Environmental Policy Performance Revisited: Designing Effective Policies for Green Markets

Date01 June 2012
AuthorCarsten Daugbjerg,Kim Mannemar Sønderskov
Publication Date01 June 2012
Environmental Policy Performance Revisited:
Designing Effective Policies for Green Marketspost_910399..418
Carsten Daugbjerg Kim Mannemar Sønderskov
University of Copenhagen Aarhus University
Studies of environmental policy performance tend to concentrate on the impact of particular policy institutions or
of single policy instruments. However, environmental policies most often consist of a package of policy instruments.
Further, these studies pay no or very little attention to policy instruments directed at the demand side of the
market. Therefore this article develops a policy typology for government intervention aimed at creating green
markets. The typology distinguishes between four types of policy based on the balance between the supply-side
and demand-side policy instruments. On the basis of the typology, a hypothesis on their ability to expand green
markets is generated and tested in a comparative analysis of the performance of organic food policies in Denmark,
Sweden, the UK and the US, focusing on their impact on organic consumption. Our analysis demonstrates that
cross-country variation in organic food consumption is explained by differences in the packages of policy instru-
ments applied, controlling for numerous systemic and individual-level alternative explanations. The analysis suggests
that for environmental and political reasons, governments should apply more demand-side instruments when
introducing environmental policies.
Keywords: policy instruments; policy typology; environmental policy; policy perfor-
mance; organic farming
What the cynics fail to understand is that the ground has shifted beneath them – that the stale
political arguments that have consumed us for so long no longer apply. The question we ask
today is not whether our government is too big or too small, but whether it works.
This statement in President Obama’s inaugural speech on 20 January 2009 was an encour-
agement for policy analysts throughout the world and signalled an end to policy making
based on the dogma‘government is not the solution ... government is the problem’ as stated
by President Reagan in his inaugural speech in 1981.But how do we know what works and
what does not? Although this question mayseem tr ivial,making public policies deliver what
they promise is a formidable task (Howlett,2009; Pressman andWildavsky, 1983),and policy
failure is just as likely as policy success (Vogel, 2003).
What works and what does not is a key concern in environmental policy and there
is now a substantial literature on environmental policy performance analysing the impacts
of environmental policies. This literature has demonstrated useful methods to establish
whether or not – or rather to what extent – environmental policies work. However, the
literature still suffers from various shortcomings. Some studies focus on institutions as the
key factor influencing environmental performance. For instance, Lyle Scruggs (2003),
Markus Crepaz (1995) and Detlef Jahn (1998) analyse the impact of corporatism on
environmental performance, and they find a positive correlation between corporatism
and environmental performance. Using not dissimilar concepts, Martin Jänicke (1992)
also applies an institutional approach to environmental policy performance. However, in
doi: 10.1111/j.1467-9248.2011.00910.x
POLITICAL STUDIES: 2012 VOL 60, 399–418
© 2011The Author.Political Studies © 2011 Political Studies Association
these studies it remains unspecified how a high degree of corporatism produces particular
policy choices which in turn lead to better environmental performance.
Other studies deal with the effectiveness of various environmental policy instruments
and therefore address policy content which is insufficiently dealt with in the institutional
approach. As it was realised in the late 1980s and 1990s that command-and-control policies
did not meet expectations in terms of their ability to bring about environmental improve-
ment, governments experimented with new market-based environmental policy instru-
ments. The instrument-focused research strategy assesses the effectiveness of these
instruments, often focusing on a single policy instrument. For instance Mikael Skou
Andersen (1994) concentrates on the environmental performance of environmental
charges, Martin Enevoldsen (2005) focuses on the performance of voluntary environmental
agreements compared with that of emission charges, and GertTinggaard Svendsen (1998)
analyses the cost-effectiveness of tradeable pollution permits compared with emission
charges. However,this focus on single instruments pays insufficient attention to the fact that
most public policies are composed of a combination of several policy instruments, and
consequently performance most often results from a package of instruments rather than a
single instr ument (Howlett, 2005, p. 42; Lascoumes and Le Gales, 2007, p. 5; Vedung, 1998,
p. 39).Further,perhaps reflecting the fact that most environmental regulation of industries
addresses the supply side of the market, these studies pay no or very little attention to the
demand side.
The reasoning behind the market-based supply-side policy instruments is to increase
environmentally sustainable production by creating economic incentives for producers to
shift to cleaner production technologies. It is assumed that industries’ cost of implementing
the instruments can be retrieved through efficiency gains and/or through growing demand
for green produce in the market. Although increasing demand is seen as an important
driving force in bringing about environmentally sustainable markets (Carter, 2007,p. 232),
the policy effort tends to be directed at the supply side. Therefore this article directs
analytical attention to instruments aimed at generating increasing demand and analyses how
they are, and can be, combined with supply-side instruments.
Recent research on policy instruments has emphasised the need to ‘understand the
complexity of multiple instrument mixes’(Howlett, 2005,p. 49). Thus,rather than focusing
on specific instruments, analysts should focus on the performance of combinations of policy
instruments directed at both the supply side and the demand side of the market. In this
article we develop a policy typology that is able to describe the various combinations of
instruments used in environmental policy. Efforts to develop policy typologies have been
limited, in particular in relation to the development of generic policy typologies. Theodore
Lowi’s (1972) typology of public policies remains the key reference more than four decades
after it was published. This indicates that there has been very little progress, especially
considering that Lowi’s typology has been strongly critiqued for not clearly defining the
categories and for outlining policy types that are not mutually exclusive (Wilson, 1973).
The lack of progress in efforts to develop generic policy typologies is striking and may
indicate that there is too much variation across policy fields to allow scholars to develop
all-encompassing policy typologies that, at the same time, are meaningful and parsimonious.
The development of policy typologies for specific policy fields is a more promising research
© 2011The Author.Political Studies © 2011 Political Studies Association

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