Environmental Regulations,Outward FDI and Heterogeneous Firms: Are Countries Used as Pollution Havens?

We consider whether environmental regulations influence FDI outflows from a country with stringent environmental policy. We consider this issue by incorporating the predictions from the recent heterogeneous firm models of international trade into an empirical model of outward FDI by UK firms. We find that environmental regulations are not a robustly significant determinant of the internationalisation decision. In addition, we do not find robust evidence to suggest that dirtier MNEs are more likely to locate in host countries with lax environmental policy than cleaner MNEs. However, we do uncover systematic differences in the FDI behaviour of high and low environmental cost firms in other respects.     

Environmental Innovations and Firm Profitability: Unmasking the Porter Hypothesis

We examine impacts of different types of environmental innovations on firm profits. Following Porter’s (Sci Am 264(4):168, 1991) hypothesis that environmental regulation can improve firms’ competitiveness, we distinguish between regulation-induced and voluntary environmental innovations. We find that innovations which do not improve firms’ resource efficiency do not provide positive returns to profitability. However, innovations that increase a firm’s resource efficiency in terms of material or energy consumption per unit of output have a positive impact on profitability. This positive result holds for both regulation-induced and voluntary innovations, although the effect is greater for regulation-driven innovation. We conclude that the Porter hypothesis does not hold in general for its “strong” version, but depends on the type of environmental innovation. Our findings rest on firm-level data from the German part of the Community Innovation Survey 2008 (CIS 2008).     

Acquirer's return and the choice of acquisition targets: does acquisition experience matter?

We study a sample of 6503 UK acquisitions completed between 1985 and 2004 and control for previous deals similarities. Returns for frequent acquirers decrease constantly but they remain positive through high-order deals. We do not detect an improving pattern of returns but, at best, a stable one when the deal is settled for cash. Using ‘characteristics-based’ experience variables, our multivariate analysis shows that the acquirers’ returns are unaffected by prior acquisition experience. However, we find solid evidence for acquirers drawing inferences from prior experience in designing the method of payment, selecting the organizational form of the target firm and engaging in focused acquisitions, which is consistent with learning through acquisitions. The results are robust to various consistency checks.     

Environmental Protection,Agency Motivations,and Rent Extraction: The Regulation of Water Pollution in Louisiana

Direct environmental regulation has been in place in the United States for more than twenty-five years. Yet there has been little study of what actually affects regulatory enforcement levels. This study examines enforcement issues by focusing on water quality enforcement by the Louisiana Department of Environmental Quality. The study finds that penalties are more likely to occur, and are likely to be higher, the more serious a firm's violation of a regulation. Penalties are also more likely, and likely to be higher, if a firm has a previous record of environmental violations. In contrast to other studies, however, we do not find that enforcement varies across regional offices. In addition, we did not find any systematic effects of the Weingast and Moran (1983) theory of legislative dominance. We did, however, find evidence of rent extraction, along the lines of McChesney (1987; 1991).     

Employment,job turnover,and trade in producer services: UK firm‐level evidence

Abstract We provide the first firm‐level evidence of the impact of the trade in producer services (‘offshoring’) on the labour market. Using a new data set from the UK that measures trade in services at the firm level, we find no evidence that importing intermediate services is associated with job losses or greater worker turnover. Using regression to control for observable differences between firms that import service inputs and those that do not, we show that firms that start importing intermediate services experience faster employment growth than equivalent firms that do not. This seems likely to be the result of positive demand shocks, which cause a simultaneous increase in employment, output, and use of imported service inputs.     

Climatic Factors as Determinants of International Migration

We examine natural disasters and long‐run climatic factors as potential determinants of international migration, implementing a panel dataset of bilateral migration flows from 1960 to 2000. We find no direct effect of long‐run climatic factors on international migration across our entire sample. These results are robust when conditioning on origin‐country characteristics, when considering migrants returning home, and when accounting for the potential endogeneity of migrant networks. Rather, we find evidence of indirect effects of environmental factors operating through wages. We find that epidemics and miscellaneous incidents spur international migration, and there is strong evidence that natural disasters beget greater flows of migrants to urban environs.     

Transformational leadership and absorptive capacity: an analysis of the organisational catalysts for this relationship

Research analysing the antecedents of a firm’s absorptive capacity suggests that transformational leadership (TL) is one of its main determinants. However, the few studies focusing on the relationship between these two variables do not explicitly assess why transformational leaders facilitate knowledge acquisition, sharing and retention inside firms. This paper suggests that the reason is that the former contributes to the creation of an organisational context that favours learning processes. We test our research model on a sample of 467 Spanish industrial firms. Findings provide evidence that TL is positively related to the firm’s absorptive capacity and that this relationship is mediated by some organisational learning facilitators: experimentation, risk-taking, interacting with external environment and dialogue.     

