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Productivity, Capital Intensity and ISO14001 Adoption \Theory and Evidence from Vietnam

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  • Bin Ni

    (Graduate school of economics, Osaka University)

Abstract

The determinants of ISO14001 adoption have been considered to fall into two categories: the external pressure from environment-oriented stakeholders or customers; the internal need due to expected future bene ts. In this paper we take a step further to elaborate on the mechanism of firms' adoption by investigating the interrelationship among firms' productivity, capital intensity and the decision-making of the adoption. Applying a general equilibrium model, we show that under optimal condition, highly productive firms can benefit more from the adoption. In the meantime technology advancement potentially drives up the capital intensity of the firms, and this factor will positively affect firms' incentive of adoption as well. The empirical practice using the firm-level data in Vietnam verifies our predictions with robustness. In addition, we find that the phenomenon outlined above becomes even more obvious in the manufacturing sectors.

Suggested Citation

  • Bin Ni, 2015. "Productivity, Capital Intensity and ISO14001 Adoption \Theory and Evidence from Vietnam," Discussion Papers in Economics and Business 15-26, Osaka University, Graduate School of Economics.
    • Handle: RePEc:osk:wpaper:1526
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    More about this item

    Keywords

    productivity; capital intensity; ISO14001; Vietnam; environmental protec-tion.;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment
    • 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

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