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Environmental Technology Transfer in a FDI Regime A Developing Country Perspective

Author

Listed:
  • Author One

    (The University of the Great Ones)

  • Author Two

    (The University of Lesser Ones & Univ. of Truth or consequences)

  • U. Thirdone

    (The University of Mild Hysterics)

Abstract

The environmental impact of Foreign Direct Investment is still to be explored totally. It is often argued that investment may come to a region or country where environment protection norms are less strict. Investors may be induced to outsource their pollution-intensive production where the expected cost of pollution abatement is significantly less. This gave birth to the much debated idea of 'pollution havens', parallel to low-wage havens. Developing countries are more vulnerable to such cases since the environmental legislation and monitoring is not rigorous over there. Again, many have debated that such 'pollution havens' does not typically exist or at the best, transient in nature. Over the last decade, as a result of its policy towards opening up of the economy to the global markets, the extent of multinational activities and their share in trade and industrial production have risen steadily in India. Viewing this development, this paper primarily attempt to show the very existence of such a pollution haven in Indian scenario, analysing time series data for industrial production and international trade of identified pollution intensive industries in the country. Then it argues that, even if of transient nature, the phasing out of such a pollution haven regime is typically dependent upon the active institutional intervention. One important factor, this paper identifies, is of making of state-of-the-art knowledge base of impact analysis and alternative production possibilities that help design prudent environmental policy regime. Also it searches for the right kind of institutional interface at the international, national and industry level; and endeavours to find the implications thereof.

Suggested Citation

  • Author One & Author Two & U. Thirdone, 2002. "Environmental Technology Transfer in a FDI Regime A Developing Country Perspective," International Trade 0212001, EconWPA.
  • Handle: RePEc:wpa:wuwpit:0212001 Note: Type of Document - pdf; prepared on IBM PC; to print on HP;
    as

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    File URL: http://econwpa.repec.org/eps/it/papers/0212/0212001.pdf
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    References listed on IDEAS

    as
    1. Hettige, Hemamala & Huq, Mainul & Pargal, Sheoli & Wheeler, David, 1996. "Determinants of pollution abatement in developing countries: Evidence from South and Southeast Asia," World Development, Elsevier, vol. 24(12), pages 1891-1904, December.
    2. Eskeland, Gunnar S. & Harrison, Ann E., 2003. "Moving to greener pastures? Multinationals and the pollution haven hypothesis," Journal of Development Economics, Elsevier, pages 1-23.
    3. Susmita Dasgupta & Ashoka Mody & Subhendu Roy & David Wheeler, 2001. "Environmental Regulation and Development: A Cross-country Empirical Analysis," Oxford Development Studies, Taylor & Francis Journals, pages 173-187.
    4. Eskeland, Gunnar S. & Harrison, Ann E., 2003. "Moving to greener pastures? Multinationals and the pollution haven hypothesis," Journal of Development Economics, Elsevier, pages 1-23.
    5. Blomstrom, Magnus & Kokko, Ari, 1997. "How foreign investment affects host countries," Policy Research Working Paper Series 1745, The World Bank.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    FDI; Environment; Technology Transfer; Developing Country;

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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