Quote Of The Day again :)

Assalamualaikum readers :)

It has been said that arguing against globalisation is like arguing the laws of gravity- Kofi Annan

Conclusion.

Assalamualaikum readers :)

Here the conclusion out of all the chapters that i have been share with all of you. Hope you will like it :)

In general, increased economic openness seems to have had, at worst, a benign effect on emissions of localised pollutants, such as SO2, NO2 and PM (particulate matter). However, it is not clear how the relative price changes that result from openness will affect the environmental composition of economic activity: some countries will produce more environmentally intensive goods, others will produce fewer. On the other hand, liberalisation will raise incomes, perhaps increasing the willingness-to-pay for environmental improvements: such income effects could well outweigh the negative scale effects associated with increased economic activity. When combined with the positive effects associated with technology transfer, the net effect of globalisation on local pollutants is quite possibly a positive one.

However, the evidence concerning carbon dioxide and other greenhouse gas emissions is less encouraging. Here, the evidence suggests that the net effect of trade liberalisation could be negative. One of the explanations for the pessimistic assessments of trade’s impact on greenhouse gas emissions is their global nature. Not only are the costs of CO2 emissions shared with citizens abroad, but many greenhouse gas emissions are associated with fossil fuel use, for which few economically viable substitutes have emerged to date. The income and other technique effects that are largely responsible for reductions in local air pollutants do not seem to have the same force when the pollutant in question burdens the global population – and requires global solutions – rather than just citizens residing within any one government’s jurisdiction.

Lots Of Love,

Amira binti Azmi

Last Chapter : Policy Instruments to Limit Negative Environmental Impacts

Assalamualaikum readers :) we meet again!Todays post is about the policy that can limit all the negative impacts cause by transportation. enjoy reading okey :)

The picture on climate change management in transport that emerges from the preceding sections is two-fold. Modes for which pre-existing policies are weak, such as shipping and aviation, seem to be candidates for integration into broader efforts to introduce climate change policy frameworks. Surface transport is characterised by stronger existing policies, and its integration in such broader frameworks is less straightforward. The shape of the broader climate change policy frameworks is uncertain. Much of the economic analysis is on top-down approaches, and studies how multilateral efforts can handle the sovereignty constraint as well as possible. Actual policy developments, however, look more like a bottom-up approach, where different jurisdictions introduce more or less broad policies. This tendency should not be too surprising, given the importance of “club benefits” in making effective climate change policy possible. While the bottom-up approach conceivably leads to gradual expansion of geographical coverage (e.g. by linking up US and EU carbon trading systems), the inclusion of developing

economies like China and India remains problematic.

Inclusion of aviation and maritime transport in cap-and-trade systems that cover other sectors is desirable from a cost-effectiveness point of view. Both for aviation and maritime transport, technological abatement options are limited in the short run because of slow fleet turnover. In maritime transport, the impression is that operational measures can reduce CO2 emissions to some extent in the short run, at relatively low cost. In aviation, there is some scope for abatement through better air traffic control and airport congestion management (as well as technology in the longer run), but the main intrasector abatement is likely to come from lower demand. Available estimates put an upper bound of about 5% on demand reductions, at prices of around EUR 20 per tonne CO2. Imperfect competition and airport congestion limit the extent of pass-through of cost increases to ticket prices, and hence limit the demand responses. The aviation sector is thus likely to be a net buyer of permits. Both in aviation and shipping, there is considerable scope for leakage, as long as trading schemes are not very comprehensive. Nevertheless, inclusion of these modes in trading schemes is desirable if overall abatement is to be costeffective. Other incentive-based measures can yield similar benefits, but seem less acceptable. Broadening the geographical scope of trading systems for maritime transport and aviation is likely to be a gradual process, perhaps along the lines discussed in Kågeson (2009).

Road transport is characterised by relatively stringent pre-existing policies. The EU has high fuel taxes and has recently introduced fuel-economy standards. The US has low fuel taxes, and fuel economy is determined by the fuel economy standard, that is now set to be tightened. In the EU, road transport is not included in the ETS. In various US proposals, the idea is to include the sector, possibly through upstream trading between refiners. Since the pre-existing policies are relatively stringent, abatement costs for CO2 in road transport are relatively high, and exceed current and expected prices for carbon permits. This seems undesirable from a narrow cost effectiveness point of view, but since the prevailing policies serve other purposes than just greenhouse gas reductions, it is not immediately clear if the welfare cost of further tightening of these policies is very high. For example, higher fuel taxes in the US seem justified if the goal is to handle congestion (in a blunt way) and increase infrastructure cost coverage, and this policy would reduce greenhouse gas emissions. It deserves emphasis, however, that the policy justification is congestion management and infrastructure provision, not reducing greenhouse gas emissions.

Within the static welfare economic framework used above, the case for tighter fuel economy standards or higher fuel taxes in road transport to reduce greenhouse gas emissions is weak. It is often argued, however, that policies are needed to increase the deployment of more fuel-efficient vehicles through the fleet. The reason is that the market for fuel economy provides only weak incentives to improve fuel economy, given consumers’ rational response to various uncertainties surrounding the investment in fuel economy. Given the additional market failures in research, development and diffusion of new technologies, a fuel economy standard could increase fleet fuel economy and the adoption of alternative technologies. And since using less carbon to produce prevailing mobility patterns is likely to be a cheaper way to reduce the risks of climate change than drastically changing the structure of transport activity, such standards could complement

market-based instruments in surface transport, aviation and shipping.

Thats all guys!