Governance, Vulnerability to Climate Change, and Green Growth: International Evidence

Abstract

We examine the role of governance and vulnerability to climate change in green growth using a global panel data set of 122 countries in 2000‒2012. We find that, as expected, governance has a positive effect on environmental performance and vulnerability to climate change has a negative effect. This suggests that promoting good governance and reducing climate change vulnerability can contribute to a cleaner environment. We find qualitatively similar results for the subsample of high-income countries, but governance does not have a significant effect for the subsamples of upper-middle-income, lower-middle-income, and low-income countries. One possible interpretation is that high-income countries have environmental policies which are strong enough to protect the environment, whereas other countries have relatively weak environmental policies which need to be strengthened.