This paper tests the pollution haven hypothesis by examining the relationship between environmental regulation and foreign investment with consideration of the role of corporate social responsibility, which has so far been neglected. Using multinationals’ investment data from China, our results in general support the pollution haven hypothesis that less stringent environmental regulation is more attractive for multinationals to invest in China, but high social responsibility can counteract attractiveness of weak environmental regulation.
The manuscript has been presented at the international workshop of “Foreign Direct Investment and Climate Change: New Research Directions” (Venice, 2011), the staff seminar at Birmingham University (2012), and the 2012 APJAE Symposium on Advances in Studies of the Chinese Economy – Growth, FDI, Trade, Finance, and Intellectual Property Rights (Hong Kong, 2012). We appreciate comments from an anonymous reviewer, Matthew Cole, Judith Dean, Robert Elliott, Belton Fleisher, James Markusen, and other participants. However, all errors remain ours.
Bu, M., Liu, Z., Wagner, M. and Yu, X. (2014), "Corporate Social Responsibility and the Pollution Haven Hypothesis: Evidence from Multinationals’ Investment Decision in China Reprinted from
Emerald Group Publishing Limited
Copyright © 2014, City University of Hong Kong and National Taiwan University