A Meta-Analysis of the Relationship between Environmental Regulations and Competitiveness and Conditions for Its Realization
Abstract
:1. Introduction
2. Literature Review and Hypotheses
2.1. Relationship between Environmental Regulations and Competitiveness
2.2. Positive Effect
2.3. Negative Effect
2.4. Uncertain Relationship
2.5. Moderating Effect
2.5.1. Industry Characteristics
2.5.2. Economic Development
2.5.3. Measurement Methods and Research Level
3. Method
3.1. Literature Search
- Include the ER and competitiveness variables and;
- Represent an empirical analysis and report the sample size, effect size, or other indicators that could be converted into the effect size.
3.2. Effect Size
3.3. Coding the Studies
3.4. Homogeneity Analysis
3.5. Publication Bias
4. Results and Discussion
4.1. Effect Size Distribution and Publication Bias
4.2. Heterogeneity Test
4.3. Main Effects
4.4. Moderator Analysis
4.5. Industry Characteristics
4.6. Economic Development
4.7. Other Moderators
5. Conclusions
- On average, there is a moderately positive correlation between ERs and competitiveness, and ERs can lead to increased competitiveness. There is a win–win relationship between the environmental impact and economic development. Our study supports the Porter hypothesis adopted by most scholars;
- Among the moderators, industry characteristics have a significant moderating effect on the ER–competitiveness relationship. ERs more significantly demonstrate a positive effect on competitiveness in pollution-intensive industries;
- The economic development, measurement of variables, and research level have no significant impact on the ER–competitiveness relationship. This verifies the generalization of the Porter hypothesis in the above contextual factors.
- The limitations of the meta-analysis place relatively high requirements on the sample studies; the sample cannot realistically include all relevant research. In addition, the moderators of the meta-analysis must be individually coded for each study. This constraint limits the choice of original research. Therefore, it is impossible to explore all potential moderators in the analysis. Other than industry characteristics, there may be other moderators (e.g., culture, ownership) that are worthy of further exploration.
- The Porter hypothesis is the theoretical premise of most of the previous studies, and the average effect size obtained by our meta-analysis confirms this approach. However, the effect of ERs on competitiveness is a complex mechanism. Therefore, it is more realistic and valuable to identify the multiple effects of ERs on competitiveness and the conditions under which these effects occur instead of focusing on the relationship between the two constructs.
- Competitiveness is a core variable of concern for governments, industries, and companies. The existing studies mainly used financial performance and productivity indicators to measure competitiveness. However, other forms of competitiveness measures, such as market share, should be used to explore the overall effect of environment regulations.
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Conflicts of Interest
References
- van Ierland, E.; Brink, C.; Hordijk, L.; Kroeze, C. Environmental economics for environmental protection. Sci. World J. 2002, 2, 1254–1266. [Google Scholar] [CrossRef] [PubMed] [Green Version]
- Baumol, W.; Oatz, W. Environment Economic Theory and Policy Design (Chinese Translation); Economic Science Press: Beijing, China, 2003. [Google Scholar]
- Porter, M.E.; van der Linde, C. Toward a new conception of the environment-competitiveness relationship. J. Econ. Perspect. 1995, 9, 97–118. [Google Scholar] [CrossRef] [Green Version]
