Impact of climate investment policies on citizens’ perception of pollution damage in the European Union

Abstract

This study examines the impact of climate investment policies on citizens’ perception of pollution damage in the European Union, while controlling for various environmental indicators. The primary panel data estimation outcome indicates that, despite substantial public expenditure on climate action, consumers’ perception of pollution improvement remains unchanged or even worsens. This suggests support for the policy ineffectiveness hypothesis. In view of this result, advocating for strengthened policies aimed at bolstering climate action in the European Union may be considered a non-credible threat from a microeconomics standpoint.