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Environmental Policy Performance and its Determinants: Application of a Three-level Random Intercept Model

Marzio Galeotti (), Yana Rubashkina, Silvia Salini and Elena Verdolini
Additional contact information
Yana Rubashkina: Catholic University of Milan
Silvia Salini: University of Milan

No 2014.90, Working Papers from Fondazione Eni Enrico Mattei

Abstract: We propose the use of a three-level random intercept model to measure the degree of environmental policy performance of different countries and to study its determinants. Inspired by the literature on multilevel latent models and Item Response Theory (IRT), this framework treats policy commitment as a latent variable which is estimated conditional on the difficulty of the policy portfolio implemented by each country. We contribute to the study and scoring of environmental and energy policies in three main ways. First, the model results in a ranking of countries which is conditional on the complexity of their chosen policy portfolio. Second, we provide a unified framework in which to construct a policy indicator and to study its determinants through a latent regression approach. The resulting country ranking can thus be cleaned from the effect of economic and institutional observables which affect policy design and implementation. Third, the model estimates parameters which can be used to describe and compare policy portfolios across countries. We apply this methodology to the case of energy efficiency policies in the industrial sectors of 29 EU countries between 2004 and 2011. We conclude by highlighting the future possible applications of this approach, which are not confined to the realm of environmental and energy policy.

Keywords: Energy Policy; Environmental Policy; Ranking; Policy Portfolios (search for similar items in EconPapers)
JEL-codes: Q58 O57 C33 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene and nep-env
Date: 2014-10
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Related works:
Journal Article: Environmental policy performance and its determinants: Application of a three-level random intercept model (2018) Downloads
Working Paper: Environmental Policy Performance and its Determinants: Application of a Three-level Random Intercept Model (2014) Downloads
Working Paper: Environmental Policy Performance and its Determinants: Application of a three-level random intercept model (2014) Downloads
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