For its proponents, neoliberal environmental policy reflects commonsense economic science that produces growing, market-oriented, profit-driven economies that will soon generate sufficient jobs and taxes to rectify any social or environmental problems that might occur. Neoliberal environmental policies contrast with those of previous import-substitution and Keynesian periods, when “command-and-control” approaches sought to solve environmental degradation problems through regulations, standards, fines, and lawsuits that force producers to reduce their environmental impacts. Neoliberal economists criticize that approach as inefficient, unnecessarily expensive, inflexible, and stifling of innovation. A better approach, they argue, comes from private property arrangements and markets that internalize the costs of environmental degradation, and so they promote privatization of agricultural land, fisheries, pollution sinks, biodiversity, and public enterprises ranging from mining companies to water provisioning systems (Appleyard, 2006).
Many other neoliberal policies, such as free trade, also affect the environment. Although the environment gets little explicit consideration in the theory promoting, for example, an end to import quotas and tariffs, the general idea is that increased trade increases wealth, which eventually leads to environmental improvement. Similarly, neoliberalism promotes decreased state expenditures, decentralization, and the participation of civil society in governance. Reconfiguring environmental governance to include streamlined states, civil society actors, and local, presumably more representative, levels of government is thought to bring greater efficiencies to environmental regulation.
Benefits of Importing and Exporting of Computer parts
Both countries can benefit if they specialize based on comparative advantage. Sticking with this example, suppose that each country has 120 person hours available for production. This means that the United States can produce at most 60 computers or 120 bushels of corn. U.S. producers will most likely do something in between, say, dividing their labor evenly between the two sectors and producing 30 computers and 60 bushels of corn. If there is no possibility for international trade (a situation know as autarky), then they must consume exactly what they produce. Note that under autarky, in the United States, each additional computer the Americans want to consume requires them to give up 2 bushels of corn. Meanwhile, in Mexico, production is at most 10 computers or 40 bushels of corn and most likely something in between, such as 5 computers and 20 bushels of corn. In Mexico, each additional computer costs 4 bushels of corn. Now imagine that instead of making both goods, Mexico produces only corn and the United States produces only computers. When Mexico wants to give up some corn for computers or when the United States wants to give up some computers for corn, they can do so by trading on the world market. At what rate is the United States willing to give up its computers for corn? As long as they can get at least 2 bushels of corn for 1 computer, the United States is better off making only computers and then trading them for ...