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RESEARCH PRODUCT

On the dynamics of eco-efficiency performance in the European Union

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This paper evaluates the evolution of environmental performance in the context of the European Union (EU), over the period 1993–2010. The context is particularly relevant, due to the traditionally high concerns of the EU about these issues, which has triggered off several initiatives and regulations on environmental protection. In this setting, we conduct a two-stage analysis which develops environmental performance indicators in the first stage for each pair country-year, and evaluates its evolution in the second. More specifically, in the first stage we estimate specific efficiencies for three air-pollutants (CO2e, SO2, NOx), along with an eco-efficiency indicator, for which we use the slack-free directional distance functions in the Data Envelopment Analysis framework (as opposed to the more extended intensity ratios), whereas in the second stage we propose to using a model of explicit distribution dynamics which takes into account how the entire distributions of these indicators evolve. Our results indicate that the dynamics underlying the evolution of the indicators analyzed are indeed remarkable. Although the eco-efficiency indicator has improved over the last two decades, it has been during the last decade when performance has shown a more convergent path. However, in the case of the more traditional indicators (CO2e, SO2, NOx) the abatement opportunities are still remarkable, especially in the case of SO2. All authors are grateful to two referees for helpful comments that have improved the overall quality of the article. David Conesa would like to thank the financial support of the Ministerio de Educación y Ciencia and the European Regional Development Fund (grants MTM2010-19528 and MTM2013-42323-P), and Emili Tortosa-Ausina acknowledges the financial support of Ministerio de Economía y Competitividad (ECO2014-55221-P) and Universitat Jaume I (P1.1B2014-17). Both authors are also grateful to the Generalitat Valenciana (ACOMP11/218, ACOMP/2014/283 and PROMETEOII/2014/046). The usual disclaimer applies.