Several studies have examined the relationship between environmental degradation and per capita income.However, most of them did not take into account institutional quality and just focused on macroeconomicdeterminants. The purpose of this paper is to fill this gap in the literature by assessing the effects on theEnvironmental Kuznets Curve (EKC) when institutional quality variables are introduced, especially those related tocorruption and rent-seeking behavior.This study considers 18 Latin

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... ican economies and panel data for 1998–2005. A standard reducedformmodeling approach with pool estimation was employed and, in order to introduce the heterogeneity of thedifferent countries, three different models were estimated. The first model corresponds to the basic EnvironmentalKuznets Curve (Basic Model), the second model introduced a sets of additional economic variables (ExtendedModel Nº 1), and finally, the third one introduced institutional variables into the previous formulation (ExtendedModel Nº 2).The expected results from this investigation lead us to support the EKC hypothesis while confirming theimportance of improvements in political institutions and governance for better environmental performances in theregion.