The SO2 allowance-trading system and the clean air act amendments of 1990: Reflections on 20 years of policy innovation

Gabriel Chan, Robert Stavins, Robert Stowe, Richard Sweeney

    Research output: Contribution to journalReview articlepeer-review

    18 Scopus citations

    Abstract

    The introduction of the U.S. SO2 allowance-trading program to address the threat of acid rain as part of the Clean Air Act Amendments of 1990 is a landmark event in the history of environmental regulation. The program was a great success by almost all measures. This paper, which draws upon a research workshop and a policy roundtable held at Harvard in May 2011, investigates critically the design, enactment, implementation, performance, and implications of this path-breaking application of economic thinking to environmental regulation. Ironically, cap-andtrade seems especially well suited to addressing the problem of climate change, in that emitted greenhouse gases are evenly distributed throughout the world's atmosphere. Recent hostility toward cap-and-trade in debates about U.S. climate legislation may reflect the broader political environment of the climate debate more than the substantive merits of market-based regulation.

    Original languageEnglish (US)
    Pages (from-to)419-452
    Number of pages34
    JournalNational Tax Journal
    Volume65
    Issue number2
    DOIs
    StatePublished - Jun 2012

    Keywords

    • Acid rain
    • Cap-and-trade
    • Clean Air Act Amendments
    • Market-based environmental policy
    • Sulfur dioxide

    Fingerprint Dive into the research topics of 'The SO<sub>2</sub> allowance-trading system and the clean air act amendments of 1990: Reflections on 20 years of policy innovation'. Together they form a unique fingerprint.

    Cite this