Public Goods

1. Incentives to Conserve Marine Biodiversity

The effect of pollution on the sea is felt by the overconsumption of sea products. It is not only limited to the area around the sea or ocean. People living in this region that are not concerned with the preservation of the sea also may benefit from its environmental homeostasis. Thus, actions aimed at the protection of the environment and marine biodiversity are of great significance for many parties, including local people and the economy benefiting from marine public goods consumption.

A gross product has characteristics of both private and public goods. In such instances, a person can pay and be barred from the consumption of such products, which become impure public goods because of their excludability. The fishing industry is one of the economic sectors providing the latter. Thus, many different incentives have triggered its preservation. First, the protection of the environment by individuals can be a result of people willing to make great sacrifices. The idea of having an attractive beach may not be so appealing to some persons, but benefits of the industrial sector in the same ocean are fascinating. As a result, they tend to ignore the conservation of the sea. The paper examines some of the incentives leading to the conservation of marine biodiversity (Arriagada and Perrings 799).

 

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These incentives used for many years are divided into active and negative types. In case of positive incentives, the government has launched payment schemes for those willing to do something to save the marine life. In this way, different conservation practices are encouraged. The approach includes the very aspect of having to forego many benefits such as economic and access certain resources. Considering particular social and economic needs, there is a possibility that it will hamper the acceptance of such practices. Thus, incentives have to address the question of economic needs to avoid a case where people make a choice of generating income regardless of the destructive nature of their actions (Arriagada and Perrings 799).

Negative incentives mean that control is imposed through fines and dues. The idea of fishing is that the catch of one fisherman is not accessible to another one. It is the reason why fish and other marine products fall under the category of impure public goods. In this case, control is placed over fishing nets and the number of catch that one gets. Since the number of fishery expeditions has reduced, the fishing of certain marine animals has also decreased. Fewer vessels mean that the amount of catch will be significantly lower. It is done through licensing and levy fees since accessibility of marine impure public goods has made it hard to curb their excessive number (Arriagada and Perrings 800).

2. Impure Public Goods and the Technology of Public Goods Supply

To understand the meaning of an impure public good, it is important to analyze the term “public good” first. Any good that falls within the purview of being accessible to people would fit the bill. Its consumption should also not be restricted to the public at large. These goods can never be produced for individual profit, since it is difficult to convince people to pay for its benefits and externalities. An impure public good satisfies the characteristics of public goods and private goods without fully identifying with either one of them. For example, a case of cable television clearly illustrates this point. Its consumption does not limit its use to the next person. However, there is a possibility that one may be unplugged because of the lack of a pay making it excludable at the same time (Bulte, van Kooten, and Swanson 5).

An externality can be defined as a possible cause of a given market failure. Its effects are a result of a direct impact of agent’s decisions. Externalities of impure public goods can be classified into either changing production or consumption. Their impact is either negative or positive. In case of active investment, externalities lead to over-investment, while the negative impact results in under-investment. Negative production can include instances of oil spills in the local fishing industry, which in this case represents an impure public good. On the other hand, consumption can have a negative effect considering the case of using fishing nets that are harmful to all organisms in the sea. In case of a positive externality, the margin of the social benefit gets larger than the marginal private benefit. Factors that fall under this category of real production include technological innovations, which in this case represent an impure public good. Public consumption includes such examples as education and vaccination services. These refer to impure public goods.

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There exist three most common public good supply technologies, namely, ‘additive’, ‘best shot’, and ‘weakest link’ one. In the first case, as the name suggests, some characteristics are associated with a particular product. For example, carbon dioxide isolation in any region will have the same value and weight. The reservation of animals will mean that every hectare of land that is conserved will have its particular value without affecting the surrounding regions (Bulte, van Kooten, and Swanson 7). On the other hand, the best shot technology is dependent on the provider. The best one presents the best good, for example, the case of the Centers for Disease Control and Prevention, which is set up in the USA, providing goods to the rest of the world. The weakest link technology is illustrated by the control of infectious diseases. In case of controlling HIV and tuberculosis, the level of protection will only be as good as the supervision of the disease in the poorest and the most densely populated countries.

3. Types of Economic Incentives for Impure Public Goods with Technologies of Public Good Supply

Many different types of economic incentives are created by impure public goods. An incentive is defined as anything that motivates someone to do something. In this case, it includes resulting taxes, fees and charges. For example, in the case of airstrip construction, the idea behind it is tariffs that the government may get from this project. Such tariffs may appear either positive or negative incentives with the use of the additive technology. In some instances, the government issues pesticides to farmers, whereby the risk of having products rot on the farm suppresses the expense on producing these pesticides (Bulte, van Kooten, and Swanson 8). The technology used in this case for impure public good supply will be classified as the best link method. It will serve as a positive incentive.

Subsidies for marine pollution control are another aspect. They are mostly in line with the weak link technology of impure marine public good supply. Financially, the cost of cleaning up pollution will be more expensive unlike the initiative to make needed adjustments before it is too late. Such companies have access to loans, grants, and favorable tax rates because of the approach they choose. Such incentives are considered negative since without doing this, certain aspects will be denied.

Tax subsidy combination is another aspect worthwhile considering. In the case of carrying out the recycling process, the company saves on taxes, it would have incurred in procuring more materials. This form of incentive is based on the use of the additive technology. Moreover, costs will be reduced significantly, if products are recycled. For example, beverage companies that use the recycling process can cut down on costs of taxation. This form of incentive is considered positive (Arriagada and Perrings 801).

Voluntary actions are the most common of all initiatives. They can be classified as being a positive incentive. No one is denied gaining anything for one’s actions, even if they are purely out of good will. It is always the reason for changing trading or production in any organization. Regardless of what pushes that, motivation is always an accompaniment. The construction of an airstrip can be because there is a need to have such a public good. It becomes a driving force for having a given initiative affected. All the above incentives will only work best, if voluntary action is implemented.