Cooperation in Environmental Policy: A Spatial Approach
Ronald Davies () and
Helen Naughton ()
University of Oregon Economics Department Working Papers from University of Oregon Economics Department
Inefficient competition in emissions taxes creates benefits from international cooperation. In the presence of cross-border pollution, proximate (neighboring) countries may have greater incentives to cooperate than distant ones as illustrated by a model of tax competition for mobile capital. Spatial econometrics is used to estimate participation in 37 international environmental treaties. Data on 41 countries from 1980-1999 reveal evidence of increased cooperation among proximate countries. Furthermore, the results indicate that FDI usually increases treaty participation. We also find that both OECD and non-OECD countries respond positively to OECD countriesÂ’ participation but the response to non-OECD countries is primarily from similar countries. This suggests that the rich countries may lead others in setting environmental quality.
Keywords: Environmental agreements; foreign direct investment; spatial econometrics (search for similar items in EconPapers)
JEL-codes: F53 Q58 (search for similar items in EconPapers)
Date: 2003-04-10, Revised 2003-06-10
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Journal Article: Cooperation in environmental policy: a spatial approach (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:ore:uoecwp:2006-18
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