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Ecological Economics
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Analysis
DiGEF, Department of Law, Philosophy and Economic Studies, University of Rome La Sapienza, p.le Aldo Moro, 5, 00185 Rome, Italy
Department of Economics, University of Foggia, Largo Papa Giovanni Paolo II, 1, 70100 Foggia, Italy
a r t i c l e
i n f o
Article history:
Received 8 May 2012
Received in revised form 2 July 2014
Accepted 14 July 2014
Available online 4 August 2014
JEL classications:
Q56
K32
Keywords:
Environmental justice
Social inequalities
Environmental Kuznets curve
Air pollution emissions
a b s t r a c t
This paper provides an empirical analysis on the relationship between income, demographic characteristics and
concentrations of air industrial pollutants within the Italian provinces. Two general conclusions can be drawn
from the empirical results. First, the estimates obtained are consistent with an inverse U-shaped environmental
Kuznets curve: air pollution releases increase with income up to a turning point where the relation reverts.
Second, there is evidence that air releases tend to be higher in provinces with high concentration of females as
households' head and with high concentration of children. Since our ndings do not point to environmental
discrimination on the basis of ethnicity, this suggests that environmental justice issues in Italy are not likely to
manifest themselves along racial and ethnic terms but instead in terms of social categories and gender composition. We also nd that the proxy variables employed to measure the efciency or inefciency of law enforcement
are associated with higher levels of pollution. In terms of policy implications, this result suggests the need to
strengthen, all through the country, the local enforcement of environmental laws in order to possibly reduce
the negative effects on ambient air pollution.
2014 Elsevier B.V. All rights reserved.
1. Introduction
The relationship between income and environmental pollution has
been the subject of a large amount of both theoretical and empirical
studies2 since the pioneering works by Grossman and Krueger (1991,
1993, 1995). An assessment of the existing literature suggests that
there are two prevalent strands of literature focusing either on the
nexus between income and environmental pollutants or between
income, demographic composition of population and pollution, where
little effort has been made to join these two strands of literature
together. The aim of this study is an attempt to ll this gap. Basically,
Corresponding author. Tel.: +39 064991 0642; fax: +39 064991 0648.
E-mail addresses: annarita.germani@uniroma1.it (A.R. Germani),
piergiuseppe.morone@uniroma1.it (P. Morone), g.testa@unifg.it (G. Testa).
1
Tel.: +39 064991 0567; fax: +39 064991 0648.
2
In particular, Grossman and Krueger analyze the EKC through the discussion of three
different mechanisms: scale effect, composition effect and technique effect. Scale effect
shows that even if the structure of the economy and technology does not change, an
increase in production will result in an increase of pollution and environmental degradation. Economic growth through scale effect has a negative impact on the environment. On
the other hand, the authors argue that composition effect may have a positive impact on
the environment. Pollution increases in the earlier stages of development, while in the
later stages of development pollution decreases as the economic structure moves towards
services and light manufacturing industries. Therefore, composition effect could lower
environmental degradation through this change in the structure of production. Finally,
technique effect captures improvements in productivity and adaptation of cleaner technologies, which will lead to an increase in environmental quality.
http://dx.doi.org/10.1016/j.ecolecon.2014.07.010
0921-8009/ 2014 Elsevier B.V. All rights reserved.
3
Environmental justice is a movement that emerged in the United States in the 1980s
and has become a concern in the US federal policy agenda in the early 1990s. In 1994, in
fact, environmental justice was institutionalized at federal level through an Executive Order, which focused attention on human health and environmental conditions in lowincome and minority communities (Title VI of the Civil Rights Act of 1964 prohibits discrimination on the basis of race, color, or national origin).
70
6
The institutional beginnings of the environmental justice approach can be dated from
the drafting of the UNECE Convention on Access to Information, Public Participation in
Decision-making and Access to Justice in Environmental Matters, adopted at the Fourth
Ministerial Conference in the Environment for Europe process in UNECE (1998). In its Article 1, the Convention states as an objective to guarantee the rights of access to information, public participation in decision-making, and access to justice in environmental
matters in accordance with the provisions of this Convention.
71
72
3.2. Methods
As broadly discussed, the main objective of this work is to test whether air releases generated by the industrial sector could be explained using
economic (income level) as well as socio-demographic variables. However, a methodological issue that arises in the literature is that regressing
pollution levels on income can introduce endogeneity problems.
In fact, when investigating if pollution amounts may be determined
by income levels, it must be considered that rms may be attracted
to locate in low-income areas (Hamilton, 1993, 1995), but also lowincome groups may choose to live in or nearby polluted areas for economic reasons (e.g. cheaper rents). Hence, there is a problem of reverse causality,7 due to the fact that (a) income might affects pollution levels through
growing levels of production, or (b) the amount of pollution might affect
the level of income due to the fact that low-income groups can decide to
live in cheaper, but more polluted, areas.8 In order to minimize possible
7
Reverse causality is one of the main sources of endogeneity problems. Been (1994) also points out this endogeneity problem and resolves it by using pre-siting demographic
data (i.e., data from before the industrial plants were built). Ringquist (1997) uses a control variable approach by controlling for housing prices; Gray and Shadbegian (2004) use
instrumental variables.
