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Module
Table 7

Instrument Instrument Description 5
Category
Economic: Deposit Refund Revenue Generating Instruments: Examples such as taxes, charges,
user fees and deposit-refund schemes require that money be paidto
Performance government in return for engaging in some behaviour. These economic
Bonds instruments discourage undesired behaviours by raising their prices. To
unduce a significat degree of behavioural change, a tax or fee may have
Taxes to be imposed at a level that raises the price of an undesired behaviour Abu Dhabi, UAE
above that of an alternative behaviour, in order to achieve the correct
Earmark Taxes relative pricing between the two options. The general principle to follow in
and Funds applying revenue generating instruments is to tax activities or behaviours
that are to be discouraged or reduced (Barg et al. 2000).
User fees
Subsidies Subsidies: Istruments such as cash subsidies, tax breaks and grants induce
behavioural change by making the more desired behavioural option
Tax - breaks cheaper, thereby increasing its attractiveness to the producer or consumer
(Barg and others 2000)
Administered Price control by governments via a regulated market.
Prices

Direct Governments influence producer and consumer behaviour by channeling expenditures
Expenditure: directly at the behaviour they want to encourage. Direct exexpenditures differ from subsidies
in that they are typically broad programmes of expenditures targeted at a macro level to
foster activities like technological innovation, whereas subsidies reward incremental changes in
individuals’ behaviour (Barg and others 2000).

Programme Governments may direct their budget toward programmes that work
/Project directly on the environment to carry out ecosystem protection and/or
Operation restoration

Green Governments can opt to spend its routine procurement budget on goods
Procurement and services that support environmental improvements goals.

Research and Governments can allocate budget expenditures to R&D directed at
Development specific economic, social and environmental goals.

Moral Suasion Governments can encourage behavioural changes consistent
with ecological goals by funding programmes designed to provide
information and education to raise awareness. These moral suasion and
education programmes are based on the premise that people behave
in environmentally harmful ways because they lack information and
knowledge, and that if they have good information they will do the “right”
thing (Barg and others 2000).

IEA Training Manual Workshop for the National Reporting Toolkit (NRT) 75