The Impact of International Organizations on the Environment: An Empirical Analysis

Swiss Institute for Business Cycle Research (KOF) Working Paper No. 131

36 Pages Posted: 30 Mar 2006

See all articles by Axel Dreher

Axel Dreher

Heidelberg University

Magdalena Ramada-Sarasola

Towers Watson; Innovation & Research Multiplier; ORT University - Uruguay

Date Written: February 2006

Abstract

When analyzing the impact of international organizations on the environment, two main issues arise. First, we have to quantify the participation of the organizations on countries they deal with.

Second, the environmental impact of this involvement has to be measured. This paper attempts to do this. We employ panel data to empirically analyze whether and to what extent the presence of IMF, World Bank, regional Multilateral Development Banks, WTO and Global Environmental Facilities has an impact on environmental governance and outcomes. Our results for a large number of countries and years show that the international organizations affect the environment directly via their impact on CO2 emissions. Projects financed by World Bank, ADB, UNDP, and membership in the WTO increase emissions, while IADB projects reduce emissions. EBRD and UNEP do not significantly affect CO2 emissions, while the AfDB increases emissions after 1985 only. Taking the indirect impact through trade liberalization into account, however, the WTO reduces emissions, while the IADB increases emissions. There is some evidence that the international organizations investigated here also influence SO2 emissions, water pollution, and round wood production; environmental governance is not affected.

Keywords: International Organizations, Environment, Governance, IMF, World Bank

JEL Classification: Q53, Q56, F34, F35

Suggested Citation

Dreher, Axel and Ramada-Sarasola, Magdalena, The Impact of International Organizations on the Environment: An Empirical Analysis (February 2006). Swiss Institute for Business Cycle Research (KOF) Working Paper No. 131. Available at SSRN: https://ssrn.com/abstract=892566 or http://dx.doi.org/10.2139/ssrn.892566

Axel Dreher (Contact Author)

Heidelberg University ( email )

Grabengasse 1
Heidelberg, 69117
Germany

HOME PAGE: http://www.axel-dreher.de

Magdalena Ramada-Sarasola

Towers Watson ( email )

255 Alhambra Circle
Suite 950
Miami, FL 33134
United States
3053428447 (Phone)

Innovation & Research Multiplier ( email )

Luis A. de Herrera 1248 - Of. 369
World Trade Center - III
Montevideo, 11300
Uruguay

ORT University - Uruguay ( email )

Bulevar Espana 2633
Montevideo, 11300
Uruguay

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