Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/155218
Authors: 
Kayalica, M. Ozgur
Lahiri, Sajal
Year of Publication: 
2001
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 55.2001
Abstract: 
We analyse strategic environmental standards in the presence of foreign direct investment (FDI). A foreign firm located in a host country competes with a domestic firm in another country to export a homogeneous good to a third country. We also extend the model to allow the number of FDI to be endogenous. When the number of foreign firms is exogenous, the FDI host country always applies stricter environmental regulation. However, under free entry and exit of foreign firms, the FDI host country may apply lower standards under both non-cooperative and cooperative equilibrium.
Subjects: 
Environment
emission permits
Foreign Direct Investment
trade
pollution
JEL: 
F2
H2
Document Type: 
Working Paper

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