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The impact of environmental policy on location patterns in the waste management industry

Aleksandra Falkowska ()
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Aleksandra Falkowska: Hitotsubashi University

Economia Politica: Journal of Analytical and Institutional Economics, 2020, vol. 37, issue 1, No 7, 167-195

Abstract: Abstract This research investigates the influence environmental policy stringency has, together with other factors, such as land and capital endowments, on the location patterns of the European waste management industry. The pollution haven hypothesis (PHH) and the Porter hypothesis (PH) are tested simultaneously through the employment of a model that includes interactions between country characteristics and waste treatment option intensities. Analysis of 27 countries and 3 treatment options reveals that stringent regulations increase a country’s share in the recovery sector, supporting the PH. Despite the opposite effect being observed in the final disposal sector, the evidence is not strong enough to confirm the PHH in its original form. The general negative relationship between the pollution intensity and the regulatory stringency, however, indicates the presence of a pollution haven effect.

Keywords: Porter hypothesis; Pollution haven hypothesis; Industry location; Waste management; Comparative advantage; Environmental policy (search for similar items in EconPapers)
JEL-codes: Q53 Q58 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1007/s40888-020-00174-9

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Handle: RePEc:spr:epolit:v:37:y:2020:i:1:d:10.1007_s40888-020-00174-9