Violation of environmental regulations as a disinvestment in social capital

Ing-Marie Gren (), Mikael Andersson Franko and Fredrik Holstein
Additional contact information
Ing-Marie Gren: Department of Economics, Swedish University of Agricultural Sciences, Postal: Box 7013, SE-750 07 Uppsala, Sweden
Mikael Andersson Franko: Department of Economics, Swedish University of Agricultural Sciences, Postal: Box 7013, , SE-750 07 Uppsala, Sweden
Fredrik Holstein: Department of Economics, Swedish University of Agricultural Sciences, Postal: , Box 7013, SE-750 07 Uppsala, Sweden

No 2014:4, Working Paper Series from Swedish University of Agricultural Sciences, Department Economics

Abstract: This paper developed a simple dynamic model in order to analyse the impact of social capital on violation of environmental regulations. Two main channels of influence were identified; through informal enforcement of regulations and through effects on costs from disinvestment in social capital caused by violation. The model was tested using survey data on enforcement and violation of command and control regulations at municipalities and counties in Sweden. Four different measures on the social capital variable were used; general trust, trust in local and national governments, and organizational activity. Count data models were used for estimating the explanatory power of these variables in relation to inspection frequency and control variables of community characteristics. Statistically best results were obtained for organizational activity for all firm categories. The results showed that both the level of this social capital measure and its growth over time curb violation.

Keywords: social capital; violation of environmental regulations; econometric test; count data model; Sweden (search for similar items in EconPapers)
JEL-codes: K33 K42 Q58 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2014-04-09
New Economics Papers: this item is included in nep-env, nep-law and nep-soc
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:slueko:2014_004

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