ECS2606 Assignment 2 (DETAILED ANSWERS) Semester 1 2025 - DISTINCTION GUARANTEED

ECS2606 Assignment 2 (DETAILED ANSWERS) Semester 1 2025 - DISTINCTION GUARANTEED - DISTINCTION GUARANTEED - DISTINCTION GUARANTEED Answers, guidelines, workings and references ,... 1. Analyse the static perspectives of the relationship between the economic growth and the environment in developing countries. Use a graph to illustrate your answer. [10] 2. Explain how multiple sources of emissions can be controlled by using the equimarginal principle. [10] 3. Use a graph to explain whether one standard of emissions can be simultaneously efficient in both a rural and an urban area. [10] Read the excerpt below and answer Question 4.1 and 4.2 Efficiency of Market Based Instruments Empirical studies in the United States (US) show that the efficiency gains associated with using economic instruments rather than command-and- control have been substantial. Tietenberg suggests that approaches to regulate air pollution were as much as 22 times as expensive as the least-cost market-oriented alternative. For the eleven applications studied command-and-control applications were on average six times as expensive. Anderson et al. estimated that as of 1992, economic instruments for air, water, and land pollution within the US had saved more than US$11 billion relative to a command-and-control baseline. https://www.environmentalauditing. org/media/5370/wgea-instrument-protection-and-management_isbn-ok.pd 4.1 Discuss the three types of environmental standards which form the commandand- control strategies. [10] 4.2 Explain why incentive-based policies such as market-based instruments would tend to produce more efficiency gains than command-and-control policies? [5] 5. Explain how property rights can steer the economy to social efficiency. [5]