Strict environmental laws ‘push’ firms to pollute elsewhere

Read the full story from Ohio State University.

Multinational companies headquartered in countries with tougher environmental policies tend to locate their polluting factories in countries with more lax regulations, a new study finds.

While countries may hope their regulations will reduce emissions of carbon dioxide and other greenhouse gases, these results show that these policies can lead to “carbon leakage” to other nations, said Itzhak Ben-David, co-author of the study and professor of finance at The Ohio State University’s Fisher College of Business.

The study was published online recently in the journal Economic Policy.

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