Corruption Effect on Persian Gulf Countries Environmental Policy

Environmental regulation has proceeded at different paces in different countries of the world. These differences are particularly pronounced between developing countries, and have given rise to much controversy and debate on the influence of corruption on environmental policies in an open economy (see, e.g., López and Mitra 2000; Fredriksson et al. 2004; Barbier et al. 2005).1 The causes and effects of corruption have been discussed extensively in the literature (see, e.g., the surveys by Bardhan 1997; Jain 2001; Aidt 2003). We explore the joint effects of corruption level and energy efficiency (a major form of environmental policy). The paper discusses the prescription of Persian Gulf countries’ environmental regulations over 1990-2012. We find that corruption level is the most important factor in explaining the variance in the region environmental policies and higher levels of the region corruption will lead to low stringent environmental policy.