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Interjurisdictional externalities, overlapping policies and NOx pollution control in Sweden

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  • Coria, Jessica
  • Hennlock, Magnus
  • Sterner, Thomas

Abstract

In this paper, we analyze the effects of the interaction between national and local policies designed to reduce an environmental externality that causes environmental damages both nationally and locally. We formulate a theoretical model to develop hypotheses regarding the combined effects of such policies on the stringency of the local policies and on firms’ emissions reductions. To test our hypotheses, we use actual data for Sweden, where emissions of nitrogen oxides from combustion boilers are subject to a heavy national tax and most are also subject to individual emissions standards set by county authorities. Our analytical findings suggest that the national tax has brought along stricter emission standards. This is confirmed in our data, where emission standards are significantly more stringent when combined with the national tax.

Suggested Citation

  • Coria, Jessica & Hennlock, Magnus & Sterner, Thomas, 2021. "Interjurisdictional externalities, overlapping policies and NOx pollution control in Sweden," Journal of Environmental Economics and Management, Elsevier, vol. 107(C).
    • Handle: RePEc:eee:jeeman:v:107:y:2021:i:c:s0095069621000279
    DOI: 10.1016/j.jeem.2021.102444
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    Cited by:

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    3. Weikun Zhang & Peng Gao & Zhe Chen & Hailan Qiu, 2023. "Preventing Agricultural Non-Point Source Pollution in China: The Effect of Environmental Regulation with Digitization," IJERPH, MDPI, vol. 20(5), pages 1-17, March.

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    More about this item

    Keywords

    Environmental regulation; Multi-governance; Federalism; Emission taxes; Command-and-control; Air pollution; NOX; Sweden;
    All these keywords.

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • D62 - Microeconomics - - Welfare Economics - - - Externalities

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