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Do Collective Actions Clear Common Air? The Effect of International Environmental Protocols on Sulphur Emissions

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  • Aakvik, Arild

    ()
    (University of Bergen, Department of Economics)

  • Tjøtta, Sigve

    ()
    (University of Bergen, Department of Economics)

Abstract

We consider the effects of voluntary international environmental protocols on emissions with regard to the 1985 Helsinki Protocol and the 1994 Oslo Protocol on the reduction of sulphur oxides. Our analysis utilizes panel data from 30 European countries for the period 1960–2002. We divide these countries into “participants” and “non-participants”, i.e., those that did and those that did not ratify the specific protocol. We use a difference-in-difference estimator that focuses on the difference in emissions before and after signing a specific protocol and compares it with this difference for non-participant countries. Difference-in-difference estimation methods rely on annual data and may induce serial correlations in the variables. We use randomly generated placebo protocols to test the estimated effects. In a panel data regression model, where we include country and year dummies, the effect of the Helsinki agreement in reducing sulphur emissions is around three per cent per year, and the effect of the Oslo agreement is around four per cent per year. Correcting the standard errors for serial correlation in both dependent and independent variables is important and overlooked in the previous empirical literature on the evaluation of international agreements.

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Bibliographic Info

Paper provided by University of Bergen, Department of Economics in its series Working Papers in Economics with number 10/07.

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Length: 37 pages
Date of creation: 13 Jul 2007
Date of revision:
Handle: RePEc:hhs:bergec:2007_010

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Postal: Institutt for økonomi, Universitetet i Bergen, Postboks 7802, 5020 Bergen, Norway
Phone: (+47)55589200
Fax: (+47)55589210
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Web page: http://www.uib.no/econ/en
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Keywords: International agreements; programme evaluation; placebo; serial correlation;

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References

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  1. Barrett, Scott, 1994. "Self-Enforcing International Environmental Agreements," Oxford Economic Papers, Oxford University Press, vol. 46(0), pages 878-94, Supplemen.
  2. Joshua Angrist & Alan Krueger, 1998. "Empirical Strategies in Labor Economics," Working Papers 780, Princeton University, Department of Economics, Industrial Relations Section..
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  4. Carraro, Carlo & Siniscalco, Domenico, 1998. "International Institutions and Environmental Policy: International environmental agreements: Incentives and political economy1," European Economic Review, Elsevier, vol. 42(3-5), pages 561-572, May.
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  13. Helland Eric & Tabarrok Alexander, 2004. "Using Placebo Laws to Test "More Guns, Less Crime"," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-9, January.
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  17. Murdoch, James C. & Sandler, Todd, 1997. "The voluntary provision of a pure public good: The case of reduced CFC emissions and the Montreal Protocol," Journal of Public Economics, Elsevier, vol. 63(3), pages 331-349, February.
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  20. Barrett, Scott, 2001. "International cooperation for sale," European Economic Review, Elsevier, vol. 45(10), pages 1835-1850, December.
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Cited by:
  1. Aichele, Rahel & Felbermayr, Gabriel, 2012. "Kyoto and the carbon footprint of nations," Munich Reprints in Economics 20163, University of Munich, Department of Economics.
  2. Rahel Aichele & Gabriel Felbermayr, 2011. "What a Difference Kyoto Made: Evidence from Instrumental Variables Estimation," Ifo Working Paper Series Ifo Working Paper No. 102, Ifo Institute for Economic Research at the University of Munich.
  3. Jürg Vollenweider, 2013. "The effectiveness of international environmental agreements," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 13(3), pages 343-367, September.
  4. Aichele, Rahel & Felbermayr, Gabriel, 2013. "The Effect of the Kyoto Protocol on Carbon Emissions," Munich Reprints in Economics 20171, University of Munich, Department of Economics.
  5. Rahel Aichele & Gabriel J. Felbermayr, 2011. "Kyoto and Carbon Leakage: An Empirical Analysis of the Carbon Content of Bilateral Trade," CESifo Working Paper Series 3661, CESifo Group Munich.
  6. Rahel Aichele & Gabriel Felbermayr, 2013. "Estimating the Effects of Kyoto on Bilateral Trade Flows Using Matching Econometrics," The World Economy, Wiley Blackwell, vol. 36(3), pages 303-330, 03.
  7. Rahel Aichele, 2013. "Trade, Climate Policy and Carbon Leakage - Theory and Empirical Evidence," ifo Beiträge zur Wirtschaftsforschung, Ifo Institute for Economic Research at the University of Munich, number 49.

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