INTRODUCTION

Part II of this book focused on industry-led corporate environmentalism. Thus far, we have treated industry as pro-active, and regulators as reactive in the face of voluntary actions by business. This, however, is an incomplete picture. Regulators around the world increasingly rely on “voluntary” programs for environmental improvement. These programs may take a variety of forms, and this part of the book explores these various forms in detail. We begin in this chapter with an institutional analysis of the factors motivating regulatory interest in voluntary programs. The analysis in this chapter is based on Maxwell and Lyon (2001). Chapter 7 studies “negotiated agreements” between regulators and industry, which are particularly popular in Europe and Japan. Chapter 8 analyzes “public voluntary agreements,” (PVAs) which are the preferred form of government-initiated voluntary programs in the USA. Chapter 9 probes the structural details of PVAs, focusing on the critical role that government provision of information plays in these programs.

Voluntary approaches to the control of environmental problems increased greatly in popularity during the 1990s, throughout the OECD countries. According to OECD (1999), by the end of the decade there were over 300 negotiated agreements in the EU countries, over 30,000 local negotiated agreements in Japan, and over forty PVAs in the USA (see OECD 1999, p. 9). The increased popularity of voluntary agreements (VAs) of various sorts has prompted a growing body of academic literature aimed at examining various efficiency and social welfare aspects of VAs. While these studies suggest several reasons why regulated firms and regulatory agencies might benefit from VAs, none has focused on explaining why these supposed benefits have led to the intense interest in VAs only recently.