- Jaffe, A.B.; Peterson, S.R.; Portney, P.R.; Stavins, R.N. Environmental regulation and the competitiveness of U.S. manufacturing: What does the evidence tell us? J. Econ. Lit. 1995, 33, 132–163. [Google Scholar]
- Song, M.; Wang, S.; Sun, J. Environmental regulations, staff quality, green technology, R&D efficiency, and profit in manufacturing. Technol. Forecast. Soc. Chang. 2018, 133, 1–14. [Google Scholar]
- Lin, B.; Chen, X. Environmental regulation and energy-environmental performance—Empirical evidence from China’s non-ferrous metals industry. J. Environ. Manag. 2020, 269, 110722. [Google Scholar] [CrossRef]
- Yuan, B.; Ren, S.; Chen, X. Can environmental regulation promote the coordinated development of economy and environment in China’s manufacturing industry? A panel data analysis of 28 sub-sectors. J. Clean. Prod. 2017, 149, 11–24. [Google Scholar] [CrossRef]
- Anger, N.; Oberndorfer, U. Firm performance and employment in the EU emissions trading scheme: An empirical assessment for Germany. Energy Policy 2008, 36, 12–22. [Google Scholar] [CrossRef]
- Stoever, J.; Weche, J.P. Environmental Regulation and Sustainable Competitiveness: Evaluating the Role of Firm-Level Green Investments in the Context of the Porter Hypothesis; Working Paper Series in Economics; University of Lüneburg: Lüneburg, Germany, 2015. [Google Scholar]
- Glass, G. Primary, secondary, and meta-analysis of research. Educ. Res. 1976, 5, 3–5. [Google Scholar] [CrossRef]
- Hang, M.; Geyer-Klingeberg, J.; Rathgeber, A.; Stöckl, S. Economic development matters: A meta-regression analysis on the relation between environmental management and financial performance. J. Ind. Ecol. 2017, 22, 720–744. [Google Scholar] [CrossRef] [Green Version]
- Palmer, K.L.; Oates, W.E.; Portney, P.R. Tightening environmental standards: The benefit-cost or the no-cost paradigm? J. Econ. Perspect. 1995, 9, 119–132. [Google Scholar] [CrossRef]
- Mazzanti, M.; Zoboli, R. Environmental efficiency and labour productivity: Trade-off or joint dynamics? A theoretical investigation and empirical evidence from Italy using NAMEA. Ecol. Econ. 2009, 68, 1182–1194. [Google Scholar] [CrossRef]
- Ambec, S.Q.; Barla, P. A theoretical foundation of the Porter hypothesis. Econ. Lett. 2002, 7, 355–360. [Google Scholar] [CrossRef]
- Lipscomb, M. The Effect of Environmental Enforcement on Product Choice and Competition: Theory and Evidence from India; Working Paper; Centre for Economic Analysis, Department of Economics, University of Colorado at Boulder: Boulder, CO, USA, 2008; Available online: https://www.researchgate.net/publication/228481684 (accessed on 4 May 2008).
- Branco, M.C.; Rodrigues, L.L. Corporate social responsibility and resource-based perspectives. J. Bus. Ethics 2006, 69, 111–132. [Google Scholar] [CrossRef]
- Siegel, R. Why has productivity slowed down? Data Resour. US Rev. 1979, 1, 59–65. [Google Scholar]
- Lanoie, P.; Patry, M.; Lajeunesse, R. Environmental regulation and productivity: Testing the Porter hypothesis. J. Prod. Anal. 2008, 30, 121–128. [Google Scholar] [CrossRef]
- Rubashkina, Y.; Galeotti, M.; Verdolini, E. Environmental regulation and competitiveness: Empirical evidence on the Porter hypothesis from European manufacturing sectors. Energy Policy 2015, 83, 288–300. [Google Scholar] [CrossRef] [Green Version]
- Deschenes, O. Environmental regulations and labour markets. IZA World Labour 2014, 31, 1–10. [Google Scholar]
- Gollop, F.M.; Roberts, M.J. Environmental regulations and productivity growth: The case of fossil fuelled electric power generation. J. Polit. Econ. 1983, 91, 654–674. [Google Scholar] [CrossRef]
