Title: Incorporating environmental institutions in environmental policy: changing behaviour by decisive information

Authors: Henrik Hammar

Addresses: Department of Economics, University of Goteborg, Environmental Economics Unit, P.O.Box 640, SE 405 30 Goteborg, Sweden

Abstract: In this paper, I discuss, from a policy perspective, the relation between environmental institutions and transaction costs. I stress the importance of environmental institutions in providing decisive information, i.e. information that induces changes in behaviour, and thereby facilitates environmentally sound choices. If the objective is to put the economy on a sustainable path, I suggest that environmental institutions are one efficient means to loosen informational and political constraints in environmental policy, and, hence, that investment in environmental institutions is justified. The rationale is that environmental institutions direct the economy to a path where percentage growth in GDP is less wasteful. Expressions of environmental institutions - consumer awareness, producer responsibility and environmental organisations - are also discussed in order to make the discussion more tangible, i.e. how these provide decisive information.

Keywords: decisive information; environmental institutions; environmental policy; externalities; transaction costs.

DOI: 10.1504/IJSD.2000.001531

International Journal of Sustainable Development, 2000 Vol.3 No.2, pp.170-178

Published online: 04 Jul 2003 *

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