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When do Finns Benefit from Environmental Regulations? A Simple Microeconomic Approach to the Porter Controversy

  • Ecology
  • Economics
  • Geography


Michael Porter and others have recently argued that suitable environmental regulations are likely to induce cost-reducing innovations. We analyze under which conditions such arguments might be consistent with microeconomic analysis, and under which additional conditions the firms' benefits might exceed the costs. It turns out that this requires fairly specific conditions.

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