The Korean experience with market-based environmental policy instruments

This paper focuses on the means of environmental policy and considers, in particular, the Korean experience with the relatively new breed of economic-incentive or market-based policy instruments. Even though these policy instruments can be defined broadly, the author considers them with emphasis on charge system, which is the main market-based environmental instrument in Korea. Within charge system, he considers effluent charge, deposit-refund system, environmental improvement charge and water quality improvement charge. This study gives the impression that economic-incentive instruments have not replaced, or have not come close to replacing, the conventional, command-and-control approach to environmental protection in Korea. But, despite this situation, market-based instruments have moved center stage, and they are considered seriously for each environmental problem that is tackled by central and local governments in Korea. Market-based instruments will enjoy increasing acceptance in Korean environmental policy process in the years ahead.