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Law and economics analysis of hazy weather governance

Author(s): Zhang Xiaofeng, Xiao Xiujuan

As the economy continues to develop, the impact of human activities on the environment intensifies, and hazy weather appears from time to time. How to reduce the appearing of hazy weather and its impact on people's lives has become an issue of great concern to the whole society. Based on the current situation of hazy weather and it's causes, the paper interpret the occurrence of hazy weather form the perspective of Law and Economics, focusing on the use of emissions trading system extending form the property right defined system guided by "Coase Theorem" and pollution charges system of Pigovian tax theory to analyze the governance of hazy weather. The features of public goods and externalities of atmospheric environment lead to "the tragedy of the commons". Emissions trading system and pollution charges system provide effective solutions from the perspective of market mechanisms, but the treatment effect of these two systems is not obvious in China. There are some issues, for example, unsound laws and regulations, non-standard operation, unreasonable charging fees, limited charging areas and others. Therefore, it is necessary to improve the relevant laws and regulations, establish reasonable monitoring and measurement systems, and strengthen supervision and management to give full play to the effect of emissions trading system and pollution charges system.

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