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Market-Based Policies for Pollution Control in Latin America

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Environmental Issues in Latin America and the Caribbean

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Abstract

Rapid urbanization and increased industrialization have led to high pollution levels throughout Latin America. Economists tout policies based on market-based economic incentives as the most cost-effective methods for addressing a wide variety of environmental problems. This chapter examines market-based incentives and their applicability to Latin America. We first review the market-based incentives traditionally used to address pollution and compare these instruments to command-and-control policies. We then discuss two sets of factors that affect how feasible and efficient pollution control policy will be in Latin America: practical considerations, and the violation of standard modeling assumptions. Finally, we compare Latin American experiences with market-based incentives to those in the U.S. and Europe and conclude with several policy recommendations.

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Author information

Authors and Affiliations

  1. Department of Economics, Macalester College, 1600 Grand Avenue, St. Paul, MN, 55105

    Sarah E. West

  2. U.S. Environmental Protection Agency, National Center for Environmental Economics, 1200 Pennsylvania Avenue NW, Washington, D.C., 20460

    Ann Wolverton

Authors
  1. Sarah E. West
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  2. Ann Wolverton
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Editor information

Editors and Affiliations

  1. Arkansas State University, State University, AR, USA

    Aldemaro Romero

  2. Macalester College, Saint Paul, MN, USA

    Sarah E. West

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West, S.E., Wolverton, A. (2005). Market-Based Policies for Pollution Control in Latin America. In: Romero, A., West, S.E. (eds) Environmental Issues in Latin America and the Caribbean. Springer, Dordrecht. https://doi.org/10.1007/1-4020-3774-0_6

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