nep-res New Economics Papers
on Resource Economics
Issue of 2008‒05‒31
two papers chosen by
Maximo Rossi
Universidad de la Republica

  1. The Cost Effectiveness of Environmental Policy Instruments in the Presence of Imperfect Compliance By Sandra Rousseau; Stef Proost
  2. Economic Growth, inequality and environment quality: An empirical analysis applied to developing and transition countries By Matthieu CLEMENT (GREThA-GRES); André MEUNIE (GREThA-GRES)

  1. By: Sandra Rousseau; Stef Proost
    Abstract: We aim to integrate information, monitoring and enforcement costs into the choice of environmental policy instruments. We use a static partial equilibrium framework to study different combinations of regulatory instruments (taxes, standards…) and enforcement instruments (criminal fine, administrative fine…). The firms’ compliance decisions depend on the instrument combination selected by the government. The model is used to compare the welfare effects of different instrument combinations for the textile industry in Flanders. We find that administrative, implementation, enforcement and monitoring costs are important to decide on the necessity of an environmental policy. Moreover, we show that emission taxes are not necessarily the most cost-effective instrument. This result holds even if we include industry heterogeneity. The decision of whether to pursue an environmental policy or not depends crucially on the formulation of an appropriate monitoring and enforcement policy.
    Keywords: K32 Environmental Law, K42 Illegal behaviour and enforcement of law, Q28 Government policy
    Date: 2008–03
    Abstract: This article aims at examining the relationship between social inequalities and pollution. On the one hand, it proposes a survey which shows that from a theoretical point of view, a decrease in inequality has an undetermined effect on environment. On the other hand, on the basis of these theoretical considerations, we propose an econometric analysis based on panel data for developing and transition countries during the period 1988-2003. More precisely, we examine the effect of income inequalities on the degree of local pollution (sulphur dioxide emissions and organic water pollution) by integrating Gini index in the formulation of environmental Kuznets curve. Then, two effects may be tested: (i) a direct effect of inequalities on pollution; (ii) an indirect effect by which the degree of inequality influence pollution by his negative impact on political freedoms.
    Keywords: pollution; inequality; environmental Kuznets curve; panel data
    JEL: C23 Q01 Q53 Q5
    Date: 2008

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