Failure of Economic Incentives Discussion Paper

CRC Discussion Paper Series, Number 4

Jim Hamilton The Failure of Economic Incentives to Encourage Sustainable Community Development

Some promote the use of economic incentives as a major public policy instrument, if not the only instrument, to encourage consumer and industrial behaviour conducive to sustainable community development. This paper questions the validity of such a position, and suggests, rather, that economic incentives without concomitant regulatory change and long-term planning and objective-setting may be too weak as a public policy instrument to achieve substantive changes in behaviours to support sustainable communities.

"Incentives, if they are to work, must be meaningful within the overall context of consumer budgets and/or industrial capital plans, otherwise they are nothing more than just a give-away.”