Moving to Greener Pastures? Multinationals and the Pollution Haven Hypothesis

39 Pages Posted: 11 Apr 2002 Last revised: 16 Oct 2022

See all articles by Gunnar S. Eskeland

Gunnar S. Eskeland

NHH Norwegian School of Economics - Department of Business and Management Science; Foundation for Research in Economics and Business Administration

Ann E. Harrison

University of California, Berkeley; National Bureau of Economic Research (NBER)

Date Written: April 2002

Abstract

This paper presents evidence on whether multinationals are flocking to developing country 'pollution havens'. Although we find some evidence that foreign investors locate in sectors with high levels of air pollution, the evidence is weak at best. We then examine whether foreign firms pollute less than their peers. We find that foreign plants are significantly more energy efficient and use cleaner types of energy. We conclude with an analysis of US outbound investment. Although the pattern of US foreign investment is skewed towards industries with high costs of pollution abatement, the results are not robust across specifications.

Suggested Citation

Eskeland, Gunnar S. and Harrison, Ann E., Moving to Greener Pastures? Multinationals and the Pollution Haven Hypothesis (April 2002). NBER Working Paper No. w8888, Available at SSRN: https://ssrn.com/abstract=307125

Gunnar S. Eskeland

NHH Norwegian School of Economics - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway
+4755959699 (Phone)

Foundation for Research in Economics and Business Administration ( email )

Breiviksveien 40
Bergen, N-5045
Norway
+47 55959699 (Phone)

Ann E. Harrison (Contact Author)

University of California, Berkeley ( email )

Giannini Hall
Berkeley, CA 94720-3880
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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