Political Economy of Transnational Water Pollution: What Do the LMB Data (1985–2000) Say?

On the basis of the cross-section and time-series data of the Lower Mekong Basin (LMB)—including large sections of Thailand, Lao PDR, Vietnam, and Cambodia, we find little evidence in support of the environmental Kuznets curve (EKC) hypothesis. Instead, our regressions support the general views that water pollution had been positively related to income level and that, as a result of the end of the Cold War era, it had been significantly reduced in the 1990s vis-à-vis the 1980s. In most circumstances, water resources were more seriously polluted in the transnational border areas than in the other areas. Specifically, the estimated coefficients on the political boundary dummies show that political influence on transnational water pollution was more significant in areas near “the international border along which the river runs” (denoted by BORDER2) than in places near “the international border across which the river runs” (denoted by BORDER1). The estimated coefficients on the ASEAN dummy present some information about the positive role of the Association for Southeast Asian Nations (ASEAN) membership in the reduction of transnational water pollution. Finally, the country-specific dummies are found to present conflicting information about the transnational differences of water pollution, although Thailand is found to have the least water pollution in the LMB.