Which form of pollution control would one expect environmental groups to favour the most?
A)Legislative controls,because of the built-in incentive firms have to reduce pollution below the required minimum.
B)A pollution tax,because the producer pays all of the tax and the consumer none.
C)The pollution tax,because the consumer pays all of the tax and the producer none.
D)The marketing of pollution permits because the environmental group has the option of directly reducing pollution by buying permits and not using them.

Question

Quizplus · Accepted Answer

Environmental groups are likely to favor the marketing of pollution permits because it provides them with the option to directly reduce pollution by buying permits and not using them. This method also creates a market for pollution reduction, incentivizing firms to reduce pollution beyond the required minimum. Legislative controls may have a weak enforcement mechanism, and a pollution tax shift burden on either the producer or consumer. Hence, a pollution permit scheme is more effective in reducing pollution while giving environmental groups agency in the process.

Which Form of Pollution Control Would One Expect Environmental Groups