National Emissions Standards,Pollution Havens,and Global Greenhouse Gas Emissions

The present study shows that the availability of “pollution havens” can negate the effect of national legislation that tightens industrial greenhouse gas emission standards. In the perverse case, a unilateral tightening of said standards in Country A (a country with relatively stringent industrial emission standards) causes a representative multinational firm to emit more units of greenhouse gas in its global production. The article highlights the potential perils of unilateral action on environmental issues that are global in nature.