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Voluntary Environmental Agreements when Regulatory Capacity Is Weak

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  • Blackman, Allen

    ()
    (Resources for the Future)

  • Lyon, Thomas P.
  • Sisto, Nicholas

Abstract

Voluntary agreements (VAs) negotiated between environmental regulators and industry are increasingly popular. However, little is known about whether they are likely to be effective in developing and transition countries, where local and federal environmental regulatory capacity is typically weak. We develop a dynamic theoretical model to examine the effect of VAs on investment in regulatory infrastructure and pollution abatement in such countries. We find that under certain conditions, VAs can improve welfare by generating more private-sector investment in pollution control and more public-sector investment in regulatory capacity than the status quo.

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Bibliographic Info

Paper provided by Resources For the Future in its series Discussion Papers with number dp-06-30.

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Date of creation: 03 Jul 2006
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Handle: RePEc:rff:dpaper:dp-06-30

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Keywords: voluntary environmental regulation; developing country;

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  1. Anna Alberini & Kathleen Segerson, 2002. "Assessing Voluntary Programs to Improve Environmental Quality," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 22(1), pages 157-184, June.
  2. Baron, David P., 1989. "Design of regulatory mechanisms and institutions," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 24, pages 1347-1447 Elsevier.
  3. Segerson, Kathleen & Miceli, Thomas J., 1998. "Voluntary Environmental Agreements: Good or Bad News for Environmental Protection?," Journal of Environmental Economics and Management, Elsevier, vol. 36(2), pages 109-130, September.
  4. Matthieu Glachant, 2003. "Voluntary Agreements under Endogenous Legislative Threats," Working Papers 2003.36, Fondazione Eni Enrico Mattei.
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Cited by:
  1. Allen Blackman & Eduardo Uribe & Bart Hoof & Thomas Lyon, 2013. "Voluntary environmental agreements in developing countries: the Colombian experience," Policy Sciences, Springer, vol. 46(4), pages 335-385, December.
  2. Bryden, Anna & Petticrew, Mark & Mays, Nicholas & Eastmure, Elizabeth & Knai, Cecile, 2013. "Voluntary agreements between government and business—A scoping review of the literature with specific reference to the Public Health Responsibility Deal," Health Policy, Elsevier, vol. 110(2), pages 186-197.
  3. Kalim Shah & Jorge Rivera, 2007. "Export processing zones and corporate environmental performance in emerging economies: The case of the oil, gas, and chemical sectors of Trinidad and Tobago," Policy Sciences, Springer, vol. 40(4), pages 265-285, December.
  4. Thomas P. Lyon & John W. Maxwell, 2007. "Corporate Social Responsibility and the Environment: A Theoretical Perspective," Working Papers 2007-16, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.

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