Spatial Autocorrelation of CO2 Pollution through the Spatial Spillover of Goods Governance in Middle Eastern and North African Countries

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Abstract

Spatial environmental autocorrelation is a known phenomenon in the environmental studies explaining spatial relationship of environmental characteristics of different geographical units. Different mechanisms have been proposed to clarify how the environments of especially neighboring countries response to changes of each other. This paper attempts to propose a new mechanism, namely spatial institutional spillover effect. In this mechanism, institutional quality of a country not only affects its own environment, but also affects the institutions of neighboring countries and then, their environments. Therefore, the institutional spillover effect is the mechanism that links the environmental features of neighboring countries. The paper tests the spatial autocorrelation of CO2 pollution in Middle Eastern and North African (MENA) countries over the period 1990-2007. The results show that improving and deepening of good governance in MENA countries could reduce the CO2 pollution in their own countries and in their neighboring countries. In this paper, another mechanism to explain the environmental autocorrelation of countries was examined through the spatial institutional spillover effect.

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