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On Local Environmental Protection


  • Fabio Fiorillo

    () (University “Politecnica delle Marche”, Italy, Department of Economics)

  • Agnese Sacchi

    () (University Roma Tre, Italy, Department of Economics)


We propose a theoretical model to analyze the provision of environmental protection activities with positive interregional externalities in order to verify whether this kind of policy is better accomplished through centralized policymaking, which implies a coordinated solution among local representatives, or by a decentralized system, where local authorities independently finance and implement their environmental protection policy. The research question concerns the identification of criteria on how to allocate powers and functions to environmental management at different tiers of government. Moreover, modelling interregional externalities as a mechanism contributing to lowering the cost of financing environmental policy in each region allows different environmental policies across regions. Given this framework, considerations favouring either institutional setting in terms of individuals’ welfare seem to involve the interaction among these key elements: the extent of the inter-jurisdictional spillovers, the size of local jurisdictions, and the intensity of regional preferences for environmental policy.

Suggested Citation

  • Fabio Fiorillo & Agnese Sacchi, 2012. "On Local Environmental Protection," EuroEconomica, Danubius University of Galati, issue 5(31), pages 28-42, December.
  • Handle: RePEc:dug:journl:y:2012:i:5:p:28-42

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    References listed on IDEAS

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    2. Ben Lockwood, 2002. "Distributive Politics and the Costs of Centralization," Review of Economic Studies, Oxford University Press, vol. 69(2), pages 313-337.
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    5. Fabio Fiorillo & Agnese Sacchi, 2011. "Free-riding or Internalizing? An Opportunistic View on Decentralization versus Centralization," CESifo Working Paper Series 3328, CESifo Group Munich.
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    14. Picard Pierre & Gilbert G, 1991. "Incentives and the optimal size of local territories," CEPREMAP Working Papers (Couverture Orange) 9124, CEPREMAP.
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    Cited by:

    1. Costantini, Valeria & Mazzanti, Massimiliano & Montini, Anna, 2013. "Environmental performance, innovation and spillovers. Evidence from a regional NAMEA," Ecological Economics, Elsevier, vol. 89(C), pages 101-114.

    More about this item


    Cooperation; Environmental federalism; Environmental protection activities; Externalities; Local government size;

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy


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