Environmental Regulations and New Plant Location Decisions: Evidence from a Meta‐Analysis

Abstract

Stricter environmental regulations are often opposed on the grounds that they will alter equilibrium capital flows. Empirical evidence in this area remains largely unresolved, mainly due to the quite disparate results found in the literature. This paper takes a positive look at the relationship between new manufacturing plant location decisions and environmental regulations by examining data from 11 studies that provide more than 365 observations. One major result from our meta-analysis is that methodological considerations play a critical role in shaping the body of received estimates. Our empirical estimates also lend insights into future research that is necessary before any robust conclusions can be made regarding the effects of environmental regulations on capital flows. Copyright 2002 Blackwell Publishers Inc.

A meta-analysis of estimates of urban agglomeration economies

“…To deal with within-study dependence of the elasticity estimates we use a static panel data framework formulated as a cluster-specific randomeffects model. Previous meta-analyses using this specification include Jeppesen et al (2002), Nitsch (2005, and Disdier and Head (2008).…”

“…Some other researchers use a Mincerian type wage 4 There is no standard value for a minimum acceptable meta-sample size. Other meta-analyses with similar sizes include Nitsch, (2005) with 29 studies on Zipf's law of cities; Nijkamp and Poot, (2005) with 17 wage curve studies ;Wieser, (2005) with 17 firm level studies of the rate of return to research and development; Longhi, Nijkamp and Poot, (2005) with 18 studies for the elasticity of wages with respect to the ratio of immigrants over native workers ;Jeppesen, List and Folmer, (2002) with 11 studies on the relationship between new plant location and environmental regulations; Gorg H., (2001) with 21 studies estimating productivity spillovers of multinational companies ;Button, (1998) with 26 studies estimating output elasticities with respect to public infrastructure investment; and Stanley, (1998) with 28 studies of the Ricardian equivalence theorem. equation (Mincer, 1974) where the wage of worker i in location j is explained by a set of workerspecific variables (education, age, etc.)…”

The Competitiveness Impacts of Climate Change Mitigation Policies

“…Fourth, proximity to firms that produce inputs or purchase outputs -e.g., agglomeration economies -also discourages relocation (Jeppesen et al 2002). …”

The Puzzling Persistence of the Distance Effect on Bilateral Trade

“…2 Topics of investigation include the employment effects of minimum wages (Card and Krueger, 1995), the union-nonunion wage gap (Jarrell and Stanley, 1990), Ricardian equivalence (Stanley, 1998 and2001), gender wage discrimination (Stanley and Jarrell, 1998), taxes and foreign direct investment (de Mooij and Ederveen, 2003), productivity spillovers (Görg and Strobl, 2001), the effects of currency unions on trade (Rose and Stanley, 2005), the relationship between location decisions of firms and environmental regulations (Jeppesen et al, 2002), and the rank-size relationship for cities (Nitsch, 2005).…”