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Environmental Responsibility and FDI: Do Firms Relocate Their Irresponsibilities Abroad?
- Publication Year :
- 2013
- Publisher :
- HAL CCSD, 2013.
-
Abstract
- The goal of this paper is to study the influence of corporate environmental responsibility (CER) and national environmental standards on the location choices of the 600 biggest European firms. By using the environmental score provided by Vigeo , we are able to test the influence of the environmental performances of firms. We find a negative interaction effect between these environmental performances and national environmental regulations. Thus, we argue that national standards can be a substitute for CER. All things being equal, firms with better environmental performances tend to be located in dirtier countries. CER can therefore be seen as an answer to the location choices of firms which invest in countries with poor environmental policies. This result is only valid when considering de facto environmental standards, not de jure environmental standards. It suggests a possible strategic behavior of firms which exploit these differences between formal environmental regulations and their effective enforcement.
- Subjects :
- Firm Heterogeneity
Corporate Social Responsibility
Multinational Firms
JEL: Q - Agricultural and Natural Resource Economics • Environmental and Ecological Economics/Q.Q5 - Environmental Economics/Q.Q5.Q56 - Environment and Development • Environment and Trade • Sustainability • Environmental Accounts and Accounting • Environmental Equity • Population Growth
JEL: F - International Economics/F.F2 - International Factor Movements and International Business/F.F2.F23 - Multinational Firms • International Business
JEL: M - Business Administration and Business Economics • Marketing • Accounting • Personnel Economics/M.M1 - Business Administration/M.M1.M14 - Corporate Culture • Diversity • Social Responsibility
Location decision
Environment
[SHS.ECO]Humanities and Social Sciences/Economics and Finance
Corporate Social Responsibility,Environment,Location decision,Regulation,Multinational Firms,Firm Heterogeneity
Regulation
Subjects
Details
- Language :
- English
- Database :
- OpenAIRE
- Accession number :
- edsair.dedup.wf.001..c2cebfd8bf18e2cdb7c65f3a5caab23b