Economics and the Environment, 8th Edition

CHAPTER 14The Regulatory Record: Achievements and Obstacles

14.0 Introduction

Chapter 13 provided an overview of the major environmental legislation in the United States. What has 45 plus years of regulation actually accomplished? Quite a lot, according to one view. Not enough, according to others. We examine some of the evidence in this chapter. We also explore one of the key drivers of regulatory success, the political muscle put behind monitoring and enforcement of the laws on the books. But moving beyond what has been achieved to date, in the face of growing pressure on the environment from rising population and affluence, how can regulation be improved?

First, by building greater flexibility and harnessing economic incentives, many economists argue that we could buy a better level of environmental quality at a substantially lower cost. However, assuming that we can improve the regulatory process in this way, a final question remains. By their very nature, regulatory approaches are limited to control of narrowly defined pollutants and work best for stationary and “point” sources; moreover, regulatory gains may be swamped by economic growth. Given the scale of challenges such as climate change, does government need to move beyond internalizing externalities through regulation and directly promote the development of clean technology?

14.1 Accomplishments of Environmental Regulation

After more than four full decades of extensive environmental regulation and the expenditure ...