Final answer:
Tradable permit programs have been successful because they create a market-based approach to reducing pollution and provide financial incentives for companies to reduce their emissions.
Step-by-step explanation:
The primary reason that tradable permit programs have been successful is because they create a market-based approach to reducing pollution. These programs allocate a limited number of permits to firms that allow them to emit a certain amount of pollution. The permits can be bought, sold, or traded among firms, creating a financial incentive for companies to reduce their emissions.
For example, in the case of sulfur dioxide emissions, the federal government issued marketable permits to electricity-generating plants. These permits were free at first but became smaller over time, encouraging plants to reduce their emissions further. By creating a market for pollution permits, tradable permit programs effectively incentivize companies to find the most cost-effective ways to lower their emissions.