Endogenous Pollution Research Articles

Control concept and countermeasures for shallow lakes’ eutrophication in China

Research on lake eutrophication in China began in the early 1970s, and many lakes in China are now known to be in meso-eutrophic status. Lake eutrophication has been showing a rapidly increasing trend since 2000. Investigations show that the main reasons for lake eutrophication include a fragile lake background environment, excessive nutrient loading into lakes, excessive human activities, ecological degeneration, weak environmental protection awareness, and lax lake management. Major mechanisms resulting from lake eutrophication include nutrient recycling imbalance, major changes in water chemistry (pH, oxygen, and carbon), lake ecosystem imbalance, and algal prevalence in lakes. Some concepts for controlling eutrophication should be persistently proposed, including lake catchment control, combination of pollutant source control with ecological restoration, protection of three important aspects (terrestrial ecology, lake coast zone, and submerged plant), and combination of lake management with regulation. Measures to control lake eutrophication should include pollution source control (i.e., optimize industrial structural adjustments in the lake catchment, reduce nitrogen and phosphorus emission amounts, and control endogenous pollution) and lake ecological restoration (i.e. establish a zone-lake buffer region and lakeside zone, protect regional vegetation, utilize hydrophytes in renovation technology); countermeasures for lake management should include implementing water quality management, identifying environmental and lake water goals, legislating and formulating laws and regulations to protect lakes, strengthening publicity and the education of people, increasing public awareness through participation in systems and mechanic innovations, establishing lake region management institutions, and ensuring implementation of governance and management measures.

Endogenous Pollution Havens: Does FDI Influence Environmental Regulations?*

AbstractWe suggest a novel perspective on the relationship between the stringency of environmental policies and foreign direct investment (FDI). We develop a political economy model with imperfect product market competition where local and foreign firms jointly lobby the local government for a favorable pollution tax. FDI is found to affect environmental policy, and the effect is conditional on the local government's degree of corruptibility. If the degree of corruptibility is sufficiently high (low), FDI leads to less (more) stringent environmental policy, and FDI thus contributes to (mitigates) the creation of a pollution haven. Our empirical results using panel data from 33 countries support the predictions of the model.

Endogenous Pollution Havens: Does FDI Influence Environmental Regulations?

We suggest a novel perspective on the relationship between the stringency of environmental policies and foreign direct investment (FDI). We develop a political economy model with imperfect product market competition where local and foreign firms jointly lobby the local government for a favorable pollution tax. FDI is found to affect environmental policy, and the effect is conditional on the local government's degree of corruptibility. If the degree of corruptibility is sufficiently high (low), FDI leads to less (more) stringent environmental policy, and FDI thus contributes to (mitigates) the creation of a pollution haven. Our empirical results using panel data from 33 countries support the predictions of the model.

Managed Trade, Trade Liberalisation and Local Pollution

Abstract The current paper addresses the relationship between trade and endogenous pollution levels, with a focus different from the previous literature. The mechanism linking pollution and trade here is that trade policy provides the home government with a credible threat that helps motivate domestic firms to adopt cleaner technologies. This credible threat comes from the fact that the government has a greater incentive to protect a clean industry than to protect a very polluting one. In that sense, the existence of trade helps reduce domestic pollution compared to what would prevail in a situation of autarky. On the other hand, a commitment to free trade would be counterproductive: it removes the government’s ability to credibly threaten lower levels of protection. In fact we show that any trade liberalization hurts the welfare of the home country. In terms of world welfare, moderate trade liberalization is helpful, but only as long as it does not affect the technology choices of the firms. Because committing to lower ‘bounded’ tariffs limits a government’s ability to enforce strict environmental standards, a country that has agreed to tighter tariff limits under the World Trade Organization would, other things equal, be a more likely “pollution haven” than a country with weaker WTO commitments.

Endogenous technological change and pollution abatement

Endogenous technological change and pollution abatement

Optimal growth with renewable resources and pollution

This paper presents three models which combine the optimal dynamics of economic growth, renewable resource harvesting and pollution. We investigate growth, pollution and renewable resources as a three state variable problem. The economy has three inputs, man made capital, renewable resources and emissions. Endogenous pollution affects both the growth of the renewable resource stock and the social welfare. It is shown that the existence of the steady state depends, in a complicated manner, and in addition to preferences, on the production technology, growth of the renewable resource and the rate of decay of pollution. The sufficient conditions for the existence of a global saddle point are given. Conditions under which the market solution equals the optimal solution of the social planner, and the consequences of a too low externality tax on emissions or on common property resource harvesting are discussed.