Integrated regulation of nonpoint pollution : combining managerial controls and economic instruments under multiple environmental targets

Aftab, Ashar; Baiocchi, Giovanni; Hanley, Nick

Abstract

Regulators are often reluctant to rely solely on economic incentives to achieveenvironmental standards. We evaluate a "mixed approach" of economic instruments andmanagement standards when two environmental objectives need to be met simultaneously:minimum river flow rates and reductions in nitrate pollution. We show how the relativeefficiency of such mixed approaches can depend on exogenous factors, in this case weatherconditions. Results indicate that mixed instruments outperform stand-alone economicincentives or managerial controls under wet weather conditions, but not in 'average' years.However, the relative cost-effectiveness of mixed approaches increases considerably at higher levels of environmental standard compliance.

Citation

Aftab, A., Baiocchi, G., & Hanley, N. (2009). Integrated regulation of nonpoint pollution : combining managerial controls and economic instruments under multiple environmental targets

• Working Paper Type: Working Paper
• Publication Date: Dec 1, 2009
• Deposit Date: Dec 7, 2012
• Publicly Available Date: Dec 7, 2012
• Series Title: Durham University Business School Economics Finance Accounting Working Papers
• Keywords: Diffuse water pollution, Environmental regulation, Minimum river flow, Mixed instruments, Nonpoint pollution.
• Public URL: https://durham-repository.worktribe.com/output/1699664
• Publisher URL: http://www.dur.ac.uk/business/faculty/working-papers/