Who Can Govern Carbon? State Capacity, Resource Dependence, and the Limits of Market Solutions

• In Event: 50620 - Section on Environmental Sociology Roundtables
  In Refereed Roundtable (60 minute): Table 15: Governing Energy and Carbon Emissions

Abstract

Carbon pricing is a widely endorsed policy tool for reducing carbon emissions, yet its effectiveness varies significantly across countries. This study examines how institutional quality and economic structure moderate the impact of carbon pricing on emissions intensity. Using a panel dataset of 49 countries from 1996-2021, I employ fixed effects regression models to analyze the relationship between carbon price levels, governance quality, and resource dependence. Contrary to expectations, stronger governance does not consistently enhance carbon pricing effectiveness, while resource-dependent economies exhibit greater emissions reductions under carbon pricing policies. These findings challenge conventional wisdom on environmental governance, suggesting that institutional and economic conditions shape market-based climate policy outcomes in unexpected ways. The study contributes to sociological debates on environmental state capacity and the embeddedness of markets by demonstrating that the success of carbon pricing is contingent on broader structural factors. Future analyses will incorporate instrumental variable approaches and sectoral disaggregation of resource rents to further refine these findings. These results have important implications for policymakers seeking to design more effective carbon pricing mechanisms that account for institutional and economic constraints.

Author

• Jacob Conley, University of North Carolina-Chapel Hill