Economics and Analysis

Economic considerations, and analysis of economic implications, are a key consideration in most environmental decisions. Decision-making needs to go through rigorous processes of analysis and appraisal and ex-post evaluation after implementation; and economists play a central role in this process, particularly with respect to the estimation of costs and benefits, including non market benefits.

Another major priority for economists working in the area of environmental protection is the promotion where appropriate of economic instruments, including "green taxes", permit trading schemes and liability regimes, as promising ways of tackling environmental problems. Economic instruments are capable of influencing the behaviour of consumers and manufacturers in ways that are more subtle, yet potentially more powerful, than conventional regulatory controls, and which are capable of achieving results at lower cost.

Budget 2003

Details of Defra's reponse to the Budget, together with links to key budget documents, are available at this page.

Wider issues

See this section of the web site on information on economics and statistics across Defra as a whole.

Business Areas

Economic analysis has played, and continues to play, a particularly important role in the business areas set out below (and which are generally addressed in material elsewhere on the Defra web site). Links to some specific papers and consultation documents on key policies and economic instruments are also given.

Climate change and sustainable energy

• Ancillary effects of greenhouse gas mitigation policies
• UK greenhouse gas emissions trading scheme
• Climate change agreements and the climate change levy
  • also www.hmce.gov.uk/business/othertaxes/ccl.htm
• Economic instruments and energy efficiency
  • Economic Instruments to Improve Household Energy Efficiency: Consultation document on specific measures
• Links to web sites on climate change and energy efficiency

Air quality

• National air quality strategy
  • An Economic Analysis to Inform the Review of the Air Quality Strategy Objectives for Particles
  • An Economic Analysis of the National Air Quality Strategy Objectives - An Interim Report
• Valuation of air pollution effects
  • Valuation of Air Pollution Effects on Ecosystems: A Scoping Study

Waste

• Landfill tax and permit trading

Water

• Implementation of the Water Framework Directive
• The role of economic instruments
  • Economic Instruments for Water Pollution Discharges
  • Economic Instruments for Water Pollution
  • Economic Instruments in Relation to Water Abstraction
  • The Review of the Water Abstraction Licensing System in England and Wales (Consultation Paper) - The Role of Economic Instrument
• Water Supply Industry Periodic review
• Diffuse water pollution from agriculture

Environmental liability

• The Environmental Liability Directive

Chemicals

• The EU White Paper on Chemicals
• The role of economic instruments
  • Scope for the Use of Economic Instruments for Selected Persistent Pollutants
• Pesticides - economic instruments and the pesticides voluntary initiative
  • Pesticides, Design of a Tax or Charge Scheme for
  • The Potential Cost and Effectiveness of Voluntary Measures in Reducing the Environmental Impacts of Pesticides (research report)

Appraisal, evaluation and valuation of environmental costs and benefits

• Appraisal
• Better Policy Making: A Guide To Regulatory Impact Assessment (on the Cabinet Office website)
• Green Book - 2003 edition: Appraisal and Evaluation in Central Government (on HM Treasury web site)
• Integrated Policy Appraisal (IPA) (on the Government's main sustainable development website) IPA is a good practice tool designed within Government to assess the potential impact of policy proposals by linking together a number of existing appraisal requirements and commitments. It provides a framework within which the economic, social and environmental impacts of policy options and their distributional effects in relation to different groups of people (e.g. the elderly, those on a low income) can be assessed.
  
• Multi-Criteria Analysis This material is on the web site of the former Department for Transport, Local Government and the Regions - DTLR
• Policy Appraisal and the Environment
• Review of Technical Guidance on Environmental Appraisal
• Ex-post policy evaluation of environmental policy
• Valuation of environmental costs and benefits
  • Environmental Valuation Source List for the UK
  • Environmental Valuation Reference Inventory (EVRI)
    This external site is an international database of environmental valuation studies, to which, through Defra's support, Environment Canada is offering is offering free access to all UK based internet users.
  • The Social Costs of Carbon

Defra is not responsible for the contents or reliability of the linked web sites and does not necessarily endorse the views expressed within them. Listing should not be taken as endorsement of any kind. We cannot guarantee that these links will work all of the time and we have no control over the availability of the linked pages.

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