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Are Multinational Enterprises in China Cleaner or Dirtier than Their Local Counterparts?

In: Globalization and the Environment of China

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  • Boqiong Yang
  • Jianguo Chen

Abstract

Accompanying the development of economy, multinational enterprises (MNEs), as a role of promoting economic development, may also lead to environmental pollution of host countries. China has become one of the most significant countries in terms of introducing foreign direct investment (FDI), along with which the pollution problem has become serious. Whether the MNEs affect the environment and whether the MNEs in China perform worse than local enterprises attracts more attention. To understand more about it, we creatively build a model of vertical product differentiation, and the result indicates that the environmental performance of MNEs is better than that of local enterprises.

Suggested Citation

  • Boqiong Yang & Jianguo Chen, 2014. "Are Multinational Enterprises in China Cleaner or Dirtier than Their Local Counterparts?," Frontiers of Economics and Globalization, in: Globalization and the Environment of China, volume 14, pages 97-107, Emerald Group Publishing Limited.
    • Handle: RePEc:eme:fegzzz:s1574-871520140000014005
    DOI: 10.1108/S1574-871520140000014005
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    More about this item

    Keywords

    Multinational enterprises; local enterprises; environmental performance; F18; F23; O13;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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