interventions may be direct, taking the form of regulations that require or prohibit certain actions, or indirect, in that they change the perceived attractiveness (e.g., the relative costs) of different courses of action.