8
Note that a similar endogeneity problem might arise from the use of sociodemographic variables. However, the values of the explanatory variables (both economic
and socio-demographic) are observed at their 2001 Census values: thus, the 2001 economic and socio-demographic characteristics are used to explain air releases in 2005
(see Arora and Cason, 1999, on the use of lagged explanatory variables to avoid
endogeneity bias). Hence, in our estimation model, we assume that the economic and
socio-demographic conditions (predetermined economic, social and demographic provincial data observed at time t) take some time (a four-year time lag) to exhibit their effects
on the levels of air pollution (observed at time t + 1). Causality problems might still occur
in our regressions if pollution is persistent over time. However, as pointed out by an anonymous referee, the fact that we use province-level data makes the issue of locating on the
basis of cheap rent less of a problem. In fact, data support the idea that in Italy internal migration is generally low when compared with other countries, such as the USA (Faini et al.,
1997). In a recent study, Napolitano and Bonasia (2010) showed for the period 19952006
that wage differential was found to be an important determinant of internal migration. On
the other hand, housing price differentials seemed to have little or no power to explain migration from one region to another.
bias due to this endogeneity problem, we propose an instrumental variable model to control for the endogeneity issue.
In the Results section, we present estimates from an ordered probit
model and an ordered probit model with instrumental variables. We
estimate two versions of our model: (1) in the rst version, we consider
as dependent variable a measure of air pollution obtained aggregating
twelve local pollutants (see Section 4.1 for details); in the second version, the dependent variable is the main global pollutant i.e. CO2.
Moreover, we also estimated our model under different econometric
specications, to further examine its robustness. Specically, we estimate a simple OLS model and a two-stage least square (2SLS) with
instrumental variables9 (results referring to the OLS and 2SLS estimates
will be reported in Appendix A). The main advantage of the ordered
probit model over either the OLS model or the 2SLS model in our
study is that the marginal effects allow us to determine the impact of
each explanatory variable (e.g., ethnicity, income and minorities) on
the probability of each level of air pollution emissions. Even though
this ranking approach to measure the amount of pollution has not
been widely used in previous environmental justice studies, there are
some precedents for using an ordered probit analysis.10
The estimated model takes the following form:
2
yi 0 1 ln Y pc 2 ln Y pc 3 lpcunivdegree 4 lpcasia
5 lpcafr 6 lpcfemhead 7 lchildren 8 lelders 9 jud inef
10 jud ef 11 D 12 emp RD 13 exp RD 14 reg exp e
1
The dependent variable measures air pollution emissions, which are
estimated against a set of independent variables. To measure income
levels, we use the variable ln(Y pc ), the logarithm of the income
values; we also considered the quadratic specication of the same
variable ln2(Ypc) which, as broadly discussed, allows us to capture
the presence (or not) of an inverse U-shaped relationship between
income and pollution. In the instrumental variable model we instrument income and income square using a set of variables which will
be discussed in Section 4.3.
Eq. (1) includes also a variable capturing high level of education
(lpcunivdegree), which measures the share of people with an undergraduate university degree. Regarding ethnic group characteristics, the
percentage of African population (pcafr) and the percentage of Asian population (pcasia) are used. The percentages of children, elders and of families with a female as the head of the household are considered to be
groups that could suffer from possible environmental discrimination.
As discussed in Section 3.1 above, we account in our regression
model also for law enforcement. Specically, we include two variables:
jud_inef accounts for the average length (expressed in years per 10,000
population) of completed proceedings this is to be considered as a
measure of the judicial inefciency; jud_ef considers the per capita
number of overall proceedings (pending and completed) in the courts
located in the Italian provinces this is to be considered as a measure
9
A multitude of different statistical approaches are employed in the environmental justice analysis, depending on the nature of the dependent variable. Multivariate analysis (for
example, Been and Gupta, 1997; Pastor et al., 2001), as well as logit (for example, Brooks
and Sethi, 1997; Cory and Rahman, 2009; Hamilton, 1995, where the dependent variable,
i.e. the level of exposure to pollution levels, assumes the value of 1 if there was an increase
of exposure in the zip code and 0 otherwise) and probit models (Aradhyula et al., 2006;
Ringquist, 1997) are used.
