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Distribution of Environmental Costs and Benefits, Additional Distortions, and the Porter Hypothesis

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  • Robert D. Mohr
  • Shrawantee Saha
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    Abstract

    The Porter Hypothesis argues that environmental regulations benefit firms by fostering innovation. We discuss four examples consistent with this idea, highlighting either the distribution of benefits or costs, or the presence of some additional distortion, other than pollution. Examples are organized according to the list of market failures. Adding any one market failure creates the possibility that firms benefit from regulations. While each example can be fully consistent with the Porter Hypothesis, it is also possible that regulations benefit firms even without fostering innovation, a result that would be empirically difficult to distinguish from the Porter Hypothesis.

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    File URL: http://le.uwpress.org/cgi/reprint/84/4/689
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    Bibliographic Info

    Article provided by University of Wisconsin Press in its journal Land Economics.

    Volume (Year): 84 (2008)
    Issue (Month): 4 ()
    Pages: 689-700

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    Handle: RePEc:uwp:landec:v:84:y:2008:i:4:p:689-700

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    Web page: http://le.uwpress.org/

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    Cited by:
    1. Andr, Francisco J. & Gonzlez, Paula & Porteiro, Nicols, 2009. "Strategic quality competition and the Porter Hypothesis," Journal of Environmental Economics and Management, Elsevier, vol. 57(2), pages 182-194, March.
    2. Marius Ley & Tobias Stucki & Martin Wörter, 2013. "The Impact of Energy Prices on Green Innovation," KOF Working papers 13-340, KOF Swiss Economic Institute, ETH Zurich.
    3. Ambec, Stefan & Cohen, Mark & Elgie, Stewart & Lanoie, Paul, 2010. "The Porter Hypothesis at 20: Can Environmental Regulation Enhance Innovation and Competitiveness?," TSE Working Papers 10-215, Toulouse School of Economics (TSE).

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