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Environmental Governance in Federal Systems: The Effects of Capital Competition and Lobby Groups

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  • Fredriksson, Per G
  • Gaston, Noel

Abstract

We argue that centralized and decentralized environmental governance yield equivalent environmental regulations. We model worker, environmental, and capital owner lobby groups that seek influence by offering political contributions. Worker lobbying in the decentralized case has an effect on environmental regulations identical to that of capital owner lobbying in the centralized case. This is because the aggregate effects of environmental regulations on income are equivalent under the two institutional designs. Whereas workers carry the full burden in the decentralized case when capital competition occurs, the burden is shared with the capital owners in the centralized case. We present evidence consistent with our theory. Copyright 2000 by Oxford University Press.

Suggested Citation

  • Fredriksson, Per G & Gaston, Noel, 2000. "Environmental Governance in Federal Systems: The Effects of Capital Competition and Lobby Groups," Economic Inquiry, Western Economic Association International, vol. 38(3), pages 501-514, July.
    • Handle: RePEc:oup:ecinqu:v:38:y:2000:i:3:p:501-14
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