Essays on Regulations and Institutions for Environmental and Climate Change policymaking

Abstract

This thesis is centred on the regulations and the institutions for policy making for the environ ment, in light of the urgent challenges of climate change and biodiversity loss. It emphasizes their interconnectedness, specifically within developing settings. Despite growing awareness, strate gies and policies often treat these issues separately, overlooking important complementarities or trade-offs. This oversight is especially notable when considering the existing heterogeneity of impacts caused by these crises and institutional settings in developing nations. This thesis employs the lens of economics, framing these challenges as the regulation of externalities and as the longstanding issue of sustainable commons management which spans across topics of water and air quality, ecosystems destruction, pollution, species extinction, and climate stability. The magnitude of these challenges is staggering, with current extinction rates reaching 100-1,000 times the average over millions of years, alongside issues such as deforestation and marine re source depletion and growing carbon emissions. Developing countries, hosting the majority of the world’s population, greenhouse gas emissions, and remaining reservoirs of untouched nature, face unique impacts and policy contexts of global importance.The four chapters of this thesis focus on policy scenarios in developing settings to regulate environmental externalities or respond to environmental shocks. Chapter 2 assesses a policy in Ecuador to stop tropical mangrove deforestation, emphasizing the complementarity between environmental and developmental goals. Chapter 3 explores the environmental-development trade-offs between ecotourism development and marine conservation in the Galapagos Islands. Chapters 4 and 5 shift focus to individual responses in developing settings. Chapter 4 exam ines charitable behavior for biodiversity conservation, utilizing a natural field experiment in the Galapagos. Chapter 5 investigates risk preferences and individual responses to an environmental disaster, the 2023 earthquake in eastern Turkey. Institutional nuances play a crucial role in environmental and climate change policy-making in developing settings. The thesis explicitly accounts for the role of institutions, acknowledging the challenges posed by weak or extractive institutions in these contexts. Chapters 2 and 3 consider communal property rights and decentralized governance in the context of mangrove conservation and fisheries management. Chapter 4 partners with an NGO in the Galapagos, highlighting the role of non-profits in supplementing government efforts. Chapter 5 explores local institutional capacity in response to an environmental disaster. Methodologically, the thesis builds on three decades of research, employing theory, experimental design, and causal statistical methods to propose mechanisms behind empirical results. Heterogeneous effects are analyzed across different subgroups, providing a nuanced understanding of the outcomes. The thesis contributes to bridging the gap between observed empirical effects and potential theoretical mechanisms, attempting to address the complex dynamics of environmental and developmental policy interventions in developing settings.