Framing Environmental Policy in the European Union
New Horizons in Environmental Economics series
Chapter 4: Centralized or Decentralized European Environmental Policy?
1. INTRODUCTION The creation of the internal market in the Community at the beginning of the 1990s has aﬀected the national choice of environmental policy instruments. Product standards covering mobile emission sources, such as cosmetics containing CFCs, or commercial products containing polluting substances, will be environmentally ineﬀective due to the principle of mutual recognition. To the extent that this principle applies in the Community, the result is that products which fail to meet the standards set by one Member State cannot be prevented from being imported from other Member States, thereby undermining stricter national environmental standards. However, at the beginning of the 1990s the principle of subsidiarity entered the political agenda in the Community as an instrument of decentralization and a guarantee that the decisions were to be taken as close as possible to the citizen. Thus a balance has to be found between, on the one hand, the economic advantages of further European integration and, on the other, the advantages of giving Member States the possibility of setting their own national standards. This chapter examines how this balance is found. The process involves a choice between a centralized and a decentralized system of environmental decision-making. Which level of government should be responsible for environmental regulation in the Community? Should environmental standards and other regulatory instruments be decided by the Community, resulting in uniform measures to be satisﬁed in all Member States, or should they be decided by the Member States themselves? The economic literature on this...
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