Cap And Trade
A very successful "deregulation" strategy that replaces government regulation and Pigouvian taxes on harmful externalities with government-limited, salable rights to externalities. In other words, government power can create markets and use market mechanisms. This brings market efficiency to regulation; thus businesses hate cap and trade.
- How much is clean air worth? [More...]
- "people are making defensive investments in a wide variety of other settings — cost of alarm systems, or to supplement public schools — and that just measuring the direct impacts, like the frequency of home robberies or test scores, is not sufficient if you want to develop a measure of the full costs or benefits of various interventions."
- Learning from Thirty Years of Experience with Cap-and-Trade Systems [More...]
- "Based on the numerous specific lessons we identified in our analysis, several design and implementation features of cap-and-trade programs appear critical to their performance."
- The Cap-and-Trade Sulfur Dioxide Allowances Market Experiment [More...]
- "The Acid Rain Program led to higher levels of premature mortality than would have occurred under a hypothetical no-trade counterfactual with the same overall sulfur dioxide emissions." Because the medical externalities of Eastern pollution are higher than Western pollution, but that is not properly priced.
- The Rise and Fall of Cap-and-Trade [More...]
- "The problem is not that cap and trade is a theoretical proposal from ivory-tower economists that cannot survive application in the real world. To the contrary, its performance in action surpassed expectations..."
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