Marc De Clercq

Environmental Policy, Policy Uncertainty and Relocation Decisions

We analyze the relocation decision of a monopolist under various assumptions with respect to the difference in environmental policy stringency between the home and foreign country. We show that relocation because of such a difference is highly unlikely in a model that includes uncertainty with respect to the difference in policy stringency. Relocation is however possible if the difference in other production costs is significant. We also show the potential for hysteresis-effects: once relocated, the firm will require a reduction in the difference of environmental policy stringency that is larger than the increase that lead to the relocation decision.

The EKC: Some really disturbing Monte Carlo evidence

Abstract In many fields of the economics discipline, much of the empirical work includes a thorough analysis of time series data. In environmental economics, however, such an analysis is often neglected. This is unfortunate for two reasons. First, as Lee and List (2004. Examining trends of criteria air pollutants: ere the effects of government intervention transitory? Environmental and Resource Economics 29 (1), 21–37) argue, time series analysis can provide many new insights relevant in modelling work or in forwarding policy advice. Secondly, the nature of the time series has a profound impact on the modelling work. This paper shows that such an analysis is a necessity. We illustrate this with a Monte Carlo investigation of an Environmental Kuznets type of transition between non-stationary variables. The Environmental Kuznets Curve hypothesis posits an inverse U-shaped relation between environmental pollution and income. Although both pollution and income may be stochastically trending, the empirical literature has largely ignored this property. Through Monte Carlo experiments we show that with stochastically trending series, regression analysis spuriously confirms the EKC hypothesis in 40% of the cases.

Success Determining Factors for Negotiated Agreements

Environmental issues have to be tackled within a network of public and private actors. However, traditional instruments of environmental policy were not always designed to deal with the multifaceted, self-referential, interdependent, and dynamic nature of this network. Therefore, most governments have come to acknowledge that an environmental policy based solely on unilateral regulation is no longer adequate. Thus, there is a need for a new way of making environmental policy making. The new approach must be based on a mix of traditional and ‘novel’ instruments of environmental policy. The new measures must be more flexible and more appropriate to the characteristics of a network.

The political economy of green taxes: The Belgian experience

This article deals with the main problems encountered with the implementation of the ecotax law in Belgium. Ecotaxes are product taxes on drink containers, throw-away products, packaging of certain industrial goods, pesticides and fytopharmaceutical products, paper and batteries. The implementation of these taxes is supervised by a special commission of experts. It proves to be a complex tax, where fiscal, political and institutional problems are serious barriers that have to be overcome.