Environmental Protection of Foreign Firms in Germany: Does the country of origin matter?
AbstractOnly recently have the aspects of pollution and environmental protection entered into the empirical literature about international firm activities. The present paper is the first firm-level study on the link between foreign ownership and environmental protection in Germany. We find that, ceteris paribus, foreign owned firms in Germany are more likely to invest in environmental protection. They also invest on a larger scale in terms of add-on measures as well as integrated measures. These results are robust against different measures, different time periods, different control groups, and selection issues arising from fractional response data. Once we control for productivity levels, the differences become less straightforward. However, the higher probability of foreign firms' making general as well as integrated environmental protection investments and the tilt of their composition towards integrated measures remain. We cannot find any support for differences among foreign firms by country of origin. This can be interpreted as support for the new institutionalist hypothesis of international convergence of management practices in the field of environmental management due to normative pressure and de facto standards at the global level.
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Bibliographic InfoPaper provided by University of Lüneburg, Institute of Economics in its series Working Paper Series in Economics with number 267.
Length: 44 pages
Date of creation: Apr 2013
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Environmental protection; foreign ownership; country of origin; multinational enterprises; manufacturing; Germany;
Find related papers by JEL classification:
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Costs; Distributional Effects; Employment Effects
- Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
- Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-04-27 (All new papers)
- NEP-CSE-2013-04-27 (Economics of Strategic Management)
- NEP-ENV-2013-04-27 (Environmental Economics)
- NEP-EUR-2013-04-27 (Microeconomic European Issues)
- NEP-RES-2013-04-27 (Resource Economics)
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