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A literature review on the links between environmental regulation and competitiveness

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Author Info

  • Fabio Iraldo

    (Sant’Anna School of Advanced Studies and IEFE – Institute for Environmental and Energy Policy and Economics, Bocconi University)

  • Francesco Testa

    (IEFE – Institute for Environmental and Energy Policy and Economics, Bocconi University)

  • Vlasis Oikonomou

    (Joint Implementation Network Laan Corpus den Hoorn)

  • Michela Melis

    (IEFE – Institute for Environmental and Energy Policy and Economics, Bocconi University)

  • Marco Frey

    (Sant’Anna School of Advanced Studies and IEFE – Institute for Environmental and Energy Policy and Economics, Bocconi University)

  • Eise Spijker

    (Joint Implementation Network Laan Corpus den Hoorn)

Abstract

The effects of environmental regulation on competitiveness is always a topic under debate for policymakers and practitioners. The article describes the different ways of defining and measuring the effects of environmental regulation on competition and market forces and synthesizes the most updated findings on the relationship between these dimensions. It also proposes an in depth analysis of the most recent empirical studies, with a particular focus on the buildings and construction (B&C) sector, which often is a substantial contributor to the most important countries’ economic indicators. We find that two variables have proved to be both (i) key in defining to what extent and under what conditions environmental regulation exerts adverse or positive effects on competitiveness and (ii) difficult to nail down: forms of regulation and responses by business.

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Bibliographic Info

Paper provided by Scuola Superiore Sant'Anna of Pisa, Istituto di Management in its series Working Papers with number 200904.

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Date of creation: 01 Apr 2009
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Handle: RePEc:sse:wpaper:200904

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  1. Paul Lanoie & Stefan Ambec & Iain Scott, 2007. "When and Why Does it Pay to be Green?," CIRANO Burgundy Reports 2007rb-03, CIRANO.
  2. Runar Brännlund & Rolf Färe & Shawna Grosskopf, 1995. "Environmental regulation and profitability: An application to Swedish pulp and paper mills," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 6(1), pages 23-36, July.
  3. Paul Lanoie & Michel Patry & Richard Lajeunesse, 2001. "Environmental Regulation and Productivity: New Findings on the Porter Hypothesis," Cahiers de recherche 01-05, HEC Montréal, Institut d'économie appliquée.
  4. Barbera, Anthony J. & McConnell, Virginia D., 1990. "The impact of environmental regulations on industry productivity: Direct and indirect effects," Journal of Environmental Economics and Management, Elsevier, vol. 18(1), pages 50-65, January.
  5. Martin Jänicke & Klaus Jacob, 2004. "Lead Markets for Environmental Innovations: A New Role for the Nation State," Global Environmental Politics, MIT Press, vol. 4(1), pages 29-46, 02.
  6. Paul Lanoie & Jérémy Laurent-Lucchetti & Nick Johnstone & Stefan Ambec, 2007. "Environmental Policy, Innovation and Performance : New Insights on the Porter Hypothesis," Cahiers de recherche 07-06, HEC Montréal, Institut d'économie appliquée.
  7. Joshua Linn, 2006. "Stock Prices and the Cost of Environmental Regulation," Working Papers 0611, Massachusetts Institute of Technology, Center for Energy and Environmental Policy Research.
  8. Ebru Alpay & Joe Kerkvliet & Steven Buccola, 2002. "Productivity Growth and Environmental Regulation in Mexican and U.S. Food Manufacturing," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 887-901.
  9. Marcus Wagner, 2004. "The Porter Hypothesis Revisited: A Literature Review of Theoretical Models and Empirical Tests," Public Economics 0407014, EconWPA.
  10. Popp, David, 2006. "International innovation and diffusion of air pollution control technologies: the effects of NOX and SO2 regulation in the US, Japan, and Germany," Journal of Environmental Economics and Management, Elsevier, vol. 51(1), pages 46-71, January.
  11. Beise, Marian & Rennings, Klaus, 2005. "Lead markets and regulation: a framework for analyzing the international diffusion of environmental innovations," Ecological Economics, Elsevier, vol. 52(1), pages 5-17, January.
  12. Wayne B. Gray & Ronald J. Shadbegian, 1993. "Environmental Regulation and Manufacturing Productivity at the Plant Level," NBER Working Papers 4321, National Bureau of Economic Research, Inc.
  13. Adam Jaffe & Richard Newell & Robert Stavins, 2002. "Environmental Policy and Technological Change," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 22(1), pages 41-70, June.
  14. Brunnermeier, Smita B. & Cohen, Mark A., 2003. "Determinants of environmental innovation in US manufacturing industries," Journal of Environmental Economics and Management, Elsevier, vol. 45(2), pages 278-293, March.
  15. Gabel H. Landis & Sinclair-Desgagne Bernard, 1993. "Managerial Incentives and Environmental Compliance," Journal of Environmental Economics and Management, Elsevier, vol. 24(3), pages 229-240, May.
  16. Khanna, Madhu & Damon, Lisa A., 1999. "EPA's Voluntary 33/50 Program: Impact on Toxic Releases and Economic Performance of Firms," Journal of Environmental Economics and Management, Elsevier, vol. 37(1), pages 1-25, January.
  17. J.B. Smith & W A. Sims, 1985. "The Impact of Pollution Charges on Productivity Growth in Canadian Brewing," RAND Journal of Economics, The RAND Corporation, vol. 16(3), pages 410-423, Autumn.
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