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Decentralization and Environmental Quality: An International Analysis of Water Pollution

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Author Info
Hilary Sigman

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Abstract

The normative literature on decentralization of public goods provision has many testable empirical implications. This paper explores some of these implications by looking at the relationship between decentralization and an environmental public good, water quality in rivers at monitoring stations around the world. It examines pollution levels and interjurisdictional variation in these levels for both a local and a regional pollutant. When fixed effects are included, greater decentralization is associated with higher levels of the regional pollutant only, suggesting interjurisdictional free riding. Federal countries exhibit greater interjurisdictional variation in both pollutants, consistent with the traditional view that decentralization allows policies more tailored to local conditions.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 13098.

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Date of creation: May 2007
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Handle: RePEc:nbr:nberwo:13098

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Find related papers by JEL classification:
H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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  3. Hilary Sigman, 2002. "International Spillovers and Water Quality in Rivers: Do Countries Free Ride?," American Economic Review, American Economic Association, vol. 92(4), pages 1152-1159, September. [Downloadable!]
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  4. Lockwood, Ben, 2002. "Distributive Politics and the Costs of Centralization," Review of Economic Studies, Blackwell Publishing, vol. 69(2), pages 313-37, April.
    Other versions:
  5. Silva, Emilson C. D. & Caplan, Arthur J., 1997. "Transboundary Pollution Control in Federal Systems," Journal of Environmental Economics and Management, Elsevier, vol. 34(2), pages 173-186, October. [Downloadable!] (restricted)
  6. Hilary Sigman, 2003. "Letting States do the Dirty Work: State Responsibility for Federal Environmental Regulation," NBER Working Papers 9451, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  7. Congleton, Roger D, 1992. "Political Institutions and Pollution Control," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 412-21, August. [Downloadable!] (restricted)
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  11. Treisman, Daniel, 2000. "The causes of corruption: a cross-national study," Journal of Public Economics, Elsevier, vol. 76(3), pages 399-457, June. [Downloadable!] (restricted)
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  13. Sigman, Hilary, 2005. "Transboundary spillovers and decentralization of environmental policies," Journal of Environmental Economics and Management, Elsevier, vol. 50(1), pages 82-101, July. [Downloadable!] (restricted)
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  14. Bowman Cutter, W. & DeShazo, J.R., 2007. "The environmental consequences of decentralizing the decision to decentralize," Journal of Environmental Economics and Management, Elsevier, vol. 53(1), pages 32-53, January. [Downloadable!] (restricted)
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