10
Ordinal probit or logit regressions have in fact been used with ordered (from low to
high) dependent variables (Agresti, 1990). Sadd et al. (1999) estimate an ordered logit
model on Los Angeles neighborhoods, building a dependent variable ordered according
to the level of assumed health hazard, which takes a value of 0 if the tract has no air release, a value of 1 if it has an air release that does not contain carcinogen compounds,
and a value of 2 if it contains carcinogen air release. Forastiere et al. (2007), in investigating
the relationship between exposure to trafc emissions and socio-economic conditions in
Rome, grouped air pollution (i.e., particulate matter emissions, PM10) into four categories:
low, mid-low, mid-high, and high emissions, using the 20th, 50th, and 80th percentiles as
cut-off points.
73
Table 1
Descriptive statistics of the air pollutants that compose the dependent variable in the ordered probit regression.
Pollutants descriptive statistics (N = 103 provinces)
Pollutants
Local
Sulphuric dioxide*
Nitrogen oxides*
Carbon monoxide**
Ammonia**
Arsenic****
Chromium**
Copper**
Mercury**
Nickel*
Lead*
Selenium*
Benzene*
Global
Carbon dioxide***
Mean
8557.90
8980.24
16,963.46
3847.59
363.38
508.68
405.63
69.95
1332.13
1943.42
109.11
153.64
3,493,031
Median
1990.71
3946.46
9025.16
2224.30
107.35
185.51
126.35
34.18
564.34
695.85
30.93
114.53
1,848,533
Standard deviation
17,423.36
11,918.65
38,034.08
4817.7
894.59
810.91
1524.76
138.26
1978.39
4622.00
215.34
140.91
4,561,720
Minimum value
0.303
14.60
1502.72
14.25
0.56
0.65
3.53
1.58
3.64
0.83
0.36
16.82
Maximum value
96,385.52
54,407.96
376,509.9
28,817.56
8076.338
4481.793
15,151.66
1076.05
13,554.87
42,187.82
1665.048
917.8066
129,135.4
2.85e + 07
Notes: *substance measured in micrograms; **substance measured in milligrams; ***substance measured in megagrams; ****substance measured in nanograms. In the ordered probit
regression analysis, all the different measurement units were converted into megagrams.
4. Data
4.1. Dependent Variables
To build the dependent variable used in the ordered probit
regression, we dene a province-level index of air pollution. Following
Brooks and Sethi (1997),11 we use threshold limit values (TLVs) in
order to adjust for toxicity. As put by the authors a threshold limit
value is the amount of airborne concentration in mg/m3 of a substance
to which a worker may be repeatedly exposed for a normal 8-hour
workday and a 40-hour workweek without adverse health effect
(Brooks and Sethi, 1997: 236).
We employ the Italian threshold limit values established by law for
ambient pollution using the GESTIS-Substance Database which contains
information for the safe handling of hazardous substances and other
chemical substances at work.12
11
Brooks and Sethi (1997) created a weighted toxicity index using threshold limit values
(TLVs), combined with a distance function, to develop an exposure measure for each U.S.
zip code.
12
For an in-depth discussion on threshold limit values and how these can be used to
built the province-level index of air pollution, see Germani et al. (2012).
For the purpose of aggregating pollutants, our air pollution index was
constructed in the following way. Let Eij dene the emission of pollutant j
from province i, and let Tj denote the threshold limit value associated
with substance j. Then, the toxicity-weighted aggregated level of air pollution in province i is dened as: AP i
Eij
13
Findings relative to the other three specications are available from the authors upon
request.
14
ISPRA is the Institute for Environmental Protection and Research established by Italian
Law 133/2008. The Institute performs the functions of three former institutions: APAT
(Agency for Environmental Protection and Technical Services), ICRAM (Central Institute
for Applied Marine Research), and INFS (National Institute for Wildlife).
74
Fig. 1. Air pollution emissions for the rst twenty most polluted Italian provinces (in million megagrams).
responsible for the National Emission Inventory. The ISPRA dataset includes data on air emissions in all the Italian provinces (103 provinces
distributed over 20 regions).15 This is a comprehensive database that collects all emission estimates of the major pollutants including greenhouse
gases, ozone precursors, benzene, particulate matters, heavy metal and
polycyclic aromatic hydrocarbon.16 The national inventory is reported
to the European Commission at the national aggregated level, but it is calculated at the regional level and then disaggregated at the provincial
level. In the Disaggregation of the National Inventory 2005 Report, data
related to the disaggregation of the emissions of the national inventory
at the provincial level are available, divided by activity according to the
SNAP (Selected Nomenclature for Air Pollution) classication.17 The
SNAP classication consists of 11 macro-sectors. We use data relative to
macro-sector 1 (combustion in energy and transformation industry),
macro-sector 3 (combustion in manufacturing industry) and macrosector 4 (production processes), since we want to base our analysis on
air pollution emissions released by the industrial sector and not also
from agriculture and road, air, or sea transportation. In other words, we
restricted our analysis on industrial emissions since our objective is to
test whether industrial plants siting might affect the demographic composition of population and the socio-economic characteristics of the different provinces. Air pollution emissions are expressed in megagrams:
the average level of air releases is 3,532,766 Mg with a minimum
value of 131,997.8 Mg (Prato) and a maximum value of 2.86e
+ 07 Mg (Rome). The average per-capita air emission levels, instead,
is 7.14 Mg with a minimum value of 0.57 megagrams (Prato) and a
15
We are aware of the fact that the use of too broad a scale or unit of analysis has been
discouraged (Anderton et al., 1994), but the most disaggregated available Italian data are
only at provincial level.
