Rational firms will choose the lowest-cost option between the two. The market is expected to be efficient, so that while some firms will find it cheaper to pollute, other firms will find it cheaper to install pollution abatement mechanisms.
Ultimately, the system will seek to deliver the lowest per-unit cost of abatement. This will be achieved because the firms that are going to abate their pollution are the ones for whom the cost of abatement is lower than the cost of polluting. With these firms focused on their abatement efforts, they will deliver a greater degree of pollution abatement at a lower per-unit cost with the marketable permits than any other system.
To see the value in this system, the alternative must be considered. If firms are mandated to reduce pollution, they will do so to bring themselves under the maximum allowable pollution levels. However, firms will have no economic incentive to reduce pollution below the mandated maximum level. Thus, while some abatement will occur, this amount will effectively be capped at the current level of surplus pollution. The marketable permits provide economic incentive for firms to continuously reduce their pollution levels. Firms that can reduce more, and more cheaply, will do so, the result being a net reduction in pollution when compared to alternative tactics.
4. GDP measures economic output, but there are many types of output that are not included in the GDP measures. These other outputs, however, can have a significant impact on our quality of life. Therefore, the following three additional outputs are proposed. The first is pollution. Pollution is typically an externality that is not included in the GDP but which can have a substantial impact on quality of life. Pollution would be subtracted from the economic indicators in the GDP, reflecting the reality that x level of growth with less pollution is more desirable than x level of growth with more pollution.
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Greek Debt The European Commission on Wednesday adopted a series of recommendations to ensure that the budget deficit of Greece is brought below 3% of GDP by 2012, that the government timely implements a reform programme to restore the competitiveness of its economy and generally runs policies that take account of its long-term interest and the general interest of the euro area and of the European Union as a whole (Europa,
Costa Coffee: An Overview What market is it in? As one of the premium espresso chains in the United Kingdom, with a price point higher than that of Starbucks or standard pub coffee, Costa Coffee is clearly focused in its efforts toward the consumer market.[footnoteRef:1] It primarily sells coffee and accompanying sandwiches and beverages. It also sells beans and other coffee products to consumers, but these aspects of its trade are a
market capitalization of 23.011 billion, Boeing is the nation's largest producer of commercial aircraft and the world's leading aerospace company. It operates in four principal segments: Commercial Airplanes, Military Aircraft and Missile Systems, Space and Communications, and Boeing Capital Corporation. As the world's market for air travel fluctuates with the risk of war, so do Boeing's revenues. However, as the United States moves towards a footing that may include
Companies such as XYZ Widget Corporation are well situated to take advantage of burgeoning markets in developing nations, particularly in Asia and Africa. 2. XYZ can grow its business by expanding its operations to certain developing nations in ways that profit the company as well as the impoverished regions that are involved, particularly when marketing efforts are coordinated with nongovernmental organizations operating in the region. 3. Several constraints and challenges must
business2community.com/social-media/2012s-ten-worst-social-media-Disaster-0370309 Using contemporary illustrative examples from academic literature and reputable business publications, discuss the concept of "Social Business" and the resultant opportunity and challenges that are currently being faced by the retail industry globally. Concept of Social Business Concept of Social Business with Retailers Social Media and Retailing Best Practices in Administering Social Media There is a growing body of research that confirms that companies of all sizes and types can realize a wide array
To take one example, in its sphere of industrial and automotive products, FACOM is described as thus: "In 1918, in the heart of Paris, a young engineer named Louis Moses founded a company called Franco Americaine de Construction d'Outillage Mecanique, or FACOM for short. It manufactured a single product: the 101 adjustable wrench, which built the French Railways. Today, FACOM has more than 130 trucks of demonstration which visit
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