An advantage of marketable pollution permits is that:

Question

Quizplus · Accepted Answer

Marketable pollution permits provide firms with an economic incentive to develop and use less polluting technologies to reduce their overall pollution emissions. This is because if a firm is able to reduce its pollution emissions below the level of its allocated permits, it can sell the unused permits to other firms that have not been able to reduce their pollution emissions as much. This incentivizes firms to invest in new technologies that are less polluting than the existing ones they are using.

An Advantage of Marketable Pollution Permits Is That