Description: Racing to the Bottom? Foreign Investment and Air Pollution in Developing Countries

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Racing to the Bottom? Foreign Investment and Air Pollution in Developing Countries

Critics of free trade have raised the specter of a "race to the bottom," in which environmental standards collapse because polluters threaten to relocate to "pollution havens" in the developing world. Proponents of this view adv...

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Bibliographic Details
Main Author:	Wheeler, David
Language:	English en_US
Published:	World Bank, Washington, DC 2014
Subjects:	AEROSOLS AIR AIR MONITORING AIR POLLUTION AIR POLLUTION CONTROL AIR POLLUTION CONTROL COSTS AIR QUALITY CAPITAL MARKETS CLIMATIC CONDITIONS COMMUNITY ACTION COMMUNITY RIGHT TO KNOW COMPLIANCE COSTS DUST ECONOMETRIC ESTIMATES ECONOMIC DEVELOPMENT ECONOMIC FACTORS ECONOMIC GROWTH ECONOMIC POLICIES EMISSIONS EMPIRICAL ANALYSIS EMPIRICAL RESEARCH EMPIRICAL STUDIES EMPLOYMENT ENVIRONMENTAL ECONOMICS ENVIRONMENTAL HEALTH ENVIRONMENTAL INFORMATION ENVIRONMENTAL MANAGEMENT ENVIRONMENTAL MONITORING ENVIRONMENTAL PERFORMANCE ENVIRONMENTAL PROTECTION ENVIRONMENTAL QUALITY FINE PARTICULATES IMPORTS INCOME INCOME LEVELS INDUSTRIAL POLLUTION INDUSTRIAL WATER INFLATION IRRIGATION IRRIGATION CHANNELS LAWS LOBBYISTS MANAGERS MARGINAL ABATEMENT MARGINAL ABATEMENT COSTS MARGINAL COST MEDIA MINING MORTALITY OIL OXIDES OXYGEN PARTICLES PARTICULATE PARTICULATE MATTER PARTICULATE POLLUTION PARTICULATES PM POLITICAL ECONOMY POLLUTERS POLLUTION ABATEMENT POLLUTION ABATEMENT EQUIPMENT POLLUTION CHARGE POLLUTION CONTROL POLLUTION CONTROL COSTS POLLUTION CONTROL EQUIPMENT POLLUTION INTENSITY POLLUTION LEVELS POLLUTION REDUCTION POLLUTION REGULATION PRIVATE SECTOR PRODUCERS PRODUCTION RESIDUALS PUBLIC EXPENDITURES PUBLIC SECTOR SULFATES SULFUR SULFUR DIOXIDE SULFURIC ACID SUSTAINABLE DEVELOPMENT TAXATION TIN URBAN AIR POLLUTION WAGES WASTE WATER POLLUTION WELFARE EFFECTS WORKERS
Online Access:	http://documents.worldbank.org/curated/en/2001/01/888058/racing-bottom-foreign-investment-air-pollution-developing-countries http://hdl.handle.net/10986/19732

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Summary:	Critics of free trade have raised the specter of a "race to the bottom," in which environmental standards collapse because polluters threaten to relocate to "pollution havens" in the developing world. Proponents of this view advocate high, globally uniform standards enforced by punitive trade measures that neutralize the cost advantage of would-be pollution havens. To test the race-to-the-bottom model, the author analyzes recent air quality trends in the United States and in Brazil, China, and Mexico, the three largest recipients of foreign investment in the developing world. The evidence clearly contradicts the model's central prediction. The most dangerous form of air pollution--suspended particulate matter--has actually declined in major cities in all four countries during the era of globalization. Citing recent research, the author argues that the race-to-the-bottom model is flawed because its basic assumptions misrepresent the political economy of pollution control in developing countries. He proposes a more realistic model, in which low-income societies serve their own long-run interests by reducing pollution. He concludes with recommendations for international assistance measures that can improve environmental quality without counterproductive enforcement of uniform standards and trade sanctions.