The Costs and Benefits of Environmental Regulation

The Costs and Benefits of Environmental Regulation

Imad A. Moosa and Vikash Ramiah

The Costs and Benefits of Environmental Regulation presents a thorough investigation into environmental regulation, its economic and financial effects and the associated costs and benefits. A variety of issues, pertaining to regulation in general and environmental regulation in particular, are examined. These issues include the theories of regulation and how it is viewed in terms of the free market doctrine, forms of regulation, command-and-control regulation as opposed to market-based regulation and the cost–benefit analysis of environmental regulation.

Chapter 1: Regulation: definition and classification

Imad A. Moosa and Vikash Ramiah

Subjects: economics and finance, environmental economics, environment, environmental economics, environmental governance and regulation, politics and public policy, environmental governance and regulation

Extract

This book is about environmental regulation – a set of laws and rules designed to eliminate or reduce the risk posed by environmental hazards on individuals and the ecosystem. Almost every aspect of our life is touched by environmental regulation. Drinking water must meet certain quality standards before it is consumed by the public. Car manufacturers must comply with emission standards to protect air quality. Environmental regulation governs the manufacture, storage, transport and disposal of the hazardous chemicals used to make deodorants, hair sprays, perfumes, make-up, fertilizers, herbicides, pesticides, detergents, cleansers, batteries, and a variety of other products that we commonly use. The presence and stringency of regulatory rules vary from one country to another, but the overall description of environmental regulation is universally valid. Before we investigate the specifics of environmental regulation it is useful to examine regulation in general. This discussion, which is the subject matter of this chapter, should put things into perspective and facilitate a consideration of the pros and cons of environmental regulation. In Chapter 2 we consider the concept of ‘free market’, which is the antithesis of regulation. A heated debate has been raging on the economic and financial effects of regulation. The debate has taken on political and ideological dimensions, particularly as governments try to revive their economies from the aftermath of the global financial crisis.