Environmental Policy in Majoritarian Systems

Per Fredriksson, Xenia Matschke and Jenny Minier

No 2008-01, Working papers from University of Connecticut, Department of Economics

Abstract: This paper sheds new light on the determination of environmental policies in majoritarian federal electoral systems such as the U.S., and derives implications for the environmental federalism debate on whether the national or local government should have authority over environmental policies. In the absence of majority bias, the socially preferred policy would be federal district-level taxation which accounts both for cross-boundary pollution and differences in industry concentration across districts. In majoritarian systems, however, where the legislature consists of geographically distinct electoral districts, the majority party (at either the national or the state level) favors its own home districts; depending on the location of polluting industries and the associated pollution damages, the majority party may therefore impose sub-optimally high or low pollution taxes due to a majority bias. We show that majority bias can influence the social-welfare ranking of alternative government policies. In some cases, the existence of majority bias may actually make decentralized or federal uniform taxation the preferred solution.

Keywords: Institutions; environmental policy; environmental federalism; geography; majority bias; political economy. (search for similar items in EconPapers)
JEL-codes: D72 D78 H20 Q48 R50 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2008-01, Revised 2009-09
New Economics Papers: this item is included in nep-cdm, nep-env and nep-pol
Note: We thank Josh Ederington and the participants at a presentation at the 54th Annual North American Meetings of the Regional Science Association International in Savannah for helpful comments.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://media.economics.uconn.edu/working/2008-01.pdf Full text (original version) (application/pdf)

Related works:
Journal Article: Environmental policy in majoritarian systems (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:uct:uconnp:2008-01

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