Which of the following approaches would an economist propose to address industrial pollution of a river?
A)Ban all dumping of pollutants near or into the river
B)Limit each plant to a maximum amount of pollutant emission
C)Charge each polluter a fixed amount for each unit of pollutant dumped into the river
D)Direct pollution control regulation
E)Command and control pollution regulation

Question

Quizplus · Accepted Answer

An economist would propose a market-based approach to address industrial pollution of a river. Option C suggests charging each polluter a fixed amount for each unit of pollutant dumped into the river, which creates a financial incentive for the companies to reduce their emissions. This approach is known as a pollution tax or Pigouvian tax, which aims to internalize the environmental costs of production. This approach is more effective and efficient than the other options because it allows companies to determine the most cost-effective way of reducing their emissions and incentivizes them to invest in pollution-reducing technology.

Which of the Following Approaches Would an Economist Propose to Address