The Role of Preferences in Disagreements over Scientific Hypothesis: An Empirical Inquiry into Environmental and Economic Decision Making
AbstractThe Porter hypothesis suggests that environmental regulations, such as restricting firms to reduce pollution, stimulates innovations and create a win-win situation for the environment and for firms. It has received a great deal of attention from academics as well as bureaucrats who disagree about the applicability of the Porter hypothesis. This study tests if part of such disagreement can be explained by a preference-expectation relationship and if people are more likely to believe in a scientific hypothesis that appeals to their preferences. The results show that individuals' who care more about the environment are more likely to believe in the Porter hypothesis. We also discuss the capacity of economic methodology to mitigate a preference-expectation bias and how it relates to the current practice in environmental economics.
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Bibliographic InfoPaper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2010-088.
Date of creation: 13 Dec 2010
Date of revision:
Porter Hypothesis; Subjective Beliefs; Economic Methodology;
Find related papers by JEL classification:
- B4 - Schools of Economic Thought and Methodology - - Economic Methodology
- Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General
- Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-12-23 (All new papers)
- NEP-ENV-2010-12-23 (Environmental Economics)
- NEP-HPE-2010-12-23 (History & Philosophy of Economics)
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- Lovell, Michael C, 1983. "Data Mining," The Review of Economics and Statistics, MIT Press, vol. 65(1), pages 1-12, February.
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