ABSTRACT
Benjamin Franklin's words concerning taxes as the other certainty of life highlight one reason why the use of economic instruments has come to supplement the regulatory approach to environmental management in many countries. Rarely is the suggestion made that, in practice, economic instruments can 'do the job' by themselves, 'the job' being to regulate the level of pollution to some predetermined level. From Turvey (1963) onwards the suggestion has been, rather, that a mixed regulatory/economic incentives approach may be optimal in a wide range of real world situations (Baumol and Oates, 1979). The economic aspects of a mixed policy confer on it two advantages:
It has efficiency built into it (i. e. a charge or tax imposed on polluters equal to the marginal social costs of their emissions at the desired level will be the least cost approach to achieving this desired level);
It is difficult to avoid or evade.
