Multiple environmental policies and pollution haven hypothesis: Evidence from China's polluting industries

2017 ◽  
Vol 141 ◽  
pp. 295-304 ◽  
Author(s):  
Dan Zheng ◽  
Minjun Shi
Author(s):  
Monica Das ◽  
Sandwip K. Das

Abstract According to the Pollution Haven Hypothesis (PHH), weak environmental policies improve a country's comparative advantage in the polluting sector, thus promoting its expansion. In this paper, we develop a neo-classical general equilibrium model with two goods and two factors and show that the relationship between environmental policies and comparative advantage can be ambiguous. We focus entirely on emission caps or command and control (CAC) programs of regulation and treat abatement as equivalent to a technological retardation. We show that when the technological retardation is Hick neutral, the PHH holds and the Heckscher Ohlin Samuelson (HOS) theorem determines trade patterns between a capital-abundant country and a labor-abundant country that follow different environmental policies. If pollution abatement is capital biased in the polluting sector, the standard trade theorems and the PHH may not hold. The paper derives a sufficient condition under which the PHH would hold. However, if this condition is violated, the PHH as well as the HOS theorem may not hold.


2021 ◽  
Vol 78 (1) ◽  
pp. 177-199
Author(s):  
Claudia Ranocchia ◽  
Luca Lambertini

AbstractThe Porter hypothesis and the pollution haven hypothesis seem to predict opposite reactions by firms facing environmental regulation, as the first invokes the arising of a win–win solution while the second envisages the possibility for firms to flee abroad. We illustrate the possibility of designing policies (taking the form of either emission taxation or environmental standards) able to eliminate firms’ incentives to relocate their plants abroad and create a parallel incentive for them to deliver a win–win solution by investing either in replacement technologies under emission taxation, or in abatement technologies under an environmental standard. This is worked out in a Cournot supergame in which firms may activate the highest level of collusion compatible with their intertemporal preferences.


Author(s):  
Ke Zhang ◽  
Xingwei Wang

With the development of trade liberalization, the pollutants emissions embodied in global trade are increasing. The pollution haven hypothesis caused by trade has aroused wide attention. The fragmentation of international production has reshaped trade patterns. The proportion of intermediate product trade in global trade is increasing. However, little has been done to study the pollution haven of different pollutants under different trade patterns. In this paper, major environmental pollutants CO2 (carbon dioxide), SO2 (sulfur dioxide), and NOx (nitrogen oxides) are selected as the research objects. This study investigated the global pollution haven phenomenon in 43 countries and 56 major industries from 2000 to 2014. Based on the MRIO model, the trade mode is divided into three specific patterns: final product trade, intermediate product trade in the last stage of production, and the trade related to the global value chain. The results show that trade liberalization could reduce global CO2, SO2, and NOx emissions, and intermediate product trade has a more significant emission reduction effect than final product trade. Trade’s impacts on each country are various, and the main drivers are also different. For example, the European Union avoids becoming a pollution haven mainly through the trade related to the global value chain. The suppressed emissions under this trade pattern are 71.8 Mt CO2, 2.2 Mt SO2, 2.2 Mt NOx. India avoids most pollutants emissions through intermediate product trade. China has become the most serious pollution haven through final product trade. The trade pattern could increase China 829.4 Mt CO2, 4.5 Mt SO2, 2.6 Mt NOx emissions in 2014.


Energy ◽  
2017 ◽  
Vol 124 ◽  
pp. 706-719 ◽  
Author(s):  
Sakiru Adebola Solarin ◽  
Usama Al-Mulali ◽  
Ibrahim Musah ◽  
Ilhan Ozturk

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