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Clean or dirty energy

Evidence of corruption in the renewable energy sector

Bibliographic Data

ID10928880
AuthorsCaterina Gennaioli (0000-0002-4058-4675, London School of Economics and Political Science, corresponding author), Massimo Tavoni (0000-0001-5069-4707, Fondazione Eni Enrico Mattei)
Year2016
Volume166
Issue3-4
Pages261-290
Publication date2016-03-01
Open AccessYes
TypeARTICLE
VenuePublic Choice (JOURNAL)
Journal identifiersISSN: 0048-5829 • E-ISSN: 1573-7101
PublisherSpringer Science and Business Media LLC (PUBLISHER)
DOI10.1007/s11127-016-0322-y
OpenAlexW2298690289
LanguageEN
Citations received17
References cited23

This paper studies the link between public policy and corruption for the case of wind energy. We show that publicly subsidized renewable energy can attract criminal appetites and favor the formation of criminal associations between entrepreneurs and politicians able to influence the licensing process. The insights of a simple model of political influence by interest groups are tested empirically using Italian data for the years 1990–2007. Using a difference in difference approach we quantify the impact of a Green Certificate policy aimed at supporting renewables, and find robust evidence that criminal association activity increased more in windy provinces after the introduction of the generous policy regime. The magnitude of the effect is large: the construction of an average wind park is associated with an increase in criminal activity of 6 % in the treatment compared to the control group. Our findings show that in the presence of poor institutions, even well designed market-based policies can have an adverse impact. The analysis is relevant for countries that are generally characterized by heavy bureaucracies, weak institutions and by large renewable potential

Bureaucracy · Business · Difference in differences · Econometrics · Economics · Energy policy · Energy subsidies · Language change · Macroeconomics · Market economy · Political science · Politics · Public economics · Public finance · Renewable energy · Subsidy · Corruption and Economic Development · Law · Media Influence and Politics · Political Influence and Corporate Strategies

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Citations per year2.13
Citation span2018 - 2026 (9)
Highly citedNo

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