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Violation of environmental regulations as a disinvestment in social capital

Author

Listed:
  • Gren, Ing-Marie

    (Department of Economics, Swedish University of Agricultural Sciences)

  • Andersson Franko, Mikael

    (Department of Economics, Swedish University of Agricultural Sciences)

  • Holstein, Fredrik

    (Department of Economics, Swedish University of Agricultural Sciences)

Abstract

This paper developed a simple dynamic model in order to analyse the impact of social capital on violation of environmental regulations. Two main channels of influence were identified; through informal enforcement of regulations and through effects on costs from disinvestment in social capital caused by violation. The model was tested using survey data on enforcement and violation of command and control regulations at municipalities and counties in Sweden. Four different measures on the social capital variable were used; general trust, trust in local and national governments, and organizational activity. Count data models were used for estimating the explanatory power of these variables in relation to inspection frequency and control variables of community characteristics. Statistically best results were obtained for organizational activity for all firm categories. The results showed that both the level of this social capital measure and its growth over time curb violation.

Suggested Citation

  • Gren, Ing-Marie & Andersson Franko, Mikael & Holstein, Fredrik, 2014. "Violation of environmental regulations as a disinvestment in social capital," Working Paper Series 2014:4, Swedish University of Agricultural Sciences, Department Economics.
    • Handle: RePEc:hhs:slueko:2014_004
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    File URL: http://pub.epsilon.slu.se/11115/
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    Cited by:

    1. Marbuah, George & Gren, Ing-Marie, 2015. "Carbon emission and social capital in Sweden," Working Paper Series 2015:5, Swedish University of Agricultural Sciences, Department Economics.

    More about this item

    Keywords

    social capital; violation of environmental regulations; econometric test; count data model; Sweden;
    All these keywords.

    JEL classification:

    • K33 - Law and Economics - - Other Substantive Areas of Law - - - International Law
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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