Over the last 5 years the air quality in Taiwan’s cities has gradually improved. Part of the credit for the improvement has been given to the air emission fee program that was first implemented in 1995. Before then, the traditional command-and-control program and tax-allowance subsidy were the two major instruments used for air pollution control. The Air Pollution Control Act was revised in early 1999. Among its many new features, the most important one was a new control program, the cap-and-trade program. Moving from a fee to a cap-and-trade program has been a unique Taiwan experience. The purpose of this article is to compare the four existing programs (i.e., command-and-control, tax-allowance subsidy, emission fee, cap-and-trade) in terms of both economic and public choice theories.
Environmental Economics and Policy Studies 4(3), pp.141-166