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Municipal Responses to Ecological Fiscal Transfers in Brazil : A microeconometric panel data approach

Droste, Nils LU orcid ; Lima, Guilherme Rodrigues ; May, Peter Herman and Ring, Irene (2017) In Environmental Policy and Governance 27(4). p.378-393
Abstract
Ecological fiscal transfers in Brazil, the so‐called ICMS‐Ecológico or ICMS‐E, redistribute part of the state‐level value‐added tax revenues on the basis of ecological indicators to local governments. We analyze whether the introduction of this economic instrument in a state offers incentives to municipal responses in terms of further protected area (PA) designation. We provide a microeconomic model for the functioning of ICMS‐E and test the derived hypothesis empirically. Employing an econometric analysis on panel data for two decades we estimate the correlation of the introduction of ICMS‐E in Brazilian states with PA coverage. We find that the introduction of ICMS‐E correlates with a higher average PA share. While the introduction of... (More)
Ecological fiscal transfers in Brazil, the so‐called ICMS‐Ecológico or ICMS‐E, redistribute part of the state‐level value‐added tax revenues on the basis of ecological indicators to local governments. We analyze whether the introduction of this economic instrument in a state offers incentives to municipal responses in terms of further protected area (PA) designation. We provide a microeconomic model for the functioning of ICMS‐E and test the derived hypothesis empirically. Employing an econometric analysis on panel data for two decades we estimate the correlation of the introduction of ICMS‐E in Brazilian states with PA coverage. We find that the introduction of ICMS‐E correlates with a higher average PA share. While the introduction of ICMS‐E schemes may be a compensation for a high share of federal and state PA, we also find an incentive effect for municipalities to designate additional PA. (Less)
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author
; ; and
publishing date
type
Contribution to journal
publication status
published
in
Environmental Policy and Governance
volume
27
issue
4
pages
378 - 393
publisher
Wiley-Blackwell
external identifiers
  • scopus:85019742051
ISSN
1756-932X
DOI
10.1002/eet.1760
language
English
LU publication?
no
id
841a4375-3585-4af6-b94c-8631e638059a
date added to LUP
2019-05-20 11:39:42
date last changed
2022-04-26 00:05:21
@article{841a4375-3585-4af6-b94c-8631e638059a,
  abstract     = {{Ecological fiscal transfers in Brazil, the so‐called ICMS‐Ecológico or ICMS‐E, redistribute part of the state‐level value‐added tax revenues on the basis of ecological indicators to local governments. We analyze whether the introduction of this economic instrument in a state offers incentives to municipal responses in terms of further protected area (PA) designation. We provide a microeconomic model for the functioning of ICMS‐E and test the derived hypothesis empirically. Employing an econometric analysis on panel data for two decades we estimate the correlation of the introduction of ICMS‐E in Brazilian states with PA coverage. We find that the introduction of ICMS‐E correlates with a higher average PA share. While the introduction of ICMS‐E schemes may be a compensation for a high share of federal and state PA, we also find an incentive effect for municipalities to designate additional PA.}},
  author       = {{Droste, Nils and Lima, Guilherme Rodrigues and May, Peter Herman and Ring, Irene}},
  issn         = {{1756-932X}},
  language     = {{eng}},
  month        = {{07}},
  number       = {{4}},
  pages        = {{378--393}},
  publisher    = {{Wiley-Blackwell}},
  series       = {{Environmental Policy and Governance}},
  title        = {{Municipal Responses to Ecological Fiscal Transfers in Brazil : A microeconometric panel data approach}},
  url          = {{http://dx.doi.org/10.1002/eet.1760}},
  doi          = {{10.1002/eet.1760}},
  volume       = {{27}},
  year         = {{2017}},
}