Transcript eia-lesson 7

The public control and its
limits
The many faces of welfare
1. THE ROLE OF THE STATE
2. THE LIMITS OF THE GOVERNMENT
INTERVENTION
3. THE INTERVENTIONS WITH THE
SUPPORT OF INTERST GROUPS
3.1 The prices policies
3.2 The distortion effects
3.3 The political market
4. - GOVERNMENT AND SOCIAL RULES
4.1 Normative dilemma
4.2 The long period effects
THE PUBLIC INTERVENTION AND ITS
LIMITS
The role of the country is to rebalance the
perverse effects of the demonstration in
themarket economy, establish rules, fix
limits, put taxes and penalty.
THE LIMITS OF THE
GOVERNMENT INTERVENTION
It is not necessary that the state does not act
in the interest of community (or the whole
comuntity  interest groups)

It is not necessary that the state is informed
on the environmental consequences of the
behavior

THE LIMITS OF THE
GOVERNMENT INTERVENTION
It is not necessary that the state is
able to apply effective control rules.

Example: The agricultural community policy
Objective:
. To sustain The agricultural incomes
. To guarantee the availability of the
products
. To check The prices to the consumption
But also
. To defend the affairs of the agricultural
lobby
Taxing the importation of foreign
alimentary products and
subsidizing
the internal agriculture.
The European community
sustains the inefficient community
productions
The interest of sheltered
agriculture expense:
- A tax payer, the pagane, the cost of
an aid
- A consumer, the pagane price and
a high price
.... With an incentive to increase
the cultivated surface and
to intensify the cultivation
Enviromental danger
In the countries in the
development course, the price is
maintained under the level of
market:
. To subsidize The consumptions of the
poor men
. To stimulate the development of the
raw materials with low prices
DISTORTION EFFECTS
- The public resources expenses in spite it is
low, it could be used in a more productive
way
- We stimulate an excessive and inefficient
use of subsidized property with possibility of
wastes
DISTORTION EFFECTS
- Many is devoted to the activities sustained
from the state to get the benefit, and
therefore more productive activity resources
are dissuaded
The government subsidies create,
a political market or a
market of the corruption in which the public
resources are distributed according to
private affairs in contrast with those
public….
.... Without some consideration
for
The environmental impact.
“External” control
State norm
“Internal” control
Social norm
The action of the less ‘spatial’ state norm can
therefore destroy a social pre-existing norm
that would have emerged by the effect of the
cultural evolution.
The distortion of the market mechanism
creates incomes and privileges that once
realized are transformed to rights difficulty
reversible and prevent the achievment of an
efficient allocation of resources.
The logic of the state intervention
should be that to make the economic
agents aware of the evaluation of the
environmental impact of their
behavior....
.... And not to encourage the behavior
that favors the diseconomisation of
the environmental resource