16
One of the main limitations of the ISPRA dataset is that it is not possible to obtain information on the compliance trends and on the enforcement activities in each province. It
would be desirable to have access to more detailed data sets on the number of inspections
conducted by enforcement authorities, on compliance levels and on the implications of the
different penalty means. The lack of accurate and incomplete information does not allow
policymakers to understand how the Italian system of enforcing environmental laws work
and what reforms may be needed.
17
This classication includes all activities which are considered relevant for atmospheric
emissions. The ISPRA database is characterized by three different typologies of emissions:
area, point and linear sources. For area emissions (emissions from sources distributed on
the territory) a direct measurement is not feasible, and it is necessary, therefore, to estimate them from statistical data and specic emission factors. The approach that ISPRA
has applied is based on a linear relation between source activity and emission, following
this relation: Ei = A FEi, where: Ei = emission of the pollutant i (g year1); A = activity
indicator (i.e. produced amount, fuel consumption, etc.); FEi = emission factor for the pollutant i (i.e., g t1 of product, kg/kg of solvent, g inhabitant1).
Fig. 2. Per-capita air emissions levels for the rst twenty most polluted provinces
(per capita megagrams).
75
Table 2
Instrumental and independent variables descriptive statistics (N = 103 provinces).
Variable
Instrumental variables
infrastructure
females
age15to34
age35to49
pcunivdegree
Independent variables
pcincome
pcasia
pcafr
pcfemhead
children
elders
judicial inefciency
judicial efciency
D
emp_RD
exp_RD
reg_exp
Mean
Standard deviation
Minimum value
Maximum value
556.902
247,242
90,399.67
93,498.53
0.105
81.927
271,537.8
101,921.6
106,050.4
0.022
443
39,886
12,641
14,172
0.067
1000
1,696,080
678,961
714,986
0.178
14,675.68
0.0027
0.0064
0.117
5.27
19.84
2.962
0.086
7010.65
2.58
0.52
99.62
3024.42
0.0031
0.0048
0.023
0.75
3.09
1.024
0.059
6982.57
1.17
0.27
121.51
9104.12
0.00015
0.0007
0.077
3.69
12.52
1.336
0.005
494.60
0 .7
0.2
21.7
20,613.52
0.020
0.021
0.201
7.35
25.91
5.968
0.356
37,089.05
5.4
1.5
749.4
Note: The variables used in logs in the regression are presented in their original levels.
s1; sr
the case for the dependent variable) of the s-th province, N is the total
number of provinces and wrs = 1 if s is neighboring r. Note that when dening our spatial regressor, we do not consider neighboring emissions
of local pollutants, but rather we concentrate on the main global pollutant (i.e. CO2) as this is most likely to generate geographical spillover effects. In fact, as observed by Maddison (2006), it is when
considering transboundary pollution effects that the existence of
spatial correlation problems should be recognized and tackled.19
4.2.4 . Technological Variables
As discussed above, we also consider intramural R&D expenditures as
well as a provincial index of researchers, technicians and other personnel
engaged in R&D activities. Both variables refer to public and private sector.
4.2.5 . Regulatory Factors
In order to control for regulatory factors we include in the ordered
probit estimation a measure of environmental expenditure made by
regional authorities which capture the regional effort to preserve a clean
environment. As observed by Costantini et al. regional environmental expenditures capture a specic feature of environmental regulations, and
are associated with a citizen's willingness to pay for abating emissions
(2013: 108). Specically, we consider the total regional expenditure per
inhabitant.20
These demographic and economic data are implemented with two
variables capturing judicial efciency and judicial inefciency. These
two variables are: (i) the number of proceedings (completed as well as
pending) which is a measure of the efciency of law enforcement and is
19
Given the geographical dimension of our case study, we consider emissions coming
from other provinces, while no transboundary pollution at international level is accounted
for (see also Costantini et al., 2013).
20
Note that data cover all 20 Italian regions and refer to the year 2004 since earlier data
were not available.
21
The data on the number of proceedings by the Il Sole 24 Ore is an elaboration of the data released by the Italian Ministry of Justice.
22
Note that trial and appeal delays are one of the major problems associated with the inefciency of justice in Italy.
