Green industrial policy builds support for carbon regulation

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When can complex multi-round environmental policymaking like that seen in climate be successful? An emerging branch of literature examines how sequencing matters to success and under what circumstances path dependent dynamics can lead to increasingly stringent climate and environmental policy. Here, I propose an industry typology that divides industry into four categories based on their relationship and likely response to early regulatory policy moves. I use a series of case studies that compare the application of this typology across issue areas internationally, looking comparatively at ozone and climate change policymaking; and subnationally across U.S. states in the climate change issue area. Using these case studies, I show how this model for understanding different mixes of industry type can help us understand and predict the likelihood of policy-industry feedback that leads to increasing environmental and renewable energy policy success over time, both at the international level and comparatively across national and sub-national jurisdictions.

Scholarship examining the highly successful ozone negotiations is rare today, as lessons derived from them do not seem to have produced comparable success in climate negotiations. This article argues that there is a “missing piece” critical to understanding ozone negotiation success. I draw on path dependency and feedback literature as well as detailed historical research into the ozone negotiation process to propose a coherent feedback mechanism I refer to as the “green spiral.” In a green spiral, an iterative interaction between negotiation outcomes and changes to the sticky, internal material interests of industry works to make more stringent regulation feasible in subsequent negotiating rounds. Such dynamics offer a consistent explanation for the overall success of the ozone negotiations as well as the timing and nature of individual countries’ shifts in negotiating position and regulatory behavior over time. Understanding environmental negotiation through this lens offers insight into how outcomes of climate and other environmental negotiations might be improved.

Countries with open capital markets tend to have fewer militarized disputes and wars. Gartzke, Li & Boehmer propose that this association arises from the enhanced ability of states with open capital markets to credibly signal resolve through the bearing of economic costs ex ante to militarized escalation. We test this causal mechanism by qualitatively examining six crucial cases in which the mechanism is most likely to be operative and observable. We employ a formal case selection strategy designed to yield cases with high inferential leverage for our confirmatory test and to select cases for an exploratory analysis of scope conditions. Through analysis of media reports, government documents, and other sources, we evaluate the extent to which relevant individuals drew the appropriate inferences about market-mediated costs and resolve. We conclude that while market-mediated signaling may operate in major conflicts, it is unlikely to account for much of the association between capital openness and peace. Exploratory analysis of our cases identifies potential scope conditions, clarifies the role of different signaling mechanisms, and suggests other explanations for the peaceful behavior of countries with open capital markets.

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