This report reviews experiences outside the United States with economic instruments for managing the environment, including air and water quality, water quantity, solid and hazardous wastes. It represents an update and extension of one chapter in the 1997 report by Anderson and Lohof to the US Environmental Protection Agency. That report found widespread use of economic instruments for managing the environment, including some applications not observed in the United States. Seven years later, this report identifies new instruments, more widespread application of older instruments, and greater acceptance of incentive-based mechanisms in environmental management. This report can also be regarded as an addition of international experience to a 2001 EPA report on the U.S. experience with using economic incentives and follows the same basic organization.

Includes bibliographical references.

This report, which is available only as a download, reviews experiences outside the United States with economic instruments for managing the environment, including air and water quality, water quantity, solid and hazardous wastes. It represents an update and extension of one chapter in the 1997 report by Anderson and Lohof to the US Environmental Protection Agency. That report found widespread use of economic instruments for managing the environment, including some applications not observed in the United States. Seven years later, this report identifies new instruments, more widespread application of older instruments, and greater acceptance of incentive-based mechanisms in environmental management. This report can be regarded as an addition of international experience to a 2001 EPA report on the US experience with using economic incentives and follows the same basic organization. Worldwide experience with these instruments is extensive, and a number of survey reports cover portions of this topic. However, some instruments are discussed in detail for the first time in this report. The intention is to offer some depth of treatment for a relatively few examples to provide the reader with an understanding of how the instrument is designed and how it performs, particularly in the context of developing nations. This report draws on other survey literature that covers a portion of this topic, but seeks to avoid redoing their analyses.