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Environmental Governance in Federal Systems: The Effects of Capital Competition and Lobby Groups

Author

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  • Fredriksson, Per G
  • Gaston, Noel

Abstract

We argue that centralized and decentralized environmental governance yield equivalent environmental regulations. We model worker, environmental, and capital owner lobby groups that seek influence by offering political contributions. Worker lobbying in the decentralized case has an effect on environmental regulations identical to that of capital owner lobbying in the centralized case. This is because the aggregate effects of environmental regulations on income are equivalent under the two institutional designs. Whereas workers carry the full burden in the decentralized case when capital competition occurs, the burden is shared with the capital owners in the centralized case. We present evidence consistent with our theory. Copyright 2000 by Oxford University Press.

Suggested Citation

  • Fredriksson, Per G & Gaston, Noel, 2000. "Environmental Governance in Federal Systems: The Effects of Capital Competition and Lobby Groups," Economic Inquiry, Western Economic Association International, vol. 38(3), pages 501-514, July.
    • Handle: RePEc:oup:ecinqu:v:38:y:2000:i:3:p:501-14
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    Citations

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    Cited by:

    1. Bert Saveyn, 2006. "Are NIMBY'S commuters?," Working Papers of Department of Economics, Leuven 500306, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    2. Federico Boffa & Amedeo Piolatto & Giacomo A. M. Ponzetto, 2011. "Political centralization and government accountability," Economics Working Papers 1335, Department of Economics and Business, Universitat Pompeu Fabra, revised Jul 2015.
    3. Ida Ferrara & Paul Missios & Halis Murat Yildiz, 2014. "Inter‐regional competition, comparative advantage and environmental federalism," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 47(3), pages 905-952, August.
    4. Fredriksson, Per G. & Mani, Muthukumara & Wollscheid, Jim R., 2006. "Environmental federalism : a panacea or Pandora's box for developing countries?," Policy Research Working Paper Series 3847, The World Bank.
    5. Stavins, Robert, 2004. "Introduction to the Political Economy of Environmental Regulation," Working Paper Series rwp04-004, Harvard University, John F. Kennedy School of Government.
    6. Wallace E. Oates & Paul R. Portney & Wallace E. Oates & Paul R. Portney, 2004. "The Political Economy of Environmental Policy," Chapters, in: Environmental Policy and Fiscal Federalism, chapter 1, pages 3-30, Edward Elgar Publishing.
    7. Fredriksson, Per G. & List, John A. & Millimet, Daniel L., 2003. "Bureaucratic corruption, environmental policy and inbound US FDI: theory and evidence," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1407-1430, August.
    8. Federico Boffa & Amedeo Piolatto & Giacomo A. M. Ponzetto, 2016. "Political Centralization and Government Accountability," The Quarterly Journal of Economics, Oxford University Press, vol. 131(1), pages 381-422.
    9. Martin Gassebner & Noel Gaston & Michael J Lamla, 2008. "Relief For The Environment? The Importance Of An Increasingly Unimportant Industrial Sector," Economic Inquiry, Western Economic Association International, vol. 46(2), pages 160-178, April.
    10. Drosdowski, Thomas, 2005. "Democracy Deficits, Inequality and Pollution. A Politico-Economic Analysis," Hannover Economic Papers (HEP) dp-323, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    11. repec:dgr:kubcen:2012033 is not listed on IDEAS
    12. Bert Saveyn, 2013. "On NIMBY and commuting," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 20(2), pages 293-311, April.
    13. Fredriksson, Per G. & Millimet, Daniel L., 2002. "Strategic Interaction and the Determination of Environmental Policy across U.S. States," Journal of Urban Economics, Elsevier, vol. 51(1), pages 101-122, January.
    14. Per G. Fredriksson & Le Wang, 2020. "The politics of environmental enforcement: the case of the Resource and Conservation Recovery Act," Empirical Economics, Springer, vol. 58(6), pages 2593-2613, June.
    15. Fredriksson, Per G. & Matschke, Xenia & Minier, Jenny, 2010. "Environmental policy in majoritarian systems," Journal of Environmental Economics and Management, Elsevier, vol. 59(2), pages 177-191, March.
    16. Hua Wang & Wenhua Di, 2002. "The determinants of Government environmental performance - an empirical analysis of Chinese townships," Policy Research Working Paper Series 2937, The World Bank.
    17. Millimet, Daniel L., 2013. "Environmental Federalism: A Survey of the Empirical Literature," IZA Discussion Papers 7831, Institute of Labor Economics (IZA).
    18. Fredriksson, Per G. & Wollscheid, Jim R., 2014. "Environmental decentralization and political centralization," Ecological Economics, Elsevier, vol. 107(C), pages 402-410.
    19. Boffa, F. & Piolatto, A. & Ponzetto, G.A.M., 2012. "Centralization and Accountability : Theory and Evidence from the Clean Air Act," Discussion Paper 2012-033, Tilburg University, Center for Economic Research.
    20. María A. García-Valiñas, 2004. "Environmental federalism: a proposal of decentralization," ERSA conference papers ersa04p492, European Regional Science Association.
    21. Michael Faure, 2020. "The Export of Ecological Civilization: Reflections from Law and Economics and Law and Development," Sustainability, MDPI, vol. 12(24), pages 1-19, December.
    22. Y. Hossein Farzin & Jinhua Zhao, 2003. "Pollution Abatement Investment When Firms Lobby Against Environmental Regulation," Working Papers 2003.82, Fondazione Eni Enrico Mattei.
    23. Fredriksson, Per G. & Vollebergh, Herman R. J. & Dijkgraaf, Elbert, 2004. "Corruption and energy efficiency in OECD countries: theory and evidence," Journal of Environmental Economics and Management, Elsevier, vol. 47(2), pages 207-231, March.
    24. Yu-Bong Lai, 2016. "Does Tax Competition Reduce Corruption?," Scottish Journal of Political Economy, Scottish Economic Society, vol. 63(4), pages 331-356, September.
    25. repec:tiu:tiucen:2012033 is not listed on IDEAS

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