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The Choice of Instruments for Environmental Policy: Liability or Regulation?

Marcel Boyer () and Donatella Porrini ()

CIRANO Working Papers from CIRANO

Abstract: We address in this paper the problem of comparing and choosing among different policy instruments to implement the incentive objective of an efficient deterrence of environmental degradation and the remedy objective of an efficient clean-up of damages and a proper compensation of victims. Two main instruments are considered, namely the assignment of legal liability for environmental damage, such as in the American CERCLA and in the European White Paper, including extended liability provisions, and the design of an incentive regulation framework. Our results derive from a formal and structured analytical approach to modeling the economic interactions between different decision makers such as governments, firms, regulators and financiers. Dans cet article, nous comparons différents instruments visant une protection efficace contre la dégradation de l'environnement, une couverture efficace des dommages et une compensation convenable aux victimes. Nous considérons deux instruments principaux, à savoir un régime de réglementation incitative et un régime de responsabilité légale en cas de dommages environnementaux, tel qu'on le trouve dans le CERCLA américain et le White Paper européen qui comportent des provisions de responsabilité élargie. Nous développons une approche analytique structurée et formelle à la modélisation des interactions économiques entre les différents décideurs que sont les gouvernements, les entreprises, les régulateurs et les financiers.

Keywords: Environmental policy; extended liability; regulatory capture; instrument choice; Politique environnementale; responsabilité élargie; capture des régulateurs; choix d'instruments (search for similar items in EconPapers)
JEL-codes: K32 L51 P16 Q28 (search for similar items in EconPapers)
Date: 2002-02-01
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Handle: RePEc:cir:cirwor:2002s-17