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The Evolution of Renewable Energy Policy in OECD Countries: Aggregate Indicators and Determinants

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  • Nicolli, Francesco
  • Vona, Francesco

Abstract

This paper proposes different methods to aggregate heterogeneous policies for renewable energy. We compare time-varying indicators built using principal component analysis with average-based indicators. The main goal of the paper is to account for the evolution of both types of policy indicators with a set of common variables. Our empirical results are consistent with predictions of political-economy models of environmental policies as lobbying, income and, to a less extent, inequality have expected effects on policy. The brown lobbying power, proxied by entry barriers in the energy sector, has negative influence on the policy indicators even when taking into account endogeneity in its effect. The results are also robust to dynamic panel specifications and to the exclusion of groups of countries. Interestingly, too, corruption has only an indirect effect on policy mediated by entry barriers, while the negative effect of inequality is much stronger for the richer countries.

Suggested Citation

  • Nicolli, Francesco & Vona, Francesco, 2012. "The Evolution of Renewable Energy Policy in OECD Countries: Aggregate Indicators and Determinants," Climate Change and Sustainable Development 130897, Fondazione Eni Enrico Mattei (FEEM).
  • Handle: RePEc:ags:feemcl:130897
    DOI: 10.22004/ag.econ.130897
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    Cited by:

    1. Nesta, Lionel & Vona, Francesco & Nicolli, Francesco, 2014. "Environmental policies, competition and innovation in renewable energy," Journal of Environmental Economics and Management, Elsevier, vol. 67(3), pages 396-411.
    2. Pitelis, Alkis & Vasilakos, Nicholas & Chalvatzis, Konstantinos, 2020. "Fostering innovation in renewable energy technologies: Choice of policy instruments and effectiveness," Renewable Energy, Elsevier, vol. 151(C), pages 1163-1172.
    3. Galeotti, Marzio & Rubashkina, Yana & Salini, Silvia & Verdolini, Elena, 2018. "Environmental policy performance and its determinants: Application of a three-level random intercept model," Energy Policy, Elsevier, vol. 114(C), pages 134-144.
    4. Elie, B. & Oger, G. & Guillerm, P.-E. & Alessandrini, B., 2017. "Simulation of horizontal axis tidal turbine wakes using a Weakly-Compressible Cartesian Hydrodynamic solver with local mesh refinement," Renewable Energy, Elsevier, vol. 108(C), pages 336-354.
    5. Nesta, Lionel & Vona, Francesco & Nicolli, Francesco, 2014. "Environmental policies, competition and innovation in renewable energy," Journal of Environmental Economics and Management, Elsevier, vol. 67(3), pages 396-411.
    6. Costantini, Valeria & Liberati, Paolo, 2014. "Technology transfer, institutions and development," Technological Forecasting and Social Change, Elsevier, vol. 88(C), pages 26-48.
    7. Galeotti, Marzio & Salini, Silvia & Verdolini, Elena, 2020. "Measuring environmental policy stringency: Approaches, validity, and impact on environmental innovation and energy efficiency," Energy Policy, Elsevier, vol. 136(C).
    8. Marzio Galeotti & Silvia Salini & Elena Verdolini, 2017. "Measuring Environmental Policy Stringency: Approaches, Validity, and Impact on Energy Efficiency," Development Working Papers 412, Centro Studi Luca d'Agliano, University of Milano.
    9. Cia Alves, Elia Elisa & Steiner, Andrea & de Almeida Medeiros, Marcelo & da Silva, Marcelo Eduardo Alves, 2019. "From a breeze to the four winds: A panel analysis of the international diffusion of renewable energy incentive policies (2005–2015)," Energy Policy, Elsevier, vol. 125(C), pages 317-329.
    10. Zhao, Yong & Tang, Kam Ki & Wang, Li-li, 2013. "Do renewable electricity policies promote renewable electricity generation? Evidence from panel data," Energy Policy, Elsevier, vol. 62(C), pages 887-897.
    11. Raad Al-Tal & Alaaeddin Al-Tarawneh, 2021. "The Impact of Government Effectiveness and Political Stability on Energy Consumption in the Selected MENA Economies," International Journal of Energy Economics and Policy, Econjournals, vol. 11(2), pages 1-6.
    12. Arminen, Heli & Menegaki, Angeliki N., 2019. "Corruption, climate and the energy-environment-growth nexus," Energy Economics, Elsevier, vol. 80(C), pages 621-634.
    13. Ana-Maria Bercu & Gigel Paraschiv & Dan Lupu, 2019. "Investigating the Energy–Economic Growth–Governance Nexus: Evidence from Central and Eastern European Countries," Sustainability, MDPI, vol. 11(12), pages 1-21, June.
    14. Miguel Cárdenas Rodríguez & Ivan Haščič & Nick Johnstone & Jérôme Silva & Antoine Ferey, 2015. "Renewable Energy Policies and Private Sector Investment: Evidence from Financial Microdata," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(1), pages 163-188, September.
    15. Alessio D'Amato & Massimiliano Mazzanti & Francesco Nicolli & Mariangela Zoli, 2014. "Illegal Waste Disposal, Territorial Enforcement and Policy. Evidence from regional data," SEEDS Working Papers 0314, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Feb 2014.
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    More about this item

    Keywords

    Resource /Energy Economics and Policy;

    JEL classification:

    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • Q38 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Government Policy (includes OPEC Policy)

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