- Rassier, D.G.; Earnhart, D. Effects of environmental regulation on actual and expected profitability. Ecol. Econ. 2015, 112, 129–140. [Google Scholar] [CrossRef]
- He, W.; Tan, L.; Liu, J.; Hongziao, Z. Property rights protection, environmental regulation and corporate financial performance: Revisiting the Porter hypothesis. J. Clean. Prod. 2020, 11, 669–685. [Google Scholar]
- Zheng, H.; Zhang, J.; Zhao, X.; Mu, H. Exploring the affecting mechanism between environmental regulation and economic efficiency: New evidence from China’s coastal areas. Ocean Coast Manag. 2020, 189, 105–148. [Google Scholar] [CrossRef]
- Ramanathan, R.; He, Q.; Black, A.; Ghobadian, A.; Gallear, D. Environmental regulations, innovation and firm performance: A revisit of the Porter hypothesis. J. Clean. Prod. 2017, 155, 79–92. [Google Scholar] [CrossRef] [Green Version]
- Wang, Y.; Sun, X.; Guo, X. Environmental regulation and green productivity growth: Empirical evidence on the Porter hypothesis from OECD industrial sectors. Energy Policy 2019, 132, 611–619. [Google Scholar] [CrossRef]
- Testa, F.; Iraldo, F.; Frey, M. The effect of environmental regulation on firms’ competitive performance: The case of the building & construction sector in some EU regions. J. Environ. Manag. 2011, 92, 2136–2144. [Google Scholar]
- Bansal, S.; Gangopadhyay, S. Tax/subsidy policies in the presence of environmentally aware consumers. J. Environ. Econ. Manag. 2003, 45, 333–355. [Google Scholar] [CrossRef]
- Tang, H.; Liu, J.; Wu, J. The impact of command-and-control environmental regulation on enterprise total factor productivity: A quasi-natural experiment based on China’s “Two Control Zone” policy. J. Clean. Prod. 2020, 254, 120011. [Google Scholar] [CrossRef]
- Zhu, S.; He, C.; Liu, Y. Going green or going away: Environmental regulation, economic geography and firms’ strategies in China’s pollution-intensive industries. Geoforum 2014, 55, 53–65. [Google Scholar] [CrossRef]
- Wang, Y.; Shen, N. Environmental regulation and environmental productivity: The case of China. Renew. Sust. Energ. Rev. 2016, 62, 758–766. [Google Scholar] [CrossRef]
- Sen, S. Corporate governance, environmental regulations, and technological change. Eur. Econ. Rev. 2015, 80, 36–61. [Google Scholar] [CrossRef]
- Barnett, M.L.; Darnall, N.; Husted, B.W. Sustainability strategy in constrained economic times. Long Range Plan. 2014, 48, 63–68. [Google Scholar] [CrossRef]
- Drozdowski, G. Economic calculus qua an instrument to support sustainable development under increasing risk. J. Risk Financ. Manag. 2021, 14, 15. [Google Scholar] [CrossRef]
- Lee, K.H.; Cin, B.C.; Lee, E.Y. Environmental responsibility and firm performance: The application of an environmental, social, and governance model. Bus. Strategy Environ. 2016, 25, 40–53. [Google Scholar] [CrossRef]
- Martinez-Zarzoso, I.; Bengochea-Morancho, A.; Morales-Loge, R. Does environmental policy stringency foster innovation and productivity in OECD countries? Energy Policy 2019, 134, 110982. [Google Scholar] [CrossRef] [Green Version]
- Yang, C.H.; Tseng, Y.H.; Chen, C.P. Environmental regulations, induced R&D, and productivity: Evidence from Taiwan’s manufacturing industries. Resour. Energy Econ. 2012, 34, 514–532. [Google Scholar]
- Grover, D. Declining pollution abatement R&D in the United States: Theory and evidence. Ind. Corp. Chang. 2016, 26, 845–863. [Google Scholar]
- Hu, D.; Wang, Y.; Huang, J.; Huang, H. How do different innovation forms mediate the relationship between environmental regulation and performance? J. Clean. Prod. 2017, 161, 466–476. [Google Scholar] [CrossRef]
