The Company and Environmental Management: 'Respectful' Behavior Towards the Environment by Means of Command and Control Instruments or Market-Based Instruments?

Abstract:     
Concern with protecting the environment for the benefit of present and future generations is now at the center of the international agenda. Awareness of the extent of the damage done to our environment through unsustainable economic activities is steadily growing. In particular there is growing awareness of the need for international actions to implement realistic and workable solutions for the reduction of these man-made environmental impacts. Command and control policies are still the most widely used method for environmental policy: national emissions ceilings or air quality standards, specific emission limits for large power plants, vehicle emissions standards, fuel quality standards. However, market-based instruments, and in particular taxes, have been playing a larger role in addressing environmental pollution during the past decade. Environmental taxes were often seen as potential substitutes for regulatory measures, although their non-compulsory character often made them inferior in the eyes of the usually non-economist regulators. This view changed slowly as the implementation deficit of traditional regulation appeared difficult to close and also because of the growing need for cost-effective measures that were easy to apply. Taxes are now perceived as tools complementary to command and control policies, and it is widely accepted that a policy package of regulation and market-based instruments may be required to achieve environmental objectives. Examples of combining these different tools are becoming more widespread and can be found in the waste policy area, for example for achieving the objectives of the end-of-life vehicles directive. In this paper we analyzing the role of command and control instruments and market-based instruments in environmental protection, and we study this instruments in Romania.

Number of Pages in PDF File: 20

Keywords: environmental taxes, economic instruments, environmental protection, command and control instruments, market-based instruments

JEL Classification: H23, Q20

working papers series