• Analysis of carbon, material, and land use intensities in affluent countries. • Government consumption has lower environmental intensities than households. • Exception: households often have lower intensities in tangibles and food. • Countries with higher public social spending have lower environmental intensities. • Results support synergy hypothesis: welfare state features improve eco-efficiency. The efficiency of public versus private sectors has interested policymakers and researchers for decades. Management research has highlighted that private ownership can improve the efficiency of production. However, regarding environmental efficiency, the public sector often outperforms the private sector. Furthermore, the so-called synergy hypothesis suggests that countries with a strong public sector might be better positioned to address environmental problems than other countries, because of their already existing governance related to welfare. Yet, empirical evidence so far has mostly suggested otherwise. Here, we contribute to these debates by 1) providing an analysis of the consumption-based environmental intensities of government versus household consumption and 2) testing the synergy hypothesis using the environmental intensities as the measure of environmental performance. Our results show that government consumption has lower carbon, material, and land use intensities compared to household consumption – particularly in services, and in most countries, also in energy. Yet, in several countries, households have lower intensities for tangible goods and food, potentially pointing to shortcomings in public procurement policies. We also find support for the synergy hypothesis : countries with higher public social expenditure (% of GDP) tend to have lower environmental intensities, even when controlling for final demand per capita.
Ottelin et al. (Sat,) studied this question.