Ch 18 - The Economics of the Environment

Question 1

This exists whenever human activity generates a sufficient concentration of a substance in the environment to cause harm to people or to resources valued by people.

Answer 1

Pollution

Question 2

The proposition that if property rights are well defined and if bargaining is cost less, the private market can achieve an efficient outcome regardless of which of the affected parties holds the property rights is know as…

Answer 2

Coase theorem

Question 3

An effort to change people’s behavior by appealing to their sense of moral values is called…

Answer 3

Moral suasion

Question 4

A method in which a government agency tells a firm or individual how much or by what method emissions must be adjusted, is called…

Answer 4

Command-and-control-approach

Question 5

When a given reduction in emissions is achieved so that the marginal benefit of an additional unit of emissions is the same for all polluters, it is a…

Answer 5

Least-cost reduction in emissions

Question 6

Regulatory efforts that seek to create market-like incentives to encourage reductions in pollution, but allow individual decision makers to determine how much to pollute, are called…

Answer 6

Incentive approaches