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The choice of environmental regulatory enforcement by lobby groups

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  • Lotte Ovaere
  • Stef Proost
  • Sandra Rousseau

Abstract

Across countries and regions, we observe wide variations in the level of enforcement instruments (fines and inspections) that are used to reach compliance with environmental regulations. In this paper, we study whether the differences in enforcement policies can be justified from an efficiency perspective, and if not, whether they favour the interests of certain lobby groups. We develop a theoretical model to derive the preferred enforcement policy, which is characterised from a global efficiency point of view and also from the point of view of different interest groups. Also, we explicitly allow for a non-linear deterrence effect of fines. We find that, despite the regulatory costs, green interest groups generally favour more stringent enforcement strategies with high fines and high inspection frequencies, while brown interest groups prefer laxer enforcement strategies.

Suggested Citation

  • Lotte Ovaere & Stef Proost & Sandra Rousseau, 2013. "The choice of environmental regulatory enforcement by lobby groups," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 2(3), pages 328-347, November.
    • Handle: RePEc:taf:teepxx:v:2:y:2013:i:3:p:328-347
    DOI: 10.1080/21606544.2013.836136
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    Citations

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    Cited by:

    1. Gerigk, Joschka, 2016. "Emission taxes, lobbying, and incomplete enforcement," VfS Annual Conference 2016 (Augsburg): Demographic Change 145920, Verein für Socialpolitik / German Economic Association.
    2. Asghar Zardkoohi & Joseph S. Harrison & Mathew A. Josefy, 2017. "Conflict and Confluence: The Multidimensionality of Opportunism in Principal–Agent Relationships," Journal of Business Ethics, Springer, vol. 146(2), pages 405-417, December.
    3. Dapeng Cai & Jie Li, 2020. "Pollution for Sale: Firms’ Characteristics and Lobbying Outcome," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 77(3), pages 539-564, November.
    4. Arguedas, Carmen & Earnhart, Dietrich & Rousseau, Sandra, 2013. "Effluent Limits, Ambient Quality, and Monitoring," Working Papers in Economic Theory 2013/08, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
    5. Choi, Seong-jin & Jiménez, Alfredo & Lee, Jeoung Yul, 2020. "The impact of political capabilities and political markets on firms' decision to lobby," Journal of International Management, Elsevier, vol. 26(4).
    6. Carmen Arguedas & Dietrich Earnhart & Sandra Rousseau, 2017. "Non-uniform implementation of uniform standards," Journal of Regulatory Economics, Springer, vol. 51(2), pages 159-183, April.

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