On the Economization of Environmental Policy: Examining the Workings of Green Competitiveness in the Pursuit of Emissions Reduction

Abstract

Hybrid, transnational governance frameworks such as the European Union’s Renewable Energy Directive (EU-RED) are designed to shape production and trade practices in third countries by linking market access to compliance with sustainability criteria. Evidence on their effectiveness in these contexts, however, remains limited. This article examines why such frameworks often fail to achieve their environmental goals, focusing on EU-RED’s regulation of biofuels in the Argentina–EU biodiesel global value chain. We argue that EU-RED is based on a form of economization of environmental regulation that we define as “green competitiveness,” in which environmental performance becomes constitutive of competitive advantage rather than merely an external constraint. Economic actors in Argentina adopt this logic to strengthen their market positions, yet their strategies frequently decouple from meaningful environmental outcomes. By conceptually identifying the defining elements of green competitiveness and empirically analyzing their implementation in the case study, we show how these tensions manifest in concrete practices on the ground.