Eco-Efficiency, Energy and Air Pollution: A NUTS 3 Analysis for Italy

The aim of this paper is the analysis of eco-efficiency for 103 provincial (NUTS 3 - Nomenclature of Units for Territorial Statistics) capitals of Italy throughout 2000-2008. We focus on the link among economic growth, energy consumption and air pollution, modeling cities as territorial units that ought to promote growth, while at the same time minimising its environmental impact. Subsequently, we empirically assess the eco-efficiency of this panel of provincial capitals and, considering some environmental control variables, we evaluate if environmental best practices correspond either to those municipalities that adopt environment-friendly policies or to cities characterised by a particular urban context. Estimation is carried out through a parametric input-distance function. Our results confirm the existence of a significant link between economic development, energy consumption and air pollution at the provincial capital level. The most eco-efficient provincial capitals are also among the wealthier, providing evidence consistent with an Environmental Kuznets Curve. On the other hand, evidence in favor of a role of environment-friendly policies is insignificant.