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 and more planning economies are going to approach more market economy structures, and they are also concerned to use MBIs and by this to strengthen private sector development and investment incentives. This concern is strongly welcomed by the western market economies as a better mutual understanding and harmonising of economics and policy is desired. But recent discussions and first project experiences came to the conclusion that the use of MBIs under Command-and-Control (CAC) conditions is much more complicated than expected. A number of legal, institutional and even intellectual, mental and cultural barriers exist to implement MBIs in CAC systems at the present.

CENTRIC AUSTRIA INTERNATIONAL is actually researching in this field:
- Definition and description of different MBIs.
- Preconditions to use MBIs and differences between market economies and command-and-control economies resp Chinese conditions.
- How to use the market in respect of MBIs, if the market is not yet sufficient existing in the required form (competition, pricing, etc.).
- How to create a market (strengthening the private sector, break up monopolies, strengthening the demand-side) under specific CAC conditions.
- How to use existing regulations and how to complete the mandatory framework with voluntary instruments to improve the environmental and economical performance of enterprises in planning economies.
- How to engage the public to a larger extent to become a more equal ranked stakeholder in the system.