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28
In recent years, a large body of literature has explored the impacts of
stakeholders on agency behaviors (Doh and Guay, 2006, Friedman and Miles, 2002,
Mitchell, et al., 1997). Since the implementation of emissions trading also involves a
large number of stakeholders with conflicting preferences, stakeholder theory may
provide a unique perspective to analyze the processes and effects of emissions trading.
In this research, I use four criteria to explore the concerns of stakeholders:
effectiveness, efficiency, equity, and flexibility.
2.3.1 Effectiveness
The effectiveness of an emissions trading system in terms of emission
reduction is a major concern of all the stakeholders of emissions trading. When the
Phase I of National Acid Rain Program was completed, it was declared by the EPA as
a success. Kamieniecki et al. (1999) confirms the effectiveness in pollution control of
the RECLAIM even when local economic grew rapidly from 1993 to 1996. Yet there
are always competing arguments. One example is the doubt on the effectiveness of
National Acid Rain Program. Greenstone (2004, p. 609) argues that the 1990 CAAA
might not be the major reason for a substantial reduction of emission SO2 during the
1990’s. Copeland and Taylor (2005) also indicate that Kyoto Protocol is based on the
assumption of closed economy. However, in the world of open economy, an emissions
trading system is unavoidably subject to free rider problem as “countries outside the
agreement increase their emissions in response to the cutbacks of others” (Copeland
and Taylor, 2005, p.206). The free rider problem is an inherent difficulty of market
design. Since there is no powerful regulatory agency at the global level that could have
Object Description
| Title | Processes, effects, and the implementation of market-based environmental policy: southern California's experiences with emissions trading |
| Author | Zhan, Xueyong |
| Author email | xzhan@usc.edu; xueyongzhan@gmail.com |
| Degree | Doctor of Philosophy |
| Document type | Dissertation |
| Degree program | Public Administration |
| School | School of Policy, Planning, and Development |
| Date defended/completed | 2008-07-01 |
| Date submitted | 2008 |
| Restricted until | Unrestricted |
| Date published | 2008-10-30 |
| Advisor (committee chair) | Tang, Shui-Yan |
| Advisor (committee member) |
Mazmanian, Daniel A. Henry, Ronald |
| Abstract | This research provides a positive explanation of the implementation processes and effects of market-based environmental policy by conducting a case study on RECLAIM (Regional Clean Air Incentives Market), the first regional emission permits trading program that has been implemented by South Coast Air Quality Management District (SCAQMD) to address air pollution problems in the Los Angeles air basin since 1994.; Firstly, I developed a game theoretic model of environmental policy implementation. This model integrates theories of administrative rulemaking, policy implementation, institutional rational choice and transaction cost politics. I argue that administrative agency tries to minimize political transaction costs of policy implementation when writing rules.; Based on the formal model, I conducted a quantitative analysis to examine the interactions between SCAQMD and its key stakeholders, such as federal, state and local governments, businesses, and environmental NGOs, during the rulemaking of RECLAIM. I found that SCAQMD is more likely to adopt rule changes suggested by state and federal environmental agencies. This research identifies the dominant role of organized interest groups, the existence of interagency lobbying, and the lack of citizen control over the rulemaking of RECLAIM. Furthermore, I conducted an evaluation of the rules governing the RECLAIM program, and I identify the major distortions of the RECLAIM rules in comparison with an ideal cap-and-trade emissions trading market. Also, I used OLS regression to examine the effects of policy difference on emission level in California between 1990 and 1999. This evaluation fails to reject the null hypothesis that using cap-and-trade (CAT) compared with using command-and-control (CAC) has no different effects on emission of both NOx and SO2 from point sources at the county level in California in the 1990's.; In summary, this research finds that the implementation of emissions trading is political, and interest group politics may distort the regulatory design and implementation of an emissions trading program. While cap-and-trade is promising to better protect our environment and natural resources, its implementation is conditioned by many political and administrative factors. Inadequate rules may come as the results of political compromises, and they may impact the functioning of an emissions trading system. |
| Keyword | emissions trading; rulemaking; RECLAIM; implementation; environmental governance |
| Geographic subject (city or populated place) | Los Angeles |
| Geographic subject (state) | California |
| Coverage date | 1990/2000 |
| Language | English |
| Part of collection | University of Southern California dissertations and theses |
| Publisher (of the original version) | University of Southern California |
| Place of publication (of the original version) | Los Angeles, California |
| Publisher (of the digital version) | University of Southern California. Libraries |
| Provenance | Electronically uploaded by the author |
| Type | texts |
| Legacy record ID | usctheses-m1719 |
| Contributing entity | University of Southern California |
| Rights | Zhan, Xueyong |
| Repository name | Libraries, University of Southern California |
| Repository address | Los Angeles, California |
| Repository email | cisadmin@lib.usc.edu |
| Filename | etd-Zhan-2335 |
| Archival file | uscthesesreloadpub_Volume44/etd-Zhan-2335.pdf |
Description
| Title | Page 39 |
| Contributing entity | University of Southern California |
| Repository email | cisadmin@lib.usc.edu |
| Full text | 28 In recent years, a large body of literature has explored the impacts of stakeholders on agency behaviors (Doh and Guay, 2006, Friedman and Miles, 2002, Mitchell, et al., 1997). Since the implementation of emissions trading also involves a large number of stakeholders with conflicting preferences, stakeholder theory may provide a unique perspective to analyze the processes and effects of emissions trading. In this research, I use four criteria to explore the concerns of stakeholders: effectiveness, efficiency, equity, and flexibility. 2.3.1 Effectiveness The effectiveness of an emissions trading system in terms of emission reduction is a major concern of all the stakeholders of emissions trading. When the Phase I of National Acid Rain Program was completed, it was declared by the EPA as a success. Kamieniecki et al. (1999) confirms the effectiveness in pollution control of the RECLAIM even when local economic grew rapidly from 1993 to 1996. Yet there are always competing arguments. One example is the doubt on the effectiveness of National Acid Rain Program. Greenstone (2004, p. 609) argues that the 1990 CAAA might not be the major reason for a substantial reduction of emission SO2 during the 1990’s. Copeland and Taylor (2005) also indicate that Kyoto Protocol is based on the assumption of closed economy. However, in the world of open economy, an emissions trading system is unavoidably subject to free rider problem as “countries outside the agreement increase their emissions in response to the cutbacks of others” (Copeland and Taylor, 2005, p.206). The free rider problem is an inherent difficulty of market design. Since there is no powerful regulatory agency at the global level that could have |
