From command-and-control to efficient emission allocation – particulate matter regulation in the European Union
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School of Business |
Bachelor's thesis
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Authors
Date
2021
Department
Major/Subject
Mcode
Degree programme
Taloustiede
Language
en
Pages
30
Series
Abstract
This literature review examines cost-effective and efficient emission regulation as well as current command-and-control regulation in the European Union for particulate matter and other criteria pollutants. I ask whether the current regulatory regime is efficient or not, and why the current regime is in place. Efficient regulation equates marginal costs to marginal damages for each emission source via differentiated emission tax scheme, or with a differentiated tradable permit program with fixed exchange rates between firms. Comparing these models to current command-and-control regulation shows that current regime may not be as efficient as it could, if source-specific marginal damages would be estimated and accounted. As damages from particulate matter and criteria pollutants vary across space, current regulation may be too lenient or too stringent comparing to local damages. These conclusions are consistent with the current literature on efficient emission regulation.Description
Thesis advisor
Stryjan, MiriVehviläinen, Iiro
Keywords
emission regulation, marginal damages, particulate matter, source-specificity, command-and-control