Regulatory interventions for promoting investments in environmentally benign energy technologies

Abstract

There are different views on the role of governmental interventions as a policy tool. Economists tend to favour market based measures believing in the invisible hand of the market to achieve optimal allocations of resources. They try to minimise governmental interventions (‘command and control’) which distort market functions. Practitioners, on the other hand, advocate governmental interventions as indispensable measures to correct market imperfections. In their views, governmental interventions are not so rigid as implied by ‘command and control’, but are a soft package of practical policy tools.