23
Data were drawn from the yearly report of data and social indicators on quality of life
performed by the leading Italian nancial newspaper, Il Sole 24 Ore that publishes this annual report on quality of life every year since 1989. The 103 Italian provinces are ranked
according to a summary indicator of their quality of life constructed collecting ofcial statistical data. The nal quality of life indicator is based on 36 social indicators related to six
main areas: consumption and wealth, labor and business, environment and services, justice efciency and criminality, population, leisure. Even though the statistical robustness
of these rankings is often criticized (Lun et al., 2006; Vitali and Merlini, 1999), the results
of the Il Sole 24 Ore report it constitutes a very regular collection and analysis of data on
quality of life.
76
Table 3
Ordered probit estimation, IV ordered probit estimation and marginal effects (dependent variable: air pollution emissions data weighted by the Italian threshold limit values).
Dependent variable:
IWE_area
Coefcients (P N |z|)
Coefcients (P N |z|)
Y=1
Y=2
Y=3
Y=4
ln(Ypc)
131.183a
(0.001)
6.851a
(0.001)
1.567b
(0.032)
0.055
(0.773)
0.193
(0.520)
6.116a
(0.000)
7.234a
(0.000)
1.184b
(0.044)
11.355a
(0.000)
.3754
(0.378)
0.493a
(0.000)
0.705a
(0.004)
1.306b
(0.041)
0.000
(0.786)
669.989
670.943
671.942
103
0.21
129.996a
(0.000)
6.745a
(0.000)
1.648
(0.051)
0.084
(0.662)
0.120
(0.628)
6.061a
(0.002)
7.862a
(0.001)
1.259
(0.059)
11.152a
(0.000)
0.361
(0.255)
0.494a
(0.002)
0.706b
(0.016)
1.306
(0.111)
0.000
(0.884)
670.072
671.025
672.029
103
26.131a
(0.000)
1.356a
(0.000)
0.331b
(0.042)
0.016
(0.663)
0.024
(0.627)
1.218a
(0.001)
1.580a
(0.000)
0.253
(0.064)
2.241a
(0.000)
0.072
(0.250)
0.099a
(0.001)
0.141b
(0.014)
0.262
(0.110)
0.000
(0.884)
10.534a
(0.000)
0.546a
(0.000)
0.133
(0.076)
0.006
(0.661)
0.009
(0.632)
0.491b
(0.012)
0.637a
(0.004)
0.102
(0.057)
0.903a
(0.001)
0.029
(0.282)
0.040a
(0.009)
0.057b
(0.038)
0.105
(0.133)
0.000
(0.885)
6.234b
(0.027)
0.323b
(0.027)
0.079
(0.084)
0.004
(0.667)
0.005
(0.637)
0.290b
(0.039)
0.377b
(0.031)
0.060
(0.144)
0.534
(0.054)
0.017
(0.311)
0.023b
(0.047)
0.033
(0.093)
0.062
(0.184)
7.310
(0.884)
30.431a
(0.000)
1.579a
(0.000)
0.385
(0.053)
0.019
(0.662)
0.028
(0.627)
1.418a
(0.002)
1.840a
(0.001)
0.294
(0.053)
2.610a
(0.000)
0.084
(0.254)
0.115a
(0.001)
0.165b
(0.015)
0.305
(0.110)
0.000
(0.884)
ln2(Ypc)
lpcunidegree
lpcasia
lpcafr
lpcfemhead
lchildren
lelders
jud_inef
jud_eff
D
empl_RD
exp_RD
reg_exp
cut1
cut2
cut3
Number of observations
pseudo R2
Wald chi2
a
b
1.83
5. Results
Tables 3 and 4 report the results of the ordered probit and IV ordered
probit models. For the sake of clarity, we rst discuss results associated
with IWE as the dependent variable (see Table 3); subsequently, we
provide account of results obtained when considering as our dependent
variable CO2 emissions (see Table 4).
First, it should be noted that when the dependent variable is ordered,
estimated parameters do not reect a unit change of an independent
variable on probability; thus, the estimated coefcients in an ordered
probit have no direct interpretation. For this reason, we also calculate
the associated marginal effects (for a discussion of calculating marginal
effects see Greene, 2003: 738). These can be interpreted as the change
in the probability of attaining different levels of air pollution emissions
as a result of a unit change in each explanatory variable. Notice that
the sum of the marginal effects equals zero. The signs on the marginal
effects of the signicant variables do not remain constant: more specifically, in the rst and the second air pollution categories Pr(Y = 1:
low emissions) and Pr(Y = 2: medium-low emissions) the statistically
signicant variables have opposite signs compared to the third and the
fourth air pollution categories Pr(Y = 3: medium-high emissions) and
Pr(Y = 4: high emissions).