- Javeed, S.A.; Latief, R.; Lefen, L. An analysis of relationship between environmental regulations and firm performance with moderating effects of product market competition: Empirical evidence from Pakistan. J. Clean. Prod. 2020, 254, 120–197. [Google Scholar] [CrossRef]
- Bartik, T.J. The effects of environmental regulation on business location in the United States. Growth Chang. 1988, 19, 22–44. [Google Scholar] [CrossRef]
- Xie, R.; Yuan, Y.; Huang, J. Different types of environmental regulations and heterogeneous influence on “green” productivity: Evidence from China. Ecol. Econ. 2017, 132, 104–112. [Google Scholar] [CrossRef]
- Botta, E.; Koluk, T. Measuring environmental policy stringency in OECD countries: A composite index approach. In OECD Economics Department Working Papers; OECD Publishing: Paris, France, 2014; No. 1177. [Google Scholar]
- Hedges, L.V.; Vevea, J.L. Fixed- and random-effects models in meta-analysis. Psychol. Methods 1998, 3, 486–504. [Google Scholar] [CrossRef]
- Rosenthal, R. Combining results of independent studies. Psychol. Bull. 1978, 85, 185–193. [Google Scholar] [CrossRef]
- Lipsey, M.W.; Wilson, D.B. Practical Meta-Analysis; Sage: Newbury Park, CA, USA, 2000; pp. 60–96. [Google Scholar]
- Pigott, T.D. Methods of meta-analysis: Correcting error and bias in research findings. Eval. Program Plan. 2006, 29, 236–237. [Google Scholar] [CrossRef]
- Mi, Z.; Zeng, G.; Xin, X. The extension of the Porter hypothesis: Can the role of environmental regulation on economic development be affected by other dimensional regulations? J. Clean. Prod. 2018, 203, 933–942. [Google Scholar]
- Zárate-Marco, A.; Vallés Giménez, J. Environmental tax and productivity in a decentralized context: New findings on the Porter hypothesis. Eur. J. Law Econ. 2013, 40, 313–339. [Google Scholar] [CrossRef]
- Du, W.; Li, M. Influence of environmental regulation on promoting the low-carbon transformation of China’s foreign trade: Based on the dual margin of export enterprise. J. Clean. Prod. 2019, 244, 86–87. [Google Scholar] [CrossRef]
- Costantini, V.; Mazzanti, M. On the green and innovative side of trade competitiveness? The impact of environmental policies and innovation on EU exports. Res. Policy 2012, 41, 132–153. [Google Scholar] [CrossRef]
- Ahmad, N.; Li, H.Z.; Tian, X.L. Increased firm profitability under a nationwide environmental information disclosure program? Evidence from China. J. Clean. Prod. 2019, 230, 1176–1187. [Google Scholar] [CrossRef]
- Yuan, B.; Zhang, Y. Flexible environmental policy, technological innovation and sustainable development of China’s industry: The moderating effect of environment regulatory enforcement. J. Clean. Prod. 2020, 243, 118543.1–118543.17. [Google Scholar] [CrossRef]
- Qian, X.; Wang, D.; Wang, J.; Chen, S. Resource curse, environmental regulation and transformation of coal-mining cities in China. Resour. Policy 2021, 74, 101447. [Google Scholar] [CrossRef]
- Li, B.; Wu, S. Effects of local and civil environmental regulation on green total factor productivity in China: A spatial Durbin econometric analysis. J. Clean. Prod. 2016, 153, 342–353. [Google Scholar] [CrossRef]
- Nishitani, K.; Itoh, M. Product innovation in response to environmental standards and competitive advantage: A hedonic analysis of refrigerators in the Japanese retail market. J. Clean. Prod. 2016, 113, 873–883. [Google Scholar] [CrossRef]
- Hwang, J.; Kim, Y. Effects of environmental regulations on trade flow in manufacturing sectors: Comparison of static and dynamic effects of environmental regulations business strategy and the environment. Bus. Strategy Environ. 2017, 26, 688–706. [Google Scholar] [CrossRef]
