The Pollution-Haven Hypothesis suggests that tight environmental standards reduce domestic producers' competitiveness and give rise to their relocating to countries with more lenient standards. This paper questions that relocation is always caused by reduced competitiveness at home. By using a...

Endogenous firm location is analyzed in a discrete two-region-two-firm model of product differentiation. In a non-cooperative game, two regional governments first decide on the imposition (or lifting) of domestic production standards; firms then choose technology (clean or polluting), location...

This paper studies the effect of an emission tax on the relocation decision in a duopoly with exogenous vertical product differentiation. We establish the relationship between quality difference, relocation cost, and marginal damage of emissions in a two-country-setting for three cases: An...

This paper studies the effect of an emission tax on the relocation decision in a duopoly with exogenous vertical product differentiation. We establish the relationship between quality difference, relocation cost, and marginal damage of emissions in a two-country-setting for three cases: An...

We study the effect of countries' energy abundance on trade and sector activity, conditional on sector's energy intensity, using an unbalanced panel with 14 high-income countries from Europe, America and Asia, 10 broad sectors, and years 1970-1997. We find that (i) countries with large energy...

This paper estimates the effect of environmental regulation on industry location and compares it with other determinants of location such as agricultural, education and R&D country characteristics. The analysis is based on a general empirical trade model that captures the interaction between...