Deteriorating environmental problem: how can government constrain environmental degradation through economic policies?

Abstract

China has replaced the USA and become the main emitter of carbon since 2006, global environmental issue especially the climate change is deteriorating. Therefore, it is urgent for countries to design policies to deal with the climate change and constrain increasing carbon emission. However, countries got stuck into a dilemma: developing economy will prompt production thus causing pollution and hindering the improvement of environment. This article will mainly analyze four possible economic policies—taxation, tradable permits, subsidies and government regulation— that countries can carry out to reduce, halt, and reverse environmental degradation by providing rationales and data to prove their effectiveness. And sufficient evidences conclude that subsidizing on alternative resources can truly help countries to develop economy without hurting the environment.