- Ghosal, V.; Stephan, A.; Weiss, J.F. Decentralized environmental regulations and plant-level productivity. Bus. Strategy Environ. 2019, 28, 998–1011. [Google Scholar] [CrossRef]
- Alsaifi, K.; Elnahass, M.; Salama, A. Carbon disclosure and financial performance: UK environmental policy. Bus. Strategy Environ. 2020, 29, 711–726. [Google Scholar] [CrossRef]
- Qiu, L.; Hu, D.; Wang, Y. How do firms achieve sustainability through green innovation under external pressures of environmental regulation and market turbulence? Bus. Strategy Environ. 2020, 30, 1–20. [Google Scholar] [CrossRef]
- Telle, K.; Larsson, J. Do environmental regulations hamper productivity growth? How accounting for improvements of plants’ environmental performance can change the conclusion. Ecol. Econ. 2007, 61, 438–445. [Google Scholar] [CrossRef]
- Yu, X.; Li, Y. Effect of environmental regulation policy tools on the quality of foreign direct investment: An empirical study of China. J. Clean. Prod. 2020, 270, 122346. [Google Scholar] [CrossRef]
- Rassier, D.G.; Earnhart, D. Short-run and long-run implications of environmental regulation on financial performance. Contemp. Econ. Policy 2011, 29, 357–373. [Google Scholar] [CrossRef]
- Hu, W.; Wang, D. How does environmental regulation influence China’s carbon productivity? An empirical analysis based on the spatial spillover effect. J. Clean. Prod. 2020, 257, 120484. [Google Scholar] [CrossRef]
- Fu, T.; Cai, C.; Jian, Z. The illusion of "win–win" solution: Why environmental regulation in china promotes firm performance? Struct. Chang. Econ. Dyn. 2020, 52, 366–373. [Google Scholar] [CrossRef]
- Peuckert, J. What shapes the impact of environmental regulation on competitiveness? Evidence from Executive Opinion Surveys. Environ. Innov. Soc. Transit. 2014, 10, 77–94. [Google Scholar] [CrossRef]
- Darnall, N. Regulatory stringency, green production offsets, and organizations’ financial performance. Public Admin. Rev. 2010, 69, 418–434. [Google Scholar] [CrossRef]
- Rosenthal, R. Meta-analysis: A review. Psychosom. Med. 1991, 53, 247–272. [Google Scholar] [CrossRef] [PubMed]
- Gray, W.; Shadbegian, R. Multimedia Pollution Regulation and Environmental Performance: EPA’s Cluster Rule. 2015. Available online: https://www.rff.org/publications/working-papers/multimedia-pollution-regulation-and-environmental-performance-epas-cluster-rule/ (accessed on 20 August 2015).
- Lanoie, P.; Laurent-Lucchetti, J.; Johnstone, N.; Ambec, S. Environmental policy, innovation and performance: New insights on the Porter hypothesis. J. Econ. Manag. 2007, 20, 803–842. [Google Scholar] [CrossRef] [Green Version]
- Brown, S.P.; Homer, P.M.; Inman, J.J. A Meta-Analysis of Relationships between Ad-Evoked Feelings and Advertising. J. Mark. Res. 1998, 35, 114–126. [Google Scholar] [CrossRef]
- Ellis, P.D. Market orientation and performance: A meta-analysis and cross-national comparisons. J. Manag. Stud. 2006, 43, 1089–1107. [Google Scholar] [CrossRef]
- Peng, J.; Xie, R.; Ma, C.; Fu, Y. Market-based environmental regulation and total factor productivity: Evidence from Chinese enterprises. Econ. Model. 2021, 95, 394–407. [Google Scholar] [CrossRef]
- Dziekanski, P.; Prus, P. Financial diversity and the development process: Case study of rural communes of eastern Poland in 2009–2018. Sustainability 2020, 12, 6446. [Google Scholar] [CrossRef]
Author (Year) | Industrial Characteristics | Economic Development | Sample Size | Observed r | Z-Value | Weight of Fixed-Effect Model | Weight of Random-Effect Model |
---|---|---|---|---|---|---|---|
Mi (2018) [48] | None | China | 270 | 0.022 | 0.36 | 0.01 | 2.72 |
Stöver (2015) [9] | None | Germany | 2712 | 0.013 | 0.66 | 0.12 | 4.16 |
