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This paper examines convergence in environmental/carbon performance
by constructing a measure based on production theory, where production processes
explicitly result in the production of two outputs; a good output (GDP) and a bad
output (CO2). We use the derived measure to test the b-convergence hypothesis for
a panel of 94 countries. The results reveal evidence in support of b-convergence in
environmental, or carbon performance for the entire (global) sample and each of the
sub-samples. The evidence points to a slower convergence rate for the high-income
countries relative to low-income countries. Moreover, the rate of convergence does
not vary with capital in the global sample, but does vary in the high-income sample,
possibly reflecting differences in abatement cost induced by differences in the
stringency of environmental regulation and enforcement. Additionally, we find
evidence of a negative relation between environmental performance and fossil fuel
share, both at the global level as well as at the middle and high sub-samples, which
tend to vary with capital intensity. As such, the results conform to the results from
studies on the dynamics of per capita emissions.