Many advocates of environmental policy see the Trump administration’s view of the environment and the U.S. Environmental Protection Agency as a setback that dims the prospects for new and stronger environmental laws. Consequently, some state and local governments are picking up the slack. For example, California recently expanded its cap-and-trade program for greenhouse gases, and the mayor of Atlanta vowed to meet his city’s commitments to lower carbon dioxide emissions, despite the President’s decision to withdraw from the Paris climate accord. In this current complex landscape, economic theory can contribute valuable insight when designing climate and environmental policies at the federal, state, or local level. In particular, economic theory suggests that market-based environmental policies may provide clear advantages when compared to command-and-control policies. Let me explain why.
Over the last month, much has been said about 2014 being the hottest year on record. The first announcement came from the Japan Meteorological Agency during the first week of January. Later, a joint announcement by NASA and NOAA reinforced the finding: 2014 was the hottest year in more than 120 years of record keeping. The joint announcement underscored the significance of two major scientific branches of the US government reaching the same conclusion through separate data analyses. Continue reading →