Permits to pollute

Permits to pollute

The issue of tradable permits, or cap-and-trade schemes is a important one at the moment, and it is a relevant solution to negative externalities of production in the microeconomics section of the course.  The basic idea is to set a limit (cap) on the amount of pollution and then divide this up into permits that …

Air pollution in Malawi

Air pollution in Malawi

At the moment in Malawi they are arguing about whether or ‘passing wind’ should be banned.  Some of those in the government are effectively claiming that it is a form of market failure, and as such are proposing government legislation as a solution to this.  The questions then arise as to how this could be …

Carbon trading

Carbon trading

A number of businesses in Europe have been ‘ripped off’ recently by fraudsters who stole a large number of carbon permits.  These are a very good example of ‘tradable permits’ that can be used as a market based solution to the negative externality of air pollution.  The second site has a good explanation of how …