Pollution Abatement Costs and Foreign Direct Investment Inflows to U.S. States: A Nonparametric Reassessment
Keller and Levinson (2002) utilize state-level panel data on inflows of foreign direct investment along with an innovative measure of relative pollution abatement costs to assess the impact of environmental stringency on capital flows. Using standard parametric panel data models, the authors find moderate evidence that capital flows are sensitive to abatement costs. Using recently developed nonparametric methods, we assess the robustness of this conclusion. The nonparametric approach reveals that (a) some of the parametric results are not robust, and (b) the impact of relative abatement costs is heterogeneous across states and generally of smaller magnitude than previously suggested. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.
Volume (Year): 89 (2007)
Issue (Month): 1 (February)
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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.:
- Wolfgang Keller & Arik Levinson, 2002. "Pollution Abatement Costs and Foreign Direct Investment Inflows to U.S. States," The Review of Economics and Statistics, MIT Press, vol. 84(4), pages 691-703, November.
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NBER Working Papers
7648, National Bureau of Economic Research, Inc.
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- Arik Levinson, 2001.
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in: Behavioral and Distributional Effects of Environmental Policy, pages 131-158
National Bureau of Economic Research, Inc.
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- Arik Levinson, 1999. "An Industry-Adjusted Index of State Environmental Compliance Costs," Working Papers gueconwpa~00-00-08, Georgetown University, Department of Economics.
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- Racine, Jeff & Li, Qi, 2004. "Nonparametric estimation of regression functions with both categorical and continuous data," Journal of Econometrics, Elsevier, vol. 119(1), pages 99-130, March.
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