Political economics of environmental regulation

Keywords: political economics, lobbying, NGO, voting model, environmental politics, redistribution

Research projects on this topic deal with environmental policymaking while confronted by constraints of incomplete information, with different degrees of perception and different individual behaviors. The group’s researchers are also studying incentives to adopt more environmentally friendly technologies.

Seeing how difficult it is to implement environmental policies – due to lobbying on the one hand and citizen rejection (red caps, yellow vests, etc.) on the other – raises research questions about how citizens perceive information about environmental issues and how these perceptions relate to their voting decisions. Hélène Ollivier addresses these issues within a theoretical framework: for example, incumbent powers can influence future elections by altering citizens’ perceptions with more or less broad policies. Another example: voters often have a confirmation bias when they receive information, i.e. they tend to believe only the information that validates their preconceived idea, and this can have potentially favorable consequences on the policy choices made by elected officials.

Rejecting environmental policies can also be explained by the existence of non-monetary motivations (e.g., identity, norms).
Some researchers in the group are working on how these motivations arise and their implications for ecological transition and environmental policymaking. Emeline Bezin studies the socio-cultural processes (socialization, imitation) that help to explain the intergenerational change in environmental values. Incorporating these dynamics in long-term macroeconomic models makes it possible to re-evaluate the cost of the ecological transition and in particular to compare the effectiveness of market instruments (e.g. taxes, permits) with that of non-monetary policies such as education. Emeline Bezin and Fanny Henriet work on identity motivations and more precisely on how collective identities are shaped in order to explain why certain environmental policies are harshly rejected, as shown by the rise of the Yellow Vests movement in the face of the ecological tax.

David Martimort and Perrin Lefevre have developed a theoretical framework to better understand how interest groups do or do not succeed in overcoming the problem of collective action that is dear to Olson, especially in a context where the costs and benefits of group creation are inextricably linked to the existence and influence already exerted by rival groups. Contrary to the lessons learnt from a very large body of work in political science or even political economics, competition between groups in no way guarantees that the policies ultimately chosen will reflect a balanced compromise between disparate influences. Strong and disciplined interest groups are better able to solve their own collective action problems and put up high barriers to entry for competing groups.

Repeated failures in international negotiations or in enforcing the resulting bare-minimum agreements demonstrate, if proof were needed, that fundamental obstacles to the efficient resolution of the “public nuisance” problem do exist. David Martimort and Wilfried Sand-Zantman showed the extent to which agreements may be hampered by the fact that it is impossible to find out in detail the costs incurred in each country for committing to reducing their emissions through virtuous practices. The authors then highlight how difficult it is to reconcile incentives provided to each country to reveal their costs and the efficiency which requires that each ton of carbon produced there offset its social cost for the rest of the world. Market mechanisms thus prove to be a very poor way of reconciling these objectives. David Martimort and Aurore Staes took this line of research further by studying the extent to which each country, by implementing ambitious environmental policies as required by international agreements, faces a number of domestic political constraints. The impossibility of redistributing the gains from adopting such policies between polluters and those who suffer from them leads to countries giving up on overly binding international commitments.

In partnership with Thomas Lyon (University of Michigan), Mireille Chiroleu-Assouiine studied the effects of the efforts made by industrial interest groups to discredit experts or environmental NGOs on economic policy decisions. She further analyzed the dampening effects of environmental policy pursued by lobbies, both theoretically and empirically, especially with Rosanne Logeart at the European level.

  • Researchers: Emeline Bezin, Mireille Chiroleu-Assouline, Fanny Henriet, David Martimort, Hélène Ollivier
  • PhD Student: Rosanne Logeart

« 5 papers… in 5 minutes! » linked with this thematic

Adrien Fabre, Thomas DouenneWhat climate policies do the French support?

Emeline Bezin, Ingmar SchumacherUrbanisation et qualité de l’environnement : le rôle des préférences

Mireille Chiroleu-Assouline, Thomas LyonMerchants of Doubt: Corporate Political Influence when Expert Credibility is Uncertain