Who invests more in advanced abatement technology? Theory and evidence

We study firm investment in abatement technology under a heterogeneous‐firm framework. We find that more‐productive firms make more (less) investment in abatement technology if investment and productivity are complements (substitutes). Under linear demand, firms’ abatement investments exhibit an inverted U‐shape with respect to productivity level. This finding is in contrast to results in existing studies. We also find that in response to tightened environmental regulations, more‐productive firms raise their respective investments in abatement technology, whereas less‐productive firms do the opposite. More‐productive firms have lower pollution emission intensity. The key theoretical predictions are confirmed by empirical tests using Chinese data.     

The more subsidies,the longer survival? Evidence from Chinese manufacturing firms

How do government subsidies affect firm survival? By using Chinese firm‐level data for 1998 to 2007, we show that, on average, there is a positive and significant impact of government subsidies on firm survival. We also investigate the heterogeneous effects of government subsidies with different intensities on firm survival, and find that moderate‐intensity government subsidies exert a positive impact on firm survival, while high‐intensity government subsidies increase the exit probabilities, the underlying mechanisms via subsidy‐seeking investment and innovation incentive weakening are supported by empirical evidence. Furthermore, we explore the role of governance institutions in the subsidy–survival relationship, and find that the positive impact of government subsidies on firm survival is more pronounced in regions with better governance institutions.     

Does FDI Facilitate Domestic Entry? Evidence from the Czech Republic

This paper analyzes the impact of FDI on domestic firm entry and firm size distributions in the Czech Republic during 1994–2000. We find that larger foreign presence stimulates the entry of domestic firms within the same industry, indicating the existence of positive horizontal spillovers from FDI. We also find evidence of significant vertical entry spillovers—FDI in downstream (upstream) industries initiates entry in upstream (downstream) sectors. Our results also show that entry spillovers through vertical linkages are stronger than horizontal spillovers and that while service industries benefit from both horizontal and vertical spillovers, manufacturing industries do not experience significant positive entry spillovers of any kind. We also find that country of origin of FDI matters—horizontal spillovers are driven by FDI from the EU countries. The right skewness of the firm size distributions in industries without FDI further emphasizes an important role of FDI presence for overall industry dynamics.     

Determinants and value relevance of UK CEO pay slice

This paper studies the CEO pay slice (CPS) of UK listed firms during the period 2003 to 2009. We investigate the determinants of CPS. We study the links between CPS and measures of firm performance. We find that firms with higher levels of corporate governance ratings and those with more independent boards tend to have higher CPS. In addition, we find that CEOs are more likely to receive lower compensation when they chair the board and when they work in firms with large board size. We also find that higher CPS is positively associated with firm performance after controlling for the firm-specific characteristics and corporate governance variables. We get compatible results when we examine the association between equity-based CPS and firm performance. Our results remain robust to alternative accounting measures of firm performance. Our results suggest that high UK CPS levels do indeed reflect top managerial talent rather than managerial power.     

Productivity Performance of Export Market Entry and Exit: Evidence from Indian Firms

This paper contributes to the literature on exporting and firm productivity, focusing on export entry (efficiency), learning (post‐entry growth) and exit (inefficiency) by Indian firms. Drawing on 7000 firms during 1989–2009, our main objective is to examine the effect of exporting on firm productivity, correcting for selection bias using propensity‐score matching, which allows a “like‐for‐like” comparison between new exporters and nonexporters. Robust to different matching estimators, we find evidence of learning‐by‐exporting that new exporters acquire rapid productivity growth after entry, relative to nonexporters. We also find that (1) exporters are more productive than nonexporters; (2) productive firms tend to self‐select in entering the exporting market, and (3) least productive exporters are found to exit the export market as they experience adverse productivity effect prior to the year of exit. Our robust result on learning‐by‐exporting suggests that entering export market does appear to be a channel explaining the Indian recent growth miracle.     

Increased sorting and wage inequality in the Czech Republic

This paper makes use of a linked employer–employee dataset to examine the evolution of wage inequality in the Czech Republic during 1998–2006. We find evidence of slightly increasing returns to human capital and diminishing gender inequality and document sharp increases in both within‐firm and between‐firm inequality. We investigate several hypotheses to explain these patterns: increased domestic and international competition, decentralized wage bargaining, skill‐biased technological change and a changing educational composition of the workforce. Domestic competition is found to lower within‐firm inequality whereas we find no evidence that increased international trade at the industry level is associated with higher between‐ or within‐firm wage inequality. The key factors driving the observed increase in wage inequality are increased educational sorting and the inflow of foreign firms to the Czech Republic.     

