Environmental Problems: Causes and Solutions

Understanding the working mechanisms of instru- ments in solving environmental problems requires some insight into the causative mechanisms resulting in such environmental problems. In virtually all causal models for societal actions, some rational actor models play a key role. It is in such rational actor models that many of the causes of environmental problems can be identified and specified, at least for a start.

Common to all environmental problems is the causal mechanism by which direct private advantages of some actions outweigh the adverse environmental effects for the persons (or organisations) deciding on that action, while at the same time this adverse effect may affect others. To this extent, the adverse effect is external to these private considerations: it is an external effect of private actions on some large collectivity. If the single owner of an island cuts down his forest to create a garden, he simply prefers the garden to the forest, and there is as yet no environmental problem involved. It is only if others are bothered by the disappearance of the forest or the consequences of its disappearance that there is an environmental problem. This shows the collective good nature of environmental quality, and is a necessary mechanism for environmental problems to occur. In economic jargon, it is external effects of private actions that are detrimental to a collective good.

An additional mechanism in problem development is that the detrimental effects usually result not from the actions of a single person but from the combined actions of many persons. Though not strictly necessary in a logical sense, this is the typical situation for nearly all environmental problems. It is the tragedy of the commons. Single actions may contribute very little to the problem, but it is the multitude that leads to overall undesirable effects, and ultimately to the breakdown of the ecological system. Together, these two mechanisms have a power that is hard to break. If an individual producer or consumer corrects his behaviour, his action may have negative effects on himself, in terms of costs and efforts, even if only in terms of the burden of nuisance. At the same time, the positive environmental effects of the adjusted behaviour may well be negligible. Such cases result in the prisoner's dilemma. Rational actors will only choose the behaviour with the preferred outcome if they can expect most others to act in the same way. In the 'wrong" situation, actual behaviour by others proves that this expectation is not justified and rational actors will choose the sub-optimal behaviour of con tributing their share to the environmental problem. If

corrective action is taken by all but a few, the environ mental problem is largely solved, benefiting these few while they do not bear their share of the costs. This is the free rider problem. If the free riders are visible, social norms on collective action may easily become eroded, and with it the collective environmental good. If the free riders are invisible, the flesh is weak. It then takes highly internalised values for most people to remain on the right track. Environmental policy instru ments somehow have to break this circle, either by effectively influencing all (or almost all) people, or at least by creating the confidence that most others will act accordingly

A criticism of this model has been that the rational actor model underlying it is based on too simple a view of the real motives of real people. In reality, many actors indeed often behave altruistically, because they like doing so, and groups of actors often have an explicit or tacit mutual understanding to avoid 'bad' behaviour (see Sen 1977). At least some people bother about separate collection of waste streams, even in instances where others cannot see what exactly they are doing. They have internalised environmental norms to some extent. However, even if the restrictions on rationality are relaxed to include such social aspects of human behaviour, the unpleasant situation remains that detrimental environmental effects do occur and are re-created all the time by people who know the problems exist. So, even after taking into account the social nature of behaviour, the wrong choices are still made so often that environmental problems result. On the basis of these theoretical considerations, sometimes named the 'field model', it is now possible to specify what environmental policy instruments should do. They should:

1. Avoid external effects on the environment and thus save collective goods, in this case related to environmental quality. 

2. Avoid the tragedy of the commons

3. Solve the prisoner's dilemma

4. Prevent the free rider problem

The model also allows us to indicate the mechanisms that policy instruments may be aimed at. The behaviour of an individual actor can be corrected in a number of ways (see Bressers and Klok 1988 for a fuller treatment).

1. The set of available alternatives can be changed.

This can be done by offering new alternatives, like separate collection facilities; by removing alternatives physically, as by fencing conservation areas; or by improving knowledge of existing but as yet unknown alternatives, as in nature education programmes.

2. The consequences of alternatives can be changed.

This may be done positively, as by subsidies on unleaded petrol, or negatively, as by threatening those who dump toxic wastes with jail sentences or other penalties. 3. The evaluation of the consequences of alternative can be changed.

This can be done by changing the value system of actors, through educational processes, or by improving their active knowledge of the consequences of available alternatives, as by eco-labelling schemes.

These three types of mechanism in a policy instru ment may avoid the external effects on the collective good, as well as the prisoner's dilemma and the free rider problem. In many situations, however, this is pos sible to a limited extent only and the situation may still be that of a prisoner's dilemma, with the free riding option lurking in the background. If only heavy industries were induced to reduce their CO, emissions substantially, using a large number of specific measures, the prisoner's dilemma would remain for all other actions not regulated, for which free riding may still remain the norm. In addition, the non-heavy industries would still be riding free, Not only would they continue to emit, hat lower energy prices because of reduced demand by heavy industry may even allow them to increase their emissions. Thus, there is another role of policy instru- ments in avoiding the tragedy of the commons, by solv ing the prisoner's dilemma through creating the trust that everybody will indeed take part in the creation of the collective good.

4. Justified trust in everybody's positive and due contribution to our common good can be created.

This would make free riding virtually impossible. In this situation, the individual may seem to be deciding alone. In fact, however, he is making his decisions as if he were the collectivity, deciding for all people simultaneously. This co-operative solution is a very direct option for solving environmental problems, with collective values being internalised in individual decision making. Although this option seems highly idealistic, it is a normal solution to many problems, at least in small communities. Most people take the trouble to store their waste in waste bins, even in larger communities. Only in situations of reduced awareness of norms, as when alcohol is used collectively, do the norma on littering break down. Tasks for the common good are executed, that is, behaviour is adjusted, because one expects everybody to do so. Still, this ideal is not always achieved, even if only a small num ber of people are involved, as can be seen in some families where children (or indeed parents) may try to avoid the daily dish-washing duties, always with good excuses at hand.

What are the requirements for this type of co-operative behaviour? One element would be that free riders undergo negative sanctions for free riding when they are caught. This would mean that the bad behaviour is forbidden at the level of the individual, and hence the co-operative approach is absent. However, control and sanctions may be more informal, not involving police and administration but friends and family, or the next-door neighbours. Another prerequisite is that the behavioural norm is clear and non-compliance is visible.