Question

1. How would a welfare-maximizing environmental regulator design an optimal policy to control emissions of a stock pollutant that is not uniformly mixing a.) ex ante (before any pollution has taken place) & b.) ex post (if firms are currently polluting the area)?

Answer 1

(a) environmental regulator and his optimal policy before pollution:

Environmental regulator is any person who is appointed by the government to protect public health and the environment from pollution by industry and development.

Non-uniformity pollutants:-

• Where pollutants are mixing non-uniformly, location matters.

• Non-uniformity is of importance as many types of pollution fall into this category. Examples: – Ozone accumulation in the lower atmosphere – Local air pollution:

• Particulate pollutants from diesel engines and trace metal emissions

• Oxides of Nitrogen and Sulphur in urban air sheds- Some local water and ground pollutants do not uniformly mix

• Complicates the policy problem: Total emissions is no longer the sole source of concern, must also consider the emissions site and its impact on concentration levels at other sites.

Pollution prevent policy by environment regulators:-

                Regulator has to take enough welfare measures for controlling the pollution.

• There are significant opportunities for industry to reduce or prevent pollution through cost-effective changes in production, operation, and raw materials use.  

Source reduction is fundamentally different and more beneficial than waste management and pollution control.

Pollution should be prevented or reduced at the source whenever useful.

Pollution that cannot be prevented should be recycled in an environmentally safe manner whenever workable.

Disposal or other resources into the environment should be employed only as a last resort and should be conducted in an environmentally safe manner.

(b) optical policy of environmental regulator (if firms are currently polluting the area) :

The regulator should provide facilities to increase hydroelectric power wherever possible and bio gas production for rural areas to reduce pollution.

*The garbage in big cities should be treated with cobalt rays. This can reduce the pollution load to

*Regulators should encourage scientific societies and scientific newspapers to create awareness among people about pollution and environment.

* Encourage industries to avoid pollutant formation at the very source by use of cleaner fuels, the adoption of less polluting materials and technology in manufacture.

Pollution is a negative externality – a cost to society. To reduce pollution, the government can use four main policies – tax to raise the price, subsidise alternatives, regulations to ban certain pollutants and pollution permits.

Pollution control optimal policies by environment regulator:

* Tax. Example, Carbon tax, which makes people pay the social cost of pollution.

* Subsidy. Example, subsidy of alternative energy sources.

* Pollution permits, e.g. carbon trading schemes where firms are given the right to pollute a certain amount; these permits can be traded with other firms.

* Changing consumer behaviour – e.g. through advertising, nudges.

*Tax

The idea of a tax is to make consumers and producers pay the full social cost of producing pollution. For example, petrol tax or a carbon tax.

The advantage of this scheme is that the government increases substantial revenue, which could be used to finance other pollution reduction schemes (e.g. subsidising alternatives).

* Pollution Permits

Pollution permits are a market-based scheme aimed at reducing pollution and trying to encourage firms to reduce the quantity of pollution they create. Permits create a financial incentive to pollute less because you can then sell your excess permits to other firms.

*subsidies

A tax may be ineffective if there are no practical choices. However, if the government subsidies alternatives, then firms and consumers will be more willing to switch.

* Changing consumer behaviour

Another strategy would be to encourage consumers to change their behaviour. For example, creating awareness of the environmental costs of leaving on heating/air conditioning.

It is very important to control air pollution for the purpose of managing our environment hence the government must focus on making policies that will fight against these emissions of Green gases.
Am very exciting on this intervention.  

Pollution in the world today is a problem for the environment and the people living there. The pollution problem arises from the use of the environment by producers and consumers as a dumping ground for wastes. The environment can be defined as the air, water, and land around us. It provides with a variety of important services, including a place for humans to live and resources with which to produce goods and services

Summary:

The environment regulator is appointed by government to stay focus on industry, government, and public attention on reducing the amount of pollution through cost-effective changes in production, operation, and raw materials use. environmental regulators also create awareness programmes among people about pollution and thereby reduces the pollution.