Industries will move to locations where environmental

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Unformatted text preview: is • Can we measure burden of environmental regulations in national accounting terms? • Industries will move to locations where environmental regulations are lowest • • Affecting Long run average cost curves • Furniture spraying moved from LA to Mexico because of Air Quality regs state by state regulations / or national regulations by all 50 states Tuesday, December 3, 2013 Environmental Regulation can lead to competitive advantage Porter hypothesis • Environmental regulations can lead to technological innovation • Environmental regulations can lead to efficiency - use less fuel, less inputs, less labor • empirical - measure R&D expenditures, spillovers • production costs go up, but environmental and other input efficiencies can go together Tuesday, December 3, 2013 Porter Hypothesis and California • California has tighter environmental regulations than other states • higher car emissions requirements • higher air and water quality restrictions • other assets and resources that make economy viable Tuesday, December 3, 2013 Energy Conservation and GDP Tuesday, December 3, 2013 Diesel Cars in California • Europe has plenty of 40 mpg cars that we cant have • Manufacturers wait to get 50 state compliant cars ( could sell in other states besides CA) • California believes innovation and technology will change Tuesday, December 3, 2013 Effect of Environmental Regulations on Jobs and GDP • Regulations can have positive or negative e...
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