Dedicated climate ministries help to reduce carbon emissions

The global climate crisis necessitates decisive government action to significantly reduce greenhouse gas emissions. While international cooperation remains crucial, the design of effective national institutions is equally important. This research focuses on the role of dedicated climate ministries, which are hypothesized to enhance climate action by clarifying responsibilities and allocating dedicated resources. The creation of such ministries is seen as a potential catalyst for more comprehensive and coordinated climate efforts, unlike situations where responsibilities are diffused across various governmental departments. However, empirical evidence on their actual impact on climate policy and effectiveness is limited. This study addresses this gap by analyzing a global dataset to determine if establishing a dedicated climate ministry demonstrably affects carbon emissions and the quantity, type, and effectiveness of climate policies.

The existing literature highlights the potential benefits of dedicated climate ministries. These include clearer lines of responsibility and the allocation of specific administrative resources (staff and budget) to climate change issues. However, there's a scarcity of empirical studies directly assessing the impact of these ministries on climate action. Some research suggests that well-designed policies are crucial for effective climate action, implying that administrative capacity is essential for policy formulation and implementation. The lack of a dedicated entity often leads to unclear responsibility and coordination challenges in governmental structures, hindering the effectiveness of climate policies. This research contributes by empirically investigating the effects of dedicated climate ministries, filling a significant gap in the literature.

This study employs a difference-in-differences (DiD) design using panel data from 169 countries between 2000 and 2021. The central independent variable is the establishment of a dedicated climate ministry, identified through analysis of ministry names and validated with secondary sources. The study examines the effect of ministry creation on CO2 emissions, as well as the number, type, and design of climate policies. Data on CO2 emissions were sourced from the World Bank's Climate Watch Historical GHG Emissions Database. Climate policy data were obtained from the Climate Policy Database, which contains information on policy types (e.g., regulatory, market-based) and sectors addressed. A matching technique was used to compare countries with similar covariate trajectories, ensuring that observed differences in emission trajectories are not due to pre-existing trends. The DiD estimator accounts for time-invariant confounders, assuming parallel trends in emissions before ministry establishment. The study uses the approach by Imai et al. (2023), combining matching methods with a difference-in-differences estimator, to account for both observed and unobserved confounders. To examine the effect of establishing a climate ministry for up to 5 years after its creation and adjusting for treatment history up to 5 years before, the authors used a specific formulation of the average treatment effect on the treated, employing the Mahalanobis matching technique. In addition to the DiD analysis, a time-series cross-sectional analysis was conducted, including country fixed effects, year fixed effects, and relevant control variables (GDP growth rate, industrial sector size, democracy status). Standard errors were computed using a block-bootstrap procedure to account for the weighting scheme of the matching algorithm.

The study's empirical results strongly support the emission-reduction potential of dedicated climate ministries. In the year after a ministry's establishment, emissions dropped by more than 0.36 metric tons per capita (95% confidence interval of -0.71 to -0.04). This effect is statistically significant at the 5% level and increases to around 1.06 metric tons per capita after 5 years (-1.87 to -0.29). This reduction equates to roughly one-eighth of average per capita emissions in OECD countries. Importantly, the analysis reveals that this emission reduction is not explained by an increase in the number or ambition of climate policies. The study found no statistically significant effect of climate ministry establishment on the total number of climate mitigation policies, the number of ambitious policies (regulatory and market-based instruments), or the average instrument diversity. This suggests that climate ministries primarily enhance the effectiveness of existing policies through better implementation and enforcement. Further analyses distinguished between specialized and general climate ministries. Only specialized ministries (focusing on a maximum of two additional policy areas besides climate change) showed a significant effect on emission reduction. General environmental ministries, addressing broader environmental concerns, did not show a statistically significant impact. Sensitivity analyses, including those without matching, matching on leadership changes and green party government participation, and focusing solely on ministries where the climate minister is the head, confirmed the robustness of these findings. A time-series cross-sectional analysis also indicated that having a climate ministry is a significant predictor of greater CO2 emission reductions. Finally, the study demonstrated that the effect of climate ministries on emissions is stronger in countries with higher overall state capacity, reinforcing the importance of effective implementation capabilities.

The findings strongly suggest that dedicated climate ministries contribute significantly to reducing carbon emissions, primarily by enhancing the implementation and enforcement of existing climate policies rather than by increasing the number or ambition of new policies. The clearer responsibilities and dedicated resources within these ministries improve governmental capacity to supervise implementation authorities. This refutes the notion that simply increasing policy numbers or ambition is sufficient for effective climate action. The study emphasizes the importance of specialized institutional structures and demonstrates the limitations of ministries with broader mandates. The lack of a significant effect from general environmental ministries highlights the importance of a focused approach to climate change. The interaction between climate ministries and state capacity suggests that the effectiveness of these ministries is context-dependent, with stronger effects in countries with robust administrative capacities.

This research demonstrates the significant contribution of dedicated climate ministries to carbon emission reduction. The positive impact stems primarily from improved implementation and enforcement of existing policies, not the creation of new ones. The study highlights the importance of specialized ministries focused solely on climate action and the need for sufficient state capacity for effective implementation. Future research should explore the influence of inter-ministerial dynamics, coalition politics, and broader socio-economic and political factors on the effectiveness of climate ministries.

While the study uses a robust methodology, some limitations exist. The reliance on ministry names to identify dedicated climate ministries might not fully capture the nuances of ministerial responsibilities. The analysis assumes a parallel trends assumption in the difference-in-differences model, which might not perfectly hold across all countries. Further research could examine the interaction of climate ministries with other governmental structures and the influence of political factors on their effectiveness in more detail. The generalizability of the findings may be affected by the specific data and time period studied.