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International environmental efficiency differences and their determinants

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  • Li, Mingquan
  • Wang, Qi
Abstract
We developed a method that combines a slacks-based efficiency measure and the meta-frontier to measure environmental efficiency in countries with different income levels; we also constructed a technology gap indicator to measure the technology gap between the group frontier and the meta-frontier. This empirical study covers the period from 1996 to 2007 and examines 95 countries classified into four groups. We found there was a tremendous technology gap among groups, with the high-income group having an advanced best practice technology. The international environmental efficiency difference continued to widen, with the environmental efficiency in high- and upper middle-income countries showing an increasing trend while lower middle- and low-income countries showed a decreasing trend. The decrease in input and environmental output inefficiencies for high-income countries was the main source of their increasing environmental efficiency; in contrast, the increase in input and environmental output inefficiencies for lower middle- and low-income countries was the main source of their decreasing environmental efficiency. We constructed a Tobit model to explore the determinants of environmental efficiency and found that economic development had a positive impact while fossil-fuel energy use and openness to trade had negative effects. Industrial structure and environmental efficiency, however, presented a “U”-shaped curve relationship.

Suggested Citation

  • Li, Mingquan & Wang, Qi, 2014. "International environmental efficiency differences and their determinants," Energy, Elsevier, vol. 78(C), pages 411-420.
    • Handle: RePEc:eee:energy:v:78:y:2014:i:c:p:411-420
    DOI: 10.1016/j.energy.2014.10.026
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