Due to these duties being left to the provinces, provincial governments have developed individualized environmental control systems. Consequently, standards greatly vary between provinces. While there is an intricate debate on whether this causes a “race-to-the-bottom”, it is clear provinces “are reluctant in any way to alienate industries that might transfer investments to less-rigorous provinces”. Another facet of federalism that can facilitate a race-to-the-bottom is the nature of environmental policy being dominated by provinces and the increasing issues surrounding trans-boundary pollutants. To elaborate, the externalities created by polluting industries in one province would have adverse effects on neighboring provinces. In other words, polluting regions or provinces can reap the economic benefits of natural resource industries however other affected provinces will not share in the monetary benefits and both regions will share the environmental costs. Therefore the interests of provinces can be divided between economic growths at expensive of other provinces and environmental harmonization between the provinces. This is an incentive to push for federal cross-boundary policies to avoid this issue …show more content…
In the bilateral system, the federal government, if active in environmental policymaking, individually negotiates agreements with provinces. This creates inconsistency in environmental standards between provinces. Conversely, in the multilateral process, the federal government and the provinces are equal in decision-making abilities. This allows for the different parties to veto policy and increases the potential for political deadlock. Similarly to the European Union or the German Federal State, Canada suffers from the joint decision trap when forming environmental policy decision between provinces. The collective decision-making between provinces usually results in the lowest common denominator policy in order to achieve an agreement between the differing value systems of the