Environmental Law and Economics

Abstract

Introduction1.1 why a book on environmental law and economics?Sustainability and environmental law have never been more important. If there are new legal toolkits available for building a better, more sustainable world, there is a duty incumbent to explore and learn those new ideas, to transform our legal rules and institutions.This book presents research drawn from literature on the economic analysis of environmental law. 1 Fundamentally, it presents a case that these methods share the established values and principles of environmental law, 2 yet they extend the set of legal policy options to address the needs of environmental protection and sustainable development. 3 Furthermore, it is shown that beyond the theoretical frameworks developed by environmental Law and Economics researchers, there now exists 1 The terms 'economic analysis of environmental law' and 'environmental Law and Economics' are synonymous and interchangeable. The concept of 'economic analysis of environmental law' is distinguishable from the similarly named 'economic analysis of environmental policy', in that the former focuses on law and legal institutions whereas the latter focuses on economics and economic institutions; also, the latter tend to present a greater amount of mathematical content in their literature. Nevertheless, the two literatures are closely intertwined. Fischman and Barbasch-Riley limited their definition of environmental law to include research on legal issues of pollution, species or habitat conservation, land use, natural resource management, and climate change law (Fischman and Barbasch-Riley 2018, at 772). 2 Driesen notes that environmental law still lacks a positive theory of environmental law; thus, it is quite likely that environmental law will continue to evolve much as Law and Economics is evolving (Driesen 2017, at 58). 3 This argument of shared common legal principles was originally presented by Faure and Skogh (2003, at 19-39). The present book honours Professor Skogh's memory, as it extends and deepens the framework originally introduced by Faure and Skogh and additionally provides empirical case studies on the effectiveness of the models proposed in that earlier work. See De Sadeleer (2002, at 15-18) for the comparative reference to the principles of 'conventional' environmental law.

Law and Economics, or Punctum Archimedis in Environmental Law

“…49 Integration with the European Union is enshrined as a constitutional norm in the transitional provisions of the Constitution of Georgia, in particular in Article 78. 50 And in Article 11 of the Treaty on the Functioning of the European Union, 51 we read that the protection of the environment and the promotion of sustainable development is a fundamental requirement for integration into the European Union.…”

“…Each case must be determined by examining the empirical circumstances. 37 Furthermore, merely showing that a particular regulation is fl awed does not imply a priori that centralized regulation of economic activity in specifi c and all the more so in each following case is concurrently not optimal, such an approach is illusory until comparative analysis specifi cally identifi es the advantages of the proposed alternative over-regulation. 38 Moreover, according to Coase, there was no single best and irreplaceable design for the optimal economic system, as the practical effectiveness of the system is determined by society and its normative order.…”

“…The problem of externalities remains the most relevant research question in both economic theory 59 and environmental law, for which there are alternatives including centralized command-control and decentralized market-based solutions. Command and control mechanisms, such as direct product bans and taxation, are often economically counterproductive because they are too infl exible and non-dynamic for market relations, although in some sectors, analysis of operating costs and cost-effectiveness 60 centralized regulation.…”

“…Companies are trying to fi nd new ways to reduce emissions and consequently increase economic productivity. 68 Unlike the command-control system, market mechanisms are highly adaptable to infl ation. 69 Free market relations are one and the only mechanism for providing information on the demand and optimal value of any given resource.…”

The Export of Ecological Civilization: Reflections from Law and Economics and Law and Development

“…The preferences for a particular environmental quality within a country or region may well therefore depend upon the level of economic development in that country. As a consequence, environmental quality standards, i.e., the standards that determine the desirable environmental quality to be reached in a country [46], should also be differentiated, taking into account individual preferences of the citizens in the particular country or region [46].…”