Corruption and environmental policy.

Abstract

The aim of the study is to identify the economic, socio-economic and political parameters that affect environmental indices. Using the fixed and the random effects panel data techniques; we examine which parameters affect environmental policy performance, energy generated from renewable resources and greenhouse gas emissions. The panel encompasses annual data from 24 out of 27 European Union countries, for the period 2000-2007. We find that corruption and shadow economy have negative effect on the environmental indices, while they reinforce each other. However, income has positive effect on indices except from emissions.