The Impact of Unilateral Climate Policy with Endogenous Plant Location and Market Size Asymmetry
| dc.creator | Sanna-Randaccio, Francesca | |
| dc.creator | Sestini, Roberta | |
| dc.date | 2017-04-01T20:12:26Z | |
| dc.date.accessioned | 2026-07-09T05:21:45Z | |
| dc.description | This paper analyses the impact of unilateral climate policy on firms’ international location strategies in emission-intensive sectors, when countries differ in terms of market size. The cases of partial and total relocation via foreign direct investment are separately considered. A simple international duopoly model highlights the differences between short-term and long-term effects. In the short-term no change in location is a likely outcome in very capital-intensive sectors, and when there is a strategy shift this takes the form of partial instead of total relocation. In the long-run total relocation becomes a feasible outcome. However we found that, when tighter mitigation measures are introduced by the larger country and unit transport cost is high, with a pronounced market asymmetry the probability of firms not relocating abroad is high even in the long-term. The welfare implications of unilateral environmental measures are assessed considering global industrial pollution and accounting for shifts in location strategy. | |
| dc.identifier | doi:10.22004/ag.econ.94789 | |
| dc.identifier | https://ageconsearch.umn.edu/record/94789/files/NDL2010-107.pdf | |
| dc.identifier | http://ageconsearch.umn.edu/record/94789 | |
| dc.identifier.uri | http://hdl.handle.net/123456789/562612 | |
| dc.language | eng | |
| dc.publisher | ||
| dc.source | http://ageconsearch.umn.edu/record/94789 | |
| dc.title | The Impact of Unilateral Climate Policy with Endogenous Plant Location and Market Size Asymmetry | |
| dc.type | Text |