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Decentralization and Environmental Quality: An International Analysis of Water Pollution


  • Hilary Sigman


This paper explores the empirical effects of decentralization on environmental quality by studying water pollution in rivers around the world. It examines the level of pollution and variation in pollution across jurisdictions within a country, for both a local and a regional pollutant. Federal countries exhibit greater interjurisdictional variation in pollution, supporting the traditional view that decentralization allows policies more tailored to local conditions. However, the analysis does not point to a "race to the bottom" in pollution levels.

Suggested Citation

  • Hilary Sigman, 2007. "Decentralization and Environmental Quality: An International Analysis of Water Pollution," NBER Working Papers 13098, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:13098
    Note: PE EEE

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    Cited by:

    1. James Alm & H. Spencer Banzhaf, 2012. "Designing Economic Instruments For The Environment In A Decentralized Fiscal System," Journal of Economic Surveys, Wiley Blackwell, vol. 26(2), pages 177-202, April.
    2. Ligthart, J.E. & Rider, M. & Wang, R., 2013. "Does the Fiscal Decentralization Promote Public Safety? Evidence from United States," Discussion Paper 2013-021, Tilburg University, Center for Economic Research.
    3. Hao, Yu & Liu, Yiming & Weng, Jia-Hsi & Gao, Yixuan, 2016. "Does the Environmental Kuznets Curve for coal consumption in China exist? New evidence from spatial econometric analysis," Energy, Elsevier, vol. 114(C), pages 1214-1223.
    4. Banzhaf, H. Spencer & Chupp, B. Andrew, 2012. "Fiscal federalism and interjurisdictional externalities: New results and an application to US Air pollution," Journal of Public Economics, Elsevier, vol. 96(5), pages 449-464.
    5. Lars-Erik Borge & Jan K. Brueckner & Jorn Rattso, 2012. "Partial Fiscal Decentralization and Public-Sector Heterogeneity: Theory and Evidence from Norway," CESifo Working Paper Series 3954, CESifo Group Munich.
    6. Mohammad Reza Farzanegan & Tim Mennel, 2012. "Fiscal decentralization and Pollution: Institutions Matter," MAGKS Papers on Economics 201222, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).

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    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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