Can Capital Markets Create Incentives for Pollution Control

摘要: Private firms reluctant to invest in pollution abatement when the penalty for noncompliance falls short of cost may be more willing enforcement is tougher or information released that allows capital markets react ranking terms their environmental performance. After weighing costs and benefits control, profit-maximizing sometimes choose not because they expect regulators impose abatement. To improve incentives have recently embarked on a strategy release communities (investors consumers) about firms' Drawing evidence from American Canadian studies, Lanoie, Laplante, Roy report do such information. The suggests heavy polluters are affected significantly than minor polluters. And whose market values hurt most by this likely greater willingness seems result regulators' undertake strong actions combined with possibility reacting public This paper - product Environment, Infrastructure, Agriculture Division, Policy Research Department part larger effort department's ongoing work industrial also study whether developing countries can provide needed control. was funded Bank's Support Budget under research project Incentives Pollution Control Developing Countries: Role Capital Markets (RPO 680-76).