We have in previous chapters argued that the basic problem in managing environmental resources is the problem of incentives. Environmental resources are often such that it is not in the best of interest of the individual to act in a way that is best for the society at large. The basic objective of environmental policy is therefore to create an economic environment in which the incentives are correct, that is, to create a system in which the best interest of individuals, households, companies, local communities, organizations, state agencies, etc. coincides with the collective or public interest. Obviously, the design of mechanisms to improve the incentive structure will depend not only on the characteristics of the resource, but also on the general economic and legal background. In western industrialized countries, for example, taxes will often work in different ways as compared to the situation in a typical developing country. However, we believe that it is possible to give some general guide-lines for the design of incentives improving policies, which would apply to most resources and most countries. Before that we will, however, return to the discussion in chapter 3 concerning common property resources.