contamination they cause in the ground water. Similarly, the Canadian
federal government gradually reduced the amount of lead allowed in
gasoline and then eliminated leaded gasoline altogether.
When the policy objective is to eliminate a specific type of pollution, direct
regulatory controls are probably the most practical policy instrument. In
the case of weed-control products, for example, the costs imposed on
homeowners by prohibiting their use of certain products are almost
certainly smaller than the benefits from removing the contamination from
the groundwater. In the case of leaded gasoline, the gradual reduction in
the permissible lead content allowed producers and consumers to
substitute toward unleaded gasoline at relatively low cost, while society
gained the considerable benefits of the cleaner automobile emissions.
In other situations, however, when the policy objective is to reduce, rather
than eliminate a particular type of pollution, and when it may not be so
clear to governments how the pollution can most effectively be reduced,
direct regulatory controls are far less effective. For example, if the goal is
to reduce the emissions of sulphur dioxide from hundreds of factory
smokestacks operating in different industries, we need to recognize that
some firms may be able to reduce their emissions much more cheaply
than others. In this situation, direct regulatory controls would generally
not be the least-cost method of reducing harmful emissions.
Problems with Direct Controls