Fredriksson, Per G.Mani, MuthukumaraWollscheid, Jim R.2012-06-212012-06-212006-02https://hdl.handle.net/10986/8738This paper provides new empirical evidence to the debate on the optimal locus of power over environmental policymaking in developing countries. The authors develop a simple lobby group model with mobile capital. The model predicts that a decentralized institutional structure leads to weaker environmental policy due to more intensive lobbying by capital owners and workers. They test this prediction using novel cross-sectional developing country data. The results are consistent with the prediction of the model, in particular for air pollution policies. The authors also find that the effect of decentralization declines with a greater degree of trade openness. They believe this is the first developing country evidence on the environmental policy effects of federalism.CC BY 3.0 IGOABATEMENTABATEMENT COSTSACCOUNTABILITYAIR POLLUTIONASYMMETRIC INFORMATIONAUTONOMYBENCHMARKCAMPAIGN CONTRIBUTIONSCAPITAL FLIGHTCAPITAL FLOWSCLEAN WATERCONSERVATIONCONSTANT RETURNS TO SCALEDECENTRALIZATIONDETRIMENTAL EFFECTSDEVELOPMENT ASSISTANCEDEVELOPMENT ECONOMICSDEVOLUTIONDIRECT INVESTMENTDUMPINGECONOMETRIC ANALYSISECONOMETRICSECONOMIC ANALYSISECONOMIC COMPETITIONECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC POLICIESEFFECTIVE USEEMISSIONEMISSION REDUCTIONEMISSIONSEMPIRICAL EVIDENCEEMPIRICAL RESEARCHENFORCEMENT RESPONSIBILITIESENVIRONMENTALENVIRONMENTAL COMPLIANCEENVIRONMENTAL ECONOMICSENVIRONMENTAL ENFORCEMENTENVIRONMENTAL GOVERNANCEENVIRONMENTAL IMPACTSENVIRONMENTAL KUZNETSENVIRONMENTAL MANAGEMENTENVIRONMENTAL MATTERSENVIRONMENTAL POLICIESENVIRONMENTAL POLICYENVIRONMENTAL POLICY FRAMEWORKENVIRONMENTAL PROBLEMSENVIRONMENTAL PROTECTIONENVIRONMENTAL QUALITYENVIRONMENTAL REGULATIONENVIRONMENTAL REGULATIONSENVIRONMENTAL STANDARDENVIRONMENTAL STANDARDSENVIRONMENTAL SUSTAINABILITYENVIRONMENTALISMENVIRONMENTALISTSEQUILIBRIUMEXOGENOUS VARIABLESEXPORTSEXPOSURE TO POLLUTIONFINANCIAL INSTITUTIONSFISCAL DECENTRALIZATIONFISHERIESFOREIGN COMPETITIONFORESTRYFREE TRADEGDPGLOBAL ENVIRONMENTGLOBAL ENVIRONMENT FACILITYIMPORTSINCOMEINDUSTRIAL PLANTSINDUSTRIAL POLLUTIONINFLATIONINFORMAL REGULATIONINSTITUTIONAL CAPACITYINSTITUTIONAL FRAMEWORKINTERNATIONAL TRADELAWSLOCAL GOVERNMENTLOCAL GOVERNMENTSMARGINAL PRODUCTMARGINAL PRODUCTIVITYMARGINAL PRODUCTSMARGINAL SOCIAL DAMAGEMUNICIPALITIESNASH EQUILIBRIUMNATURAL RESOURCENATURAL RESOURCE MANAGEMENTNATURAL RESOURCESNATURAL RESOURCES MANAGEMENTNITROGEN OXIDESPOLICY DECISIONSPOLICY FRAMEWORKPOLICY INSTRUMENTSPOLITICAL ECONOMYPOLITICAL PRESSUREPOLLUTION CONTROLPOLLUTION DAMAGEPOLLUTION LEVELSPOLLUTION MANAGEMENTPOLLUTION REGULATIONPRODUCTION TECHNOLOGYPUBLIC GOODPUBLIC POLICYPUBLIC SERVICESPURCHASING POWERREGULATORY COMPLIANCERESOURCES MANAGEMENTSAVINGSSCARCE CAPITALSUSTAINABLE DEVELOPMENTSUSTAINABLE GROWTHSUSTAINABLE USETAXATIONTHEORETICAL MODELSTOTAL OUTPUTTRADE LIBERALIZATIONUTILITY FUNCTIONSWASTEWASTE MANAGEMENTWATER POLLUTIONWATER QUALITYWorld Bank10.1596/1813-9450-3847