The returns to exporting: evidence from UK firms

Abstract The question of learning versus self‐selection has dominated the micro‐econometric literature on firm export decisions without leading to any firm conclusions. In part this reflects the limited information content of the data typically used. In this paper we use survey data on UK firms to offer some new insights into this debate. We find that the majority of firms report benefits to exporting across a wide range of performance measures, including size, profitability, and the introduction of new products. These effects do not decline as the number of years of exporting rises if the export intensity of the firm rises.     

Investment, uncertainty and irreversibility

This paper investigates the irreversibility of investments and the impact this has on the nature of the relationship between investment and uncertainty. The empirical analysis uses firm‐level data and is based on a survey of 210 rice‐milling firms in the Mekong River Delta in Vietnam, which was carried out during the year 2000. We show that uncertainty reduces investment of rice millers in the presence of irreversibility, as is predicted by the real options approach to investment. We do not find evidence that the negative association between uncertainty and investment is influenced by the degree of irreversibility.     

Meanings and practices of learning from incidents: a social constructivist perspective of incident reporting systems

Incident reporting systems (IRSs) are used in many organisations as tools that promote safety by allowing to collectively learn from incidents. In this paper, we propose a social constructivist approach to learning from incidents, in which the focus is not purely on safety, but on the technology of incident reporting itself. We employ Wiebe Bijker’s work on the Social Construction of Technology to open up the analysis of a specific IRS in use at the Belgian Nuclear Research Center. For this purpose, we carried out 28 interviews with key local actors and collected documents and observation notes. Such social constructivist perspective provides detailed insight into the practices of reporting and the meanings of learning from incidents. Our research shows that various actors within the organisation frame the IRS differently. These framings each have their own implications for the vulnerability of the organisation.     

Information technology investment and firm performance in US retail trade

We examine the relationship between investments in information technology (IT) and retail firm performance. We use untapped firm and establishment micro data from the Censuses of Retail Trade and the Assets and Expenditures Survey. We show that large firms account for most retail IT investment, employment, and establishment growth. We find evidence of a significant relationship between IT investment intensity and productivity growth.     

环境规制对现存企业迁移行为的影响研究

在城市化发展过程企业渐渐由中心区迁往外围区域,鲜有研究从这一视角观察企业迁移行为。本文从环境规制的角度对现存企业的迁移行为进行了探讨。实证分析发现在省级层面,废水污染费征收率提升显著减少企业在城市之间迁移的数量,废气污染费征收率提高增加企业城市之间迁移的数量。在企业层面环境规制增强显著提升企业在县区之间迁移的概率。利用国家贫困县名录,进一步发现废气污染费率增加显著提升企业往县和贫困县迁移的概率。进一步分析发现加入WTO、2003年污染费征收改革后污染费上升时企业显著提高向贫困县迁移的概率。最后本文发现环境规制提高了企业的创新水平以规避环境规制成本从而降低了迁移的概率。     

Imported carbon emissions: Evidence from French manufacturing companies

This paper analyzes imported carbon emission at the firm level. To do so, we combine information on emissions, imports, imported emissions and energy prices for French manufacturing firms between 1997 and 2014. We document a significant increase of the carbon emissions embedded in imports of French manufacturing companies over the period 1997 to 2014 that is attributable mainly to a shift towards more carbon-intensive products and countries. We then estimate the impact of imported emissions on domestic emissions and emission intensity using a shift-share instrumental variable strategy based on third countries supply shocks. We do not find compelling evidence of an impact of carbon imports on total emissions, but emission efficiency improves significantly in companies offshoring emissions abroad. A 10% increase in carbon offshoring causes a 4% decline in emission intensity. In addition, we find that the elasticity of domestic emission intensity to imported emissions is stronger in energy-intensive sectors, on high-productivity companies and among exporters. Reassuringly, the relationship between imported emissions and emission intensity does not seem to be driven by a pollution haven motive.     

Does Exporting Increase Productivity? A Microeconometric Analysis of Matched Firms

Exporting involves sunk costs, so some firms export whilst others do not. This proposition derives from a number of models of firm behavior and has been exposed to microeconometric analysis. Evidence from the latter suggests that exporting firms are generally more productive than nonexporters. They self‐select, in that they are more productive before they enter export markets, but the evidence suggests that entry does not make them any more productive. This paper investigates exporting and firm performance for a large panel of UK manufacturing firms, applying matching techniques. The authors find that exporters are more productive and they do self‐select. In contrast to other evidence, however, exporting further increases firm productivity.