The correction of externalities, as discussed so far in this chapter, has focused on government intervention in private markets through regulatory approaches such as taxation, authorities and standards. However, if the government works with objectives other than maximizing social welfare [Peltzman (1976)], there is no guarantee that state intervention will achieve social optimum. In addition, lipsey and Lancaster`s two best arguments (1956-1957) and the «double dividend» literature suggest that state intervention could reduce social welfare, even if the government`s objective is to improve well-being. It is therefore useful to consider other possible ways to achieve environmental protection. Two possibilities are voluntary environmental impact programs and the use of courts. At least in the mid-19th century, courts in Europe and elsewhere understood that insurance contracts deviated considerably from what was traditionally considered to be an ideal type of contract (a voluntary agreement with negotiated terms between two parties with the same bargaining power). In many cases, the role of insurance agency as a custodian can hardly be exempted from the voluntary nature of insurance. Insurance companies use typical standard contracts almost everywhere with conditions that are not applicable. And in all cases, but in very few cases, the parties do not have the same bargaining power.
As a general rule, the insurance company is a much larger economic entity; Competing insurance companies rarely offer very different terms (except sometimes price) and the insurance company has information about the size and value of the contract that the insurance claimant does not have. Moreover, the promising nature of insurance gives the insurance company enormous power as soon as the insured is entitled; on that date, the insured cannot take out a new insurance policy. The work studies the use of voluntary approaches in situations where alternative instruments could have been used. It notes that, although the environmental objectives of most voluntary approaches have been achieved, there are few instances where such approaches have contributed to environmental improvements that would have exceeded what would have been done anyway. The work also shows that the macroeconomic effectiveness of voluntary approaches is generally low, as they rarely include mechanisms to offset the costs of reducing borders between all polluters. It recognizes, however, that traditional «command and control policies» rarely offset mitigation costs and that voluntary approaches can offer greater economic efficiency than these policies by providing companies with greater flexibility in achieving environmental improvements. Voluntary approaches to the environment: effectiveness, efficiency and use in policy dosages provide an in-depth assessment of the use of voluntary approaches, based on a series of new case studies and extensive research of available literature. The analysis focuses on both voluntary approaches, which are isolated and used in policy dosages.
Kintzer (1973) proposes a useful typology of articulation agreements and transfer policies: formal state agreements or legislation requiring the adoption of certain measures, public policies that promote articulation and transmission, and voluntary agreements between institutions or systems. The United States has put in place a number of measures to promote the articulation and deboning of two- to four-year-old institutions, most of which are voluntary or non-compulsory, although they are often translated into legislation. The State Education Commission (2001) found that of the 50 United States, 30 had transfer support laws, 40 had national cooperation agreements, 33 states regularly collected transfer data and reported that 18 states had incentives and rewards to send students or send or host institutions, and 26 maintained a national transfer guide.