Environmental regulation and productivity: testing the porter hypothesis

Lanoie, Paul; Patry, Michel; Lajeunesse, Richard

doi:10.1007/s11123-008-0108-4

Cited by 671 publications

(376 citation statements)

References 13 publications

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“…Another strand of studies in the distance function framework is stochastic production frontier analysis (SFA), which includes a stochastic error term in the computation of the production possibility frontier, e.g., [8,18]. Finally, total factor productivity (TFP) is used in numerous studies [2,6,[19][20][21][22][23][24][25][26][27][28][29]. The literature on TFP measurements has lately incorporated bad outputs.…”

Section: Previous Researchmentioning

confidence: 99%

“…An important issue when evaluating the impact of environmental policy is the dynamic dimension [8,15,[26][27][28]. It is not evident that a regulation should only have contemporaneous effects, or maybe not even a contemporaneous effect at all, but the response could come with a certain lag (or even prior to the date of policy enforcement if it is credibly and transparently announced).…”

Section: Previous Researchmentioning

confidence: 99%

“…However, the empirical results are ambiguous. For instance, Managi [15] and Lanoie [27] show that environmental regulations have a negative contemporaneous effect but a positive effect on productivity in the medium to long-term. In the latter study, the positive long-term effect outweighs the initial negative effect.…”

Section: Previous Researchmentioning

confidence: 99%

“…However, regarding the studies conducted during the last 20 years, the results are somewhat ambiguous. There are cases where no statistically significant effect on productivity by environmental regulation can be found in [20,24], while some studies find positive effects [12,15,18,[26][27][28]39].…”

Section: Previous Researchmentioning

confidence: 99%

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Effect of Environmental Regulation Stringency on the Pulp and Paper Industry

Brolund

Lundmark

2017

Sustainability

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Abstract:The article investigates whether environmental regulations have affected productivity development and technological change in the European pulp and paper industry. A dynamic panel data approach is selected for analyzing a sample consisting of the pulp and paper industries in eight European countries. Industry total factor productivity for the period 1993-2009 is used as the dependent variable; it is explained by the intensities of environmental regulations for various types of pollutants, as well as by a number of other independent variables. The econometric results indicate that the regulation of nitrogen oxides is associated with productivity improvements with a one-year lag, whereas regulations regarding sulphur dioxide and carbon dioxide have not had any statistically significant impact. In line with the a priori expectations, the price of pulp is connected to a negative effect, while lagged R&D expenditures have had corresponding positive impacts. However, since stationary tests are asymptotic and the data series are quite short, strong conclusions regarding the actual causal effect of environmental policy could not be drawn. The results could therefore not be viewed as a proof of the so-called strong Porter hypothesis postulating that stringent well-designed environmental regulations increase productivity growth compared to a no-policy scenario.

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Section: Previous Researchmentioning

confidence: 99%

Section: Previous Researchmentioning

confidence: 99%

Section: Previous Researchmentioning

confidence: 99%

Section: Previous Researchmentioning

confidence: 99%

See 2 more Smart Citations

Effect of Environmental Regulation Stringency on the Pulp and Paper Industry

Brolund

Lundmark

2017

Sustainability

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“…That tighter environmental standards can not only reduce costs directly, but also spur further cost reducing innovation, boosting competitiveness -the so called Porter hypothesis -has inspired a large body of supportive empirical studies (e.g. Lanoie et al 2008;Horbach, 2007;Costantini, and Crespi, 2007;and Kriechel and Ziesemer, 2009). However, others have rejected this case-study based approach by arguing such examples are special cases and that across the economy it is just as likely environmental regulations come at a net cost, as well as embodying a significant opportunity cost.…”

Section: Michael Porter a D Claas Va De Li De Smentioning

confidence: 99%

Banning the bulb: Institutional evolution and the phased ban of incandescent lighting in Germany

Howarth

Rosenow

2014

Energy Policy

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Much academic attention has been directed at analysing energy efficiency investments through the lens of behavioural failure . These studies ha e halle ged the neoclassical framing regulation which emphasises the efficiency benefits of price-based policy, underpinned by the notion of rational individual self-mastery. The increasing use of a regulatory ban on electric lamps in many countries is one of the most recent and high p ofile flash poi ts i this diale ti of f eedo -versus-the-state i the public policy discourse. This paper interrogates this debate through a study of electric lamp diffusion in Germany. It is argued that neoclassical theory and equilibrium analysis is inadequate as a tool for policy analysis as it takes the formation of market institutions, such as existing regulations, for granted. Further still, it may be prone to encourage idealistic debates around such grand narratives which may in practice simply serve those who benefit most from the status quo. Instead we argue for an evolutionary approach which we suggest offers a more pragmatic framing tool which focuses on the formation of market institutions in light of shifting social norms and political goals -in our case, progress towards energy efficiency and environmental goals.

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