Environmental Engineering Reference
In-Depth Information
transport of hazardous waste, and ozone-depleting chemicals. Neumayer (2002)
nds that
the degree of democracy - as measured by indices of political rights and 'voice and
accountability' - is a strong predictor of whether countries will enter into environmental
agreements, again pointing to the importance of
fi
political variables in determining
outcomes.
'Governance from below' refers to
de facto
rules that are imposed not by governments,
but by 'civil society' and public opinion. A series of studies at the World Bank, for
example, has found that 'informal regulation' by local communities can limit industrial
pollution even in the absence of formal regulation (see Pargal and Wheeler, 1996; Pargal
et al., 1997). These studies generally
nd average income and education of communities
to be strongly correlated with successful informal regulation. Transnational environmen-
tal alliances also can increase the bargaining power of local communities (see, e.g.,
Keenan et al., 2007). In addition to directly in
fi
fl
uencing the decisions of private
fi
rms and
government o
cials, informal actors have developed third-party certi
fi
cation and 'eco-
labeling' initiatives that respond to and in
fl
uence consumer demands.
8
Environmental protectionism
Instead of harmonization upward, many environmentalists maintain that globalization
promotes a 'race to the bottom', in which competition for private investment undermines
environmental regulation. In its weaker variant, this argument holds that global compe-
tition impedes new regulation so that South countries remain 'stuck at the bottom'
(Porter, 1999) and Northern countries are 'stuck in the mud' (Zarsky, 1997). In its
stronger variant, globalization spurs the competitive lowering of standards in the North,
ultimately leading to convergence on the lowest common denominator. Hence the claim
in the NAFTA debate that the trade agreement would 'sabotage' US environmental
laws.
9
The usual policy recommendation
fl
owing from this analysis is that Northern countries
should use compensating tari
s or other trade restrictions to prevent 'ecological
dumping' - the sale of products at prices below their marginal social cost of production
by virtue of externalization of environmental costs.
10
Hence this school of thought is here
termed 'environmental protectionism'.
The logic rests on the uneven globalization of markets and governance:
ff
International trade increases competition, and competition reduces costs. But competition can
reduce costs in two ways: by increasing eciency or by lowering standards. A firm can save
money by lowering its standards for pollution control, worker safety, wages, health care and so
on - all choices that externalize some of its costs . . . Nations maintain large legal, administra-
tive and auditing structures that bar reductions in the social and environmental standards of
domestic industries. There are no analogous international bodies of law and administration;
there are only national laws, which differ widely. Consequently, free international trade encour-
ages industries to shift their production activities to the countries that have the lowest standards
of cost internalization - hardly a move toward global eciency. (Daly, 1993, p. 52)
Empirical studies generally have concluded that environmental regulation does not, in
fact, have much e
e et al., 1995). At the
same time, however, studies of 'revealed comparative advantage' in pollution-intensive
industries (such as pulp and paper, mining, chemicals, and petroleum products) have
found that countries in the global South and Eastern Europe account for a rising share of
ff
ect on
fi
rms' competitiveness (for a review, see Ja
ff
