Abstract
The transition process in Central and Eastern Europe was associated with growing environmental awareness. This paper analyses the determinants of pollution abatement and control expenditure at plant level in the case of Romania using survey data and a multilevel regression model. Our findings suggest that, although Romania has improved its environmental performance, formal and informal regulations are still only partially developed owing to the difficulties of economic transition, and heterogeneity across regions remains considerable.
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Notes
The cost of pollution concerns all environmental damages (for example those related to health costs) while the benefit of pollution consists of reduced production costs and then cheaper goods.
In 1995 the adoption of the framework for environmental law (137/1995) introduced important principles for legislation and environmental policy, such as “the polluter pays” principle. It is based on the principle of sustainable development and regulates economic and social activities with impact on the environment; the regime for chemicals and hazardous waste and other wastes, for chemical fertilizers and pesticides; the protection against ionizing radiation and safety of radiation sources; the protection of natural resources and biodiversity conservation, etc.
For more details concerning MRM, see Greene (2002).
The eight regions (Nord-Vest, Centru, Nord-Est, Sud-Est, Sud ,Bucuresti-Ilfov, Sud-Vest, Vest) correspond to the development regions created in Romania in 1998 in order to co-ordinate better regional development in the run-up to EU accession. They correspond to NUTS II-level divisions in EU member states and do not have an administrative status and a legislative or executive council or government, but play a role for allocating EU funds for regional development, as well as for collection of regional statistics. Each region contains about 6 counties.
The literature defines as pollution-intensive (dirty) sectors those which rank high on actual emissions intensity (emissions per unit of output) or have incurred high levels of abatement expenditure per unit of output. According to Low classification (1992), the following industries are considered as ‘dirty’: Pulp and Waste Paper; Petroleum Products; Residual Petroleum Products; Organic Chemicals; Inorganic Chemicals; Fertilizers; Chemical Material; Veneers, Plywood; Wood Manufactures; Paper, Paperboard; Lime, Cement, Construction Materials; Iron and Steel; Non-Ferrous Metals; and Metals Manufactures.
Some examples of legal bindings: Ministerial Order No. 462/1993 on technical requirements for air protection and limits on polluting emissions from stationary sources; Government Decision No. 457/1998 on the Pb content of fuels; Standards for the sulphur content of liquid fuels; Government Decision No. 172/1997 approving the national register of chemicals and potentially dangerous substances and its regulation; norm NTPA-001 on the limit values of polluting substances discharged into receiving waters, and norm NTPA-002 on the limit values of polluting substances discharged into sewerage systems, Ministerial Order No. 654/1997.
Emission standards are not taken into account in analysis, all major emission standards not changing significantly over the investigated period. Concerning the water quality standards, these are defined for each pollutant and fix a maximum concentration in the receiving water body according to its quality class. Their differentiation across river will be subject for another research according to the data availability.
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We are very grateful to two anonymous referees for their useful comments and suggestions. The usual disclaimer applies.
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Sova, R., Rault, C., Caporale, G.M. et al. Improving Environmental Performance: A Challenge for Romania. Environ Resource Econ 57, 431–452 (2014). https://doi.org/10.1007/s10640-013-9687-2
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DOI: https://doi.org/10.1007/s10640-013-9687-2