Question: Understanding different policy options to correct for negativeexternalities Carbon dioxide emissions have been linked to melting of sea ice. The following table lists some potential
Understanding different policy options to correct for negativeexternalities
Carbon dioxide emissions have been linked to melting of sea ice. The following table lists some potential regulations targeting the amount of airborne carbon dioxide.
For each policy listed, identify whether it is a commandandcontrol policy regulation tradable permit system, corrective subsidy, or corrective tax.
tablePublic Policy,Commandand Control Policy,Tradable Permit System,tableCorrectiveSubsidyCorrective TaxThe government orders every factory to adopt a new technology, which reduces carbondioxide emissions into the atmosphere.,OOThe government agrees to reimburse all factories that purchase new, emissionsreducing technology in order to provide cleaner air.,The government charges factories $ for every ton of carbon dioxide they emit.,O
The government limits total carbondioxide emissions by all factories to tons per ten years. Each individual factory is given the right to emit tons of carbon dioxide, and factories may buy and sell these rights in a marketplace.
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