Common Access Resources
Common Access resources are those that are non excludable;
meaning that they are available to anyone to use without a payment fee. However
these are rivalrous, and decrease the amount available for others. The problem
arises because these goods are over exploited beyond their sustainable use.
Sustainability is the ability of something being maintained over time.[1]
This is threatened due to the large increase of economic activities in the past
century.
An example of this is high-income consumption of fossil
fuels.
In December 2015, the Chinese government issued a pollution
red alert, the first of China’s history. China’s coal industry is said to emit
1/5th of the worlds’ carbon emission. However this number has said
to have increased by 17% than what the government had previously disclosed.[2]
The emission of carbon, had created a heavy smog that threatened the population
of Beijing in particular, till the wind reduced its impact. According to the Greenpeace organisation two coal mines
itself, produces an average of 10 million tonnes a year, increasing the amount
of coal consumption, making it easily accessible and available. The smog that
is created by these emissions cost China billions of dollars each year, due to
a loss in productivity and health expenses
Due to a more widespread awareness of the impact of a toxic
environment, the Chinese public demanded solutions instead of high alerts that
simply inconvenience daily activities.
To solve the problem of over mining and over consumption of coal that leads to a greater emission of carbon dioxide, the government could introduce several policies and rules:
1) By making air quality statistics and data easily
available to the public, there would be an equal amount of information which
would inhibit transparency and encourage the public to be more aware of how to
reduce the impact of the carbon on the air quality.
2) For large industries the government could
heighten their control on the emissions by increasing the price of carbon tax. [3]
These taxes are imposed on the units of carbon that are emitted by the
industry. The spike in prices would encourage them to find a more
environmentally friendly method of production.
3) A short term solution would be to improve
urbanisation plans of development by leaving room for green spaces.
4) Cap and trade
schemes [4]
are permits to pollute that are given to firms by the governments. These are fixed for producing a
pollutant over a period of time and
cannot be changed. However companies can trade these between them. These
provide incentives to producers to switch to less harmul production methods as
it decreases their cost of production. The government can cap the coal
consumption to discourage emissions.
The Chinese Government amended the law, by legislation. For instance, the law now dictates that China should promote
cleanliness and efficiency in the use of coal, by banning the burning and
consumption of low quality coal for residential use. This will decrease the production of coal as the public will not purchase it for household purposes. This will also reduce the carbon emissions that China itself releases.
The law states an open “information allowance” allowing certain information to be disclosed publicly such as; environmental authorities
and supervisors' information, test results of new vehicles, and sources and fluctuations of air
pollution in certain areas. Another amendment stated that local governments
could now restrict or ban high emission vehicles.[5]
However the government was unable to place a cap on coal.
This would have created a legislative anchor which would have restricted the
consumption of coal and lowered smog levels.
Cap and trade schemes simply create a ceiling for the amount
of carbon emitted and do not reduce it, carbon tax however discourages the
producers from using fossil fuels for production, as the high prices put a strain on their cost of production. Although both aim at reducing the emissions, carbon tax is more
effective as it can be tracked and observed and controlled as the tax price can place a greater burden on the producers forcing them to find a substitute fuel.
[1] Tragakes, Ellie. "Chapter 5 Market
Failure." Economics for the IB Diploma. Cambridge: Cambridge UP,
2009. 121+. Print.
[2] Jonah. "Chinese Coexist With
Coal." The New York Times. The New York Times, 03 Nov. 2015. Web.
10 Jan. 2016.
[3] Tragakes, Ellie. "Chapter 5 Market
Failure." Economics for the IB Diploma. Cambridge: Cambridge UP,
2009. 121+. Print.
[4] Tragakes, Ellie. "Chapter 5 Market
Failure." Economics for the IB Diploma. Cambridge: Cambridge UP,
2009. 121+. Print.
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