Department of Economics and Business Economics

Do Liberalising Reforms Harm the Environment? Evidence from the Post-Communist Transition

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Whether or not economic freedom and capitalism are associated with better or worse environmental performance gives rise to a heated political debate. This article sheds empirical light on the debate by examining the association between economic and political freedom on the one hand and environmental performance on the other. Estimating the effects of economic freedom and democracy on four environmental measures since 1993 across 27 formerly communist countries shows that liberalising the size of the public sector is associated with less environmental damage, although only in autocracies. The consequences of regulatory activity, market openness and the rule of law are more mixed.

Original languageEnglish
JournalEconomic Affairs
Pages (from-to)22-37
Number of pages16
Publication statusPublished - 2018

    Research areas

  • DEMOCRACY, ECONOMIC-FREEDOM, INSTITUTIONS, KUZNETS CURVE, POLICY, RATES, economic freedom, environmental performance, liberalisation

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