Analysis of Public Subsidies to the Solar Energy Sector: Corruption and the Role of Institutions

Arbeitspapier

This study investigates the connection between rent-seeking behaviour, corruption activity and quality of institutions to empirically evaluate the unexpected implications of an energy policy for criminal activity. The object of this research is a program of public subsidies introduced in Italy in 2005, which successfully boosted the solar energy sector but seems to have generated a growth of corruption activity, arisen from the opportunity of rent extraction. In particular, according to the main hypothesis of this research, bribery is expected to rise significantly where big photovoltaic plants are concentrated and administrative procedures are more complicated. To determine the causal effect of the subsidies on corruption, the study employs a Difference-in-Difference methodology on a sample of 76 Italian provinces and exploits solar radiation as exogenous variable to discriminate the profitability of investments and bribing. Results confirm that, in poor-institutions areas, the growth of the solar sector in sunniest provinces has gone hand in hand with increasing corruption. Results suggest that policy makers should pay additional attention to the potential distortions of public policies implying large rent opportunities, in areas where the weakness of institutional settings and the bureaucratic complexities encourage illegal behaviour.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Nota di Lavoro ; No. 33.2017

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products ; Bureaucracy; Administrative Processes in Public Organizations; Corruption ; Other Economic Systems: Performance and Prospects ; Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
• Thema: Renewable Energy ; Corruption ; Public Subsidies ; Legal Institutions

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Moliterni, Fabio
• Ereignis: Veröffentlichung
• (wer): Fondazione Eni Enrico Mattei (FEEM)
• (wo): Milano
• (wann): 2017

Weitere Informationen

• Handle: http://hdl.handle.net/10419/177227
• Letzte Aktualisierung: 10.03.2025, 11:45 MEZ