Umweltpolitik und internationale Wettbewerbsfähigkeit

Stefanie U. Schmid

No 823, Kiel Working Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: The paper discusses the impact of environmental policies on international competitiveness of industries. Two positions are taken in the current debate on this issue. One the one hand, strict environmental policies are blamed for imposing substantiell costs which worsen international competitiveness. One the other hand, the competitiveness of firms may be improved in the long run because firms are encouraged to develop green technologies and may take a leading position on these world markets in the future (Porter-Hypothesis). The paper demonstrates that neither theoretical nor empirical evidence is able to support one of these conßicting positions in general. It shows the effects of environmental policies in different theoretical settings and discusses the problem in a model of perfect competition, in strategic environmental policy models of an international oligopoly, and in a model of firms' locational decisions. Many of the results are very sensitive to changes in parameters and assumptions and cannot be generalized. A survey of empirical studies concludes that there is no general clear evidence for neither a positive nor a negative impact of environmental policy on international competitiveness.

JEL-codes: F12 L1 Q20 (search for similar items in EconPapers)
Date: 1997
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:823

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