A Spatial Dynamic Model for Export Intensity of Hazardous Industrial Waste: The Incentive Effect of Regional Environmental Policies

Abstract

AbstractThis paper analyses, in the context of the Environmental Kuznet Curve, the determinants of export intensity of hazardous industrial waste among Spanish regions, with particular attention to the influence of waste taxes and of environmental policies. This study is carried out for the first time in the literature with a spatial dynamic model, fixed effects and panel data for the 17 regions (Comunidades Autónomas) of Spain during the period 2007–2017. The results suggest there is a spatial-dynamic component to export intensity, and that both regional taxes on waste disposal and environmental policy stringency appear to encourage, albeit modestly, the rate of exported waste to other regions. The model also shows that the more regions recycle, and the greater the economies of scale arising from industrial agglomeration, the lower is the region’s waste export intensity, although increasing restrictions on the international trade in hazardous waste have intensified trading inside the country. Finally, the results suggest a non-linear relationship between growth and export intensity, although apparently we are still far from the absolute decoupling of the Environmental Kuznet Curve.