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Cooperation in Environmental Policy: A Spatial Approach

Author

Listed:
  • Ronald B. Davies

    (University of Oregon Economics Department)

  • Helen T. Naughton

    (University of Oregon Economics Department)

Abstract

Inefficient competition in emissions taxes creates benefits from international cooperation. In the presence of cross-border pollution, proximate (neighboring) countries may have greater incentives to cooperate than distant ones as illustrated by a model of tax competition for mobile capital. Spatial econometrics is used to estimate participation in 37 international environmental treaties. Data on 41 countries from 1980-1999 reveal evidence of increased cooperation among proximate countries. Furthermore, the results indicate that FDI usually increases treaty participation. We also find that both OECD and non-OECD countries respond positively to OECD countriesÂ’ participation but the response to non-OECD countries is primarily from similar countries. This suggests that the rich countries may lead others in setting environmental quality.

Suggested Citation

  • Ronald B. Davies & Helen T. Naughton, 2003. "Cooperation in Environmental Policy: A Spatial Approach," University of Oregon Economics Department Working Papers 2006-18, University of Oregon Economics Department, revised 10 Jun 2003.
    • Handle: RePEc:ore:uoecwp:2006-18
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    File URL: http://economics.uoregon.edu/papers/UO-2006-18_Davies_Environmental.pdf
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    Citations

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    Cited by:

    1. Pavel Čížek & Jinghua Lei & Jenny E. Ligthart, 2017. "Do Neighbours Influence Value-Added-Tax Introduction? A Spatial Duration Analysis," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 79(1), pages 25-54, February.
    2. Thierry Madiès & Ornella Tarola & Emmanuelle Taugourdeau, 2022. "Tax haven, pollution haven or both?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 29(6), pages 1527-1560, December.
    3. Bellelli, Francesco S. & Scarpa, Riccardo & Aftab, Ashar, 2023. "An empirical analysis of participation in international environmental agreements," Journal of Environmental Economics and Management, Elsevier, vol. 118(C).
    4. Atsushi Yamagishi, 2019. "Transboundary pollution, tax competition and the efficiency of uncoordinated environmental regulation," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 52(3), pages 1165-1194, August.
    5. Hikaru Ogawa & Taiki Susa, 2017. "Majority voting and endogenous timing in tax competition," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 24(3), pages 397-415, June.
    6. Tibor Besedeš & Erik P. Johnson & Xinping Tian, 2020. "Economic determinants of multilateral environmental agreements," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 27(4), pages 832-864, August.
    7. Ronald B. Davies & Yutao Han & Kate Hynes & Yong Wang, 2020. "Competition in Taxes and IPR," Working Papers 202019, School of Economics, University College Dublin.
    8. Ronald B. Davies & Yutao Han & Kate Hynes & Yong Wang, 2023. "Competition in taxes and intellectual property right," Review of International Economics, Wiley Blackwell, vol. 31(3), pages 931-955, August.
    9. Antoine Cazals & Alexandre Sauquet, 2015. "How do elections affect international cooperation? Evidence from environmental treaty participation," Public Choice, Springer, vol. 162(3), pages 263-285, March.
    10. Le Gallo, Julie & Ndiaye, Youba, 2021. "Environmental expenditure interactions among OECD countries, 1995–2017," Economic Modelling, Elsevier, vol. 94(C), pages 244-255.
    11. Keisaku HIGASHIDA & Hirofumi OKOSHI, 2024. "Together or Apart? Eco-friendly location under fiscal competition," Discussion papers 24086, Research Institute of Economy, Trade and Industry (RIETI).
    12. Reiter, Franz, 2015. "Who Competes with Whom? The Structure of International Tax Competition," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113189, Verein für Socialpolitik / German Economic Association.
    13. Young Lee, 2020. "Competition in Corporate and Personal Income Tax: Evidence from 67 Developed and Developing Countries," Korean Economic Review, Korean Economic Association, vol. 36, pages 101-133.
    14. Stefan Borsky & Paul A. Raschky, 2015. "Intergovernmental Interaction in Compliance with an International Environmental Agreement," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 2(2), pages 161-203.

    More about this item

    Keywords

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    JEL classification:

    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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