Enviro

Question 1

theory set up

Answer 1

Theory set up:
o Intro: define ecologically sustainable development, market failure (pos/neg ext.) public & private goods (free riders)
the issues: preservation of natural environment, pollution & climate change, depletion of renewable and non
renewable resources).
o Rationale: achieve sustainable economic growth (Figure 1: PPF), issue = resource overuse, impact on long-term
productive capacity, intergenerational equality,
o Rationale: prevent market failure (define, private vs. social forces)
o Market failure: price mechanism (efficient allocation of resources, allocatively efficient), price mechanism (results in
market failure),
– Figure 2: Negative externalities (explain) (supply side, left shift for social costs)
– Figure 3: Positive externalities (explain) (demand side, right shift for social benefits)

Question 2

strategies

Answer 2

Strategies
o Regulations (limit goods, specify how its made, controls its impact on environment)
– E.g. 1989 Ozone Protection and Synthetic Greenhouse
Gas Management Act
– E.g. 1999 Environmental Protection and Biodiversity
Conservation Act (2009 review)
– E.g. 2000 Fuel Quality Standards Act
o Targets (not effective unless supported by market
based policies)
– E.g. 2001 RET (target revised, exempts trade exposed
industries)
– E.g. 2015 emissions reduction target for 2030 (achieved
by ERF and NEG)
– E.g. 2017 Finkel Review recommendations for CET
o Market based policies (incentives, disincentives)
– E.g. 2012 Carbon tax (abandoned 2014, replaced by
ERF)
– E.g. NSW Solar Energy Panel Bonus Scheme (cancelled
2016)
– E.g. $444 million to Great Barrier Reef Foundation
o International agreements (often difficult to agree on)
– E.g. 1989 Montreal Protocol reduces CFCs
– E.g. 2016 Paris Climate Change Conference (Trump
withdrew 2017, G20 Hamburg)