Environmental Policy Instruments: Command and Control vs Economic Instruments

This lecture explores different environmental policy instruments, such as command and control regulations and economic tools like taxes and subsidies. It delves into the concept of voluntary approaches, using real-world examples like congestion fees and nudges to influence market actors. The discussion extends to the idea of internalizing external costs through communication strategies and the role of subsidies in incentivizing environmentally friendly production. The lecture also touches on the concept of external benefits, showcasing how positive externalities can be leveraged to promote sustainable practices. The instructor engages the audience in a thought-provoking analysis of market dynamics and policy interventions to address environmental challenges.