Market Based Instruments (MBIs)

MBIs - A new feature of environmental policy

Unlike the Command and Control (CAC) approach, MBIs use price or other economic variables to provide incentives for polluters to reduce harmful emissions. It is supposed, that the use of MBIs could, beside other clean energy actions, contribute to the long-term overall objectives to increase living conditions, to sustain energy supply and to reduce environmental degradation in the concerned Chinese cities. This engaged goal makes an explanation of MBIs necessary.

What are MBIs

In general, environmental policies try to reduce environmental degradation at the lowest possible social costs. MBIs pincipal have the same target. more >>

Categories of MBIs

There are four main categories of MBIs: first, MBIs using the market; second, MBIs creating the market; third, MBIs using regulations; fourth, MBIs engaging the public. more >>

Applicability of MBIs in CAC systems

MBIs are a relatively new feature of environmental policy. Many of these instruments are in the experimental stage even in market economies. Not every useful measure must be a MBI, not every measure, which is intended as MBI, is really a MBI, if the base is missed. And MBIs cannot substitute non-economical instruments like standards in total. more >>