The income variables (in their logarithmic linear and quadratic
specications) are both statistically signicant (both in the ordered probit
and IV ordered probit specication), showing that an increase in income
translates to an increase in the probability of attaining high levels of air
pollution emissions (see the last column of Table 3). Moreover, the
statistical signicance of the squared term for income and its negative relationship with the dependent variable, allow us to identify an inverse Ushaped relationship between income and air releases with an estimated
turning point occurring just above 14,000.00 per capita. Following
Millimet et al. (2003), we use the delta method24 to derive standard
error and 95% condence interval around the turning point estimate25
and obtained a range roughly between 13,000 and 16,000.26 This interval falls well within the range of the income data (which as showed in
Table 2 varies between 9104 and 20,614), a fact that strengths the evidence in favor of the existence of the EKC. Further, we plotted a graph
depicting the Environmental Kuznets Curve, where we allow only income
to vary; the graph (see Fig. 3) describes the quadratic relationship linking
pollutions levels and income along with the 95% condence intervals, and
clearly shows the existence of a turning point in the relationship.
The traditional interpretation of this environmental Kuznets (1955)
curve is that an increase in economic activity leads to a higher probability of attaining high levels of air pollution, but beyond the turning point,
24
This method consists in linearly approximating the nonlinear function of the turning
point in the regression coefcients.
25
A symmetric condence interval is formed based on the assumption that per capita income is normally distributed.
26
As a robustness check we also employed a parametric bootstrap method through
Monte Carlo simulation as well as a nonparametric bootstrap based on resampling observations. In both cases results obtained with the delta method were conrmed.
77
Table 4
Ordered probit estimation, IV ordered probit estimation and marginal effects (dependent variable: CO2 emissions).
Dependent variable:
CO2_area
Coefcients (P N |z|)
Coefcients (P N |z|)
Y=1
Y=2
Y=3
Y=4
ln(Ypc)
56.274
(0.129)
2.877
(0.142)
1.262
(0.057)
0.076
(0.613)
0.154
(0.538)
4.863a
(0.001)
6.425a
(0.000)
0.592
(0.210)
8.202a
(0.006)
0245
(0.508)
0.407b
(0.033)
0.467
(0.144)
0.895
(0.270)
0.000
(0.779)
310.6
311.453
312.359
103
0.14
55.531a
(0.000)
2.807a
(0.000)
1.371
(0.085)
0.102
(0.595)
0.217
(0.363)
4.713b
(0.010)
6.658a
(0.003)
0.658
(0.309)
7.942a
(0.002)
0.235
(0.442)
0.408a
(0.005)
0.439
(0.116)
0.784
(0.319)
0.000
(0.897)
0.000
0.000
.
103
13.024a
(0.000)
0.658a
(0.000)
0.321
(0.078)
0.023
(0.596)
0.050
(0.366)
1.105a
(0.007)
1.561a
(0.002)
0.154
(0.310)
1.862a
(0.002)
0.055
(0.439)
0.095a
(0.004)
0.103
(0.110)
0.183
(0.316)
0.000
(0.897)
4.342a
(0.000)
0.219a
(0.001)
0.107
(0.106)
0.007
(0.596)
0.016
(0.352)
0.368b
(0.034)
0.520b
(0.012)
0.051
(0.310)
0.621a
(0.008)
0.018
(0.453)
0.031b
(0.022)
0.034
(0.147)
0.061
(0.335)
0.000
(0.897)
2.935b
(0.033)
0.148b
(0.036)
0.072
(0.119)
0.005
(0.604)
0.011
(0.381)
0.249
(0.065)
0.351b
(0.043)
0.034
(0.350)
0.419
(0.062)
0.012
(0.459)
0.021
(0.053)
0.023
(0.175)
0.041
(0.346)
7.030
(0.897)
14.431a
(0.000)
0.729a
(0.000)
0.356
(0.087)
0.026
(0.595)
0.056
(0.362)
1.224b
(0.010)
1.730a
(0.003)
0.171
(0.306)
2.064a
(0.001)
0.061
(0.442)
0.106a(0.005)
ln2(Ypc)
lpcunidegree
lpcasia
lpcafr
lpcfemhead
lchildren
lelders
jud_inef
jud_eff
D
empl_RD
exp_RD
reg_exp
cut1
cut2
cut3
Number of observations
pseudo R2
Wald chi2
a
b
0.114
(0.115)
0.203
(0.320)
0.000
(0.897)
4,335,741.29
as income increases further, the demand for a cleaner environment reduces the level of pollution. This outcome might have very different origins. One possible interpretation (coherent with a post-materialist/
ecological modernization type of framework) would suggest that in the
richest Italian provinces industrial rms are more likely to invest in technology and innovation and to control air pollution. An alternative
78
27
Recall that we considered CO2 release of neighboring provinces; however, as a robustness check, we replicate the regression model considering neighboring emissions of local
pollutants (i.e. IWE) obtaining highly comparable results. Results are available from the
authors upon request.
