Paying the polluter

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'The financial means embedded in subsidies for unsustainable systems of production and consumption are increasingly well studied and reported. This has led to policy recommendations (e.g. OECD, EU) on how to reform subsidy systems in support of the necessary transitions to a low carbon and ecosystem resilient society based on a strong resource efficient economy. The authors in this book contribute to the debate based on recent, high quality and policy relevant research. It is a timely contribution to a pressing financial issue in environmental policy.'--Hans Bruyninckx , Executive Director of the European Environment Agency. 'Recently the IPCC finished their 5th Assessment report and we see that while emissions continue unabated - and in some areas even increase, relatively little is done in terms of policy making. Instead of sound policies to deal with climate issues, we are still faced with perverse incentives that promote fossil fuels. This book sets itself a very important agenda of trying to find a workable path towards abolishing such subsidies. This is vital reading for all policy makers.'--Thomas Sterner, Visiting Chief Economist, Environmental Defense Fund Professor of environmental economics, University of Gothenburg. 'EU countries increasingly receive recommendations through the European Semester and OECD Environmental Performance Reviews to assess and progressively phase out environmentally harmful subsidies. It is not only a matter of avoiding damage to the environment, it is also a question of transparency, equity, and of eliminating unjustified privileges. Subsidy reform can help reduce public deficits, restore fair market conditions and eliminate distortions in competition. This book is a precious tool for Governments and experts.'--Aldo Ravazzi Douvan, Italian Ministry of Environment, Professor of Sustainable Development at University Roma Luiss. 'Tax spending and public subsidies harmful to the environment have attracted high level attention at the Rio and Johannesburg Sustainable Development Conferences, in the context of the Kyoto Protocol and of the Convention on Biological Diversity, in OECD and EU recommendations, and are now firmly on the public agenda. They are often also poorly designed, do not reach their goals, are costly, not transparent and can be inefficient. With the present public budget crises in many countries, rarely has the timing been more favorable to lower such harmful support. The book is thus timely and shows through concrete examples that the reform of harmful public subsidies is possible.'--Guillaume Sainteny, Associate Professor, Ecole Polytechnique, Paris, France. 'In the policy world, there are few opportunities for reforms that can simultaneously benefit the economy, society and the environment. Phasing-out environmentally harmful subsidies is one. It can reduce the burden on government budgets, free up funds for more worthy causes, and reduce perverse incentives to pollute the environment and over-use scarce natural resources. However, subsidy reforms have been notoriously difficult to implement, despite the efforts of organisations like the OECD, IEA, GSI, World Bank and IMF. Reform is hampered by the limited information available on subsidies, their impacts, and who actually benefits from them. This book brings to light the latest information and analysis on environmentally harmful subsidies and reform efforts, pulled together by some of the leading experts on this issue. It is essential reading for any policy maker wanting to ensure a smooth and successful reform of environmentally harmful subsidies.'--Helen Mountford, Deputy Director, OECD Environment Directorate. Pledges to reform environmentally harmful subsidies (EHS) have increased over the past few years, at both global and national levels. Paying the Polluter addresses the most important issues to be considered when embarking upon these necessary reforms. In this unique work, leading experts explore the definition of EHS, how they can be identified and measured and assess their impacts and the potential benefits of reform. Barriers and opportunities for EHS reform are elaborated with examples of successes and failures. A practical subsidy reform tool is also presented, giving guidance to help develop transparent inventories of subsidies and road maps for future development. Demonstrating how subsidy reform may contribute to a better environment, support fiscal reform and address social and economic objectives, this authoritative book will appeal to policy makers and their advisors all over the world. It will also be a useful sourcebook for academics interested in concrete applications of environmental economics. Finally it should prove a rich and informative read for anyone looking for facts and arguments supporting green budget reforms.

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