Multinationals and environmental regulation: are foreign firms harmful?

Dardati, Evangelina; Saygili, Meryem

doi:10.1017/s1355770x11000398

Cited by 21 publications

(9 citation statements)

References 25 publications

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“…Rather than emission levels, other studies use measures of pollution intensity, i.e., emissions scaled by the total output (or value-added) of an industry (or a firm) (see [37][38][39][40]. Other papers use energy use as a measure of pollution intensity under the assumption of a positive relationship between pollution emissions and energy use (37,(41)(42)(43).…”

Section: Measuring the Stringency Of Environmental Regulationsmentioning

confidence: 99%

Foreign Direct Investment and the Environment

Cole¹,

Elliott

Zhang³

2017

Annu. Rev. Environ. Resour.

108

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We review the literature that investigates the relationship between foreign direct investment (FDI) and the environment. After reviewing the theoretical literature, we discuss two broad strands of research. First, the impact of environmental regulations on the choice of plant location and second, the impact of FDI on the emissions of various pollutants and the related question of whether we can observe environmental spillovers from foreign to domestic firms. Finally, we review the more recent literature on environmental outsourcing as an alternative to FDI and conclude with suggestions for future research.

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Section: Measuring the Stringency Of Environmental Regulationsmentioning

confidence: 99%

Foreign Direct Investment and the Environment

Cole¹,

Elliott

Zhang³

2017

Annu. Rev. Environ. Resour.

108

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“…They find exporting to be associated with greater (reduced) energy intensity at lower (higher) quantiles. Next, Cole et al (2008) and Dardati and Saygili (2012) use data on Ghanaian and Chilean firms, respectively, to primarily analyze the energy intensity of foreignowned firms. However, both studies also control for exporter status in some specifications and find exporting to be negatively related to energy intensity.…”

Section: Introductionmentioning

confidence: 99%

Energy efficiency and exporting: Evidence from firm-level data

Roy

Yaşar

2015

Energy Economics

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While exporting firms and non-exporters have been compared across several dimensions, empirical comparisons on the basis of environmental performance are relatively few. Moreover, analyzing the environmental implica-tions of firmlevel exports is not trivial due to non-random selection into exporting. In this light, we examine the impact of exporting on firms' energy efficiency by resorting to an instrumental variables strategy based on a differencing approach (Pitt and Rosenzweig, 1990). Utilizing data from Indonesia, we find (i) exporting to reduce the use of fuels (relative to electricity) and (ii) concerns over endogeneity of exporting status to be relevant. While exporting firms and non-exporters have been compared across several dimensions, empirical comparisons on the basis of environmental performance are relatively few. Moreover, analyzing the environmental implications of firm-level exports is not trivial due to non-random selection into exporting. In this light, we examine the impact of exporting on firms' energy efficiency by resorting to an instrumental variables strategy based on a differencing approach (Pitt and Rosenzweig, 1990). Utilizing data from Indonesia, we find (i) exporting to reduce the use of fuels (relative to electricity) and (ii) concerns over endogeneity of exporting status to be relevant. Roy, J. and M. Yasar (2015

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“…Dardati and Saygili () show that foreign firms are cleaner than domestic firms in the case of Chile.…”

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confidence: 99%

Emission Taxes and Product Differentiation in the Presence of Foreign Firms

Gautier

2016

J Public Economic Theory

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Industries characterized by differentiated products are important contributors of greenhouse gases and currently subject to market-based policies such as emission taxes. In the context of developing countries, fears about foreign investment leaving the country are often used as an argument not to address industry emissions through emission taxes. This paper develops a Cournot model with product differentiation in the presence of abatement efforts where host and foreign firms are subject to an emission tax. The analysis indicates that abatement efforts and differences in pollution intensity coefficients across firms may play a significant role in the characterization of optimal policy. The analysis also suggests that the government may opt to encourage foreign, less pollution-intensive firms via higher taxation. Additionally, this paper examines how an optimal emission tax may be adjusted as products become more differentiated; industry emissions may fall/rise as a result of more differentiated products. One important contribution of this paper is that it emphasizes the role of abatement efforts, product differentiation, and differences in pollution intensity coefficients across firms in the characterization of the optimal emission tax.

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Multinationals and environmental regulation: are foreign firms harmful?

Cited by 21 publications

References 25 publications

Foreign Direct Investment and the Environment

Foreign Direct Investment and the Environment

Energy efficiency and exporting: Evidence from firm-level data

Emission Taxes and Product Differentiation in the Presence of Foreign Firms

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