Firm incentives to promote technological change in pollution control: comment

Following on from an analysis by Milliman and Prince, this article considers further the relative incentives for technical change provided by different pollution control instruments. The comments involve the recognition that emission targets are typically chosen fairly arbitrarily because of regulators' lack of knowledge of abatement cost schedules. There is also a more detailed discussion of the practicability of auctioning emissions permits, as these have been less thoroughly covered in the literature than the other instruments.