This paper discusses environmental policies in response to foreign direct investment (FDI) in a symmetrie two-country setting, where firms' behavior affects government policy decisions. We show that two alternative equilibria with FDI are possible: (i) one with unilateral FDI, where one firm is...

This paper analyzes the interactions between international environmental policy and multinational corporate strategy. The main contribution is building a new conceptual framework to analyze the type of corporate strategy developed in the presence of both national and international environmental...