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Environmental Regulation and Competitiveness

Author

Listed:
  • Abay Mulatu

    () (Vrije Universiteit Amsterdam)

  • Raymond J.G.M. Florax

    (Vrije Universiteit Amsterdam)

  • Cees A.A.M. Withagen

    () (Vrije Universiteit Amsterdam, and Tilburg University)

Abstract

The potential relationship between domestic environmental regulation and internationalcompetitiveness has evoked various speculations. The common neoclassical train of thought is thatstrict environmental regulation is detrimental to the competitiveness of industry, and that itinduces phenomena such as ecological dumping, ecological capital flight, and regulatory 'chill' inenvironmental standards. A different view is that strict environmental regulation triggers industry'sinnovation potential, and subsequently increases its competitiveness. The impact of environmentalregulation on competitiveness has been analyzed in terms of international capital movements, newfirm formation, and international trade. This paper focuses on a statistically rigorous analysis ofinternational trade studies, using a technique that is known as meta-analysis. The paper presentsa statistically supported evaluation of the literature, in order to assess what the main conclusionsregarding the relationship between environmental regulation and competitiveness are when itcomes to studies on international trade flows. The synthesis of the literature is subsequently usedto present guidelines for future primary research in this area.

Suggested Citation

  • Abay Mulatu & Raymond J.G.M. Florax & Cees A.A.M. Withagen, 2001. "Environmental Regulation and Competitiveness," Tinbergen Institute Discussion Papers 01-039/3, Tinbergen Institute.
  • Handle: RePEc:tin:wpaper:20010039
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    File URL: http://papers.tinbergen.nl/01039.pdf
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    References listed on IDEAS

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    1. Orley Ashenfelter & Colm Harmon & Hessel Oosterbeek, 1999. "A Review of Estimates of the Schooling/Earnings Relationship, with Tests for Publication Bias," Working Papers 804, Princeton University, Department of Economics, Industrial Relations Section..
    2. Smith, V. Kerry & Kaoru, Yoshiaki, 1990. "What have we learned since hotelling's letter? : A meta-analysis," Economics Letters, Elsevier, vol. 32(3), pages 277-281, March.
    3. Rauscher, Michael, 1997. "International Trade, Factor Movements, and the Environment," OUP Catalogue, Oxford University Press, number 9780198290506.
    4. Ashenfelter, Orley & Harmon, Colm & Oosterbeek, Hessel, 1999. "A review of estimates of the schooling/earnings relationship, with tests for publication bias," Labour Economics, Elsevier, vol. 6(4), pages 453-470, November.
    5. V. Kerry Smith & Yoshiaki Kaoru, 1990. "Signals or Noise? Explaining the Variation in Recreation Benefit Estimates," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(2), pages 419-433.
    6. Low, P., 1992. "International Trade and the Environment," World Bank - Discussion Papers 159, World Bank.
    7. van Beers, Cees & van den Bergh, Jeroen C J M, 1997. "An Empirical Multi-country Analysis of the Impact of Environmental Regulations on Foreign Trade Flows," Kyklos, Wiley Blackwell, vol. 50(1), pages 29-46.
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    Citations

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    Cited by:

    1. Thomas Ziesemer & Peter Michaelis, 2008. "Strategic Environmental Policy and the Accumulation of Knowledge," Discussion Paper Series 301, Universitaet Augsburg, Institute for Economics.
    2. Esteve Mora, F. & Muñoz De Bustillo Llorente, R., 2004. "Mitos y falacias populares en el debate acerca de los sistemas de pensiones/Myths and Fallacies in the Debate About the Future of Pension Systems," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 22, pages 289-316, Agosto.
    3. Daniel Millimet & John List, 2004. "The Case of the Missing Pollution Haven Hypothesis," Journal of Regulatory Economics, Springer, vol. 26(3), pages 239-262, August.
    4. Costantini, Valeria & Crespi, Francesco, 2008. "Environmental regulation and the export dynamics of energy technologies," Ecological Economics, Elsevier, vol. 66(2-3), pages 447-460, June.
    5. Thomas Roediger-Schluga, 2003. "Some Micro-Evidence on the "Porter Hypothesis" from Austrian VOC Emission Standards," Growth and Change, Wiley Blackwell, vol. 34(3), pages 359-379.
    6. Robert SOVA & Ion STANCU & Laurentiu FRATILA & Anamaria SOVA, 2011. "Corporate Social Responsibility and its Macroeconomic Implications," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 12(1), pages 172-183, March.

    More about this item

    Keywords

    environmental policy; strictness; competitiveness; meta-analysis;

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General

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