Environmental regulation and productivity growth: Main policy challenges

Abstract

In this paper, we investigate the environmental regulation-productivity nexus for 14 OECD countries over the years 1990-2015 and discuss its main policy challenges. Our findings support the hypothesis that environmental policies generate positive productivity returns through innovation as suggested by Porter and Van Der Linde (1995). We find that environmental policies have a productivity growth-promoting effect. Both market and non-marked based policies exert a positive but differentiated impact on labour and multifactor productivity growth. Environmental policy measures generate also potentially mixed redistributive impacts. As for specific polices, green taxes display the largest effect on multifactor productivity although with potentially negative redistributive impact. We also find that environmental regulation exerts indirect positive effect on productivity growth fostering capital accumulation especially in high ICT intensive countries.

Environmental regulation, green innovation, and international competitiveness of manufacturing enterprises in China: From the perspective of heterogeneous regulatory tools

“…First, we incorporate different types of environmental regulations into a unified framework. In the measurement of environmental regulation intensity, previous studies usually choose several indicators in an attempt to build a comprehensive index to reflect and measure the overall level of environmental regulation [1][2][3][4]; in some cases, scholars only used some of the tools of environmental regulation in terms of the category of index selection, command-control [2,5,6], market-incentive [7][8][9], voluntary-participation [10,11] and so forth. However, this approach is not appropriate.…”

Can environmental protection policies promote regional innovation efficiency: a difference-in-differences approach with continuous treatment

“…Taking China as an example, in regions where enterprises spend a lot on bribery and have a high degree of corruption, environmental regulation has a significant positive impact on enterprise innovation (Fu and Jian 2021). At the same time, De Santis et al (2021) verified the strong Porter hypothesis based on the environmental policies of 18 OECD countries and used hourly data to represent productivity, proving that the environmental regulation policies of OECD countries have a positive effect on productivity, especially in developed countries with information and communication technology. Countries can make better use of innovation opportunities provided by environmental policies to indirectly improve productivity and economic growth by promoting capital accumulation.…”

Environmental regulations and outward foreign direct investment—empirical evidence from Chinese enterprises

“…Speci cally, this hypothesis posits that a reasonable and effective environmental regulation will enhance enterprise R&D investment and promote technological innovation. Therefore, jointly improving environmental regulations and enterprise productivity through the "innovation compensation effect" and " rst-mover advantage" will indirectly encourage enterprises to engage in OFDI (Porter and Linde 1995;Ambec et al 2013;Santis et al 2021).…”