Please post the answers to both these two questions correctly. Thank you! 1)U.S.

Question

Please post the answers to both these two questions correctly. Thank you!

1)U.S. policy to increase the miles per gallon (mpg) of new cars is to mandate an average mpg for cars sold by U.S. manufacturers. In many countries within the European Union, the policy is to tax gasoline so that the price per gallon at the pump is stable around $4.50 per gallon. Which policy is more to be successful at the least cost? Explain.

2)What role, if any, do property rights (efficient or inefficient) play in designing and implementing environmental policy? Explain.

Explanation / Answer

US policy is more successfull because it will reduce the dependance on foreign oil.This will save families money at the pump and cut the oil consumption. And also the cars will get nearly miles per gallon, almost double in the future. It’ll strengthen the nation's energy security, it's good for middle class families and it will help create an economy built to last.Achieving the new fuel efficiency standards will encourage innovation and investment in advanced technologies that increase the economic competitiveness and support high-quality domestic jobs in the auto industry.The policy in many countries is not as good as US policy because fuel taxes in western Europe are in general quite high, in relation to those in the US, for example (Schipper and Myers, 1992). This is not primarily for environmental reasons, but reflects the simple fact that motor fuels have been an easy target for taxation.This generalisation applies principally to petrol, however, as greater caution has generally been applied to diesel because of its use in haulage and public transport. In the US by contrast, the long distances between centres and population and a perception of plentiful supplies have led to an expectation of far lower tax rates.

2.Threats to human health and environmental quality continue to grow worldwide. Patterns of industrial production, as well as the use of natural and land resources, are important contributing factors. While environmental problems vary in their details, they generally involve either overuse of a natural resource or emission of damaging pollutants. Transitioning to more sustainable use patterns is both difficult and expensive even under optimum conditions. Developing countries face the added challenges of severe funding constraints, weak institutional capacity, and a dependence on environmental and natural resources for economic development.

property rights is the one of the economic instrument in regulating and designing environmental policy.In order for a society to use its resources efficiently, property rights must be well defined, enforced, and transferable.

Inadequately defined and insecure property rights can be one of the reasons for environmental depletion and pollution. Therefore the establishment of secure (and tradeable) property rights will lead to more appropriate pricing of the use of natural resources. Establishing secure and transferable property rights will ensure that cost of depletion is internal to the user and that will ensure the sustainable use of his property. In case of somebody polluting or using natural resources from somebody else in a specific area, secured and tradeable property rights will ensure that they will negotiate with each other and find a solution to internalize the externalities.

However, the assignment of property rights can not solve all environmental problems. It is only useful under certain circumstances and conditions. For example, the assignment of property rights is not feasible if there are a lot of users of a specific environmental commodity, such as air, atmosphere or water, since exclusion of other users is technically not possible. In such a case alternative instruments must be used to ensure the environmentally sound use of the commodity.

The assignment of secure and tradable property rights would have the following advantages:

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