Tradeable emissions rights could cut pollution at lower cost than command-and-control rules

Evidence

The second impetus for convergence between pollution control and natural resources law occurred because as the drafters of natural resources law were relying increasingly on tort law principles, those crafting pollution control laws were seeking ways to utilize the advantages of property law concepts more effectively. Economists and many environmental policymakers have long contended that pollution control laws could achieve greater environmental protection at lower cost if they relied more on property rights and market incentives than on the kind of “command and control” regulation that generally dominates the federal pollution control framework. Instead of dictating to each facility how much pollution it can emit, many economists believe it would be more efficient to create a system that encourages those who can reduce pollution more cheaply to do so. At least in theory, a market of tradeable emissions rights could accomplish just that result by assigning to individual facilities a property right to release a specified number of emissions that the facility could then either apply to its own emissions or sell to another facility for application to the latter’s emissions. — Richard J. Lazarus, The Making of Environmental Law, 799

Categorization

• DEFINE: Explains the cap-and-trade logic plainly: property rights in emissions let cheaper reducers sell to costlier ones.
• XREF: connects to: Tradeable emissions policies stayed dormant for decades due to moral and practical objections — Richard J. Lazarus, The Making of Environmental Law, 800; Both sides treat environmental regulation as an absolute-rights matter, precluding economic compromise — Richard J. Lazarus, The Making of Environmental Law, 150; A mere duty to warn can outperform formal emission limits through market pressure — Richard J. Lazarus, The Making of Environmental Law, 504 (+3 more)

Broader Connections

• Carbon permit markets divert emissions curbs into market-making technicalities #complicates (0.80) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 928
• Well-intentioned carbon credit incentives can be exploited to increase polluting production #contradicts (0.80) — Albert Bandura, Moral Disengagement, 1527