Beyond aggregates: Environmental policy intensity impacts across ecosystem components

The proliferation of studies on the impact of environmental regulations on environmental sustainability does not preclude the existence of yet notable gaps that still limit effective policy making. One of such limitations is the massive disregard for how not just environmental policies, but their stringency, affect different components of the ecosystem other than the atmosphere. This study provides comprehensive analysis, unraveling how a robust measure of environmental policy stringency that combines both command-and-control and market-based instruments, affects different components of ecological footprints using both linear and threshold methodologies. We find that stringent environmental policies are only effective in reducing ecological footprints in the long run, except for built-up land and fishing grounds. Our threshold analysis confirms significant threshold effects in all the footprints except grazing land. Only built-up land and carbon footprints are significantly affected when environmental policies are less stringent. But more stringent environmental policies reduce all the components of ecological footprints (except cropland), with carbon footprint being the most affected. Policy makers must understand the differential impacts of environmental policies on the different components of the ecosystem, and how enforcing the policies must be to produce the desired results.