The practice of harnessing market forces to motivate compliance with regulatory goals is known as:

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The practice of harnessing market forces to motivate compliance with regulatory goals is known as market incentive regulation. This includes strategies such as emissions trading and subsidies that incentivize polluters to reduce their emissions or improve environmental performance. Cap-and-trade regulation also uses market mechanisms, but it specifically involves setting a cap on emissions and allowing companies to trade permits to emit within that cap. Command-and-control regulation involves setting specific standards and enforcing them through inspections and penalties. Voluntary regulation relies on companies to voluntarily adopt environmentally friendly practices without being required to do so by law.

The Practice of Harnessing Market Forces to Motivate Compliance with Regulatory