Designing Public Policies: Principles and Instruments

This book presents a methodological approach for the joint design of economic and environmental policies. The starting point is the observation that, in practice, policy makers do not usually have a well-defined objective, but they are typically concerned about a number of economic and environmental indicators that conflict with each other. In view of this, policy making is addressed by combining two separate analytical approaches: multiple criteria decision making (MCDM) and computable general equilibrium (CGE) modeling. The aim is to come up with a methodological framework for policy design which is both operational and consistent with economic theory. In short, this book offers a unified view of this novel approach, paying special attention to the connections between economic and environmental objectives. The methodological foundations are presented as well as some real applications that illustrate the pragmatic value of the theoretical proposal.