While that is ideal, another strategy is to implement government subsidies (or taxes) to privatize the social costs of pollution. Regrettably, Al Gore's loss i

While that is ideal, another strategy is to implement government subsidies (or taxes) to privatize the social costs of pollution. Regrettably, Al Gore's loss in 2000 saw environmental policy fall by the wayside and we are slowly picking up the pieces. Carbon credits is a good example of this, but it illustrates the pitfalls clearly: if not everyone is subject to the same environmental regulations, those who are will lose their competitive edge.