Measuring and explaining the EU’s effect on national climate performance

ABSTRACT

To what extent has the European Union (EU) had a benign or retarding effect on what its member states would have undertaken in the absence of EU climate policies during 2008–2012? A measurement tool for the EU policy’s effect is developed and shows a benign average EU effect with considerable variation across countries. The EU’s policy effectiveness vis-à-vis its member states is explained by the EU’s non-compliance mechanism, the degree of usage of the Kyoto flexible mechanisms, and national pre-Kyoto emission reduction goals. Time-series cross-sectional analyses show that the EU’s non-compliance mechanism has no effect, while the ex-ante plans for using Kyoto flexible mechanisms and/or the ambitious pre-Kyoto emission reduction targets allow member states to escape constraints imposed by EU climate policy.

KEYWORDS:

• Climate change
• policy effectiveness
• EU
• kyoto protocol
• non-compliance
• Kyoto (flexible) mechanisms

Acknowledgments

We greatly appreciate comments on earlier versions by Ronald Mitchell, Patrick Bayer, Gabriele Spilker, and two anonymous reviewers for this journal.

Disclosure statement

This work was supported by the Greek State Scholarship Foundation (IKY) [Grant number: 5001552]. No potential conflict of interest was reported by the authors.

Notes

1. We exclude Luxembourg from the analysis; due to its small size it is an outlier.

2. The Kyoto (or flexible) mechanisms reflect the ability to purchase pollution reductions abroad rather than to generate them at home. Following the standard (environmental) economic theory, flexible mechanisms are cost-effective tools to reach environmental targets, and several EU countries defended their use based on this argument.

3. Given that the UNFCCC-based climate regime forms part of the wider EU climate regime, the measurement of the EU policy’s effect on national performance during 2008–2012 empirically incorporates the effect of the global climate regime. Conceptually, separating the effect of the EU from the global (UNFCCC) climate regime is possible, yet necessitates permutations of counterfactual assessments. It is impossible within the confines of ex ante calculations (see below) to retroactively undertake these permutations of counterfactuals that should have been undertaken in 1997–2000. Given the EU’s leadership role during much of the existence of UNFCCC’s climate regime, it would be very unlikely that the effect of the global climate regime exceeds that of the EU climate regime. As the EU did not upgrade its 2020 Kyoto Protocol goals (conditional on equivalent efforts of other countries – which were lacking), positive interaction of the EU and the global climate regime is also unlikely. We henceforth point to the effect of the EU, its measurement, and the explanation of its variation.

4. Optimal allocation of efforts according to the full flexibility scenario (i.e., potential for emission trading across member states, sectors and pollutants). The least-cost optimum scenario assumes that the EU member states achieve the 8% reduction target jointly. See Capros et al. (2001, p. 77) for details. For the collective optimum, we use the 2010 simulations results uniformly for the years 2008 through 2012.

5. Emissions reported by the European Environment Agency (2012) take into account neither carbon sinks from land use, land-use change and forestry (LULUCF), nor the additional use of flexible mechanisms. See EEA (2014a, p. vi).

6. We do allow for the carbon intensities of economies to change from those projected to more credibly adjust for country-level effects during 1990–2010.

7. See also hypothesis 2 below.

8. The Kyoto Protocol contains bubble (joint) commitments for all EU members as well as individual (uniform) commitments. Under the emission ‘bubble’ scheme, 15 EU member-countries took on an overall target (−8%), with widely varying national obligations under EU climate policies.

9. Corporatism remains a contested variable in the literature. Siaroff (1999) summarizes and compares the corporatist rankings of 23 different analyses, resulting from different definitions of ‘corporatism’. He observes limited scholarly disagreement with the classification of Switzerland, Japan, and France featuring as the more controversial cases. For example, scholars consider France, which we also include in our sample, a country with a historic legacy of statism, yet with specific areas of sectoral corporatism. Siaroff uses a 5-point scale; Liefferink et al. (2009) (based on Siaroff’s ranking) cluster countries into the three conventional categories of neo-corporatism (liberal), pluralism, and statism. We follow the latter approach.

10. The aggregate indicator developed by the World Bank (2014) reflects perceptions of the quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government’s commitment to such policies.

11. We probed the robustness of our results by excluding the pre-Kyoto reductions variable. The findings with the omitted variable indicated that the EU non-compliance mechanism continues to have no effect, and replicated the inverse relationship between the Kyoto (flexible) mechanisms and the impact the EU’s effectiveness (compare Table 3 and Table A4).

12. We derive all ‘projected’ metrics from business-as-usual computations.