Abstract
This paper assesses the convergence in eco-efficiency of a group of 22 OECD countries over the period 1980–2008. In doing so, three air pollutants representing the impact on the environment of economic activities are considered, namely, carbon dioxide (\({\text{ CO}}_{2}\)), nitrogen oxides (\({\text{ NO}}_\mathrm{X}\)) and sulphur oxides (\({\text{ SO}}_\mathrm{X}\)); furthermore, eco-efficiency scores at both country and air-pollutant-specific level are computed using Data Envelopment Analysis techniques. Then, convergence is evaluated using the recent approach by Phillips and Sul Econometrica 75:1771–1855 (2007), which tests for the existence of convergence groups. First, we find that eco-efficiency has improved over the period, with the exception of \({\text{ NO}}_\mathrm{X}\) emissions. Second, Switzerland is the most eco-efficient country, followed by some Scandinavian economies, such as Sweden, Iceland, Norway and Denmark. In contrast, Southern European countries such as Portugal, Spain and Greece, in addition to Hungary, Turkey, Canada and the United States, are among the worst performers. Finally, we find that both the most eco-efficient countries and the worst tend to form clubs of convergence.
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Notes
Camarero et al. (2008) tested for convergence in the environmental performance of 22 OECD countries during the period 1970–2002 using a series of indicators computed within the framework of the production theory. In addition, Nourry (2009) analysed the hypothesis of stochastic convergence for \(\text{ CO}_{2}\) and \(\text{ SO}_{2}\) emissions using a pair-wise approach that considers all the pairs of per capita gas emission gaps across a sample of 127 and 81 countries for carbon dioxide and sulfur dioxide, respectively.
Furthermore, although some recent papers such as Zhang et al. (2008) and Wursthorn et al. (2011) have assessed eco-efficiency using aggregate data at sector or regional level, no previous paper has addressed, to the best of our knowledge, the assessment of eco-efficiency at pressure-specific and country level, as we do in our paper. Only Kortelainen (2008) constructed a dynamic environmental performance index based on the standard definition of eco-efficiency at macro-level for 20 European Union members.
Only a few papers have used this approach to convergence assessment in the field of environmental studies. Panopoulou and Pantelidis (2009) explains club convergence in per capita \(\text{ CO}_{2}\) emissions among 128 countries in 1960–2003; Camarero et al. (2013) studies convergence among OECD countries in 1960–2008 in \(\text{ CO}_{2}\) emission intensity and its determinants, namely, energy intensity and the so-called carbonisation index.
The extent of our dataset regarding both countries included and years is determined by the availability of statistical information.
Accessed through http://databank.worldbank.org.
The Intergovernmental Panel on Climate Change considers carbon dioxide to be responsible for more than sixty percent of the global warming expected in the twentyfirst century (IPCC 1990).
The CEIP (http://www.ceip.at) provides official data on air-pollution emissions, as well as the data used in the models of the European Monitoring and Evaluation Programme (EMEP, http://www.emep.int). While the former are directly reported for individual countries, the latter are harmonised by the CEIP. This is why harmonised data are strongly recommended for modelling and cross-country comparisons. The EMEP series include data on air pollutants for 1980 and 1985 and annual data from 1990 onwards. Conversely, official reported data start in 1980. We have completed the series of harmonised data for the 1980s by applying the growth rates of official data to harmonised data from 1980 and 1985. These series are available upon request. Finally, the data for Canada and the United States are the original officially reported data.
DEA has been widely used for the analysis of environmental performance; Zhou et al. (2008) review the empirical applications of these techniques in energy and environmental studies.
The weight assigned to each environmental pressure is calculated in such a way that it rates each country in the most favourable light in relation to all the other countries in the sample when those same weights are used. Nonetheless, as pointed out by Kuosmanen and Kortelainen (2005), additional a priori restrictions on the relative importance of environmental pressures could also be accounted for (Allen and Thanassoulis 2004 review the techniques used to introduce these weight restrictions in DEA).
Our scores of overall eco-efficiency are in fact largely determined by eco-efficiency in \(\text{ CO}_{2}\) emissions, as the proportional reduction in all three emissions is constrained in most countries by these emissions. In more technical words, due to greater effort being made to reduce \(\text{ CO}_{2}\) emissions, restrictions on this pollutant in program (3) have more binding power.
Kortelainen (2008) obtains the same result for Spain and Greece as regards the evolution of environmental performance between 1990 and 2003.
The statistic was \(-\)28.527 (log \(t\) equal to \(-\)0.862), so we reject convergence for the group of countries.
For the sake of simplicity, our discussion here will focus on the average relative transition paths of the clubs found.
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Acknowledgments
The authors thank the comments and suggestions from two anonymous referees. This research has been financed by the Spanish Ministry of Science and Technology (projects ECO2011-30260-C03-01 and ECO2012-32189). The authors also thank the financial aid received from the Generalitat Valenciana (program PROMETEO 2009/098).
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Camarero, M., Castillo, J., Picazo-Tadeo, A.J. et al. Eco-Efficiency and Convergence in OECD Countries. Environ Resource Econ 55, 87–106 (2013). https://doi.org/10.1007/s10640-012-9616-9
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DOI: https://doi.org/10.1007/s10640-012-9616-9