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Does Entrepreneurial Behaviour Matter for the Strong Porter Hypothesis

Dominique Bianco ()

MPRA Paper from University Library of Munich, Germany

Abstract: The traditional economic argument states that compliance with environmental policy diverts resources from innovation. In his engaging paper, Porter (1991) argues counterintuitively that more stringent environmental policies induce innovations the benefits of which exceed the costs. We build a Schumpeterian endogenous growth model that takes account of both arguments by including satisficing and profit-maximizing managers. Our theoretical results enable us to determine the validity condition of the strong Porter hypothesis which is consistent with empirical results.

Keywords: Endogenous growth; Environmental Porter hypothesis; Environmental policy; Entrepreneurial Behaviours. (search for similar items in EconPapers)
JEL-codes: D40 H23 L21 O33 O44 Q58 (search for similar items in EconPapers)
Date: 2020-05-04
New Economics Papers: this item is included in nep-ent, nep-env, nep-gro and nep-ino
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