A new CERE working paper is entitled "Command and Control Revisited: Environmental regulation and Technological Change in Swedish Industry 1970-1990".
The paper addresses the issue of environmental policy instrument choice for achieving deep emissions reductions in the industrial sector and combines a theoretical review with analysis of the actual design of the Swedish regulation of industrial pollutants and the outcomes of said regulations.
The authors, Ann-Kristin Bergquist, Kristina Söderholm, Hanna Kinneryd, Magnus Lindmark and Patrik Söderholm, sets two objectives for the paper. The first is to provide a theoretical review and discussion of the conditions under which performance standards, i.e., individual emission limits for stationary industrial plants, can provide efficient incentives for deep emission reductions and the second, more strictly empirical, is to analyze the design and the outcomes of the environmental regulation of Swedish industry during the period 1970-1990.
Among the findings are that the Rönnskär licensing case shows that the former Swedish regulatory approach to industrial pollution control had many of the attributes characterizing a dynamically efficient command-and-control policy and for the Rönnskär plant a host of hazardous emissions could be radically reduced while at the same time allowing plant output to double over the period and the experiences of the environmental regulation of the Swedish PPI during the period 1970-1990 confirm many of the findings from the Rönnskär licensing process.
In summary the empirical findings are encouraging in that they suggest that the Swedish regulatory approach comprised many key elements of an efficient policy-induced transition towards radically lower emissions in the industrial sector. This largely by relying heavily on performance standards.