Incentives and Disincentives: A Systematic Approach

Abstract

The purpose of this Forum is to pool knowledge from many disciplines and different parts of the world. This session is principally about identifying innovations that might materially enable the shift of society towards a more sustainable resource-consumption status. Over the last decade or so, I have been working with many collaborators to better understand the fundamentals of the regulatory, market and institutional arrangements likely to achieve this goal. Our approach aims to synthesize knowledge from various disciplines by attempting to go beneath the language barriers of individual disciplines to understand the fundamental concepts within law, economics, education and various other approaches to how they think about sustainability issues. The aim is to apply these concepts to consider the fundamentals of the effectiveness of different instruments such as regulation, voluntarism or market instruments, and to suggest ways of improving that effectiveness (Martin and Verbeek, 2006). Thousands of websites, papers and books from around the world have been consulted in our attempt to understand the fundamental mechanisms and effectiveness issues. The perspectives on the topic are myriad, including regulatory theory, economics and market theory, process perspectives, social perspectives, ethical frameworks, and voluntarism and educational approaches. This paper principally reflects both our recent attempt to understand international best practices in the design of environmental instruments, and the preparatory work being done on a study on behavioural underpinnings of the operation of some of these instruments. In tackling the regulatory study, our expectations at the outset were that: 1) A suite of sophisticated processes was available for the creation of natural resource management strategies and the regulations that form the basis for their implementation by government. 2) There was a coherent body of empirical data to demonstrate the received wisdom of the superiority of market instruments over regulation in achieving behavioural change towards sustainability.