The ability of environmental interventions to achieve the objectives they are designed for depends on the political process leading to policy adoption as well as on the nature of the underlying institutions, dominant ideas, cultural discourses, the industrial structure, and the distribution of resources and power. Designing targeted economic, social, and environmental policies will play a crucial role in steering and fostering this transition towards sustainability. Yet, since environmental interventions are essentially economic policies ultimately implemented by bureaucrats in a broader institutional setting, the quality and efficiency of institutions crucially affects the effective implementation and monitoring of policies.

A study realized by CMCC researchers Shouro Dasgupta and Enrica De Cian from ECIP – Economic analysis of Climate Impacts and Policy Division, a reasearch recently published on the journal Energy Research and Global Science, explores this issue. The authors synthesized findings from the applied econometrics literature to examine the influence of institutions and governance on environmental policy, environmental performance, innovation, and green investments at the national level. Along with reviewing impacts of institutions and governance on physical indicators such as indicators of environmental performance, the study also reviewed the literature on the relationship between institutions and green investments and innovation, considered fundamental drivers of sustainability transition. Finally, researchers reviewed the empirical literature on the impact of public opinion and populism on environmental policy adoption to reflect the growing influence of right-leaning populism.

The results of the analysis highlighted that greater democracy, more civil liberties, and experience with democratic systems of government generally lead to greater environmental protection policies, including greater participation in international environmental agreements and better environmental performance outcomes. Public opinion matters in democracies, but it can be a ‘double-edged sword’ as the rise of right-leaning populism threatens to bring about worse environmental policies and outcomes, or reverse previous progress with environmental policies and energy transition. This seems particularly relevant for the US, where the right denies the existence and policy importance of climate change. Increased levels of corruption tend to lead to environmental degradation, fewer environmentally friendly laws being passed or adopted, and acts as a barrier to green investment and innovation.

Read the integral version of the paper:
Dasgupta S., De Cian E. The influence of institutions, governance, and public opinion on the environment: Synthesized findings from applied econometrics studies
2018, Energy Research & Social Science, DOI: https://doi.org/10.1016/j.erss.2018.05.02