Question

Identify the different types of Policy Instruments available to a country. How would you choose which instruments to recommend a Government to use in implementing their National Transport Policy? Why

Answer 1

General economic and social policies

1. Fiscal and monetary policies
2. Trade and exchange rate polices
3. Labour and employment policies
4. Investment and foreign aid
5. Population policies
6. Incomes and equity policies

General economic and social policies intended to influence overall economic growth, trade, price levels, employment, investment and population, attained chiefly by utilizing monetary and fiscal instruments.

• Policies relating to agricultural and rural development. Policies of this type are usually intended to influence such factors as the agricultural resource base, agricultural production, consumption of agricultural products, agricultural price levels and variability, rural incomes and the quality of food. They are usually implemented via instruments such as taxes and subsidies, direct government production and provision of services, and direct control through regulation.
• Policies relating to markets, including the establishment of market institutions and rules, and circumscription of property rights.
• Policies aimed at establishing a democratic and participatory process designed to involve all interested groups in decision making and implementing SARD.
• Policies designed specifically to influence natural resource use and protect the environment. These policies utilize: (i) command and control (effected, for example, by prohibiting or limiting certain resource uses or establishing limits on emissions, with penalties for non-compliance); (ii) economic incentives such as taxes and subsidies; and (iii) persuasive measures such as education and advertising.

The first four categories above are not primarily intended to achieve SARD, and are adopted to accomplish other goals. Yet all are essential for SARD. Therefore, the challenge in policy making is to integrate sustainability and environmental considerations into mainstream policy making both within the agricultural sector and generally.