Resource information
This study reviews regulatory
instruments designed to reduce environmental externalities
from the transport sector. The study finds that the main
regulatory instruments used in practice are fuel economy
standards, vehicle emission standards, and fuel quality
standards. Although industrialized countries have introduced
all three standards with strong enforcement mechanisms, most
developing countries have yet to introduce fuel economy
standards. The emission standards introduced by many
developing countries to control local air pollutants follow
either the European Union or United States standards. Fuel
quality standards, particularly for gasoline and diesel,
have been introduced in many countries mandating 2 to 10
percent blending of biofuels, 10 to 50 times reduction of
sulfur from 1996 levels, and banning lead contents. Although
inspection and maintenance programs are in place in both
industrialized and developing countries to enforce
regulatory standards, these programs have faced several
challenges in developing countries due to a lack of
resources. The study also highlights several factors
affecting the selection of regulatory instruments, such as
countries' environmental priorities and institutional capacities.
