Dynamic causality testing for EKC hypothesis, pollution haven hypothesis and international trade in India

Rana, Ritu; Sharma, Manoj

doi:10.1080/09638199.2018.1542451

Cited by 112 publications

(51 citation statements)

References 37 publications

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“…For robustness, the analysis was conducted in the following ways: For Phase 1 of the Red Line policy, the coefficients of ER1 in columns (1) to (2) are not significant, suggesting that for firms located in provinces, simply setting Red Line standards did not have any impact on firm exports; presumably, these provinces had not engaged in any real activities to manage pollution. In contrast, for firms located in provinces meeting Phase 2, the coefficients of ER2 are positive and significant at the 5% and 10% level in columns (3) to (6), indicating that when a province completes the legislation of the Red Line standards, firms located in the province experience an increase in firm exports. These findings are economically significant.…”

Section: Base Findingsmentioning

confidence: 86%

“…Once environmental protections are tightened in LDCs, firms from developed countries then move away, and the exports of the host country (an LDC) stall (Kearsley and Riddel [3]; Kolcava et al [4]). The pollution haven hypothesis is supported in empirical studies in China (Xu et al [5], India (Rana and Sharma [6]), and East European countries (Martinez-Zarzoso et al [7]). In contrast to the pollution haven hypothesis, Porter [8] hypothesizes that if environmental protection policies are designed properly, they stimulate firms to innovate and compete.…”

Section: Introductionmentioning

confidence: 89%

“…Essentially, LDCs are pollution havens for firms from developed countries. Kearsley and Riddel [3], Kolcava et al [4], Xu et al [5], Rana and Sharma [6], and Martinez-Zarzoso et al [7] offer cross-country or single-country evidence to support the hypothesis.…”

Section: Literature Reviewmentioning

confidence: 98%

See 2 more Smart Citations

The Impact of Environmental Regulation on Firm Export: Evidence from China’s Ecological Protection Red Line Policy?

2019

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China conducted a comprehensive overhaul of its environmental regulation as of April 2014. The regulation, which calls for a holistic approach to protect the environment, is also called the “Ecological Protection Red Line” (Red Line). It sets comprehensive standards for pollutants and mandates provinces to implement the regulations. The Porter and pollution haven hypotheses were tested for the impact of the Red Line on firm exports using a sample of Chinese A-share firms from 2011 to 2017. Our findings are consistent with the Porter hypothesis. The implementation of the Red Line has a positive impact on a firm’s exports. The findings are robust to alternative metrics of exports and different sub-samples. A firm’s innovation activities (in terms of research and development investments) and production efficiency were found to be the transmission channels, corroborating the underlying logic of the Porter hypothesis. Policy implications are discussed.

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Section: Base Findingsmentioning

confidence: 86%

Section: Introductionmentioning

confidence: 89%

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The Impact of Environmental Regulation on Firm Export: Evidence from China’s Ecological Protection Red Line Policy?

2019

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“…e results of regional difference in spatial effects of FDI, regional corruption, and environmental pollution are shown in Table 6. For the eastern region, the spatial lag coefficients ρ in Models (5)- (8) are positive and significant at the 5% level, and for the central region and the western region, the spatial lag coefficients ρ are negative and significant at the 5% level, indicating the regional spatial spillover effects of environmental pollution. For the eastern region and the western region, linear increasing relationships between FDI and environmental pollution are found in models (5)- (7), that is, strengthening FDI inflows fail to effectively reduce environmental pollution, and Pollution Haven Hypothesis is verified.…”

Section: Regional Difference In Spatial Effectsmentioning

confidence: 96%

“…In fact, there is a large amount of literature on the environmental effects of FDI, but previous studies has been plagued by contradictory and ambiguous empirical results, resulting in three diverging perspectives. One popular view is the Pollution Haven Hypothesis, which many scholars confirmed using theoretical and empirical analyses [1][2][3][4][5][6][7][8].…”

Section: Introductionmentioning

confidence: 99%

Regional Difference in Spatial Effects: A Theoretical and Empirical Study on the Environmental Effects of FDI and Corruption in China

Tang

Yang

et al. 2020

Discrete Dynamics in Nature and Society

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Environmental pollution has aroused extensive concern worldwide in recent years. Existing studies on the relationship between foreign direct investment (FDI) and environmental pollution have, however, paid little attention to spatial effects and regional corruption’s environmental performance from a spatial perspective. To address this gap, we investigate the spatial agglomeration effects of environmental pollution in China and the environmental effects of FDI and regional corruption using spatial econometric analysis method. The results indicate significant spatial agglomeration effects in environmental pollution. The results of spatial panel data models reveal that the estimation coefficient of FDI is significantly negative, and FDI inflows reduce China’s environmental pollution. Regional corruption is shown to increase environmental pollution, thereby contributing further to environmental degradation. The interaction coefficient of FDI and regional corruption is significantly positive, indicating that regional corruption reduces the environmental benefits derived from FDI. In addition, regional differences in spatial effects verify that regional corruption also reduces the environmental performance of FDI in the central region. Meanwhile, regional corruption increases the environmental aggravation effects of FDI in the eastern region but weakens it in the western region. Our findings lead to some policy recommendations with regard to environmental protection and pollution control.

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The effects of regional trade integration and renewable energy transition on environmental quality: Evidence from South Asian neighbors

et al. 2021

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Improving environmental quality across South Asia has become one of the utmost important policy agendas of the concerned governments. The susceptibility of the majority of the South Asian countries to multifaceted climate change adversities has motivated the need to identify the factors that can function to ensure environmental sustainability across South Asia. Although several studies have highlighted the importance of globalization and cleaner energy use in tackling the environmental degradaton issues of the South Asian countries, very little is known regarding the impacts of regional trade and renewable energy transition in this regard. Hence, this paper aims to scrutinize the effects of enhancing intra-regional trade integration and undergoing renewable energy transition on per capita carbon dioxide emissions in the context of six South Asian nations between 1990 and 2016. The results from the recently developed cross-sectionally augmented autoregressive distributed lag regression approach, accounting for cross-sectional dependency and slope heterogeneity issues, reveal that facilitating trade among the South Asian neighbors reduces carbon emissions in both the short and long run. Moreover, enhancing the share of renewable energy in the aggregate energy consumption figures is also found to reduce carbon dioxide emissions in both the short and long run. Furthermore, both regional trade integration and renewable energy transition are found to jointly reduce carbon dioxide emissions in South Asia. The results also authenticate the existence of the environmental Kuznets curve hypothesis, while financial development and urbanization are found to boost carbon dioxide emissions only in the long run.

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Dynamic causality testing for EKC hypothesis, pollution haven hypothesis and international trade in India

Cited by 112 publications

References 37 publications

The Impact of Environmental Regulation on Firm Export: Evidence from China’s Ecological Protection Red Line Policy?

The Impact of Environmental Regulation on Firm Export: Evidence from China’s Ecological Protection Red Line Policy?

Regional Difference in Spatial Effects: A Theoretical and Empirical Study on the Environmental Effects of FDI and Corruption in China

The effects of regional trade integration and renewable energy transition on environmental quality: Evidence from South Asian neighbors

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