Advanced Search
MyIDEAS: Login to save this paper or follow this series

The Effect of Environmental Regulation on the Locational Choice of Japanese Foreign Direct Investment

Contents:

Author Info

  • Kirkpatrick, Colin
  • Shimamoto, Kenichi
Registered author(s):

    Abstract

    This paper assesses the impact of environmental regulation in host countries on Japanese foreign direct investment (FDI) decision-making. It tests the pollution haven hypothesis using data on national environmental regulation standards and Japanese inward FDI in five dirty industries (iron and steel industry, non-ferrous metals industry, chemicals industry, paper and pulp industry, non-metallic products industry). The results do not support the pollution hypothesis. On the contrary, inward Japanese FDI appears to be attracted to countries which have committed themselves to a transparent and stable environment regulatory environment, suggesting that the quality of the regulatory framework in terms of its certainty and transparency has a greater influence on foreign investors' choice of location than the level of the environmental regulatory measures.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://purl.umn.edu/30584
    Download Restriction: no

    Bibliographic Info

    Paper provided by University of Manchester, Institute for Development Policy and Management (IDPM) in its series Impact Assessment Research Centre (IARC) Working Papers with number 30584.

    as in new window
    Length:
    Date of creation: 2005
    Date of revision:
    Handle: RePEc:ags:idpmia:30584

    Contact details of provider:
    Postal: Harold Hankins Building, Precinct Centre, Booth Street West, Manchester, M13 9QH
    Phone: +44-161-275-2800
    Fax: +44-161-273-8829
    Email:
    Web page: http://www.sed.manchester.ac.uk/idpm
    More information through EDIRC

    Related research

    Keywords: Environmental regulation; foreign direct investment; Japanese multinationals; Environmental Economics and Policy; International Relations/Trade; Q56; F21;

    Find related papers by JEL classification:

    References

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
    as in new window
    1. Werner Antweiler & Brian R. Copeland & M. Scott Taylor, 1998. "Is Free Trade Good for the Environment?," NBER Working Papers 6707, National Bureau of Economic Research, Inc.
    2. Brian R. Copeland & M. Scott Taylor, 2003. "Trade, Growth and the Environment," NBER Working Papers 9823, National Bureau of Economic Research, Inc.
    3. Levinson, Arik, 1996. "Environmental regulations and manufacturers' location choices: Evidence from the Census of Manufactures," Journal of Public Economics, Elsevier, vol. 62(1-2), pages 5-29, October.
    4. David W Loree & Stephen E Guisinger, 1995. "Policy and Non-Policy Determinants of U.S. Equity Foreign Direct Investment," Journal of International Business Studies, Palgrave Macmillan, vol. 26(2), pages 281-299, June.
    5. Schneider, Friedrich & Frey, Bruno S., 1985. "Economic and political determinants of foreign direct investment," World Development, Elsevier, vol. 13(2), pages 161-175, February.
    6. van Beers, Cees & van den Bergh, Jeroen C J M, 1997. "An Empirical Multi-country Analysis of the Impact of Environmental Regulations on Foreign Trade Flows," Kyklos, Wiley Blackwell, vol. 50(1), pages 29-46.
    7. Chen, Tain-Jy, 1992. "Determinants of Taiwan's direct foreign investment : The case of a newly industrializing country," Journal of Development Economics, Elsevier, vol. 39(2), pages 397-407, October.
    8. Smarzynska, Beata K., 2001. "Pollution havens and foreign direct investment : dirty secret or popular myth?," Policy Research Working Paper Series 2673, The World Bank.
    9. Busse, Matthias, 2004. "Trade, environmental regulations and the World Trade Organization : new empirical evidence," Policy Research Working Paper Series 3361, The World Bank.
    10. Timothy J. Bartik, 2002. "The Effects of Environmental Regulation on Business Location in the United States," Book chapters authored by Upjohn Institute researchers, in: Wayne B. Gray (ed.), Economic Costs and Consequences of Environmental Regulation, pages 129-151 W.E. Upjohn Institute for Employment Research.
    11. Cole, Matthew A. & Elliott, Robert J.R. & Shimamoto, Kenichi, 2005. "Industrial characteristics, environmental regulations and air pollution: an analysis of the UK manufacturing sector," Journal of Environmental Economics and Management, Elsevier, vol. 50(1), pages 121-143, July.
    12. Farrell, Roger & Gaston, Noel & Sturm, Jan-Egbert, 2004. "Determinants of Japan's foreign direct investment: An industry and country panel study, 1984-1998," Journal of the Japanese and International Economies, Elsevier, vol. 18(2), pages 161-182, June.
    13. Matthew A. Cole & Robert J. R. Elliott, 2005. "FDI and the Capital Intensity of "Dirty" Sectors: A Missing Piece of the Pollution Haven Puzzle," Review of Development Economics, Wiley Blackwell, vol. 9(4), pages 530-548, November.
    14. Virginia D. McConnell & Robert M. Schwab, 1990. "The Impact of Environmental Regulation on Industry Location Decisions: The Motor Vehicle Industry," Land Economics, University of Wisconsin Press, vol. 66(1), pages 67-81.
    15. Baek, In-Mee & Okawa, Tamami, 2001. "Foreign exchange rates and Japanese foreign direct investment in Asia," Journal of Economics and Business, Elsevier, vol. 53(1), pages 69-84.
    16. Wheeler, David & Mody, Ashoka, 1992. "International investment location decisions : The case of U.S. firms," Journal of International Economics, Elsevier, vol. 33(1-2), pages 57-76, August.
    17. Cheng, Leonard K. & Kwan, Yum K., 2000. "What are the determinants of the location of foreign direct investment? The Chinese experience," Journal of International Economics, Elsevier, vol. 51(2), pages 379-400, August.
    18. List, John A. & Co, Catherine Y., 2000. "The Effects of Environmental Regulations on Foreign Direct Investment," Journal of Environmental Economics and Management, Elsevier, vol. 40(1), pages 1-20, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:ags:idpmia:30584. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.