28
As an additional robustness check we run a restricted version of our regression model
excluding spatial, technological and regulatory variables. We observe that results are very
similar to those reported in Table 4 but the pseudo R2 is lower, suggesting that these variables improve the t of the estimation model. Data are available from the authors upon
request.
6. Conclusions
This paper presents a reduced-form statistical analysis on the relationship between air pollution and economic, institutional, technological and socio-demographic characteristics across the Italian provinces.
Our approach uses the level of air pollution emissions (twelve types of
local pollutant substances from the industrial sector), released by industrial plants in 2005 as the measure of environmental quality, merged
with 2001 data on institutional, technological and socio-demographic
characteristics at provincial level. The main objective is to ascertain
whether income, ethnicity and gender composition of the population can help explain releases and whether environmental injustice
arguments can be identied in Italy. Even though our analysis does
not allow us to determine why the gender composition of the population and income interact to produce environmental inequities, it
does allow us to increase our understanding of environmental inequality in Italy.
The estimates obtained by the ordered probit models indicate that
an increase in income is expected to increase the probability of higher
levels of air pollution releases, that is releases increase with income.
Our estimates are also consistent with an inverse U-shaped environmental Kuznets curve: once income exceeds a turning point, air pollution decreases with increasing income.
Our search for environmental injustice nds evidence that releases
tend to be higher in provinces with high concentration of females as
households' head and with high concentration of children. Our ndings
do not allow identifying any environmental discrimination based on
ethnicity suggesting that environmental justice issues are not likely in
Italy to be perceived in racial and ethnic terms but in terms of social categories and gender households' composition.
We nd also that greater judicial inefciency (or lenient law
enforcement) is associated with higher levels of pollution. This result
suggests that a better implementation, all through the country, of the
local enforcement of environmental laws can play an important role
in creating the conditions for better relationships between rms and
judicial institutions improving, thus, the overall environmental
quality.
Finally, we nd evidence of a clustering effect at the provincial
level suggesting the existence of agglomerative forces producing a
concentration of dirty activities in specic geographical areas, as
well as a technological effect (when technology capability is proxied
by R&D employees) suggesting that those provinces with higher
number of R&D employees are more likely to reduce their polluting
emissions.
79
Table A1
Pollutant description and threshold limit values.
In the following table the types of pollutants and their respective US and Italian threshold limit values are reported.
Pollutants description and threshold limit values
Code
Pollutant
US TLVs 8 h mg/m3
001
002
005
008
M01
M03
M04
M06
M07
M08
P11
Local
SO2 sulphur dioxide
NOX nitrogen monoxide
CO carbon monoxide
NH3 ammonia
As arsenic
Cr chromium
Cu copper
Ni nickel
Pb lead
Se selenium
Benz benzene (NIOSH)
13
30
55
35
0,2
1
1
1
0.05
0.2
0.32
80 g/m3
40 g/m3
10 mg/m3
10 mg/Nm3
6 ng/m3
0.05 mg/m3
1 mg/m3
0.1 g/m3
0.5 g/m3
0.2 g/m3
5 g/m3
006
Global
CO2 carbon dioxide
9000
100,000 t/year
Notes: *substance measured in micrograms; **substance measured in milligrams; ***substance measured in megagrams; ****substance measured in nanograms. In the ordered probit
regression analysis, all the different measurement units were converted into megagrams.
Table A2
Variable description and data sources.
Variable
Description
Source
Data on air emissions in all the Italian provinces expressed as ratio of emissions to area
infrastructure
females
age15to34
age35to49
pcuniversitydegree
pcfemalehead
pcasia
pcafr
children
judicial efciency
Number of civil proceedings pending and concluded at courts located in a province divided by the
population
Trial length (expressed in years) divided by the population
judicial inefciency
employees in R&D
expenditure in R&D
regional environmental
expenditure
territorial dummies: northern
provinces, central provinces
Number of researchers, technicians and other personnel engaged in R&D in the public administration
sector, universities and public and private enterprises (by provinces, per 1000 inhabitants)
Provincial expenses for R&D of public and private enterprises to GDP
Regional expenditure for environmental protection to GDP
The geographical distinction in the three macro-areas has been done following the denition of ISTAT.
North-west and North-East regions comprehend: Liguria, Lombardia, Piemonte, Valle d'Aosta, Friuli
Venezia Giulia, Emilia R., Trentino, Veneto.
Central regions: Toscana, Marche, Umbria, Lazio.
Southern regions: Abruzzo, Basilicata, Calabria, Campania, Molise, Puglia, Sardegna, Sicilia
80
Table A3
Correlation matrices.
