Final Report “The economic benefits of environmental policy” online!

This report describes the areas in which environmental policies deliver Europe’s current economic priorities, often more successfully than other forms of economic policy intervention. It provides evidence of the role of environmental policy both in providing a short term economic stimulus and in building a sustainable, efficient and resilient economy in the long term. It highlights many areas where environmental policy is essential for sustainable economic progress.

Economic Outcomes of Environmental Policy

The report explains and illustrates how environmental policy may benefit the economy by delivering eight key economic outcomes. These are that environmental policy:

1. Enhances Productivity

2. Stimulates Innovation

3. Increases Employment (and/or the quality of Employment)

4. Improves our Balance of Trade

5. Strengthens our Capital Base

6. Supports Public Finances

7. Promotes Economic Cohesion

8. Encourages the Transition to a Resilient and Sustainable Economy.

Delivery of these key economic outcomes is important both in stimulating economic recovery and in delivering the EU’s longer term economic goal.

The Need for Policy Action

The report demonstrates that there are numerous “win-win” opportunities for the EU simultaneously to strengthen its economy and enhance its environment. However, because of market failures these opportunities are not being fully realised by the free market. There is therefore a need for government intervention if the EU is to take full advantage of the opportunities identified.

A Package of Environmental Policies to Achieve Economic Goals

The report presents a proposed package of environmental policy measures that will strengthen the EU’s economy, and contribute to the Lisbon priorities of enhancing growth and employment. The chosen package is designed both to:

  • Provide a short term stimulus to the EU economy, creating jobs and boosting demand during the current economic crisis; and
  • Support the development of a stronger, more resilient and sustainable economy in the long run, by promoting a more innovative and resource efficient economy that is less dependent on fossil fuels and imported raw materials and less prone to climate change and other environmental damage.

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