Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
Toward a New Conception of the Environment-Competitiveness Relationship
Journal of Economic Perspectives
vol. 9,
no. 4, Fall 1995
(pp. 97–118)
(Complimentary)
Abstract
Accepting a fixed trade-off between environmental regulation and competitiveness unnecessarily raises costs and slows down environmental progress. Studies finding high environmental compliance costs have traditionally focused on static cost impacts, ignoring any offsetting productivity benefits from innovation. They typically overestimated compliance costs, neglected innovation offsets, and disregarded the affected industry's initial competitiveness. Rather than simply adding to cost, properly crafted environmental standards can trigger innovation offsets, allowing companies to improve their resource productivity. Shifting the debate from pollution control to pollution prevention was a step forward. It is now necessary to make the next step and focus on resource productivity.Citation
Porter, Michael E., and Claas van der Linde. 1995. "Toward a New Conception of the Environment-Competitiveness Relationship." Journal of Economic Perspectives 9 (4): 97–118. DOI: 10.1257/jep.9.4.97JEL Classification
- Q20 Renewable Resources and Conservation: General
- O31 Innovation and Invention: Processes and Incentives