Maintainability of First Mover Advantages When Environmental Regulations Differ Between Countries

Abstract

Companies in many countries complain of the unfairness of having to compete against foreign rivals facing more lenient environmental regulations. In this article I examine the competitive conditions for firms in such a position. I outline the development of a new pollution-reduction paradigm centered on lowering costs by reducing pollution and, using twelve scenarios of international differences in environmental regulatory regimes faced by first movers and imitators, make propositions on which factors are important to the maintainability of these advantages.