Environmental regulation and the location of polluting industries
Does international tax competition in the environmental field lead to undesirably low levels of environmental regulation and to unacceptable disruptions of environmental quality? The paper tries to answer this question in a non-competitive partial-equilibrium framework. There is one firm that wishes to establish a plant in one of n countries. The paper shows that tax competition may lead to emission taxes that are either too low or too high. They may be so high that the investment is not undertaken although this would be optimal if the countries cooperated. On the other end of the spectrum, a scenario in which taxes are driven to zero becomes possible if there are substantial transfrontier pollution effects.
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- Markusen James R. & Morey Edward R. & Olewiler Nancy D., 1993.
"Environmental Policy when Market Structure and Plant Locations Are Endogenous,"
Journal of Environmental Economics and Management,
Elsevier, vol. 24(1), pages 69-86, January.
- James R. Markusen & Edward R. Morey & Nancy Olewiler, 1991. "Environmental Policy When Market Structure and Plant Locations are Endo-genous," NBER Working Papers 3671, National Bureau of Economic Research, Inc.
- James R. Markusen & Edward R. Morey & Nancy Olewiler, 1992. "Noncooperative Equilibria in Regional Environmental Policies When Plant Locations are Endogenous," NBER Working Papers 4051, National Bureau of Economic Research, Inc.
- G. D. A. MacDougall, 1960. "THE BENEFITS and COSTS OF PRIVATE INVESTMENT FROM ABROAD: A THEORETICAL APPROACH," The Economic Record, The Economic Society of Australia, vol. 36(73), pages 13-35, 03.
- James Brander & Paul Krugman, 1982.
"A 'Reciprocal Dumping' Model of International Trade,"
513, Queen's University, Department of Economics.
- Brander, James & Krugman, Paul, 1983. "A 'reciprocal dumping' model of international trade," Journal of International Economics, Elsevier, vol. 15(3-4), pages 313-321, November.
- James Brander & Paul Krugman, 1980. "A "Reciprocal Dumping" Model of International Trade," Working Papers 405, Queen's University, Department of Economics.
- James A. Brander & Paul Krugman, 1983. "A 'Reciprocal Dumping' Model of International Trade," NBER Working Papers 1194, National Bureau of Economic Research, Inc.
- Long, Ngo Van & Siebert, Horst, 1989.
"Institutional competition versus ex-ante harmonization: the case of environmental policy,"
Kiel Working Papers
396, Kiel Institute for the World Economy (IfW).
- Long, Ngo Van & Siebert, Horst, 1989. "Institutional competition versus ex-ante harmonization: the case of environmental policy," Kiel Working Papers 396, Kiel Institute for the World Economy.
- Lucas, Robert E.B. & Wheeler, David & Hettige, Hemamala, 1992. "Economic development, environmental regulation, and the international migration of toxic industrial pollution : 1960-88," Policy Research Working Paper Series 1062, The World Bank.
- Low, P., 1992. "International Trade and the Environment," World Bank - Discussion Papers 159, World Bank.
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