CRAVING FOR BALANCED PUBLIC DECISION-MAKING ON MARKET FAILURE PERTAINING TO THE INTERVENTIONIST ECONOMIC POLICIES STRAINER

Bitoiu Teodora () and Radulescu Crina ()
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Bitoiu Teodora: National University of Political Studies and Public Administration, Faculty of Public Administration
Radulescu Crina: National University of Political Studies and Public Administration, Faculty of Public Administration

Annals of Faculty of Economics, 2015, vol. 1, issue 1, 157-164

Abstract: The research proposes a topic of very high interest for both our national economy and the European economy as it refers to the negative externalities and their role in the economic theory of subsidiarity developed as part of the multilevel governance. The case of the negative externalities represents one of the six situations of market interventions (due to the non Pareto efficient status) and, moreover, their specific case (pollution) is on the priority list of the European Union (Treaty establishing the European Community (Art. 174/130r – EC Treaty establishing the polluter pays principle (PPP)). Romania does not have a broad experience in this area (as it is also a new Member State) or if it has it is one that has confirmed our lack of expertise (e.g. the case of the eco-duty). In order to contribute to knowledge building in this field, the project aims at developing a methodology in the area of public decision-making for a particular market failure (externalities/spillovers) by appealing to the instruments provided by the multilevel governance vision and its subsidiarity principle so to provide a more efficient relationship between the costs and the benefits of a solid environmental policy. This methodology, imagined as a decision map, must provide a correspondence between the procedural part of the decision-making (correlating the national and the European level) and the formal part consisting in a formula that weights the elements that the research finds important. This particular manuscript is a work-in-progress as it puts forward the results we have reached so far as part of a post-doctoral research. The work proves valuable as it substantiates the theoretical framework needed for the final part of the research, which will be testing the decision map. Consequently, this research was undertaken by foraying the field literature and challenging the findings on a theoretical level. It must be underlined that the findings are purely speculative and shall be listed as valid only after performing the data testing. At the same time, we should also add that part of the model has been already validated in a previous research, but the test only targeted a niche-case, namely the eco-duty.

Keywords: market failure; regulation; public decision (search for similar items in EconPapers)
JEL-codes: H23 H83 K23 (search for similar items in EconPapers)
Date: 2015
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