A Cross-Country Empirical Analysis of Determinants of Clean Development Mechanism (CDM) Projects

Katsuya Kasai

MPRA Paper from University Library of Munich, Germany

Abstract: The CDM seems to play a significant role in international GHG reduction activities. Yet, a few emerging countries have hosted majority of CDM projects whereas most LDCs have not hosted CDM projects at all. Given the current distributional imbalance, this study aims to identify determinants of CDM project hosting based on an empirical analysis using the tobit model. On the basis of the literature review, this study focuses on two factors, namely the host countries’ qualities of business environment and scientific level. As a result, this study finds the significance of business environment for both bilateral and unilateral CDM projects. Likewise, the significance of scientific and technical level is confirmed especially for unilateral CDM projects. Finally, this article suggests that eligible host countries should focus exclusively on the improvement of controllable determinants such as business environment to attract CDM investors. In addition, it is likely to be better for eligible host countries with low GHG emissions to develop CDM projects unilaterally using programmatic CDM due to their lower economic attractiveness.

Keywords: CDM; Kyoto Protocol; unequal distribution; business environment; tobit model (search for similar items in EconPapers)
JEL-codes: O38 O44 Q54 Q56 (search for similar items in EconPapers)
Date: 2011-09, Revised 2012-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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https://mpra.ub.uni-muenchen.de/59697/1/MPRA_paper_52160.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:52160

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