Culture and Compliance: Evidence from the European Union Emissions Trading Scheme
Journal of Law and Economics, 2021, vol. 64, issue 1, 181 - 205
I study the role of culture in firms’ compliance decisions in the context of the EU Emissions Trading Scheme, an international regulation implemented in multiple countries with different levels of cultural indicators. To probe causality, I look within countries and exploit the differences in the locations of central headquarters of multinational firms. Using trust as a main cultural indicator, this exercise reveals that installations owned by firms headquartered in high-trust countries were more likely to comply with the regulation than those owned by firms headquartered in low-trust countries, even when they operated in the same geographic area. Using other relevant indicators of culture such as morality and civic virtue yields similar results, which suggests that culture, measured by several indicators, exerts influence on the compliance behavior of firms.
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
Access to the online full text or PDF requires a subscription.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ucp:jlawec:doi:10.1086/711158
Access Statistics for this article
More articles in Journal of Law and Economics from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().