What are the advantages and disadvantages of this proposal

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A presidential candidate is concerned that Americans create too much pollution by driving excessively. She proposes issuing a fixed number of tradable driving permits each month. Each permit would be good for 100 miles during that particular month. Each adult citizen would receive the same number of permits. People would be free to buy and sell their permits. Those who drive more than the amount allowed by the permits they retain or purchase would face stiff penalties. Enforcement would involve periodic odometer checks. What are the advantages and disadvantages of this proposal? Is it workable? How does it compare to a gasoline tax?

Reference no: EM131132318

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