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The Tradable Permits Approach to Protecting the Commons: What Have We Learned?

By Tom Tietenberg
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The atmosphere is but one of many commons and
climate change is but one example of over-exploitation of the commons. An approach employed increasingly for coping with the problem of rationing access to the commons involves the use of tradable permits. Applications of this approach have spread to many different types of resources and many different countries. A recent survey found nine applications in air-pollution control, 75 in fisheries, three in managing water resources, five in controlling water pollution, and five in land-use control (OECD, 1999, Appendix 1, pp. 18–19). And that survey failed to include many current applications, including those that have sprung up in response to the Kyoto Protocol.