Fajardo, Germán and Carlos Chávez Rebolledo. 2012. “Estándares vs. Sistemas de Permisos Transables con Costos de Fiscalización: Una aplicación al caso de fuentes fijas en Bogotá, Colombia.” El Trimestre Económico LXXIX 313:1: 87-117.
We study the cost effectiveness property of different control strategies for improving environmental quality. Our prospective analysis considers the application of Transferable Emissions Permit System (TEPS), Transferable Ambient Permit System (TAPS) and Standards (STD) applied on fix sources in Bogota-Colombia. A numerical simulation model allowed us to obtain costs of each regulatory system, which were compared with associated urban environmental quality. The results show that the most cost effective regulation for any environmental quality goal is TEPS, followed by TAPS and finally STD. In addition, the paper presents a new conceptual result on the enforcement strategies for a regulatory instrument that considers a spatially differentiated pollutant. The results suggest that for any goal of environmental improvement, a TAPS induce compliance it is cheaper than in any other regulatory system under consideration.