Assessing the Role of Institutions in Limiting the Environmental Externalities of Economic Growth

Stephane Dees

Environmental & Resource Economics, 2020, vol. 76, issue 2, No 10, 429-445

Abstract: Abstract Emissions of pollutants tend to be procyclical as they generally increase with economic growth. However, as government policy has a role to play in the mitigation of the environmental consequences of economic activity, the quality of institutions may influence the procyclicality of pollution and reduce the environmental cost of economic growth. Based on the assumption that changes in emissions are stronger at earlier stages of development, we develop a non-linear framework and confirm first the presence of income-related threshold effects in the relationship between pollution (CO $$_2$$ 2 and greenhouse gas emissions) and growth, for a panel of 142 countries over a period spanning from 1960 to 2017. We also find that institutional quality influences this relationship, as the quality of institutions lowers the value of the threshold and the degree of procyclicality of emissions. These results bring therefore evidence that higher institutional quality can attenuate the environmental externalities of economic growth.

Keywords: CO $$_2$$ 2 emissions; GHG emissions; Economic growth; Institutions (search for similar items in EconPapers)
JEL-codes: C33 O44 Q56 Q58 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10640-020-00432-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
Working Paper: Assessing the Role of Institutions in Limiting the Environmental Externalities of Economic Growth (2022)
Working Paper: Assessing the Role of Institutions in Limiting the Environmental Externalities of Economic Growth (2020)
Working Paper: Assessing the Role of Institutions in Limiting the Environmental Externalities of Economic Growth (2020)
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: https://EconPapers.repec.org/RePEc:kap:enreec:v:76:y:2020:i:2:d:10.1007_s10640-020-00432-1

Ordering information: This journal article can be ordered from
http://www.springer. ... al/journal/10640/PS2

DOI: 10.1007/s10640-020-00432-1

Access Statistics for this article

Environmental & Resource Economics is currently edited by Ian J. Bateman

More articles in Environmental & Resource Economics from Springer, European Association of Environmental and Resource Economists Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().