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Why we can't confirm the pollution haven hypothesis: a model of carbon leakage with agglomeration

Abstract:

The literature on carbon leakage has not yet benefitted from many of the insights of the 'New Economic Geography' (NEG). Most studies assume both an absence of agglomeration forces and that factors do not move interregionally. This paper develops a 2-region NEG model with factor mobility to study the impact of regionally-di§erentiated environmental regulation on the location of polluting firms. There are three main results: (i) trade liberalisation can reduce firms incentives to relocate...

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Publication status:
Published

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Publisher:
University of Oxford
Series:
Department of Economics Discussion Paper Series
Publication date:
2012-06-01
Paper number:
613
Keywords:
Pubs id:
1143818
Local pid:
pubs:1143818
Deposit date:
2020-12-15

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