Environmental Policy in Majoritarian Systems

Per G. 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: Q48 D72 D78 H20 R50 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-env and nep-pol
Date: 2008-01, Revised 2009-09
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.
View list of references

Downloads: (external link)
http://www.econ.uconn.edu/working/2008-01r.pdf Full text (revised version) (application/pdf)
http://www.econ.uconn.edu/working/2008-01.pdf Full text (original version) (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:uct:uconnp:2008-01

Access Statistics for this paper

More papers in Working papers from University of Connecticut, Department of Economics
Address: University of Connecticut 341 Mansfield Road, Unit 1063 Storrs, CT 06269-1063
Contact information at EDIRC.
Series data maintained by Christian Zimmermann ().