ABSTRACT
This chapter analyses simple Baltic Sea cost-effective charge and permit market systems. The cost-sharing programme requires information on both costs and benefits. In addition to policy schemes, the chapter provides alternative benefits estimates based on specific Polish valuation studies. The basic idea of a permit market system is to let the market for permits determine the price of nitrogen and phosphorus load permits. Pollution control authorities then only have to regulate the total amount of nitrogen and phosphorus loading. As the drainage basins of the Baltic Sea differ with respect to transport of nutrients, the impacts of non-point sources differ in terms of their transport to the coastal waters. The cost-sharing scheme develops an international financing mechanism that would be both cost-effective and equitable for all the countries that share responsibility for the public good, and that are concerned about its quality.
