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The effect of environmental decentralization on polluting industries in India

  • Stefania Lovo

This paper examines the unintended effects of the 2006 reform of the Environmental Impact Assessment (EIA) process in India using firm-level data for the period 1998-2012. The reform favored a decentralization process by delegating the responsibility over environmental clearance of certain activities to state-level authorities. The results show that variations in the strength of environmental enforcement across states has resulted in an increase of births for polluting industries affected by the reform in states with lower level of enforcement.

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File URL: http://www.lse.ac.uk/GranthamInstitute/wp-content/uploads/2014/01/Working-Paper-143-Lovo-2014.pdf
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Paper provided by Grantham Research Institute on Climate Change and the Environment in its series GRI Working Papers with number 143.

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Date of creation: Jan 2014
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Handle: RePEc:lsg:lsgwps:wp143
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  1. Dean, Judith M. & Lovely, Mary E. & Wang, Hua, 2005. "Are foreign investors attracted to weak environmental regulations? Evaluating the evidence from China," Policy Research Working Paper Series 3505, The World Bank.
  2. Barrios, Salvador & Huizinga, Harry & Laeven, Luc & Nicodème, Gaëtan, 2012. "International taxation and multinational firm location decisions," Journal of Public Economics, Elsevier, vol. 96(11), pages 946-958.
  3. Brülhart, Marius & Jametti, Mario & Schmidheiny, Kurt, 2007. "Do Agglomeration Economies Reduce the Sensitivity of Firm Location to Tax Differentials?," CEPR Discussion Papers 6606, C.E.P.R. Discussion Papers.
  4. Hilary Sigman, 2004. "Transboundary Spillovers and Decentralization of Environmental Policies," NBER Working Papers 10717, National Bureau of Economic Research, Inc.
  5. Holl, Adelheid, 2004. "Manufacturing location and impacts of road transport infrastructure: empirical evidence from Spain," Regional Science and Urban Economics, Elsevier, vol. 34(3), pages 341-363, May.
  6. Kathuria, Vinish, 2007. "Informal regulation of pollution in a developing country: Evidence from India," Ecological Economics, Elsevier, vol. 63(2-3), pages 403-417, August.
  7. Besley, Timothy & Coate, Stephen, 2003. "Centralized versus decentralized provision of local public goods: a political economy approach," Journal of Public Economics, Elsevier, vol. 87(12), pages 2611-2637, December.
  8. Lall, Somik V. & Chakravorty, Sanjoy, 2004. "Industrial Location and Spatial Inequality: Theory and Evidence from India," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  9. Chloe Duvivier & Hang Xiong, 2011. "Transboundary Pollution in China: A Study of Polluting Firms' Location Choices in Hebei Province," Working Papers halshs-00598592, HAL.
  10. World Bank, 2006. "India - Strengthening Institutions for Sustainable Growth : Country Environmental Analysis," World Bank Other Operational Studies 19628, The World Bank.
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