A common claim holds that investment treaties reduce the willingness of host countries to regulate foreign … replacement investment. This paper examines these claims in a stylised setting with a stranded investment and a potential … replacement investment, both of which are protected by an investment agreement. The paper shows how treaty protection weakens …

tendency to divest from more polluting firms, increases with per capita GDP. Especially investment managers, who invest on … behalf of their clients, and investors with longer investment horizons contribute to the portfolio greening effect of … economic development. We find that this effect is weaker for smaller firms and for firms that are included in the MSCI World …