The state should limit its role to using general taxes and fees to steer away from environmentally and health hazardous use of energy, materials, and products.
It creates the framework within which companies and individuals can operate, and develop solutions, resources, and technology that competitively solves our need for food, energy and products without negative environmental consequences. In this way, the dynamics of the market economy is utilized and we reach climate and environmental goals at the lowest cost.
The state should only provide four types of support:
- Research and development
- Support for the demonstration and testing of unproven technology
- Support for initial market development
- Support for education and information
Negative consequences of specific support:
- With specific support, the state disfavors all solutions that are not known to the state. The support has a conserving effect.
- With specific support, the state hinders the development of the most competitive products, as companies become hesitant to invest in solutions they believe in due to the possibility of the state changing market conditions with support.
- The support disrupts the market, leading to distortion of competition and dependence on subsidies. Companies adapt to the support instead of doing what is best.
- “Stop-and-go effects” occur, which disrupt the market. Activity becomes intense during the support period but stops before and after, causing companies to become passive while waiting for potential new support.
In addition to economic instruments, the state and municipalities have other administrative and legal instruments that help us achieve set goals, such as environmental legislation, permitting processes, land-use planning, support for conservation, and more.