Zárate-Marco (2013) [49] | None | Spain | 153 | −0.319 | −4.048 | 0.01 | 2.09 |
Rassier (2015) [22] | Polluting | USA | 740 | 0.008 | 0.217 | 0.03 | 3.6 |
Hu (2017) [39] | None | China | 315 | 0.154 | 2.745 | 0.01 | 2.88 |
Yuan (2017) [7] | None | China | 99 | −0.218 | −2.174 | 0.00 | 1.62 |
He (2020) [23] | None | China | 7208 | −0.007 | −0.588 | 0.31 | 4.32 |
Javeed (2020) [40] | None | Pakistan | 1406 | 0.426 | 17.060 | 0.06 | 3.95 |
Yang (2020) [37] | Polluting | China | 1569 | 0.946 | 70.925 | 0.07 | 3.99 |
Du (2020) [50] | None | China | 411,111 | 0.000 | 0.000 | 17.62 | 4.41 |
Testa (2011) [27] | None | Three European regions | 56 | 0.865 | 9.569 | 0.00 | 1.07 |
Costantini (2012) [51] | None | EU | 15,453 | 0.002 | 0.273 | 0.66 | 4.37 |
Ahmad (2019) [52] | None | China | 416,152 | 0.098 | 63.097 | 17.83 | 4.41 |
Yuan (2020) [53] | None | China | 300 | 0.284 | 5.033 | 0.01 | 2.83 |
Tang (2020) [29] | None | China | 1,454,899 | 0.036 | 43.164 | 62.35 | 4.41 |
Lin (2020) [6] | Polluting | China | 464 | 0.090 | 1.929 | 0.02 | 3.25 |
Qian (2019) [54] | None | China | 330 | 0.603 | 12.623 | 0.01 | 2.93 |
Li (2017) [55] | None | China | 66 | 0.137 | 1.094 | 0.00 | 1.21 |
Nishitani (2016) [56] | None | Japan | 5686 | 0.114 | 8.615 | 0.24 | 4.29 |
Hwang (2017) [57] | None | OECD countries | 4788 | 0.000 | 0.086 | 0.21 | 4.27 |
Ghosal (2019) [58] | Polluting | Sweden | 245 | 0.284 | 4.544 | 0.01 | 2.62 |
Alsaifi (2019) [59] | None | China | 752 | 0.076 | 2.084 | 0.03 | 3.61 |
Qiu (2020) [60] | Polluting | China | 472 | 0.068 | 1.466 | 0.02 | 3.26 |
Telle (2007) [61] | Polluting | Norway | 427 | 0.098 | 2.024 | 0.02 | 3.17 |
Yu (2020) [62] | None | China | 299 | 0.099 | 1.702 | 0.01 | 2.83 |
Rassier (2011) [63] | Polluting | USA | 815 | 0.218 | 6.304 | 0.03 | 3.66 |
Hu (2020) [64] | None | China | 510 | −0.482 | −11.828 | 0.02 | 3.33 |
Fu (2020) [65] | None | China | 4430 | 0.085 | 5.669 | 0.19 | 4.26 |
Peuckert (2014) [66] | None | 43 countries | 215 | 0.329 | 4.970 | 0.01 | 2.47 |
Darnall (2010) [67] | None | Seven OECD countries | 1517 | 0.146 | 5.981 | 0.07 | 4.01 |
Moderators | Tau2 | I2 | p | R2 |
---|---|---|---|---|
Economic development | 0.0061 | 99.65% | 0.00 | 0.00 |
Industry characteristics | 0.0046 | 99.52% | 0.00 | 0.24 |
Measurement of dependent variable | 0.0060 | 99.64% | 0.00 | 0.00 |
Research level | 0.0060 | 99.68% | 0.00 | 0.00 |
Measurement of independent variable | 0.0060 | 99.62% | 0.00 | 0.00 |
Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affiliations. |
© 2022 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/).
Share and Cite
Li, Y.; Li, J.; Gan, L. A Meta-Analysis of the Relationship between Environmental Regulations and Competitiveness and Conditions for Its Realization. Int. J. Environ. Res. Public Health 2022, 19, 7968. https://doi.org/10.3390/ijerph19137968
Li Y, Li J, Gan L. A Meta-Analysis of the Relationship between Environmental Regulations and Competitiveness and Conditions for Its Realization. International Journal of Environmental Research and Public Health. 2022; 19(13):7968. https://doi.org/10.3390/ijerph19137968
Chicago/Turabian StyleLi, Yanli, Jiayuan Li, and Luyao Gan. 2022. "A Meta-Analysis of the Relationship between Environmental Regulations and Competitiveness and Conditions for Its Realization" International Journal of Environmental Research and Public Health 19, no. 13: 7968. https://doi.org/10.3390/ijerph19137968
APA StyleLi, Y., Li, J., & Gan, L. (2022). A Meta-Analysis of the Relationship between Environmental Regulations and Competitiveness and Conditions for Its Realization. International Journal of Environmental Research and Public Health, 19(13), 7968. https://doi.org/10.3390/ijerph19137968