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How do Domestic Attributes Affect International Spillovers of CO2-Efficiency?

40 Pages Posted: 19 Jul 2010 Last revised: 17 Feb 2014

Eric Neumayer

London School of Economics and Political Science (LSE)

Richard Perkins

London School of Economics & Political Science (LSE)

Date Written: 2010

Abstract

Although there is evidence that CO2-efficiency enhancing innovations in one country diffuse into other countries to contribute to the goals of climate change mitigation, very little is known about the conditions under which such international spillovers are most likely to take place. Our contribution in the present article seeks to address this gap by examining whether the strength of cross-border CO2-efficiency interdependence working through import ties and inward foreign direct investment (FDI) stocks is greater in (a) countries with lower existing levels of domestic CO2-efficiency and (b) countries with greater social capabilities in terms of a better educated workforce and a less risky institutional environment for investment. We find that less CO2-efficient countries and countries with a more investment-friendly institutional environment experience stronger FDI-weighted CO2-efficiency spillovers, whereas a higher level of human capital increases domestic receptivity to import-weighted international spillovers.

Keywords: spillover, efficiency, imports, foreign direct investment, education, institutions

Suggested Citation

Neumayer, Eric and Perkins, Richard, How do Domestic Attributes Affect International Spillovers of CO2-Efficiency? (2010). APSA 2010 Annual Meeting Paper. Available at SSRN: https://ssrn.com/abstract=1642144

Eric Neumayer (Contact Author)

London School of Economics and Political Science (LSE) ( email )

Houghton Street
WC2A 2AE London
United Kingdom
+44 207 955 7598 (Phone)
+44 207 955 7412 (Fax)

HOME PAGE: http://personal.lse.ac.uk/neumayer

Richard Perkins

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

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