Economics of Pollution Trading for SO2 and NOx

Dallas Burtraw, David A. Evans, Alan J. Krupnick, Karen Palmer and Russell Toth

No 10488, Discussion Papers from Resources for the Future

Abstract: For years economists have urged policymakers to use market-based approaches such as cap-and-trade programs or emission taxes to control pollution. The SO2 allowance market created by Title IV of the 1990 U.S. Clean Air Act Amendments represents the first real test of the wisdom of economists' advice. Subsequent urban and regional applications of NOx emission allowance trading took shape in the 1990s in the United States, culminating in a second large experiment in emission trading in the eastern United States that began in 2003. This paper provides an overview of the economic rationale for emission trading and a description of the major U.S. programs for sulfur dioxide (SO2) and nitrogen oxides (NOx). We evaluate these programs along measures of performance including cost savings, environmental integrity, and incentives for technological innovation. We offer lessons for the design of future programs including, most importantly, those reducing carbon dioxide.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 59
Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (42)

Downloads: (external link)
https://ageconsearch.umn.edu/record/10488/files/dp050005.pdf (application/pdf)

Related works:
Working Paper: Economics of Pollution Trading for SO2 and NOx (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:rffdps:10488

DOI: 10.22004/ag.econ.10488

Access Statistics for this paper

More papers in Discussion Papers from Resources for the Future Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().