Teachers and Students > Debates

Reducing carbon emissions - Market or Regulative approach?

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$tyli$h Executive:
We all know that scientists have identified the ever increasing amounts of carbon emissions for the global climate change. And this can, on the long term, drown the low lying areas of the earth if the glaciers of the poles melt due to the greenhouse effect.

So, there is a need to control carbon emisssions. The debate is about whether it should be done in a 'market' approach or direct regulative approach by the government?

Market approach to reduce CO2 emissions involves imposing prices over carbon emissions. For example, by putting high taxes on vehicles, and by making it mandatory for businesses and other private users to obtain permits for polluting the environment up to a certain level (like the road pricing technique of Singapore). The businesses who make less emissions than the quota can sell the permit to other businesses, but the total amount will be limited.

Regulation might ban certain polluting practices, such as coal-fired power stations, and force businesses and consumers to adopt cleaner technologies like hydrogen powered cars.

Which approach should be used and why?

$tyli$h Executive:
I think the market approach is much more suitable.

Market mechanisms to control CO2 emissions are open ended and provide and an ongoing profit motive for companies, state agencies, and individuals to reduce emissions, as doing so either creates additional profits (trading emission quotas) or yields up additional tax reductions (carbon tax). This is better than a regulatory approach, according to my opinion, which only requires cuts to a certain level and provides no longer-term incentive for companies to drive down emissions by investing in new technology – meaning companies will take the minimum action necessary to meet the regulatory standard. Due to less R&D, we will see no new innovations of technology for making less carbon emissions.

Freaked12:
Both will increase unemployment in the short run and unfortunately in democracy party will look to improve short term objectives to boost their election chances the following term.
If You put market approach then we need to look at how transparent the Government is.You belong to Bengladesh you would know that rich folks or big multinationals could easily not pay the taxes by bribing the government.Thank the Lord above countries like Pakistan or India are not high producers of Co2.
it should be of concern though that China another country where corruption is high has attained the second position in top 10 Carbon producers.
United States is already doing this approach and as far i have heard it is already in place in Chicago (correct me if i am wrong) and results are not satisfactory.There should another policy that not only shows positive results in America for example but also tackles countries like Pakistan or China where there is alot of corruption
Second is way tooo RADICAL.I mean for countries like China or India where millions of workers are employed in coal producing factories,banning these firms might result in Civil War.

I suggest Going for Nuclear Power.Lasts for 30 years although has a high initial cost but is cheaper in the long run

Freaked12:
Also not to mention
that countries like Saudi Arabia or UAE or Qatar Or Russia Or Miami state of USA where there are alot of billionaires ,they could easily pay the taxes and continue to pollute the environment.
For example Looking to reduce water consumption in Saudi arabia, the government suggested increasing the rate of tax of water consumed per second.
This was easily put to dust bin when the chief economist Sfiankis told them that the group which consumes alot of water aka rich folks  which consume about 51 percent of total water in Saudi Arabia could easily pay the new amount thus rendering it useless in the first place

$tyli$h Executive:
I wouldn't agree that the market approach will cause any significant unemployment. Carbon trading between businesses allows the greatest reduction in emissions at the least cost – this damages the world economy less and will ultimately allow more rapid decreases in emissions than costly regulations like banning gas guzzlers would achieve. Power generating plants and motor vehicles in the developing world are often hugely more polluting than those in the most developed nations, and it would be relatively cheap to equip them with more modern technology in order to bring emissions down. By contrast, achieving even a tiny additional reduction in more efficient developed world plants and vehicles would be hugely costly, as it would require completely new technologies to be developed (come on, they're already advanced). Carbon trading (or an international carbon tax) would encourage firms to direct investment into whatever would reduce their emissions most cost-effectively, either by direct investment in their developing world operations, or by buying carbon credits (or quotas) from such countries. If this means emissions in the rich world stay level while carbon reduction efforts are concentrated elsewhere, then fine – the world as a whole gains from this. And if it transfers money and directs investment into developing nations, then that is an additional benefit as the developing countries get a chance too!

The regulations damage businesses the most. It is a blunt mechanism and provides no incentives for trading or improvement. Besides, carbon trading of quotas could develop a whole new financial market just like the stock market or commodity markets! And may allow small traders and investors to take part too!

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