Hardback
The Porter Hypothesis and the Economic Consequences of Environmental Regulation
A Neo-Schumpeterian Approach
9781843766445 Edward Elgar Publishing
Combining the public choice literature on political decision making with the Neo-Schumpeterian literature on innovation, this valuable new book develops a conceptual model of how environmental regulation is designed. The author presents a novel perspective on the Porter Hypothesis, arguing that the effect of environmental regulation is too weak to induce technological change. This implies that environmental policy intervention has little, if any, economic consequences which has significant repercussions for environmental decision-making.
More Information
Critical Acclaim
Contents
More Information
Combining the public choice literature on political decision making with the Neo-Schumpeterian literature on innovation, this valuable new book develops a conceptual model of how environmental regulation is designed. The author presents a novel perspective on the Porter Hypothesis, arguing that the effect of environmental regulation is too weak to induce technological change. This implies that environmental policy intervention has little, if any, economic consequences which has significant repercussions for environmental decision-making.
Since radical technological advance is unpredictable, this implies that environmental regulation induces, at the very most, incremental improvements of existing designs. Moreover, due to the high political costs of disrupting existing industry structures, regulation objectives are often adjusted or the compliance costs reduced through subsidies. Due to this limited inducement effect, the author finds that environmental regulation does not produce outcomes consistent with the Porter Hypothesis, nor does it have any palpable negative economic impact. Using detailed case-study evidence, each step of his argument is skilfully illustrated. The book concludes with a number of concrete policy recommendations as to how existing and future regulations might be improved and how the development of radically novel cleaner technology may be fostered.
This book provides a comprehensive assessment of the negotiation process that leads to the design of regulatory policy objectives. It also represents a first attempt to study the possibilities and limitations of environmental regulation as a policy tool to stimulate the development and diffusion of cleaner technologies. Environmental economists, resource managers and policymakers interested in environmental regulation and technological change will welcome this valuable addition to the literature.
Since radical technological advance is unpredictable, this implies that environmental regulation induces, at the very most, incremental improvements of existing designs. Moreover, due to the high political costs of disrupting existing industry structures, regulation objectives are often adjusted or the compliance costs reduced through subsidies. Due to this limited inducement effect, the author finds that environmental regulation does not produce outcomes consistent with the Porter Hypothesis, nor does it have any palpable negative economic impact. Using detailed case-study evidence, each step of his argument is skilfully illustrated. The book concludes with a number of concrete policy recommendations as to how existing and future regulations might be improved and how the development of radically novel cleaner technology may be fostered.
This book provides a comprehensive assessment of the negotiation process that leads to the design of regulatory policy objectives. It also represents a first attempt to study the possibilities and limitations of environmental regulation as a policy tool to stimulate the development and diffusion of cleaner technologies. Environmental economists, resource managers and policymakers interested in environmental regulation and technological change will welcome this valuable addition to the literature.
Critical Acclaim
‘It is a tribute to Thomas Roediger-Schluga that he has turned his Austrian doctoral thesis into a very fine book, written in a clear style. . . anyone wanting a concise but careful overview of the literature on the effects of environmental regulation on the economy will not do better than the early chapters of this book. . . the style and execution of the book make it readable and relevant. In an age when economists, in particular, produce impenetrable and obscure tracts, this is to be welcomed. This is a fine book and one to be very firmly recommended.’
– The late David Pearce, European Environment
‘The book is right on target about a much-discussed topic: innovation impacts and techno-economic consequences of environmental regulation. Its novelty lies in engaging in empirical case research of the impacts and the political regulatory design process of volatile organic compound (VOC) control in Austria. It is a valuable contribution to the literature on the Porter Hypothesis, offering a model for predicting outcomes and offering recommendations for dealing with information asymmetries in the regulatory process.’
– René Kemp, Maastricht University, The Netherlands
– The late David Pearce, European Environment
‘The book is right on target about a much-discussed topic: innovation impacts and techno-economic consequences of environmental regulation. Its novelty lies in engaging in empirical case research of the impacts and the political regulatory design process of volatile organic compound (VOC) control in Austria. It is a valuable contribution to the literature on the Porter Hypothesis, offering a model for predicting outcomes and offering recommendations for dealing with information asymmetries in the regulatory process.’
– René Kemp, Maastricht University, The Netherlands
Contents
Contents: 1. Introduction 2. The Porter Hypothesis: Environmental Regulation, Innovation and Competitiveness 3. The Technological, Regulatory and Economic Environment 4. Some Stylised Facts on Technological Advance 5. Determinants and Adoption of Cleaner Technological Innovations 6. The Design of an Environmental Regulation in a Market Framework: A Conceptual Model 7. Empirical Evidence on the Genesis of Austrian VOC Emission Standards 8. Confronting the Expected Regulatory Outcome with Reality 9. Summary and Policy Implications References Index
