ABSTRACT
This chapter shows that the language of economic instruments has been widely disseminated and that the arguments in principle in favour of market-based instruments have generally been won. Most of the environmental economics literature tends to assume that any policy instrument that is not an administered price or administered market is command and control. The disadvantage of revenue raising is that governments might quickly lose sight of the main purpose of the charge, namely to help solve an environmental problem. Landfill sites can be the source of environmental problems. The Organisation for Economic Co-operation and Development (OECD) has reviewed the experience of economic instruments in OECD countries. While market-based instruments are often referred to as economic incentives, it is clear that all environmental policy is based on economic incentives. The incentive system in command and control is financial and rests on the penalty for non-compliance.
