Explaining environmental performance: Insights for progress on sustainability

Abstract

Every country in the world needs to improve its environmental performance, and doing so requires data-driven insights into the factors associated with success in attaining environmental sustainability goals. We analyze here the 2020 Environmental Performance Index (EPI), a comprehensive composite index that provides a scorecard for 180 countries on their results in protecting human health and ecosystem services. Analysis of the EPI metrics helps to explain the variation in performance among nations and across issues. While per capita GDP, or level of development, is a substantial explanatory variable, this study improves upon past research by testing additional, policy-relevant factors that provide important insights for decisionmakers and other environmental stakeholders. We find that quality of governance is a significant and important explanation for many dimensions of environmental performance at all levels of economic development. Economic liberalism shows a moderate but significant association with EPI scores, offering some signals about how to resolve the tension between growth and green development. Service-based economies typically score higher on environmental performance, but we fail to replicate the connection between environmental degradation and manufacturing and exports.