Environmental Regulation, Globalization, and Innovation: Integrating Industrial, Environmental, and Trade Policies

This paper analyses the relationship between industrial and environmental regulation and sustainable development in the context of a global economy. It is argued that industrial policy, environment policy and commercial initiatives should be integrated and should act jointly. Particular emphasis is also placed on the promotion of technological innovation. Consolidated national regulations can thus act as a stimulus for technological, organisational and social innovation, which would entail commercial advantages for those pioneering firms that are the first to come into line with regulations, enabling them to become leaders and displace rivals that offer sub-optimal products