 Unraveling the impact of economic policy uncertainty on environmental efficiency: How do institutional quality and political orientation matter?Cristian Barra and Pasquale Marcello Falcone Economics and Politics, 2024, vol. 36, issue 3, 1450-1490 Abstract: Economic policy uncertainty significantly influences governmental decisions regarding environmental sustainability, particularly in CO2 emissions reduction efforts. This study examines the impact of economic policy uncertainty on environmental inefficiency across 136 emergent and non‐emerging countries from 1990 to 2018, using an unbalanced and heterogeneous sample. Additionally, we explore the moderating effects of institutional quality and political orientation on this relationship. Employing a directional distance function in a parametric context, our analysis reveals that economic policy uncertainty exacerbates environmental inefficiency. However, we find that institutional quality and political orientation act as important moderating factors, fostering greater environmental sustainability. Sensitivity analyses support these empirical findings, providing insights into potential implications for economic policy and guiding regulatory and policymaking efforts toward achieving enhanced environmental sustainability. Date: 2024 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:ecopol:v:36:y:2024:i:3:p:1450-1490 Ordering information: This journal article can be ordered from Access Statistics for this article Economics and Politics is currently edited by Peter Rosendorff More articles in Economics and Politics from Wiley Blackwell |
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