Theoretical and Applied Economics
No. 7 / 2006 (502)
Pollution and Property: Is Relevant Market Failure Theory?
Universitatea „Politehnica” Bucuresti
Abstract. An externality exists whenever a transaction creates a cost or a benefit for a party not directly involved. Pollution, such as smoke emitted into the air or sewage poured into the water is an externality. In this paper I analyze the differences between Neo-classical and Austrian School of Economics regarding externalities and the best way to fight it. Neo-classicals are concerned about efficiency and they propose some forms of government intervention in order to alleviate pollution: taxes and tradable permits. Austrians seek to remove interpersonal conflict related to pollution and show that although taxes and permits could theoretically work, they fail to eliminate conflicts among people.
Keywords: externality; pollution; property rights; neo-classical economics; Austrian economics.
Contents
- Organizational Transition and Change Resistance
Ovidiu Nicolescu
Ciprian Nicolescu
- Corporate Governance, between Classicism and Modernism
Niculae Feleaga
Cristina Vasile
- Dilemmas of Modernity in Change
Sultana Suta-Selejan
- Romania. The Pillars for its Sustainable Development
Mirela Roxana Chirita
Emilian M. Dobrescu
- Using Standard-Sole Cost Method for Performance Gestion Accounting and Calculation Cost in the Machine Building Industry
Cleopatra Sendroiu
Aureliana Geta Roman
Costantin Roman
- The Prevailing of the Human Nature in the Economics of Adam Smith
Mara Magda Maftei
- Growth and Efficiency at the Macroeconomic Level
Alexandrina Duta
Nicoleta Sîrghi
Adina Popovici
- A Mental Value Perspective in Risk Decision Theory
Roxana Davidescu
Alexandru Trifu