IWE
pcincome
pcunidegree
pcasia
pcafr
elders
children
pcfemhead
judicial_ineff
judicial_eff
D
emp_RD
exp_RD
reg_exp
CO2
pcincome
pcunidegree
pcasia
pcafr
elders
children
pcfemhead
judicial_ineff
judicial_eff
D
emp_RD
exp_RD
reg_exp
IWE
pcincome
pcunidegree
pcasia
pcafr
elders
children
pcfemhead
judicial_ineff
judicial_eff
emp_RD
exp_RD
reg_exp
1
0.116
0.209
0.084
0.050
0.038
0.133
0.029
0.207
0.030
0.070
0.057
0.031
0.048
1
0.127
0.461
0.527
0.251
0.600
0.626
0.355
0.045
0.008
0.071
0.040
0.060
1
0.073
0.374
0.294
0.139
0.091
0.069
0.031
0.079
0.053
0.028
0.033
1
0.536
0.188
0.097
0.095
0.339
0.192
0.098
0.134
0.169
0.116
1
0.107
0.069
0.150
0.370
0.070
0.013
0.154
0.156
0.025
1
0.875
0.227
0.106
0.021
0.009
0.114
0.115
0.023
1
0.150
0.096
0.001
0.056
0.140
0.151
0.062
1
0.023
0.026
0.078
0.145
0.072
0.027
1
0.012
0.075
0.027
0.042
0.035
1
0.325
0.286
0.169
0.020
1
0.1651
0.116
0.197
1
0.919
0.361
1
0.389
CO2
pcincome
pcunidegree
pcasia
pcafr
elders
children
pcfemhead
judicial_ineff
judicial_eff
emp_RD
exp_RD
reg_exp
1
0.171
0.317
0.190
0.006
0.122
0.058
0.062
0.247
0.043
0.086
0.113
0.057
0.095
1
0.127
0.461
0.527
0.251
0.600
0.626
0.355
0.045
0.008
0.071
0.040
0.060
0.073
0.374
0.294
0.139
0.091
0.069
0.031
0.079
0.053
0.028
0.03
1
0.536
0.188
0.097
0.095
0.339
0.192
0.098
0.134
0.169
0.116
1
0.107
0.069
0.150
0.370
0.070
0.013
0.154
0.156
0.025
1
0.875
0.227
0.106
0.021
0.009
0.114
0.115
0.023
1
0.150
0.096
0.001
0.056
0.140
0.151
0.062
1
0.023
0.026
0.078
0.145
0.072
0.027
1
0.012
0.075
0.027
0.042
0.035
1
0.325
0.286
0.169
0.020
1
0.165
0.116
0.197
1
0.919
0.361
1
0.389
Table A4
Linear regressions OLS estimation and 2SLS estimation.
^
ln Ypc
ln
^
Ypc
lpcunidegree
lpcasia
lpcafr
lpcfemhead
lchildren
lelders
jud_inef
lpcproceedings
lsigma_co2
addetti_rs
capacit_innov
environ_expenses
constant
Number of observations
R2
a
b
Dependent variable:
IWE_area
Dependent variable:
IWE_area
Dependent variable:
CO2_area
Dependent variable:
IWE_area
OLS coefcients
2SLS coefcients
OLS coefcients
2SLS coefcients
68.566
(0.383)
3.499
(0.396)
1.265
(0.077)
0.085
(0.567)
0.012
(0.965)
3.509b
(0.001)
5.362b
(0.000)
0.811
(0.089)
8.486b
(0.000)
0.305
(0.314)
0.294b
(0.000)
0.513a
(0.011)
0.856
(0.088)
0.000
(0.776)
362.721
(0.330)
103
0.41
39.913
(0.242)
2.030
(0.261)
0.869
(0.141)
0.084
(0.524)
0.134
(0.563)
3.463b
(0.008)
4.701b
(0.001)
0.556
(0.211)
6.861a
(0.021)
0.261
(0.444)
0.286
(0.072)
0.383
(0.150)
0.626
(0.354)
0.000
(0.950)
220.457
(0.176)
103
0.33
133.655
(0.154)
6.943
(0.157)
0.491
(0.434)
0.129
(0.364)
0.099
(0.706)
3.517b
(0.001)
5.097b
(0.001)
0.623
(0.146)
7.247a
(0.013)
0.282
(0.378)
0.265a
(0.047)
0.479
(0.085)
1.007
(0.175)
0.000
(0.718)
667.354
(0.138)
103
0.30
74.503
(0.032)
3.887a
(0.033)
1.042
(0.087)
0.023
(0.878)
0.106
(0.673)
3.865b
(0.003)
4.679b
(0.000)
0.925
(0.084)
7.709b
(0.002)
0.318
(0.366)
0.293b
(0.005)
0.490a
(0.020)
0.823
(0.126)
0.000
(0.744)
382.469a
(0.021)
103
0.42
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